Document:

exv10w3

 

Exhibit 10.3

ADVANCED ENERGY INDUSTRIES, INC.

2003 STOCK OPTION PLAN

STANDARD STOCK OPTION AGREEMENT

     The Optionee described in the accompanying Notice of Option Grant has been awarded an option
to purchase common stock of Advanced Energy Industries, Inc. (“Option”), the terms of which are
contained in:

	 	•  	this Standard Stock Option Agreement (“Agreement”);
	 
	 	•  	the Notice of Option Grant (the “Notice”); and
	 
	 	•  	the Advanced Energy Industries, Inc. 2003 Stock Option Plan (the “Plan”).

     This Agreement is entered into by and between the Optionee and Advanced Energy Industries,
Inc. (“AEI”), as of the Grant Date specified in the Notice.

     1. Defined Terms. Specified in the Notice are the Optionee, the Grant Date (which is the
effective date of this Option), the number of Shares subject to this Agreement, the Exercise Price
per Share and the latest Expiration Date. Other terms used but not defined in this Agreement have
the meanings given to them in the Plan.

     2. Exercisability. Subject to the limitations herein, this Option is exercisable in
installments according to the vesting schedule set forth in the Notice. An installment shall not
become exercisable on the otherwise applicable vesting date for that installment if the Optionee’s
Date of Termination (see Section 4 below) occurs on or before that date. This Option may be
exercised on or after the Date of Termination (if at all) only as to that portion of the Shares as
to which it was exercisable immediately before the Date of Termination. Further vesting of this
Option shall be suspended on and after the 91st day of the Optionee’s approved leave of
absence (unless such suspension is prohibited by law) and will resume (without credit for the
suspension period) if and when the leave of absence terminates before the Optionee’s Date of
Termination.

     3. Termination. This Option shall terminate, and cease to be exercisable, on the close of
business of the last business day that occurs on or before the earliest to occur of:

	 	(i)  	the date the Optionee voluntarily terminates Service before retirement (as
described in (vi) below), is terminated for Cause, or terminates for any other reason
not described below in this section;
	 
	 	(ii)  	the 91st day of a leave of absence, or such later date that the
Optionee’s right to reemployment is no longer guaranteed by law or by agreement with
the Company;
	 
	 	(iii)  	if the Optionee is terminated by the Company involuntarily, 180 days after the
Date of Termination;
	 
	 	(iv)  	if the Optionee terminates Service by reason of disability as defined in Plan
Section 9(c), the period of twenty-four (24) months after the Date of Termination;

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	 	(v)  	if the Optionee terminates Service by reason of the Optionee’s death, the
period of twelve (12) months after the date of death;
	 
	 	(vi)  	if the Optionee retires by terminating after having attained age 60 and having
earned 5 or more years of continuous Service, the 3-year anniversary of the Date of
Termination; and
	 
	 	(vii)  	the expiration date listed in the Notice (or, if earlier, the 10-year
anniversary of the Grant Date).

     This Option may terminate earlier than the date described above in this section in connection
with a Change in Control as provided under Section 10 of the Plan.

     4. Date of Termination. An Optionee’s “Date of Termination” is the first day after
the Grant Date on which the Optionee is no longer in the Service of the Company, regardless of the
reason for such termination. For purposes of this definition, the Optionee’s Service shall not be
considered terminated while the Optionee is on a leave of absence from the Company until the leave
exceeds 90 days or such later date as the Optionee’s right to employment is no longer guaranteed by
statute or contract. If, as a result of a sale or other transaction, (i) the Optionee’s employer
ceases to be an entity within the Company and (ii) the Optionee is not, at the end of the 30-day
period following the transaction, employed by the Company, then the occurrence of such transaction
shall be treated as the Optionee’s Date of Termination caused by the Optionee being discharged by
the Company involuntarily.

     5. Method of Exercise. Subject to its terms, this Option may be exercised in whole or in
part by filing a written notice with AEI’s stock plan administrator at its corporate headquarters
before this Option terminates. Such notice shall specify the number of Shares which the Optionee
elects to purchase and will include payment of the Exercise Price for such Shares. Payment shall
be by cash or personal check payable to Advanced Energy Industries, Inc. In addition to any other
method approved by the Administrator, this Option may be exercised by (i) delivery (or attestation,
if acceptable to the Administrator) of Shares owned by the Optionee having an aggregate Fair Market
Value (valued as of the date of exercise) that is equal to the amount of cash that would otherwise
be required and (ii) authorizing a third party to sell the Shares (or a sufficient portion of the
Shares) acquired upon exercise of this Option and remitting to AEI a sufficient portion of the sale
proceeds to pay the entire Exercise Price and any tax withholding resulting from exercise. This
Option is not exercisable if and to the extent AEI determines that exercise would violate
applicable securities laws or the rules and regulations of any securities exchange on which AEI
stock is traded. If AEI makes such a determination, it shall use all reasonable efforts to obtain
compliance with such laws, rules and regulations. In making any determination hereunder, AEI may
rely on the opinion of its counsel.

Special Rule for Residents of China. A resident of China must pay the Exercise Price
through the immediate sale of Shares acquired upon Option exercise and remitting to the
Company a sufficient portion of the proceeds to pay the aggregate Exercise Price and tax
withholding.

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     6. Withholding. Performance under this Agreement is subject to withholding of all
applicable taxes. Subject to such rules that the Administrator may establish from time to time,
Optionee may elect to satisfy any withholding obligations by surrendering Shares that the Optionee
already owns, or to which the Optionee is otherwise entitled under the Plan. If this Option is
exercised while the Optionee is resident outside the United States, AEI may require settlement of
all applicable tax withholding through the immediate sale of a sufficient number of Shares that
would otherwise be acquired upon Option exercise.

     7. Transferability. Except as provided in Plan Section 6(c), this Option is not
transferable.

     8. Heirs and Successors. This Agreement shall be binding upon, and inure to the benefit
of, AEI and its successors and assigns, and upon any person acquiring, whether by merger,
consolidation, purchase of assets or otherwise, all or substantially all of the Company’s assets
and business. If any rights exercisable by the Optionee under this Agreement have not been
exercised at the time of the Optionee’s death, such rights shall be exercisable in accordance with
Section 9(e) of the Plan.

     9. Administration. The Administrator shall control the operation and administration of
this Option, and the Administrator shall have all powers with respect to this Agreement as it has
with respect to the Plan. Any interpretation of the Agreement by the Administrator and any
decision made by it with respect to the Agreement is final and binding on all persons.

     10. Plan Governs. Notwithstanding anything in this Agreement to the contrary, the terms of
this Agreement shall be subject to the terms of the Plan, a copy of which may be obtained by the
Optionee from AEI’s stock plan administrator; and this Agreement is subject to all interpretations,
amendments, rules and regulations promulgated by the Administrator from time to time pursuant to
the Plan.

     11. Not An Employment Contract. This Option does not confer on the Optionee any right with
respect to continuance of employment or other service with the Company, nor will it interfere in
any way with any right the Company would otherwise have to terminate or modify the terms of such
Optionee’s employment or other service at any time.

     12. Notices. Any written notices provided for in this Agreement or the Plan shall be in
writing and shall be deemed sufficiently given if either hand delivered or if sent by fax or
overnight courier, or by postage paid first class mail. Notices sent by mail shall be deemed
received three business days after mailing but in no event later than the date of actual receipt.
Notices shall be directed, if to the Optionee, at the Optionee’s address indicated by AEI’s
records, or if to AEI, to AEI’s stock plan administrator at its principal executive office.

     13. Fractional Shares. No exercise shall be allowed with respect to a fraction of a Share.
Should only a fraction of one Share remain vested but unexercised when the last exercise under
this Option is made, AEI shall pay to the Optionee an amount equal to the Fair Market Value of such
fractional Share.

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     14. No Rights As Stockholder. The Optionee shall have no rights of a stockholder with
respect to the Shares subject to this Option, until a stock certificate has been duly issued
following exercise of this Option as provided herein.

     15. Amendment. This Agreement may be amended by written agreement of the Optionee and the
Administrator, without the consent of any other person.

     16. Acknowledgements. Optionee acknowledges receipt of and understands and agrees to the
terms of this Option. Optionee also understands and agrees to the following:

	 	(a)  	As of the Grant Date, this Agreement, the Notice and the Plan set forth the
entire understanding between Optionee and the Company regarding the acquisition of
Shares and supersedes all prior oral and written agreements pertaining to this Option.
	 
	 	(b)  	In order to perform its duties under the Plan, the Company may process
sensitive personal data about Optionee that is not limited to the information provided
above, any changes thereto and other appropriate personal and financial data about
Optionee. Optionee hereby gives explicit consent to the Company to process any such
personal data and/or sensitive personal data. Optionee also hereby gives explicit
consent to the Company to transfer any such personal data and/or sensitive personal
data outside the country in which Optionee is employed, and to the United States. The
legal persons for whom such personal data are intended are Advanced Energy Industries,
Inc. and [INSERT BROKER NAME]. Optionee has been informed of his or her right of
access and correction to his or her personal data by applying to [INSERT NAME OF LOCAL
ADMINISTRATOR].
	 
	 	(c)  	Optionee understands that AEI has reserved the right to amend or terminate the
Plan at any time, and that the grant of an option under the Plan at one time does not
in any way obligate AEI to grant additional options at any future time in any amount.
Optionee acknowledges and understands that the grant of this Option and any future
options granted under the Plan is wholly discretionary in nature and is not to be
considered part of any normal or expected compensation that is or would be subject to
severance, resignation, redundancy or similar pay, other than to the extent required by
local law.

     17. Immediate Sale of Shares for Residents of China. Upon the exercise of this Option, an
Optionee who is a resident of China shall authorize and direct the broker to immediately sell any
and all Shares that otherwise would have been delivered, net of applicable taxes and exercise
consideration due AEI. This Agreement shall serve as such Optionee’s express authorization to sell
immediately any and all Shares acquired upon the exercise of this Option. As soon as reasonably
practical, Optionee shall be entitled to payment of the proceeds resulting from such disposition,
net of the applicable tax withholding and exercise consideration due to the Company.

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     By executing this Agreement, Optionee agrees to the foregoing and acknowledges having received
a copy of the separate Plan and Notice, both of which contain important terms.

	 	 	 
	OPTIONEE	 	
ADVANCED ENERGY INDUSTRIES, INC.
		 	 
	 	 	
By: _________________________________
	Print Name: ________________________	 	
Title: Chief Financial Officer, Executive Vice

           President of Finance & Administration

 

 

 

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                                                                   EXHIBIT 10.66

                              ESS TECHNOLOGY, INC.

                              AMENDED AND RESTATED
                             STOCK OPTION AGREEMENT

      1.    OPTION. This Amended and Restated Stock Option Agreement sets forth
the terms applicable to the option (the "Option") previously granted by ESS
Technology, Inc., a California corporation (the "Company"), to the optionee (the
"Optionee") named in the Notice of Grant of Stock Options and Option Agreement
(the "Notice") on the date set forth therein. This option provides the Optionee
the right to purchase the total number of shares of common stock of the Company
set forth in the Notice (the "Shares") at the exercise price per Share set forth
in the Notice (the "Exercise Price") subject to the terms and conditions of the
Notice, this Agreement and the plan identified in the Notice (the ESS
Technology, Inc. 1997 Equity Incentive Plan or the ESS Technology, Inc. 1995
Equity Incentive Plan, the "Plan"), which Plan is incorporated in this Agreement
by reference. Unless otherwise defined in this Agreement, the terms used in this
Agreement shall have the meanings defined in the Plan.

      2.    DESIGNATION OF OPTION. This Option is intended to be a nonstatutory
stock option.

      3.    EXERCISE OF OPTION. This Option shall be exercisable during its term
in accordance with the vesting schedule set out in the Notice and with the
applicable provisions of the Plan as follows:

            (a)   RIGHT TO EXERCISE.

                  (i)   This Option may not be exercised for a fraction of a
share.

                  (ii)  In the event of Optionee's death, disability or other
termination of service, the exercisability of the Option is governed by Section
5 below, subject to the limitations contained in this Section 3.

                  (iii) In no event may this Option be exercised after the
Expiration Date of the Option as set forth in the Notice.

            (b)   METHOD OF EXERCISE.

                  (i)   This Option shall be exercisable by delivering to the
Company a written notice of exercise (in the form attached hereto as Exhibit A
or in any other form of notice approved by the Committee) which shall state
Optionee's election to exercise the Option, the number of Shares in respect of
which the Option is being exercised, and such other representations and
agreements as to the holder's investment intent with respect to such Shares as
may be required by the Company pursuant to the provisions of the Plan. Such
written notice shall be signed by Optionee and shall be delivered to the Company
by such means as are determined by the Committee in its discretion to constitute
adequate delivery. The written notice shall be accompanied by payment of the
Exercise Price. This Option shall be deemed to be

<PAGE>

exercised upon receipt by the Company of such written notice accompanied by the
Exercise Price.

                  (ii)  As a condition to the exercise of this Option, Optionee
agrees to make adequate provision for federal, state or other tax withholding
obligations, if any, which arise upon the vesting or exercise of the Option, or
disposition of Shares, whether by withholding, direct payment to the Company, or
otherwise.

                  (iii) The Company is not obligated, and will have no liability
for failure, to issue or deliver any Shares upon exercise of the Option unless
such issuance or delivery would comply with the Applicable Laws, with such
compliance determined by the Company in consultation with its legal counsel.
This Option may not be exercised until such time as the Plan has been approved
by the stockholders of the Company, or if the issuance of such 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 regulation, including any rule under Part 221 of Title 12 of the Code of
Federal Regulations as promulgated by the Federal Reserve Board. As a condition
to the exercise of this Option, the Company may require Optionee to make any
representation and warranty to the Company as may be required by the Applicable
Laws. Assuming such compliance, for income tax purposes the Shares shall be
considered transferred to Optionee on the date on which the Option is exercised
with respect to such Shares.

      4.    METHOD OF PAYMENT. Payment of the Exercise Price shall be by any of
the following, or a combination of the following, at the election of Optionee:

            (a)   cash or check; or

            (b)   delivery of a properly executed exercise notice together with
irrevocable instructions to a broker approved by the Company to deliver promptly
to the Company the amount of sale or loan proceeds required to pay the exercise
price; or

            (c)   surrender of other shares of common stock of the Company that:

                  (i)   either have been owned by Optionee for more than six (6)
      months on the date of surrender or were not acquired, directly or
      indirectly, from the Company, and

                  (ii)  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.

      5.    TERMINATION OF RELATIONSHIP. In the event of the termination of
Optionee's Continuous Service Status for any reason (the date of such
termination is referred to herein as the "Termination Date") or the death of
Optionee within three months after Optionee's Termination Date, Optionee (or, in
the case of Optionee's death, Optionee's estate or any person who acquired the
right to exercise the Option by bequest or inheritance), may, but only within 3
years of the Termination Date, exercise this Option to the extent Optionee was
entitled to exercise it as of the Termination Date. To the extent that Optionee
is not entitled to exercise this Option as of the Termination Date, or if
Optionee does not exercise this Option within the time specified herein,

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<PAGE>

the Option shall terminate. Notwithstanding anything stated herein to the
contrary, in no event may the Option be exercised after the Expiration Date of
the Option as set forth in the Notice.

      6.    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 him or her. The terms
of this Option shall be binding upon the executors, administrators, heirs,
successors and assigns of Optionee.

      7.    EFFECT OF AGREEMENT. Optionee acknowledges receipt of a copy of the
Plan, the Notice and this Agreement and represents that he or she is familiar
with the terms and provisions thereof (and has had an opportunity to consult
counsel regarding the Option terms), and hereby accepts this Option and agrees
to be bound by its contractual terms as set forth herein and in the Notice and
the Plan. Optionee hereby agrees to accept as binding, conclusive and final all
decisions and interpretations of the Committee regarding any questions relating
to the Option. In the event of a conflict between the terms and provisions of
the Plan and the terms and provisions of the Notice and this Agreement, the Plan
terms and provisions shall prevail. The Option, including the Plan and the
Notice, constitutes the entire agreement between Optionee and the Company on the
subject matter hereof and supersedes all proposals, written or oral, and all
other communications between the parties relating to such subject matter.

      8.    NO ADDITIONAL EMPLOYMENT RIGHTS. Optionee understands and agrees
that the vesting of Shares pursuant to the vesting schedule is earned only by
continuing as an employee or consultant at the will of the Company or, to the
extent applicable, its Parent, Subsidiary or Affiliate (not through the act of
being hired, being granted this Option or acquiring Shares under this
Agreement). Optionee further acknowledges and agrees that nothing in this
Agreement, nor in the Plan which is incorporated in this Agreement by reference,
shall confer upon Optionee any right with respect to continuation as an employee
or consultant with the Company, its Parent, Subsidiaries or Affiliates, nor
shall it interfere in any way with his or her right or the Company's (or the
Parents, Subsidiaries, or Affiliates) right to terminate his or her employment
or consulting relationship at any time, with or without cause.

      9.    DEFINITIONS.

            (a)   "Applicable Laws" means all applicable laws, rules and
      regulations, including, but not limited to, U.S. state corporate laws,
      U.S. federal and applicable state securities laws, the Internal Revenue
      Code of 1986, as amended, any Stock Exchange rules or regulations and the
      applicable laws of any other country or jurisdiction where awards are
      granted under the Plan or where Plan participants reside or provide
      services to the Company or any Parent, Subsidiary or Affiliate, as such
      laws, rules, regulations and requirements shall be in place from time to
      time.

            (b)   "Continuous Service Status" means the absence of any
      interruption or termination of service as an employee or consultant.
      Continuous Service Status as an employee or consultant shall not be
      considered interrupted in the case of: (i) sick leave; (ii) military
      leave; (iii) any other leave of absence approved by the Committee,
      provided that such leave is for a period of not more than ninety days,
      unless reemployment upon

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<PAGE>

      the expiration of such leave is guaranteed by contract or statute, or
      unless provided otherwise pursuant to Company policy adopted from time to
      time; or (iv) in the case of transfers between locations of the Company or
      between the Company, its Parents, Subsidiaries, Affiliates or their
      respective successors. A change in status from an employee to a consultant
      or from a consultant to an employee will not constitute an interruption of
      Continuous Service Status.

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<PAGE>

                                    EXHIBIT A

                               NOTICE OF EXERCISE

To:         ESS Technology, Inc.
Attn:       Stock Option Administrator
Subject:    Notice of Intention to Exercise Stock Option

      This is official notice that the undersigned ("Optionee") intends to
exercise Optionee's option (Option Number _________) to purchase
___________________ shares of ESS Technology, Inc. common stock, under and
pursuant to the Notice of Grant of Stock Options and Option Agreement ("Notice")
dated ______________________, the plan identified in the Notice, and the Amended
and Restated Stock Option Agreement, as follows:

            Grant Number:      _______________________________________

            Date of Purchase:  _______________________________________

            Number of Shares:  _______________________________________

            Purchase Price:    _______________________________________

            Method of Payment
            of Purchase Price: _______________________________________

      The shares should be issued as follows:

            Name:     _______________________________________

            Address:  _______________________________________

                      _______________________________________

                      _______________________________________

            Signed:   _______________________________________

            Date:     _______________________________________

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