Document:

2001 Stock Plan

 Exhibit 10.2 
  
 HYTEK MICROSYSTEMS, INC. 
  
 2001 STOCK PLAN 
  
 (As adopted by the Board of 
 Directors on February 21, 2001) 
  
 1. Purposes of the Plan. The purposes of this 2001 Stock Plan are:

  

	 	•	to attract and retain the best available personnel for positions of substantial responsibility, 

  

	 	•	to provide additional incentive to Employees, Directors and Consultants, and 

  

	 	•	to promote the success of the Company’s business. 

  
 Options granted under the Plan may be Incentive Stock Options or Nonstatutory Stock Options, as determined by the Administrator at the time of grant.
Stock Purchase Rights may also be granted under the Plan. 
  
 2.
Definitions. As used herein, the following definitions shall apply: 
  
 (a) “Administrator” means the Board or any of its Committees as shall be administering the Plan, in accordance with Section 4 of the Plan. 
  
 (b) “Applicable Laws” means the requirements relating to the administration of stock option plans under U.
S. state corporate laws, U.S. federal and state securities laws, the Code, any stock exchange or quotation system on which the Common Stock is listed or quoted and the applicable laws of any foreign country or jurisdiction where Options or Stock
Purchase Rights are, or will be, granted under the Plan. 
  
 (c)
“Board” means the Board of Directors of the Company. 
  
 (d) “Code” means the Internal Revenue Code of 1986, as amended. 
  
 (e) “Committee” means a committee of Directors appointed by the Board in accordance with Section 4 of the Plan. 
  

(f) “Common Stock” means the common stock of the Company. 
  
 (g) “Company” means Hytek Microsystems, Inc., a California corporation. 
  
 (h) “Consultant” means any person, including an advisor,
engaged by the Company or a Parent or Subsidiary to render services to such entity. 
  
 (i) “Director” means a member of the Board. 

 (j) “Disability” means total and permanent disability as defined in Section 22(e)(3) of
the Code. 
  
 (k) “Employee” means any person,
including Officers and Directors, employed by the Company or any Parent or Subsidiary of the Company. A Service Provider shall not cease to be an Employee in the case of (i) any leave of absence approved by the Company or (ii) transfers between
locations of the Company or between the Company, its Parent, any Subsidiary, or any successor. For purposes of Incentive Stock Options, no such leave may exceed ninety (90) days, unless reemployment upon expiration of such leave is guaranteed by
statute or contract. If reemployment upon expiration of a leave of absence approved by the Company is not so guaranteed, on the 181st day of such leave any Incentive Stock Option held by the Optionee shall cease to be treated as an Incentive Stock
Option and shall be treated for tax purposes as a Nonstatutory Stock Option. Neither service as a Director nor payment of a director’s fee by the Company shall be sufficient to constitute “employment” by the Company. 
  
 (l) “Exchange Act” means the Securities Exchange Act of
1934, as amended. 
  
 (m) “Fair Market Value”
means, as of any date, the value of Common Stock determined as follows: 
  
 (i) If the Common Stock is listed on any established stock exchange or a national market system, including without limitation the Nasdaq National Market or The Nasdaq SmallCap Market of The Nasdaq Stock Market, its
Fair Market Value shall be the closing sales price for such stock (or the closing bid, if no sales were reported) as quoted on such exchange or system for the last market trading day prior to the time of determination, as reported in The Wall
Street Journal or such other source as the Administrator deems reliable; 
  
 (ii) If the Common Stock is regularly quoted by a recognized securities dealer but selling prices are not reported, the Fair Market Value of a Share of Common Stock shall be the mean between the high bid and low asked
prices for the Common Stock on the last market trading day prior to the day of determination, as reported in The Wall Street Journal or such other source as the Administrator deems reliable; or 
  
 (iii) In the absence of an established market for the Common Stock, the Fair
Market Value shall be determined in good faith by the Administrator. 
  
 (n) “Incentive Stock Option” means an Option intended to qualify as an incentive stock option within the meaning of Section 422 of the Code and the regulations promulgated thereunder. 
  
 (o) “Nonstatutory Stock Option” means an Option not intended
to qualify as an Incentive Stock Option. 
  
 (p) “Notice
of Grant” means a written or electronic notice evidencing certain terms and conditions of an individual Option or Stock Purchase Right grant. The Notice of Grant is part of the Option Agreement. 
  

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 (q) “Officer” means a person who is an officer of the Company within the meaning of
Section 16 of the Exchange Act and the rules and regulations promulgated thereunder. 
  
 (r) “Option” means a stock option granted pursuant to the Plan. 
  
 (s) “Option Agreement” means an agreement between the Company and an Optionee evidencing the terms and conditions of an individual Option
grant. The Option Agreement is subject to the terms and conditions of the Plan. 
  
 (t) “Option Exchange Program” means a program whereby outstanding Options are surrendered in exchange for Options with a lower exercise price. 
  
 (u) “Optioned Stock” means the Common Stock subject to an
Option or Stock Purchase Right. 
  
 (v)
“Optionee” means the holder of an outstanding Option or Stock Purchase Right granted under the Plan. 
  
 (w) “Parent” means a “parent corporation,” whether now or hereafter existing, as defined in Section 424(e) of the Code.

  
 (x) “Plan” means this Hytek Microsystems,
Inc. 2001 Stock Plan. 
  
 (y) “Restricted Stock”
means shares of Common Stock acquired pursuant to a grant of Stock Purchase Rights under Section 11 of the Plan. 
  
 (z) “Restricted Stock Purchase Agreement” means a written agreement between the Company and the Optionee evidencing the terms and
restrictions applying to stock purchased under a Stock Purchase Right. The Restricted Stock Purchase Agreement is subject to the terms and conditions of the Plan and the Notice of Grant. 
  
 (aa) “Rule 16b-3” means Rule 16b-3 of the Exchange Act or any successor to Rule 16b-3, as in effect when
discretion is being exercised with respect to the Plan. 
  
 (bb)
“Section 16(b) “ means Section 16(b) of the Exchange Act. 
  
 (cc) “Service Provider” means an Employee or Consultant. 
  
 (dd) “Share” means a share of the Common Stock, as adjusted in accordance with Section 13 of the Plan. 
  
 (ee) “Stock Purchase Right” means the right to purchase
Common Stock pursuant to Section 11 of the Plan, as evidenced by a Notice of Grant. 
  
 (ff) “Subsidiary” means a “subsidiary corporation”, whether now or hereafter existing, as defined in Section 424(f) of the Code. 
  

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 3. Stock Subject to the Plan. Subject to the provisions of Section 13 of the Plan, the maximum
aggregate number of Shares that may be optioned and sold under the Plan is 131,000 Shares. The Shares may be authorized, but unissued, or reacquired Common Stock. 
  
 If an Option or Stock Purchase Right expires or becomes unexercisable without having been exercised in full, or is
surrendered pursuant to an Option Exchange Program, the unpurchased Shares that were subject thereto shall become available for future grant or sale under the Plan (unless the Plan has terminated); provided, however, that Shares that have
actually been issued under the Plan, whether upon exercise of an Option or Stock Purchase Right, shall not be returned to the Plan and shall not become available for future distribution under the Plan, except that if Shares of Restricted Stock are
repurchased by the Company at their original purchase price, such Shares shall become available for future grant under the Plan. 
  
 4. Administration of the Plan. 
  
 (a) Procedure. 
  
 (i) Multiple Administrative Bodies. Different Committees with respect to different groups of Service Providers may administer the Plan.

  
 (ii) Section 162(m). To the extent that the
Administrator determines it to be desirable to qualify Options granted hereunder as “performance-based compensation” within the meaning of Section 162(m) of the Code, the Plan shall be administered by a Committee of two or more
“outside directors” within the meaning of Section 162(m) of the Code. 
  
 (iii) Rule 16b-3. To the extent desirable to qualify transactions hereunder as exempt under Rule 16b-3, the transactions contemplated hereunder shall be structured to satisfy the requirements for exemption
under Rule 16b-3. 
  
 (iv) Other Administration. Other
than as provided above, the Plan shall be administered by (A) the Board or (B) a Committee, which committee shall be constituted to satisfy Applicable Laws. 
  
 (b) Powers of the Administrator. Subject to the provisions of the Plan, and in the case of a Committee, subject to the specific duties delegated by
the Board to such Committee, the Administrator shall have the authority, in its discretion: 
  
 (i) to determine the Fair Market Value; 
  
 (ii) to select the Service Providers to whom Options and Stock Purchase Rights may be granted hereunder; 
  
 (iii) to determine the number of shares of Common Stock to be covered by each Option and Stock Purchase Right granted hereunder; 
  
 (iv) to approve forms of agreement for use under the Plan; 
  

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 (v) to determine the terms and conditions, not inconsistent with the terms of the Plan, of any Option or
Stock Purchase Right granted hereunder. Such terms and conditions include, but are not limited to, the exercise price, the time or times when Options or Stock Purchase Rights may be exercised (which may be based on performance criteria), any vesting
acceleration or waiver of forfeiture restrictions, and any restriction or limitation regarding any Option or Stock Purchase Right or the shares of Common Stock relating thereto, based in each case on such factors as the Administrator, in its sole
discretion, shall determine; 
  
 (vi) to reduce the exercise
price of any Option or Stock Purchase Right to the then current Fair Market Value if the Fair Market Value of the Common Stock covered by such Option or Stock Purchase Right shall have declined since the date the Option or Stock Purchase Right was
granted; 
  
 (vii) to institute an Option Exchange Program;

  
 (viii) to construe and interpret the terms of the Plan and
awards granted pursuant to the Plan; 
  
 (ix) to prescribe, amend
and rescind rules and regulations relating to the Plan, including rules and regulations relating to sub-plans established for the purpose of qualifying for preferred tax treatment under foreign tax laws; 
  
 (x) to modify or amend each Option or Stock Purchase Right (subject to
Section 15(c) of the Plan), including the discretionary authority to extend the post-termination exercisability period of Options longer than is otherwise provided for in the Plan; 
  
 (xi) to allow Optionees to satisfy withholding tax obligations by electing to have the Company withhold from the Shares to
be issued upon exercise of an Option or Stock Purchase Right that number of Shares having a Fair Market Value equal to the amount required to be withheld. The Fair Market Value of the Shares to be withheld shall be determined on the date that the
amount of tax to be withheld is to be determined. All elections by an Optionee to have Shares withheld for this purpose shall be made in such form and under such conditions as the Administrator may deem necessary or advisable; 
  
 (xii) to authorize any person to execute on behalf of the Company any
instrument required to effect the grant of an Option or Stock Purchase Right previously granted by the Administrator; 
  
 (xiii) to make all other determinations deemed necessary or advisable for administering the Plan. 
  
 (c) Effect of Administrator’s Decision. The Administrator’s
decisions, determinations and interpretations shall be final and binding on all Optionees and any other holders of Options or Stock Purchase Rights. 
  
 5. Eligibility. Nonstatutory Stock Options and Stock Purchase Rights may be granted to Service Providers. Incentive Stock Options may be granted
only to Employees. 
  

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 6. Limitations. 
  
 (a) ISO Status. Each Option shall be designated in the Option Agreement as either an Incentive Stock Option or a
Nonstatutory Stock Option. However, notwithstanding such designation, to the extent that the aggregate Fair Market Value of the Shares with respect to which Incentive Stock Options are exercisable for the first time by the Optionee during any
calendar year (under all plans of the Company and any Parent or Subsidiary) exceeds $100,000, such Options shall be treated as Nonstatutory Stock Options. For purposes of this Section 6(a), Incentive Stock Options shall be taken into account in the
order in which they were granted. The Fair Market Value of the Shares shall be determined as of the time the Option with respect to such Shares is granted. 
  
 (b) No Employment Agreement. Neither the Plan nor any Option or Stock Purchase Right shall confer upon an Optionee any right with respect to
continuing the Optionee’s relationship as a Service Provider with the Company, nor shall they interfere in any way with the Optionee’s right or the Company’s right to terminate such relationship at any time, with or without cause.

  
 (c) Section 162(m) Limits. The following limitations
shall apply to grants of Options: 
  
 (i) No Service Provider
shall be granted, in any fiscal year of the Company, Options to purchase more than 50,000 Shares. 
  
 (ii) In connection with his or her initial service, a Service Provider may be granted Options to purchase up to an additional 50,000 Shares, which shall
not count against the limit set forth in subsection (i) above. 
  
 (iii) The foregoing limitations shall be adjusted proportionately in connection with any change in the Company’s capitalization as described in Section 13. 
  
 (iv) If an Option is cancelled in the same fiscal year of the Company in which it was granted (other than in connection
with a transaction described in Section 13), the cancelled Option will be counted against the limits set forth in subsections (i) and (ii) above. For this purpose, if the exercise price of an Option is reduced, the transaction will be treated as a
cancellation of the Option and the grant of a new Option. 
  
 7.
Term of Plan. The Plan, the Plan shall become effective upon its approval by the shareholders. It shall continue in effect for a term of ten (10) years unless terminated earlier under Section 15 of the Plan. 
  
 8. Term of Option. The term of each Option shall be stated in the
Option Agreement. In the case of an Incentive Stock Option, the term shall be ten (10) years from the date of grant or such shorter term as may be provided in the Option Agreement. Moreover, in the case of an Incentive Stock Option granted to an
Optionee who, at the time the Incentive Stock Option is granted, owns stock representing more than ten percent (10%) of the total combined voting power of all classes of stock of the Company or any Parent or Subsidiary, the term of the Incentive
Stock Option shall be five (5) years from the date of grant or such shorter term as may be provided in the Option Agreement. 
  

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 9. Option Exercise Price and Consideration. 
  
 (a) Exercise Price. The per share exercise price for the Shares to be
issued pursuant to exercise of an Option shall be determined by the Administrator, subject to the following: 
  
 (i) In the case of an Incentive Stock Option 
  
 (A) granted to an Employee who, at the time the Incentive Stock Option is granted, owns stock representing more than ten percent (10%) of the voting
power of all classes of stock of the Company or any Parent or Subsidiary, the per Share exercise price shall be no less than 110% of the Fair Market Value per Share on the date of grant. 
  
 (B) granted to any Employee other than an Employee described in paragraph (A) immediately above, the per Share exercise
price shall be no less than 100% of the Fair Market Value per Share on the date of grant. 
  
 (ii) In the case of a Nonstatutory Stock Option, the per Share exercise price shall be no less than 100% of the Fair Market Value per Share on the date of grant. 
  
 (iii) Notwithstanding the foregoing, Options may be granted with a per Share
exercise price of less than 100% of the Fair Market Value per Share on the date of grant pursuant to a merger or other corporate transaction. 
  
 (b) Waiting Period and Exercise Dates. At the time an Option is granted, the Administrator shall fix the period within which the Option may be
exercised and shall determine any conditions that must be satisfied before the Option may be exercised. 
  
 (c) Form of Consideration. The Administrator shall determine the acceptable form of consideration for exercising an Option, including the method of
payment. In the case of an Incentive Stock Option, the Administrator shall determine the acceptable form of consideration at the time of grant. Such consideration may consist entirely of: 
  
 (i) cash; 
  
 (ii) check; 
  
 (iii) promissory note; 
  
 (iv) other Shares which (A) in the case of Shares acquired upon exercise of an option, have been owned by the Optionee for more than six months on the
date of surrender, and (B) have a Fair Market Value on the date of surrender equal to the aggregate exercise price of the Shares as to which said Option shall be exercised; 
  
 (v) consideration received by the Company under a cashless exercise program implemented by the Company in connection with
the Plan; 
  

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 (vi) a reduction in the amount of any Company liability to the Optionee, including any liability
attributable to the Optionee’s participation in any Company-sponsored deferred compensation program or arrangement; 
  
 (vii) any combination of the foregoing methods of payment; or 
  
 (viii) such other consideration and method of payment for the issuance of Shares to the extent permitted by Applicable Laws. 
  
 10. Exercise of Option. 
  
 (a) Procedure for Exercise; Rights as a Shareholder. Any Option
granted hereunder shall be exercisable according to the terms of the Plan and at such times and under such conditions as determined by the Administrator and set forth in the Option Agreement. Unless the Administrator provides otherwise, vesting of
Options granted hereunder shall be tolled during any unpaid leave of absence. An Option may not be exercised for a fraction of a Share. 
  
 An Option shall be deemed exercised when the Company receives: (i) written or electronic notice of exercise (in accordance with the Option Agreement)
from the person entitled to exercise the Option, and (ii) full payment for the Shares with respect to which the Option is exercised. Full payment may consist of any consideration and method of payment authorized by the Administrator and permitted by
the Option Agreement and the Plan. Shares issued upon exercise of an Option shall be issued in the name of the Optionee or, if requested by the Optionee, in the name of the Optionee and his or her spouse. Until the Shares are issued (as evidenced by
the appropriate entry on the books of the Company or of a duly authorized transfer agent of the Company), no right to vote or receive dividends or any other rights as a shareholder shall exist with respect to the Optioned Stock, notwithstanding the
exercise of the Option. The Company shall issue (or cause to be issued) such Shares promptly after the Option is exercised. No adjustment will be made for a dividend or other right for which the record date is prior to the date the Shares are
issued, except as provided in Section 13 of the Plan. 
  
 Exercising an Option in any manner shall decrease the number of Shares thereafter available, both for purposes of the Plan and for sale under the Option, by the number of Shares as to which the Option is exercised. 
  
 (b) Termination of Relationship as a Service Provider. If an Optionee
ceases to be a Service Provider, other than upon the Optionee’s death or Disability, the Optionee may exercise his or her Option within such period of time as is specified in the Option Agreement to the extent that the Option is vested on the
date of termination (but in no event later than the expiration of the term of such Option as set forth in the Option Agreement). In the absence of a specified time in the Option Agreement, the Option shall remain exercisable for three (3) months
following the Optionee’s termination. If, on the date of termination, the Optionee is not vested as to his or her entire Option, the Shares covered by the unvested portion of the Option shall revert to the Plan. If, after termination, the
Optionee does not exercise his or her Option within the time specified by the Administrator, the Option shall terminate, and the Shares covered by such Option shall revert to the Plan. 
  

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 (c) Disability of Optionee. If an Optionee ceases to be a Service Provider as a result of the
Optionee’s Disability, the Optionee may exercise his or her Option within such period of time as is specified in the Option Agreement to the extent the Option is vested on the date of termination (but in no event later than the expiration of
the term of such Option as set forth in the Option Agreement). In the absence of a specified time in the Option Agreement, the Option shall remain exercisable for six (6) months following the Optionee’s termination. If, on the date of
termination, the Optionee is not vested as to his or her entire Option, the Shares covered by the unvested portion of the Option shall revert to the Plan. If, after termination, the Optionee does not exercise his or her Option within the time
specified herein, the Option shall terminate, and the Shares covered by such Option shall revert to the Plan. 
  
 (d) Death of Optionee. If an Optionee dies while a Service Provider, the Option may be exercised within such period of time as is specified in the
Option Agreement (but in no event later than the expiration of the term of such Option as set forth in the Notice of Grant), by the Optionee’s estate or by a person who acquires the right to exercise the Option by bequest or inheritance, but
only to the extent that the Option is vested on the date of death. In the absence of a specified time in the Option Agreement, the Option shall remain exercisable for six (6) months following the Optionee’s termination. If, at the time of
death, the Optionee is not vested as to his or her entire Option, the Shares covered by the unvested portion of the Option shall immediately revert to the Plan. The Option may be exercised by the executor or administrator of the Optionee’s
estate or, if none, by the person(s) entitled to exercise the Option under the Optionee’s will or the laws of descent or distribution. If the Option is not so exercised within the time specified herein, the Option shall terminate, and the
Shares covered by such Option shall revert to the Plan. 
  
 (e)
Buyout Provisions. The Administrator may at any time offer to buy out for a payment in cash or Shares an Option previously granted based on such terms and conditions as the Administrator shall establish and communicate to the Optionee at the
time that such offer is made. 
  
 11. Stock Purchase
Rights. 
  
 (a) Rights to Purchase. Stock Purchase
Rights may be issued either alone, in addition to, or in tandem with other awards granted under the Plan and/or cash awards made outside of the Plan. After the Administrator determines that it will offer Stock Purchase Rights under the Plan, it
shall advise the offeree in writing or electronically, by means of a Notice of Grant, of the terms, conditions and restrictions related to the offer, including the number of Shares that the offeree shall be entitled to purchase, the price to be
paid, and the time within which the offeree must accept such offer. The offer shall be accepted by execution of a Restricted Stock Purchase Agreement in the form determined by the Administrator. 
  
 (b) Repurchase Option. Unless the Administrator determines otherwise,
the Restricted Stock Purchase Agreement shall grant the Company a repurchase option exercisable upon the voluntary or involuntary termination of the purchaser’s service with the Company for any reason (including death or Disability). The
purchase price for Shares repurchased pursuant to the Restricted Stock Purchase Agreement shall be the original price paid by the purchaser and may be paid by cancellation of any indebtedness of the purchaser to the Company. The repurchase option
shall lapse at a rate determined by the Administrator. 
  

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 (c) Other Provisions. The Restricted Stock Purchase Agreement shall contain such other terms,
provisions and conditions not inconsistent with the Plan as may be determined by the Administrator in its sole discretion. 
  
 (d) Rights as a Shareholder. Once the Stock Purchase Right is exercised, the purchaser shall have the rights equivalent to those of a shareholder,
and shall be a shareholder when his or her purchase is entered upon the records of the duly authorized transfer agent of the Company. No adjustment will be made for a dividend or other right for which the record date is prior to the date the Stock
Purchase Right is exercised, except as provided in Section 13 of the Plan. 
  
 12. Non-Transferability of Options and Stock Purchase Rights. Unless determined otherwise by the Administrator, an Option or Stock Purchase Right may not be sold, pledged, assigned, hypothecated, transferred,
or disposed of in any manner other than by will or by the laws of descent or distribution and may be exercised, during the lifetime of the Optionee, only by the Optionee. If the Administrator makes an Option or Stock Purchase Right transferable,
such Option or Stock Purchase Right shall contain such additional terms and conditions as the Administrator deems appropriate. 
  
 13. Adjustments Upon Changes in Capitalization, Dissolution, Merger or Asset Sale. 
  
 (a) Changes in Capitalization. Subject to any required action by the shareholders of the Company, the number of
shares of Common Stock covered by each outstanding Option and Stock Purchase Right, and the number of shares of Common Stock that have been authorized for issuance under the Plan but as to which no Options or Stock Purchase Rights have yet been
granted or that have been returned to the Plan upon cancellation or expiration of an Option or Stock Purchase Right, as well as the price per share of Common Stock covered by each such outstanding Option or Stock Purchase Right, shall be
proportionately adjusted for any increase or decrease in the number of issued shares of Common Stock resulting from a stock split, reverse stock split, stock dividend, combination or reclassification of the Common Stock, or any other increase or
decrease in the number of issued shares of Common Stock effected without receipt of consideration by the Company; provided, however, that conversion of any convertible securities of the Company shall not be deemed to have been “effected without
receipt of consideration.” Such adjustment shall be made by the Board, whose determination in that respect shall be final, binding and conclusive. Except as expressly provided herein, no issuance by the Company of shares of stock of any class,
or securities convertible into shares of stock of any class, shall affect, and no adjustment by reason thereof shall be made with respect to, the number or price of shares of Common Stock subject to an Option or Stock Purchase Right. 
  
 (b) Dissolution or Liquidation. In the event of the proposed
dissolution or liquidation of the Company, the Administrator shall notify each Optionee as soon as practicable prior to the effective date of such proposed transaction. The Administrator in its discretion may provide for an Optionee to have the
right to exercise his or her Option until ten (10) days prior to such transaction as to all of the Optioned Stock covered thereby, including Shares as to which the Option would not otherwise be exercisable. In addition, the Administrator may provide
that any Company repurchase option applicable to any Shares purchased upon exercise of an Option or Stock Purchase Right shall lapse as to all such Shares, provided the proposed dissolution or liquidation takes place at the time and in the manner
contemplated. To the extent it has not been previously exercised, an Option or Stock Purchase Right will terminate immediately prior to the consummation of such proposed action. 
  

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 (c) Merger or Asset Sale. In the event of a merger of the Company with or into another
corporation, or the sale of substantially all of the assets of the Company, each outstanding Option and Stock Purchase Right shall be assumed or an equivalent option or right substituted by the successor corporation or a Parent or Subsidiary of the
successor corporation. In the event that the successor corporation refuses to assume or substitute for the Option or Stock Purchase Right, the Optionee shall fully vest in and have the right to exercise the Option or Stock Purchase Right as to all
of the Optioned Stock, including Shares as to which it would not otherwise be vested or exercisable. If an Option or Stock Purchase Right becomes fully vested and exercisable in lieu of assumption or substitution in the event of a merger or sale of
assets, the Administrator shall notify the Optionee in writing or electronically that the Option or Stock Purchase Right shall be fully vested and exercisable for a period of fifteen (15) days from the date of such notice, and the Option or Stock
Purchase Right shall terminate upon the expiration of such period. For the purposes of this paragraph, the Option or Stock Purchase Right shall be considered assumed if, following the merger or sale of assets, the option or right confers the right
to purchase or receive, for each Share of Optioned Stock subject to the Option or Stock Purchase Right immediately prior to the merger or sale of assets, the consideration (whether stock, cash, or other securities or property) received in the merger
or sale of assets by holders of Common Stock for each Share held on the effective date of the transaction (and if holders were offered a choice of consideration, the type of consideration chosen by the holders of a majority of the outstanding
Shares); provided, however, that if such consideration received in the merger or sale of assets is not solely common stock of the successor corporation or its Parent, the Administrator may, with the consent of the successor corporation, provide for
the consideration to be received upon the exercise of the Option or Stock Purchase Right, for each Share of Optioned Stock subject to the Option or Stock Purchase Right, to be solely common stock of the successor corporation or its Parent equal in
fair market value to the per share consideration received by holders of Common Stock in the merger or sale of assets. 
  
 (d) Change in Control. In the event of a “Change in Control” of the Company, as defined in paragraph (e) below, unless otherwise
determined by the Administrator prior to the occurrence of such Change in Control, any Options outstanding on the date such Change in Control is determined to have occurred that are not yet exercisable and vested on such date shall become fully
exercisable and vested. 
  
 (e) Definition of “Change in
Control”. For purposes of this Section 13, a “Change in Control” means the happening of any of the following: 
  
 (i) When any “person”, as such term is used in Sections 13(d) and 14(d) of the Exchange Act (other than the Company, a Subsidiary or a Company
employee benefit plan, including any trustee of such plan acting as trustee) is or becomes the “beneficial owner” (as defined in Rule 13d-3 promulgated under the Exchange Act), directly or indirectly, of securities of the Company
representing fifty percent (50%) or more of the combined voting power of the Company’s then outstanding securities; or 
  

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 (ii) The shareholders of the Company approve a merger or consolidation of the Company with any other
corporation, other than a merger or consolidation that would result in the voting securities of the Company outstanding immediately prior thereto continuing to represent (either by remaining outstanding or by being converted into voting securities
of the surviving entity) at least fifty percent (50%) of the total voting power represented by the voting securities of the Company or such surviving entity outstanding immediately after such merger or consolidation, or the shareholders of the
Company approve an agreement for the sale or disposition by the Company of all or substantially all of the Company’s assets; or 
  
 (iii) A change in the composition of the Board as a result of which fewer than a majority of the directors in office are Incumbent Directors.
“Incumbent Directors” shall mean directors who either (A) are directors of the Company as of the date of adoption of the Plan by the Board, or (B) are elected, or nominated for election, to the Board with the affirmative votes of at least
a majority of the Incumbent Directors at the time of such election or nomination (but shall not include an individual whose election or nomination is in connection with an actual or threatened proxy contest relating to the election of directors to
the Company). 
  
 14. Date of Grant. The date of grant of
an Option or Stock Purchase Right shall be, for all purposes, the date on which the Administrator makes the determination granting such Option or Stock Purchase Right, or such other later date as is determined by the Administrator. Notice of the
determination shall be provided to each Optionee within a reasonable time after the date of such grant. 
  
 15. Amendment and Termination of the Plan. 
  
 (a) Amendment and Termination. The Board may at any time amend, alter, suspend or terminate the Plan. 
  
 (b) Shareholder Approval. The Company shall obtain shareholder
approval of any Plan amendment to the extent necessary and desirable to comply with Applicable Laws. 
  
 (c) Effect of Amendment or Termination. No amendment, alteration, suspension or termination of the Plan shall impair the rights of any Optionee,
unless mutually agreed otherwise between the Optionee and the Administrator, which agreement must be in writing and signed by the Optionee and the Company. Termination of the Plan shall not affect the Administrator’s ability to exercise the
powers granted to it hereunder with respect to Options granted under the Plan prior to the date of such termination. 
  
 16. Conditions Upon Issuance of Shares. 
  
 (a) Legal Compliance. Shares shall not be issued pursuant to the exercise of an Option or Stock Purchase Right unless the exercise of such Option
or Stock Purchase Right and the issuance and delivery of such Shares shall comply with Applicable Laws and shall be further subject to the approval of counsel for the Company with respect to such compliance. 
  
 (b) Investment Representations. As a condition to the exercise of an
Option or Stock Purchase Right, the Company may require the person exercising such Option or Stock Purchase Right to represent and warrant at the time of any such exercise that the Shares are being purchased only for investment and without any
present intention to sell or distribute such Shares if, in the opinion of counsel for the Company, such a representation is required. 
  

 -12- 

 (c) Inability to Obtain Authority. The inability of the Company to obtain authority from any
regulatory body having jurisdiction, which authority is deemed by the Company’s counsel to be necessary to the lawful issuance and sale of any Shares hereunder, shall relieve the Company of any liability in respect of the failure to issue or
sell such Shares as to which such requisite authority shall not have been obtained. 
  
 (d) Grants Exceeding Allotted Shares. If the Optioned Stock covered by an Option exceeds, as of the date of grant, the number of Shares that may be issued under the Plan without additional shareholder approval,
such Option shall be void, and shall not be exercisable, with respect to such excess Optioned Stock, unless shareholder approval of an amendment sufficiently increasing the number of Shares subject to the Plan to permit full exercise of the Option
is timely obtained in accordance with Section 15(b) of the Plan. 
  
 17. Stock Withholding to Satisfy Withholding Tax Obligations. 
  
 (a) Ability to Use Stock for Withholding. At the discretion of the Administrator, Optionees may satisfy withholding obligations as provided in this Section 17. When an Optionee incurs tax liability in
connection with the exercise of an Option, which tax liability is subject to tax withholding under applicable tax laws, and the Optionee is obligated to pay the Company an amount required to be withheld under applicable tax laws, the Optionee may
satisfy the withholding tax obligation by electing to have the Company withhold from the Shares to be issued upon exercise of the Option that number of Shares having a Fair Market Value equal to the amount required to be withheld. The Fair Market
Value of the Shares to be withheld shall be determined on the date that the amount of tax to be withheld is to be determined (the “Tax Date”). 
  
 (b) Election to Have Stock Withheld. All elections by an Optionee to have Shares withheld for this purpose shall be made in writing in a form
acceptable to the Administrator and shall be subject to the following restrictions: 
  
 (i) the election must be made on or prior to the applicable Tax Date; 
  
 (ii) once made, the election shall be irrevocable as to the particular Shares of the Option as to which the election is made (unless otherwise permitted
by applicable tax regulations under the Code); 
  
 (iii) all
elections shall be subject to the consent or disapproval of the Administrator; and 
  
 (iv) if the Optionee is a Director, Officer or 10% Shareholder, the election must comply with the applicable provisions of Rule 16b-3 and shall be subject to such additional conditions or restrictions as may be
required thereunder to qualify for the maximum exemption from Section 16 of the Exchange Act with respect to Plan transactions. 
  

 -13- 

 (c) Section 83(b) Election. In the event the election to have Shares withheld is made by an
Optionee, no election is filed under Section 83(b) of the Code and the Tax Date is deferred under Section 83 of the Code, the Optionee shall receive the full number of Shares with respect to which the Option is exercised but such Optionee shall be
unconditionally obligated to tender back to the Company the proper number of Shares on the Tax Date. 
  
 18. Reservation of Shares. The Company, during the term of this Plan, will at all times reserve and keep available such number of Shares as shall
be sufficient to satisfy the requirements of the Plan. 
  
 19.
Shareholder Approval. The Plan shall be subject to approval by the shareholders of the Company within twelve (12) months after the date the Plan is adopted. Such shareholder approval shall be obtained in the manner and to the degree required
under Applicable Laws. 
  

 -14- 

 HYTEK MICROSYSTEMS, INC. 
  
 2001 STOCK PLAN 
  
 STOCK OPTION AGREEMENT 
  
 Unless otherwise defined herein, the terms defined in the Plan shall have the same defined meanings in this Option Agreement. 
  
 I. NOTICE OF STOCK OPTION GRANT 
  
 [Optionee’s Name and Address] 
  
 You have been granted an option to purchase Common Stock of the Company,
subject to the terms and conditions of the Plan and this Option Agreement, as follows: 
  

			
	 Grant Number
	 	  
 __________________________________

		
	Date of Grant	 	  
 __________________________________

		
	Vesting Commencement Date	 	  
 __________________________________

		
	Total Number of Shares Granted	 	  
 __________________________________

		
	Exercise Price per Share	 	  
 $_________________________________

		
	Total Exercise Price	 	  
 $_________________________________

		
	Type of Option:	 	 
		
	 	 	       Incentive Stock Option
		
	 	 	       Nonstatutory Stock Option
		
	Expiration Date:	 	  
 __________________________________

  
 Vesting
Schedule: 
  
 This Option may be exercised, in whole or in
part, in accordance with the following schedule: 
  
 One-fourth (1/4) of the Shares subject to the Option (rounded down to the nearest whole share) shall first become exercisable one year after the Vesting Commencement Date. After the first year anniversary of the option grant, shares
shall vest and become exercisable monthly at the rate of 1/48th per month for the balance of the 4 year option exercisable
subject to the Optionee continuing to be a Service Provider on such dates. 

 Post-Termination Exercisability Period: 
  
 This Option may be exercised for ninety (90) days after Optionee ceases to
be a Service Provider. Upon the death or Disability of the Optionee, this Option may be exercised for such longer period of time as is specified in the Plan. In no event shall this Option be exercised later than the Expiration Date as provided
above. 
  
 II. AGREEMENT 
  
 A. Grant of Option. 
  
 The Plan Administrator of the Company hereby grants to the Optionee named in
the Notice of Grant set forth as Part I of this Agreement (the “Optionee”) an option (the “Option”) to purchase the number of Shares, as set forth in the Notice of Grant, at the exercise price per share set forth in the Notice of
Grant (the “Exercise Price”), subject to the terms and conditions of the Plan, which is incorporated herein by reference. Subject to Section 15(c) of the Plan, in the event of a conflict between the terms and conditions of the Plan and the
terms and conditions of this Option Agreement, the terms and conditions of the Plan shall prevail. 
  
 If designated in the Notice of Grant as an Incentive Stock Option (“ISO”), this Option is intended to qualify as an Incentive Stock Option under
Section 422 of the Code. However, if this Option is intended to be an Incentive Stock Option, to the extent that it exceeds the $100,000 rule of Code Section 422(d), it shall be treated as a Nonstatutory Stock Option (“NSO”). 

 
 B. Exercise of Option. 
  
 1. Right to Exercise. This Option is exercisable during its term in
accordance with the Vesting Schedule set out in the Notice of Grant and the applicable provisions of the Plan and this Option Agreement. 
  
 2. Method of Exercise. This Option is exercisable by delivery of an exercise notice, in the form attached as Exhibit A (the “Exercise
Notice”), which shall state the election to exercise the Option, the number of Shares in respect of which the Option is being exercised (the “Exercised Shares”), and such other representations and agreements as may be required by the
Company pursuant to the provisions of the Plan. The Exercise Notice shall be completed by the Optionee and delivered to the Secretary of the Company. The Exercise Notice shall be accompanied by payment of the aggregate Exercise Price as to all
Exercised Shares. This Option shall be deemed to be exercised upon receipt by the Company of such fully executed Exercise Notice accompanied by such aggregate Exercise Price. 
  
 3. Compliance with Laws. No Shares shall be issued pursuant to the exercise of this Option unless such issuance and
exercise complies with Applicable Laws. Assuming such compliance, for income tax purposes the Exercised Shares shall be considered transferred to the Optionee on the date the Option is exercised with respect to such Exercised Shares. 
  

 -2- 

 C. Method of Payment. 
  
 Payment of the aggregate Exercise Price shall be by any of the following, or a combination thereof, at the election of the
Optionee: 
  
 1. cash; 
  
 2. check; 
  
 3. surrender of other Shares that (i) in the case of Shares acquired upon exercise of an option, have been owned by the
Optionee for more than six (6) months on the date of surrender, and (ii) have a Fair Market Value on the date of surrender equal to the aggregate Exercise Price of the Exercised Shares; or 
  
 4. to the extent permitted by the Administrator, delivery of a properly
executed exercise notice together with such other documentation as the Administrator and the broker, if applicable, shall require to effect an exercise of the Option and delivery to the Company of the sale proceeds required to pay the aggregate
Exercise Price. 
  
 D. Non-Transferability of Option.

  
 This Option may not be transferred in any manner otherwise
than by will or by the laws of descent or distribution and may be exercised during the lifetime of Optionee only by the Optionee. The designation of a beneficiary by the Optionee does not constitute a transfer. The terms of the Plan and this Option
Agreement shall be binding upon the executors, administrators, heirs, successors and assigns of the Optionee. 
  
 E. Term of Option. 
  
 This Option may be exercised only on or before the Expiration Date set forth in the Notice of Grant, and may be exercised during such term only in
accordance with the Plan and the terms of this Option Agreement. 
  
 F. Tax Consequences. 
  
 Some of the federal tax
consequences relating to this Option, as of the date of this Option, are set forth below. THIS SUMMARY IS NECESSARILY INCOMPLETE, AND THE TAX LAWS AND REGULATIONS ARE SUBJECT TO CHANGE. THE OPTIONEE SHOULD CONSULT A TAX ADVISOR BEFORE EXERCISING
THIS OPTION OR DISPOSING OF THE SHARES. 
  
 G. Exercising the
Option. 
  
 1. Nonstatutory Stock Option
(“NSO”). If this Option does not qualify as an Incentive Stock Option, the Optionee may incur regular federal income tax liability upon exercise of the Option. The 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 Exercised Shares on the date of exercise over their aggregate Exercise Price. If the Optionee is an Employee or a former Employee, the Company will
be required to withhold from his or her compensation or to 
  

 -3- 

 collect from Optionee and pay to the applicable taxing authorities an amount in cash equal to a percentage of this
compensation income at the time of exercise, and may refuse to honor the exercise and refuse to deliver Shares if such withholding amounts are not delivered at the time of exercise. 
  
 2. Incentive Stock Option (“ISO”). If this Option qualifies as an Incentive Stock Option, the Optionee will
have no regular federal income tax liability upon its exercise, although the excess, if any, of the Fair Market Value of the Exercised Shares on the date of exercise over their aggregate Exercise Price will be treated as an adjustment to alternative
minimum taxable income for federal tax purposes and may subject the Optionee to alternative minimum tax in the year of exercise. In the event that the Optionee ceases to be an Employee but remains a Service Provider, any Incentive Stock Option of
the Optionee that remains unexercised shall cease to qualify as an Incentive Stock Option and will be treated for tax purposes as a Nonstatutory Stock Option on the date that is three (3) months and one (1) day following such change of status.

  
 3. Disposition of Shares. 
  
 (a) NSO. If the Optionee holds Shares issued upon exercise of an NSO
for at least one year, any gain realized on disposition of the Shares will be treated as long-term capital gain for federal income tax purposes. 
  
 (b) ISO. If the Optionee holds Shares issued upon exercise of an ISO for at least one year after exercise and two years after the grant
date, any gain realized on disposition of the Shares will be treated as long-term capital gain for federal income tax purposes. If the Optionee disposes of such ISO Shares within one year after exercise or two years after the grant date, any gain
realized on such disposition will be treated as compensation income (taxable at ordinary income rates) to the extent of the excess, if any, of the lesser of (A) the difference between the Fair Market Value of the Exercised Shares on the date of
exercise and the aggregate Exercise Price, or (B) the difference between the sale price of such Exercised Shares and the aggregate Exercise Price. Any additional gain will be taxed as capital gain, short-term or long-term depending on the period
that the ISO Shares were held. 
  
 (c) Notice of Disqualifying
Disposition of ISO Shares. If the Optionee sells or otherwise disposes of any of Exercised Shares acquired upon exercise of an ISO on or before the later of (i) two years after the grant date, or (ii) one year after the exercise date, the
Optionee shall immediately notify the Company in writing of such disposition. The Optionee agrees that he or she may be subject to income tax withholding by the Company on the compensation income recognized from such early disposition of ISO Shares
by payment in cash or out of the current earnings paid to the Optionee. 
  
 H. Entire Agreement; Governing Law. 
  
 The Plan
is incorporated herein by reference. The Plan and this Option Agreement constitute the entire agreement of the parties with respect to the subject matter hereof and supersede in their entirety all prior undertakings and agreements of the Company and
Optionee with respect to the subject matter hereof, and may not be modified adversely to the Optionee’s interest except by means of a writing signed by the Company and Optionee. This agreement is governed by the internal substantive laws, but
not the choice of law rules, of California. 
  

 -4- 

 I. NO GUARANTEE OF CONTINUED SERVICE. 
  
 OPTIONEE ACKNOWLEDGES AND AGREES THAT THE VESTING OF SHARES PURSUANT TO THE
VESTING SCHEDULE HEREOF IS EARNED ONLY BY CONTINUING AS A SERVICE PROVIDER AT THE WILL OF THE COMPANY (AND NOT THROUGH THE ACT OF BEING HIRED, BEING GRANTED AN OPTION OR PURCHASING SHARES HEREUNDER). OPTIONEE FURTHER ACKNOWLEDGES AND AGREES THAT
THIS AGREEMENT, THE TRANSACTIONS CONTEMPLATED HEREUNDER AND THE VESTING SCHEDULE SET FORTH HEREIN DO NOT CONSTITUTE AN EXPRESS OR IMPLIED PROMISE OF CONTINUED ENGAGEMENT AS A SERVICE PROVIDER FOR THE VESTING PERIOD, FOR ANY PERIOD, OR AT ALL, AND
SHALL NOT INTERFERE WITH OPTIONEE’S RIGHT OR THE COMPANY’S RIGHT TO TERMINATE OPTIONEE’S RELATIONSHIP AS A SERVICE PROVIDER AT ANY TIME, WITH OR WITHOUT CAUSE. 
  
 By your signature and the signature of the Company’s representative below, you and the Company agree that this Option
is granted under and governed by the terms and conditions of the Plan and this Option Agreement. Optionee has reviewed the Plan and this Option Agreement in their entirety, has had an opportunity to obtain the advice of counsel prior to executing
this Option Agreement and fully understands all provisions of the Plan and Option Agreement. Optionee hereby agrees to accept as binding, conclusive and final all decisions or interpretations of the Administrator upon any questions relating to the
Plan and Option Agreement. Optionee further agrees to notify the Company upon any change in the residence address indicated below. 
  

			
	OPTIONEE:	 	HYTEK MICROSYSTEMS, INC.
		
	  

 Signature
	 	  

 By

		
	  

 Print Name
	 	  

 Title

		
	  

 Residence Address
	 	 
		
	  

	 	 

  

 -5- 

 CONSENT OF SPOUSE 
  
 The undersigned spouse of Optionee has read and hereby approves the terms and conditions of the Plan and this Option
Agreement. In consideration of the Company’s granting his or her spouse the right to purchase Shares as set forth in the Plan and this Option Agreement, the undersigned hereby agrees to be irrevocably bound by the terms and conditions of the
Plan and this Option Agreement and further agrees that any community property interest shall be similarly bound. The undersigned hereby appoints the undersigned’s spouse as attorney-in-fact for the undersigned with respect to any amendment or
exercise of rights under the Plan or this Option Agreement. 
  

	
	  

 Spouse of
Optionee

 EXHIBIT A 
  
 HYTEK MICROSYSTEMS, INC. 
  
 2001 STOCK PLAN 
  
 EXERCISE NOTICE 
  
 Hytek Microsystems, Inc. 
 400 Hot Springs Road 
 Carson
City, NV 
  
 Attention: Corporate Secretary 
  
 1. Exercise of Option. Effective as of today,
                    , 20    , the undersigned (“Purchaser”) hereby elects to purchase
                 shares (the “Shares”) of the Common Stock of Hytek Microsystems, Inc. (the “Company”) under and pursuant to the 2001 Stock
Plan (the “Plan”) and the Stock Option Agreement dated          (the “Option Agreement”). The purchase price for the Shares shall be
$             per share, as required by the Option Agreement. 
  
 2. Delivery of Payment. Purchaser herewith delivers to the Company the full aggregate purchase price for the Shares. 
  
 3. Representations of Purchaser. Purchaser acknowledges that Purchaser
has received, read and understood the Plan and the Option Agreement and agrees to abide by and be bound by their terms and conditions. 
  
 4. Rights as Shareholder. Until the issuance (as evidenced by the appropriate entry on the books of the Company or of a duly authorized transfer
agent of the Company) of the Shares, no right to vote or receive dividends or any other rights as a shareholder shall exist with respect to the Optioned Stock, notwithstanding the exercise of the Option. The Shares so acquired shall be issued to the
Optionee as soon as practicable after exercise of the Option. No adjustment will be made for a dividend or other right for which the record date is prior to the date of issuance, except as provided in Section 13 of the Plan. 
  
 5. Tax Consultation. Purchaser understands that Purchaser may suffer
adverse tax consequences as a result of Purchaser’s purchase or disposition of the Shares. Purchaser represents that Purchaser has consulted with any tax consultants Purchaser deems advisable in connection with the purchase or disposition of
the Shares and that Purchaser is not relying on the Company for any tax advice. 

 6. Entire Agreement; Governing Law. The Plan and Option Agreement are incorporated herein by
reference. This Agreement, the Plan and the Option Agreement constitute the entire agreement of the parties with respect to the subject matter hereof and supersede in their entirety all prior undertakings and agreements of the Company and Purchaser
with respect to the subject matter hereof, and may not be modified adversely to the Purchaser’s interest except by means of a writing signed by the Company and Purchaser. This agreement is governed by the internal substantive laws, but not the
choice of law rules, of California. 
  

					
	Submitted by:	 	Accepted by:
		
	PURCHASER:	 	HYTEK MICROSYSTEMS, INC.
		
	  

 Signature
	 	
 By

		
	  

 Print Name
	 	  

 Title

		
	Address:	 	Address:
		
	
	 	HYTEK MICROSYSTEMS, INC.
	 	 	400 Hot Springs Road
	
	 	Carson City, NV
		
	 	 	 
	 	 	
 Date Received

  

 -2-2001 Director Stock Option Plan

 Exhibit 10.3 
  
 HYTEK MICROSYSTEMS, INC. 
  
 2001 DIRECTOR STOCK OPTION PLAN 
  
 (As adopted by the Board of Directors on February 21, 2001 and amended on March 1, 2002) 
  
 1. Purposes of the Plan. The purposes of this 2001 Director Option
Plan are to attract and retain the best available personnel for service as Outside Directors (as defined herein) of the Company, to provide additional incentive to the Outside Directors of the Company to serve as Directors, and to encourage their
continued service on the Board. 
  
 All options granted hereunder
shall be nonstatutory stock options. 
  
 2. Definitions. As
used herein, the following definitions shall apply: 
  
 (a)
“Board” means the Board of Directors of the Company. 
  
 (b) “Code” means the Internal Revenue Code of 1986, as amended. 
  
 (c) “Common Stock” means the common stock of the Company. 
  
 (d) “Company” means Hytek Microsystems, Inc., a California corporation. 
  
 (e) “Continuous Service as a Director” shall mean the absence of any interruption or termination of service
as a Director. 
  
 (f) “Director” means a member
of the Board. 
  
 (g) “Disability” means total
and permanent disability as defined in section 22(e)(3) of the Code. 
  
 (h) “Employee” means any person, including officers and Directors, employed by the Company or any Parent or Subsidiary of the Company. The payment of a Director’s fee by the Company shall not be sufficient in and of
itself to constitute “employment” by the Company. 
  
 (i) “Exchange Act” means the Securities Exchange Act of 1934, as amended. 
  
 (j) “Fair Market Value” means, as of any date, the value of Common Stock determined as follows: 
  
 (i) If the Common Stock is listed on any established stock exchange or a
national market system, including without limitation the Nasdaq National Market or The Nasdaq SmallCap Market of The Nasdaq Stock Market, its Fair Market Value shall be the closing sales price for such stock (or the closing bid, if no sales were
reported) as quoted on such exchange or system for the last market trading day prior to the time of determination as reported in The Wall Street Journal or such other source as the Administrator deems reliable; 

 (ii) If the Common Stock is regularly quoted by a recognized securities dealer but selling prices are
not reported, the Fair Market Value of a Share of Common Stock shall be the mean between the high bid and low asked prices for the Common Stock for the last market trading day prior to the time of determination, as reported in The Wall Street
Journal or such other source as the Board deems reliable; or 
  
 (iii) In the absence of an established market for the Common Stock, the Fair Market Value thereof shall be determined in good faith by the Board. 
  
 (k) “Inside Director” means a Director who is an Employee. 
  
 (l) “Option” means a stock option granted pursuant to the Plan. 
  
 (m) “Optioned Stock” means the Common Stock subject to an
Option. 
  
 (n) “Optionee” means a Director who
holds an Option. 
  
 (o) “Outside Director” means
a Director who is not an Employee. 
  
 (p)
“Parent” means a “parent corporation,” whether now or hereafter existing, as defined in Section 424(e) of the Code. 
  
 (q) “Plan” means this 2001 Director Stock Option Plan. 
  
 (r) “Share” means a share of the Common Stock, as adjusted in accordance with Section 10 of the Plan.

  
 (s) “Subsidiary” means a “subsidiary
corporation,” whether now or hereafter existing, as defined in Section 424(f) of the Internal Revenue Code of 1986. 
  
 3. Stock Subject to the Plan. Subject to the provisions of Section 10 of the Plan, the maximum aggregate number of Shares which may be optioned and
sold under the Plan is 130,000 Shares (the “Pool”). The Shares may be authorized, but unissued, or reacquired Common Stock. 
  
 If an Option expires or becomes unexercisable without having been exercised in full, the unpurchased Shares which were subject thereto shall become
available for future grant or sale under the Plan (unless the Plan has terminated). Shares that have actually been issued under the Plan shall not be returned to the Plan and shall not become available for future distribution under the Plan.

  
 4. Administration and Grants of Options under the Plan.

  
 (a) Procedure for Grants. All grants of Options to
Outside Directors under this Plan shall be automatic and nondiscretionary and shall be made strictly in accordance with the following provisions: 
  

 -2- 

 (i) No person shall have any discretion to select which Outside Directors shall be granted Options or to
determine the number of Shares to be covered by Options. 
  
 (ii)
Each Outside Director shall be automatically granted an Option to purchase 15,000 Shares (the “First Option”) on the date on which such person first becomes an Outside Director, whether through election by the shareholders of the Company
or appointment by the Board to fill a vacancy; provided, however, that an Inside Director who ceases to be an Inside Director but who remains a Director shall not receive a First Option; and provided, further, that persons who first became Outside
Directors prior to February 21, 2001 shall not receive a First Option. 
  
 (iii) Each Outside Director who shall have been in Continuous Service as a Director for a period of five years or more as of the last business day of a fiscal year (commencing with fiscal 2001) shall be automatically granted an Option to
purchase 5,000 Shares (a “Subsequent Option”) on the last business day of each such fiscal year. 
  
 (iv) Notwithstanding the provisions of subsections (ii) and (iii) hereof, any exercise of an Option granted before the Company has obtained shareholder
approval of the Plan in accordance with Section 16 hereof shall be conditioned upon obtaining such shareholder approval of the Plan in accordance with Section 16 hereof. 
  
 (v) The terms of a First Option granted hereunder shall be as follows: 
  
 (1) the term of the First Option shall be ten (10) years. 
  
 (2) the First Option shall be exercisable only while the Outside Director
remains a Director of the Company, except as set forth in Sections 8 and 10 hereof. 
  
 (3) the exercise price per Share shall be 100% of the Fair Market Value per Share on the date of grant of the First Option. 
  
 (4) subject to Section 10 hereof, the First Option shall represent the right to purchase 15,000 shares and shall become exercisable cumulatively as to
5,000 Shares subject to the First Option on each anniversary of its date of grant, provided that the Optionee continues to serve as a Director on such dates. 
  
 (vi) The terms of a Subsequent Option granted hereunder shall be as follows: 
  
 (1) the term of the Subsequent Option shall be ten (10) years. 
  
 (2) the Subsequent Option shall be exercisable only while the Outside
Director remains a Director of the Company, except as set forth in Sections 8 and 10 hereof. 
  
 (3) the exercise price per Share shall be 100% of the Fair Market Value per Share on the date of grant of the Subsequent Option. 
  

 -3- 

 (4) Each Subsequent Option shall represent the right to purchase up to 5,000 Shares and shall become
exercisable cumulatively as to approximately 1/12 of the Shares subject to the Subsequent Option per month following the date of grant as follows: 
  

					
	 Number of Months After
 Grant Date

	 	 Number of Shares
 Becoming Exercisable

	 	 Cumulative Number
 of Shares Exercisable

	 1
	 	416	 	416
			
	 2
	 	417	 	833
			
	 3
	 	417	 	1,250
			
	 4
	 	416	 	1,666
			
	 5
	 	417	 	2,083
			
	 6
	 	417	 	2,500
			
	 7
	 	416	 	2,916
			
	 8
	 	417	 	3,333
			
	 9
	 	417	 	3,750
			
	 10
	 	416	 	4,166
			
	 11
	 	417	 	4,583
			
	 12
	 	417	 	5,000
	 	 	
	 	 
	 TOTAL
	 	5,000	 	 
	 	 	
	 	 

  
 The Subsequent Option
shall be fully vested and exercisable one year from the date of grant. 
  
 (vii) In the event that any Option granted under the Plan would cause the number of Shares subject to outstanding Options plus the number of Shares previously purchased under Options to exceed the Pool, then the remaining Shares available
for Option grant shall be granted under Options to the Outside Directors on a pro rata basis. No further grants shall be made until such time, if any, as additional Shares become available for grant under the Plan through action of the Board or the
shareholders to increase the number of Shares which may be issued under the Plan or through cancellation or expiration of Options previously granted hereunder. 
  

(b) Administrator. Except as otherwise required herein, the Plan shall be administered by the Board. 
  
 5. Eligibility. Options may be granted only to Outside Directors. All
Options shall be automatically granted in accordance with the terms set forth in Section 4 hereof. 
  

 -4- 

 The Plan shall not confer upon any Optionee any right with respect to continuation of service as a
Director or nomination to serve as a Director, nor shall it interfere in any way with any rights which the Director or the Company may have to terminate the Director’s relationship with the Company at any time. 
  
 6. Term of Plan. The Plan shall become effective upon the earlier to
occur of (i) its adoption by the Board or (ii) its approval by the shareholders of the Company as described in Section 16 of the Plan. It shall continue in effect for a term of ten (10) years unless sooner terminated under Section 11 of the Plan.

  
 7. Form of Consideration. The consideration to be paid
for the Shares to be issued upon exercise of an Option, including the method of payment, shall consist of (i) cash, (ii) check, (iii) other shares which (x) in the case of Shares acquired upon exercise of an option, have been owned by the Optionee
for more than six (6) months on the date of surrender, and (y) have a Fair Market Value on the date of surrender equal to the aggregate exercise price of the Shares as to which said Option shall be exercised, (iv) to the extent permitted by the
Administrator, delivery of a properly executed exercise notice together with such other documentation as the Administrator and the broker, if applicable, shall require to effect an exercise of the Option and delivery to the Company of the sale
proceeds required to pay the aggregate Exercise Price, or (v) any combination of the foregoing methods of payment. 
  
 8. Exercise of Option. 
  
 (a) Procedure for Exercise; Rights as a Shareholder. Any Option granted hereunder shall be exercisable at such times as are set forth in Section 4
hereof; provided, however, that no Options shall be exercisable until shareholder approval of the Plan in accordance with Section 16 hereof has been obtained. 
  

An Option may not be exercised for a fraction of a Share. 
  
 An Option shall be deemed to be exercised when written notice of such exercise has been given to the Company in accordance with the terms of the Option
by the person entitled to exercise the Option and full payment for the Shares with respect to which the Option is exercised has been received by the Company. Full payment may consist of any consideration and method of payment allowable under Section
7 of the Plan. Until the issuance (as evidenced by the appropriate entry on the books of the Company or of a duly authorized transfer agent of the Company) of the stock certificate evidencing such Shares, no right to vote or receive dividends or any
other rights as a shareholder shall exist with respect to the Optioned Stock, notwithstanding the exercise of the Option. A share certificate for the number of Shares so acquired shall be issued to the Optionee as soon as practicable after exercise
of the Option. No adjustment shall be made for a dividend or other right for which the record date is prior to the date the stock certificate is issued, except as provided in Section 10 of the Plan. 
  
 Exercise of an Option in any manner shall result in a decrease in the number
of Shares which thereafter may be available, both for purposes of the Plan and for sale under the Option, by the number of Shares as to which the Option is exercised. 
  

 -5- 

 (b) Termination of Continuous Status as a Director. Subject to Section 10 hereof, in the event an
Optionee’s status as a Director terminates (other than upon the Optionee’s death or Disability), the Optionee may exercise his or her Option, but only within one (1) year following the date of such termination, and only to the extent that
the Optionee was entitled to exercise it on the date of such termination (but in no event later than the expiration of its ten (10) year term). To the extent that the Optionee was not entitled to exercise an Option on the date of such termination,
and to the extent that the Optionee does not exercise such Option (to the extent otherwise so entitled) within the time specified herein, the Option shall terminate. 
  
 (c) Disability of Optionee. In the event Optionee’s status as a Director terminates as a result of Disability,
the Optionee may exercise his or her Option, but only within one (1) year following the date of such termination, and only to the extent that the Optionee was entitled to exercise it on the date of such termination (but in no event later than the
expiration of its ten (10) year term). To the extent that the Optionee was not entitled to exercise an Option on the date of termination, or if he or she does not exercise such Option (to the extent otherwise so entitled) within the time specified
herein, the Option shall terminate. 
  
 (d) Death of
Optionee. In the event of the death of an Optionee: 
  
 (i)
During the term of the Option who is at the time of death a Director of the Company and who shall have served as a Director since the date of grant of the Option, the Option may be exercised, at any time within one year following the date of death,
by the Optionee’s estate or by a person who acquired the right to exercise the Option by bequest or inheritance. In such case, the exercisability of the Option shall be accelerated such that the Option shall be exercisable during such one-year
period with respect to (A) all Shares that were exercisable as of the date of death plus (B) such additional Shares as would have become exercisable had the Optionee continued living and served as a Director for a period of one year after the date
of death. With respect to Shares that the Optionee would not have been entitled to exercise until after the end of such one-year period, the Option shall be cancelled as of the date of death and the unexercisable shares shall be returned to the
Plan. To the extent such Option is not exercised with respect to the exercisable Shares subject thereto within the time specified herein, the Option shall terminate and any unexercised Shares shall be returned to the Plan at the end of such time.

  
 (ii) Within one year after the Optionee’s termination of
service as a Director, the Option may be exercised, at any time within one year following the date of death, by the Optionee’s estate or by a person who acquired the right to exercise the Option by bequest or inheritance, but only to the extent
of the right to exercise that had accrued at the date of termination. To the extent that such Option is not exercised with respect to the exercisable Shares subject thereto within the time specified herein, the Option shall terminate and any
unexercised Shares shall be returned to the Plan at the end of such time. 
  
 9. Non-Transferability of Options. The Option may not be sold, pledged, assigned, hypothecated, transferred, or disposed of in any manner other than by will or by the laws of descent or distribution and may be
exercised, during the lifetime of the Optionee, only by the Optionee. 
  

 -6- 

 10. Adjustments Upon Changes in Capitalization, Dissolution, Merger or Asset Sale. 
  
 (a) Changes in Capitalization. Subject to any required action by the
shareholders of the Company, the number of Shares covered by each outstanding Option, the number of Shares which have been authorized for issuance under the Plan but as to which no Options have yet been granted or which have been returned to the
Plan upon cancellation or expiration of an Option, as well as the price per Share covered by each such outstanding Option, and the number of Shares issuable pursuant to the automatic grant provisions of Section 4 hereof shall be proportionately
adjusted for any increase or decrease in the number of issued Shares resulting from a stock split, reverse stock split, stock dividend, combination or reclassification of the Common Stock, or any other increase or decrease in the number of issued
Shares effected without receipt of consideration by the Company; provided, however, that conversion of any convertible securities of the Company shall not be deemed to have been “effected without receipt of consideration.” Except as
expressly provided herein, no issuance by the Company of shares of stock of any class, or securities convertible into shares of stock of any class, shall affect, and no adjustment by reason thereof shall be made with respect to, the number or price
of Shares subject to an Option. 
  
 (b) Dissolution or
Liquidation. In the event of the proposed dissolution or liquidation of the Company, to the extent that an Option has not been previously exercised, it shall terminate immediately prior to the consummation of such proposed action. 
  
 (c) Merger or Asset Sale. In the event of a merger of the Company with
or into another corporation or the sale of substantially all of the assets of the Company, outstanding Options may be assumed or equivalent options may be substituted by the successor corporation or a Parent or Subsidiary thereof (the
“Successor Corporation”). If an Option is assumed or substituted for, the Option or equivalent option shall continue to be exercisable as provided in Section 4 hereof for so long as the Optionee serves as a Director or a director of the
Successor Corporation. Following such assumption or substitution, if the Optionee’s status as a Director or director of the Successor Corporation, as applicable, is terminated other than upon a voluntary resignation by the Optionee, the Option
or option shall become fully exercisable, including as to Shares for which it would not otherwise be exercisable. Thereafter, the Option or option shall remain exercisable in accordance with Sections 8(b) through (d) above. 
  
 If the Successor Corporation does not assume an outstanding Option or
substitute for it an equivalent option, the Option shall become fully vested and exercisable, including as to Shares for which it would not otherwise be exercisable. In such event the Board shall notify the Optionee that the Option shall be fully
exercisable for a period of thirty (30) days from the date of such notice, and upon the expiration of such period the Option shall terminate. 
  
 For the purposes of this Section 10(c), an Option shall be considered assumed if, following the merger or sale of assets, the Option confers the right to
purchase or receive, for each Share of Optioned Stock subject to the Option immediately prior to the merger or sale of assets, the consideration (whether stock, cash, or other securities or property) received in the merger or sale of assets by
holders of Common Stock for each Share held on the effective date of the transaction (and if holders were offered a choice of consideration, the type of consideration chosen by the holders of a majority of the outstanding Shares). If such
consideration received in the merger or sale of assets 
  

 -7- 

 is not solely common stock of the successor corporation or its Parent, the Administrator may, with the consent of the
successor corporation, provide for the consideration to be received upon the exercise of the Option, for each Share of Optioned Stock subject to the Option, to be solely common stock of the successor corporation or its Parent equal in fair market
value to the per share consideration received by holders of Common Stock in the merger or sale of assets. 
  
 11. Amendment and Termination of the Plan. 
  
 (a) Amendment and Termination. The Board may at any time amend, alter, suspend, or discontinue the Plan, but no amendment, alteration, suspension,
or discontinuation shall be made which would impair the rights of any Optionee under any grant theretofore made, without his or her consent. In addition, to the extent necessary and desirable to comply with any applicable law, regulation or stock
exchange rule, the Company shall obtain shareholder approval of any Plan amendment in such a manner and to such a degree as required. 
  
 (b) Effect of Amendment or Termination. Any such amendment or termination of the Plan shall not affect Options already granted and such Options
shall remain in full force and effect as if this Plan had not been amended or terminated. 
  
 12. Time of Granting Options. The date of grant of an Option shall, for all purposes, be the date determined in accordance with Section 4 hereof. 
  
 13. Conditions Upon Issuance of Shares. 
  
 (a) Legal Compliance. Shares shall not be issued pursuant to the exercise of an Option unless the exercise of such
Option and the issuance and delivery of such Shares pursuant thereto shall comply with all relevant provisions of law, including, without limitation, the Securities Act of 1933, as amended, the Exchange Act, the rules and regulations promulgated
thereunder, state securities laws, and the requirements of any stock exchange upon which the Shares may then be listed, and shall be further subject to the approval of counsel for the Company with respect to such compliance. 
  
 (b) Investment Representations. As a condition to the exercise of an
Option, the Company may require the person exercising such Option to represent and warrant at the time of any such exercise that the Shares are being purchased only for investment and without any present intention to sell or distribute such Shares,
if, in the opinion of counsel for the Company, such a representation is required by any of the aforementioned relevant provisions of law. 
  
 (c) Lack of Authority. Inability of the Company to obtain authority from any regulatory body having jurisdiction, which authority is deemed by the
Company’s counsel to be necessary to the lawful issuance and sale of any Shares hereunder, shall relieve the Company of any liability in respect of the failure to issue or sell such Shares as to which such requisite authority shall not have
been obtained. 
  
 14. Reservation of Shares. The Company,
during the term of this Plan, will at all times reserve and keep available such number of Shares as shall be sufficient to satisfy the requirements of the Plan. 
  

 -8- 

 15. Option Agreement. Options shall be evidenced by written option agreements in such form as the
Board shall approve. 
  
 16. Shareholder Approval. The Plan
shall be subject to approval by the shareholders of the Company within one (1) year after the date the Plan is adopted by the Board. Such shareholder approval shall be obtained in the degree and manner required under applicable state and federal law
and any stock exchange rules. 
  

 -9- 

 HYTEK MICROSYSTEMS, INC. 
  
 DIRECTOR’S NONSTATUTORY STOCK OPTION AGREEMENT 
 UNDER 2001 DIRECTOR STOCK OPTION PLAN 
  
 (First Option) 
  
 Hytek Microsystems, Inc., a California corporation (the “Company”), has granted to
                                        
(the “Optionee”) an option to purchase a total of 15,000 shares of the Company’s Common Stock (the “Optioned Stock”), at the price set forth herein, and in all respects subject to the terms, definitions and provisions
of the Company’s 2001 Director Stock Option Plan (the “Plan”) adopted by the Company, which is incorporated herein by reference. The terms defined in the Plan shall have the same defined meanings herein. 
  
 1. Nature of the Option. This Option is a nonstatutory option and is
not intended to qualify for any special tax benefits to the Optionee. 
  
 2. Exercise Price. The exercise price is $             for each Share of Common Stock, which is 100% of the Fair Market Value of the Common Stock on the date of grant
of this Option. 
  
 3. Exercise of Option. This Option
shall be exercisable during its term in accordance with the provisions of the Plan as follows: 
  
 (a) Right to Exercise. 
  
 (i) This Option shall become exercisable cumulatively in installments, to the extent of one-third (5,000 Shares) of the Optioned Stock on each of the
first, second and third anniversary dates of the date of grant of this Option specified on the signature page, so that 100% of the Optioned Stock shall be exercisable three years after the date of grant. 
  
 (ii) This Option may not be exercised for a fraction of a Share. 

 
 (iii) In the event of the Optionee’s termination of service as a
Director due to death, Disability or any other reason, the exercisability of this Option is governed by Section 8 of the Plan. 

 (b) Method of Exercise. This Option shall be exercisable by written notice, which shall state the
election to exercise the Option and the number of Shares in respect of which the Option is being exercised. Such written notice, in the form attached hereto as Exhibit A, shall be signed by the Optionee and shall be delivered in person or by
certified mail to the Secretary of the Company. The written notice shall be accompanied by payment of the exercise price. 
  
 (c) Method of Payment. Payment of the exercise price shall be by any of the following, or a combination thereof, at the election of the Optionee:

  
 (i) cash; 
  
 (ii) check; 
  
 (iii) surrender of other Shares of Common Stock of the Company, which (A) in the case of Shares acquired directly from the
Company upon exercise of an option, have been owned by the Optionee for more than six months on the date of surrender, and (B) have a Fair Market Value on the date of surrender equal to the aggregate exercise price of the Shares with respect to
which the Option is being exercised; or 
  
 (iv) to the extent
permitted by the Administrator, delivery of a properly executed exercise notice together with such other documentation as the Administrator and the broker, if applicable, shall require to effect an exercise of the Option and delivery to the Company
of the sale proceeds required to pay the aggregate Exercise Price. 
  
 (d) Restrictions on Exercise. This Option may not be exercised if the issuance of Shares upon such exercise or the method of payment of consideration for such Shares would constitute a violation of any applicable federal or state
securities or other law or regulations, or if such issuance would not comply with the requirements of any stock exchange or quotation system upon which the Shares may then be listed or quoted. As a condition to the exercise of this Option, the
Company may require the Optionee to make any representation and warranty to the Company as may be required by any applicable law or regulation. 
  
 4. Non-Transferability of Option. This Option may not be sold, pledged, assigned, hypothecated, transferred or disposed of in any manner other than
by will or by the laws of descent and distribution. The designation of a beneficiary by the Optionee does not constitute a transfer. This Option may be exercised during the lifetime of the Optionee only by the Optionee. The terms of this Option
shall be binding upon the executors, administrators, heirs, successors and assigns of the Optionee. 
  
 5. Term of Option. This Option may not be exercised more than ten years from the date of grant hereof, and may be exercised during such term only
in accordance with the Plan and the terms of this Option. In no event may this Option be exercised after its ten-year term has expired. 
  

 -2- 

 6. Taxation Upon Exercise of Option. Optionee understands that, upon exercise of this Option, he
or she will recognize income for tax purposes in an amount equal to the excess of the then Fair Market Value of the Shares purchased over the exercise price paid for such Shares. If the Optionee is subject to Section 16(b) of the Securities Exchange
Act of 1934, as amended, at the time of exercise, under certain limited circumstances the measurement and timing of such income (and the commencement of any capital gain holding period) may be deferred, and the Optionee is advised to contact a tax
advisor concerning the application of Section 83 of the Internal Revenue Code in general and the availability a Section 83(b) election in particular in connection with the exercise of the Option. Upon a resale of such Shares by the Optionee, any
difference between the sale price and the Fair Market Value of the Shares on the date of exercise of the Option, to the extent not included in income as described above, will be treated as capital gain or loss. 
  
 DATE OF GRANT:
                    , 20     
  

			
	 HYTEK MICROSYSTEMS, INC.,
 a California corporation

		
	 By:
	 	  

	 Title:
	 	  

  
 ACKNOWLEDGEMENT OF OPTION 
  
 Optionee
acknowledges receipt of the Option and a copy of the Plan, which is attached hereto. Optionee represents that he or she is familiar with the terms and provisions thereof and hereby accepts this Option subject to all of the terms and provisions
thereof. Optionee hereby agrees to accept as binding, conclusive and final all decisions or interpretations of the Board upon any questions arising under the Plan. 
  
 Dated:                     ,
20     
  

	
	
 Optionee

  

 -3- 

 EXHIBIT A 
  
 DIRECTOR OPTION EXERCISE NOTICE 
  
 Hytek Microsystems, Inc. 
 400 Hot Springs Road

 Carson City, NV 
  
 Attention: Corporate Secretary 
  
 1. Exercise of Option. The undersigned (“Optionee”) hereby elects to exercise Optionee’s option to purchase
             shares of the Common Stock (the “Shares”) of Hytek Microsystems, Inc. (the “Company”) under and pursuant to the Company’s 2001 Director Stock
Option Plan and the Director’s Nonstatutory Stock Option Agreement dated                     . 20     (the
“Agreement”). 
  
 2. Representations of Optionee.
Optionee acknowledges that Optionee has received, read and understood the Agreement. 
  
 3. Tax Consequences. Optionee understands that Optionee may suffer adverse tax consequences as a result of Optionee’s purchase or disposition of the 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. 
  
 4. Delivery of Payment. Optionee herewith delivers to the Company the aggregate purchase price for the Shares that
Optionee has elected to purchase and has made provision for the payment of any federal or state withholding taxes required to be paid or withheld by the Company. 
  
 5. Entire Agreement. The Agreement is incorporated herein by reference. This Exercise Notice and the Agreement
constitute the entire agreement of the parties and supersede in their entirety all prior undertakings and agreements of the Company and Optionee with respect to the subject matter hereof. This Exercise Notice and the Agreement are governed by
California law except for that body of law pertaining to conflict of laws. 
  

							
	 Submitted by:
	  	 Accepted by:

		
	 OPTIONEE:
	  	 HYTEK MICROSYSTEMS, INC.

				
	 By:
	 	  

	  	 By:
	 	  

	 Address:
	 	 	  	 Its:
	 	  

	  

	  	 	 	 
	  

	  	 	 	 
	 Dated:
	 	  

	  	 Dated:
	 	  

 HYTEK MICROSYSTEMS, INC. 
  
 DIRECTOR’S NONSTATUTORY STOCK OPTION AGREEMENT 
 UNDER 2001 DIRECTOR STOCK OPTION PLAN 
  
 (Subsequent Option) 
  
 Hytek Microsystems, Inc., a California corporation (the “Company”), has granted to
                                        
(the “Optionee”) an option to purchase a total of 5,000 shares of the Company’s Common Stock (the “Optioned Stock”), at the price set forth herein, and in all respects subject to the terms, definitions and provisions
of the Company’s 2001 Director Stock Option Plan (the “Plan”) adopted by the Company, which is incorporated herein by reference. The terms defined in the Plan shall have the same defined meanings herein. 
  
 1. Nature of the Option. This Option is a nonstatutory option and is
not intended to qualify for any special tax benefits to the Optionee. 
  
 2. Exercise Price. The exercise price is $             for each Share of Common Stock, which is 100% of the Fair Market Value of the Common Stock on the date of grant
of this Option. 
  
 3. Exercise of Option. This Option
shall be exercisable during its term in accordance with the provisions of the Plan as follows: 
  
 (a) Right to Exercise. 
  
 (i) This Option shall become exercisable cumulatively in installments, to the extent of approximately one-twelfth of the Optioned Stock subject to the
Option per month following the date of grant of this Option specified on the signature page, as follows: 

					
	 Number of Months
 After Grant Date

	 	 Number of
 Shares Becoming
 Exercisable

	 	 Cumulative Number
 of Shares Exercisable

			
	 1
	 	416	 	416
			
	 2
	 	417	 	833
			
	 3
	 	417	 	1,250
			
	 4
	 	416	 	1,666
			
	 5
	 	417	 	2,083
			
	 6
	 	417	 	2,500
			
	 7
	 	416	 	2,916
			
	 8
	 	417	 	3,333
			
	 9
	 	417	 	3,750
			
	 10
	 	416	 	4,166
			
	 11
	 	417	 	4,583
			
	 12
	 	417	 	5,000
	 	 	
	 	 
	 TOTAL
	 	5,000	 	 
	 	 	
	 	 

  
 All of the Optioned Stock shall be
exercisable one year after the date of grant. 
  
 (ii) This
Option may not be exercised for a fraction of a Share. 
  
 (iii)
In the event of the Optionee’s termination of service as a Director due to death, Disability or any other reason, the exercisability of this Option is governed by Section 8 of the Plan. 
  
 (b) Method of Exercise. This Option shall be exercisable by written
notice, which shall state the election to exercise the Option and the number of Shares in respect of which the Option is being exercised. Such written notice, in the form attached hereto as Exhibit A, shall be signed by the Optionee and shall
be delivered in person or by certified mail to the Secretary of the Company. The written notice shall be accompanied by payment of the exercise price. 

 (c) Method of Payment. Payment of the exercise price shall be by any of the following, or a
combination thereof, at the election of the Optionee: 
  
 (i)
cash; 
  
 (ii) check; 
  
 (iii) surrender of other Shares of Common Stock of the Company, which (A) in
the case of Shares acquired directly from the Company upon exercise of an option have been owned by the Optionee for more than six months on the date of surrender, and (B) have a Fair Market Value on the date of surrender equal to the aggregate
exercise price of the Shares with respect to which the Option is being exercised; or 
  
 (iv) to the extent permitted by the Administrator, delivery of a properly executed exercise notice together with such other documentation as the Administrator and the broker, if applicable, shall require to effect an
exercise of the Option and delivery to the Company of the sale proceeds required to pay the aggregate Exercise Price. 
  
 (d) Restrictions on Exercise. This Option may not be exercised if the issuance of Shares upon such exercise or the method of payment of
consideration for such Shares would constitute a violation of any applicable federal or state securities or other law or regulations, or if such issuance would not comply with the requirements of any stock exchange or quotation system upon which the
Shares may then be listed or quoted. As a condition to the exercise of this Option, the Company may require the Optionee to make any representation and warranty to the Company as may be required by any applicable law or regulation. 
  
 4. Non-Transferability of Option. This Option may not be sold,
pledged, assigned, hypothecated, transferred or disposed of in any manner other than by will or by the laws of descent and distribution. The designation of a beneficiary by the Optionee does not constitute a transfer. This Option may be exercised
during the lifetime of the Optionee only by the Optionee. The terms of this Option shall be binding upon the executors, administrators, heirs, successors and assigns of the Optionee. 
  
 5. Term of Option. This Option may not be exercised more than ten years from the date of grant hereof, and may be
exercised during such term only in accordance with the Plan and the terms of this Option. In no event may this Option be exercised after its ten-year term has expired. 
  
 6. Taxation Upon Exercise of Option. Optionee understands that, upon exercise of this Option, he or she will
recognize income for tax purposes in an amount equal to the excess of the then Fair Market Value of the Shares purchased over the exercise price paid for such Shares. If the Optionee is subject to Section 16(b) of the Securities Exchange Act of
1934, as amended, at the time of exercise, under certain limited circumstances the measurement and timing of such income (and the commencement of any capital gain holding period) may be deferred, and the Optionee is advised to contact a tax advisor
concerning the application of Section 83 of the Internal Revenue Code in general and the availability a Section 83(b) election in particular in connection with the exercise of the Option. 

 Upon a resale of such Shares by the Optionee, any difference between the sale price and the Fair Market Value of the
Shares on the date of exercise of the Option, to the extent not included in income as described above, will be treated as capital gain or loss. 
  
 DATE OF GRANT:                     ,
20     
  

			
	 HYTEK MICROSYSTEMS, INC.,

	 a California corporation

		
	 By:
	 	  

	 Title:
	 	  

  
 ACKNOWLEDGEMENT OF OPTION 
  
 Optionee
acknowledges receipt of the Option and a copy of the Plan, which is attached hereto. Optionee represents that he or she is familiar with the terms and provisions thereof and hereby accepts this Option subject to all of the terms and provisions
thereof. Optionee hereby agrees to accept as binding, conclusive and final all decisions or interpretations of the Board upon any questions arising under the Plan. 
  
 Dated:
                    , 20     
  

	
	
 Optionee

  

 EXHIBIT A 
  
 DIRECTOR OPTION EXERCISE NOTICE 
  
 Hytek Microsystems, Inc. 
 400 Hot Springs Road

 Carson City, NV 
  
 Attention: Corporate Secretary 
  
 1. Exercise of Option. The undersigned (“Optionee”) hereby elects to exercise Optionee’s option to purchase
             shares of the Common Stock (the “Shares”) of Hytek Microsystems, Inc. (the “Company”) under and pursuant to the Company’s 2001 Director Stock
Option Plan and the Director’s Nonstatutory Stock Option Agreement dated                     , 20    (the
“Agreement”). 
  
 2. Representations of Optionee.
Optionee acknowledges that Optionee has received, read and understood the Agreement. 
  
 3. Tax Consequences. Optionee understands that Optionee may suffer adverse tax consequences as a result of Optionee’s purchase or disposition of the 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. 
  
 4. Delivery of Payment. Optionee herewith delivers to the Company the aggregate purchase price for the Shares that
Optionee has elected to purchase and has made provision for the payment of any federal or state withholding taxes required to be paid or withheld by the Company. 
  
 5. Entire Agreement. The Agreement is incorporated herein by reference. This Exercise Notice and the Agreement
constitute the entire agreement of the parties and supersede in their entirety all prior undertakings and agreements of the Company and Optionee with respect to the subject matter hereof. This Exercise Notice and the Agreement are governed by
California law except for that body of law pertaining to conflict of laws. 
  

							
	 Submitted by:
	  	 Accepted by:

		
	 OPTIONEE:
	  	 HYTEK MICROSYSTEMS, INC.

				
	 By:
	 	  

	  	 By:
	 	  

	 Address:
	 	 	  	 Its:
	 	  

	  

	  	 	 	 
	  

	  	 	 	 
	 Dated:
	 	  

	  	 Dated:

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