Document:

Key Employee Special Stock Based Incentive Program

 
EXHIBIT 10.14

 
PLAN DOCUMENT 
 
Key Employee 
 
Special Stock Based Incentive Program 
 
Fiscal Year 2004 
 
 
 
Contents 
 

	  	 A.	  	 Purpose 

 

	  	 B.	  	 Effective Date 

 

	  	 C.	  	 Plan Changes 

 

	  	 D.	  	 Plan Administration 

 

	  	 E.	  	 Participation 

 

	  	 F.	  	 Overall Plan Concepts and Definitions 

 

	  	 G.	  	 Example 

 

	  	 H.	  	 Procedure 

 

	  	 I.	  	 Interpretation Of Plan Terms 

 
 
 
Attachment:  Letter Acknowledging Participation 

 

	 A.	  	 Purpose 

 
The purpose of the Key Employee Special Stock Based Incentive Program for Fiscal Year 2004 is to encourage and reward performance which contributes
to the company’s success. Stock option incentives which complement base salary will be awarded to participants in the plan. 
 

	 B.	  	 Effective Date 

 
The period April 1, 2003 through March 31, 2004 is considered the “Plan Year”. 
 

	 C.	  	 Plan Changes 

 
The Company, at its sole discretion through the Board of Directors, may amend, alter, or cancel this Key Employee Special Stock Based Incentive
Program at any time. 
 

	 D.	  	 Plan Administration 

 
The Key Employee Special Stock Based Incentive Program will be administered by the Plan Committee consisting of the President/CEO and the Executive
Vice President/CFO with the staff support of the Human Resources Director. The role of the Plan Committee is to interpret the provisions and intent of the plan, evaluate and determine eligibility, amend and modify the plan administration, and
communicate the Plan provisions to participants, as necessary. The President/CEO will approve the final recommendations to be submitted for Board of Directors’ approval. 
 

	 E.	  	 Participation 

 
Eligibility in this stock incentive plan is determined by the recommendations of senior management and the approval of the President/CEO and the
Board of Directors. 
 

	  	 1.	  	 New Hires 

 

	  	 (a)	  	 Employees were hired after the beginning of the plan year who are approved as participants will have prorated stock option awards, and the grant date will be the date of
hire, and the option price will be the lower of the fair market value or the close, on that date. 

 

	  	 (b)	  	 Employees hired in the final quarter of the plan year (January 1 through March 31, 2004) are not eligible to participate for that plan year. 

 

	  	 2.	  	 This is a plan especially designed for FY2004. Participants in previous year(s) are not automatically included in subsequent years. A number of factors may change from year
to year, such as: business conditions, individual employee contribution, criticality of certain positions, etc. 

 

	  	 3.	  	 Inclusion in the plan does not constitute a guarantee of employment, or specific award of future stock options. 

 

	 F.	  	 Overall Plan Concepts and Definitions 

 

	  	 1.	  	 Base Salary: employee’s annual base salary. 

 

	  	 2.	  	 Target Cash Incentive: a percentage of the employee’s annual base salary used to calculate the stock option award, as determined by senior management.

 

	  	 3.	  	 Stock Option Award: the number of options awarded will be calculated based on the employee’s Target Cash Incentive (see paragraph G), divided by $20.00. The options
granted are “non-qualified” and therefore subject to applicable taxes at time of exercise. 

 

	  	 4.	  	 Stock Option Price: $12.32 per share (closing price of Exar stock as of December 5, 2001) 

 

	  	 5.	  	 Option Grant Date: December 5, 2002 

 

	  	 6.	  	 Vesting Schedule: stock options granted for this Incentive Plan will vest in equal amounts over a twelve month period beginning April 5, 2003 and ending March 5, 2004.

 

	  	 7.	  	 Expiration of Grant: seven (7) years from the date of grant, or three (3) months from the employee’s date of termination, whichever is sooner.

 

	 G.	  	 Example: 

 

	  Employee annual base salary
	   	  $104,000

	  Target Cash Incentive @15%
	   	  15,600

	  Possible gain estimate
	   	  20.00

	
	  Stock Option Award (divided by $20 gain/share)
	   	  

 

	  $15,600

	  	  =
	  	  780 options

	  $20
	  	  	  	  

 

	 H.	  	 Procedure 

 
The employees selected for inclusion in this Key Employee Special Stock Based Incentive Program will be notified in writing and provided a copy of
the Plan. Any changes in the plan or the measurement criteria must be approved in writing by the President/CEO and the Board of Directors. 
 
Participants are eligible to exercise their options at any time once they are vested. Designated insiders have different requirements for
exercising. 
 

	 I.	  	 Interpretation of Plan Terms 

 
The Plan Committee, with the approval of the Board of Directors, is responsible for the interpretation of this plan. Any resolution or dispute
regarding eligibility, determination of procedures, measurements, or awards is the sole responsibility of the Plan Committee with Board of Directors’ approval. 

 
Attachment 
 
I acknowledge receiving a copy of the Plan “Key Employee Special Stock Based
Incentive Program” for the period April 1, 2003 through March 31, 2004. I have read and understand the terms of this Plan, and also understand that this plan neither constitutes a contract of employment nor a representation as to my future
earnings or award of stock options. The Letter of Notification and the Plan constitute the entire agreement and supersede any prior written and oral agreements. Further, I understand that the Plan Committee and the Board of Directors have the sole
discretionary authority for interpreting the provisions of the plan and determining eligibility. 
 

	
	       

	  Employee Name (PLEASE PRINT)

	
	       

	  Employee Signature

	
	       

	  DateExecutive Special Stock Based Incentive Program

 
EXHIBIT 10.15

 
PLAN DOCUMENT 
 
Executive 
 
Special Stock Based Incentive Program 
 
Fiscal Year 2004 
 
 
 
Contents 
 

	  	 A.	  	 Purpose 

 

	  	 B.	  	 Management Participation Qualifications 

 

	  	 C.	  	 Plan Changes 

 

	  	 D.	  	 Rules 

 

	  	 E.	  	 Overall Plan Concepts and Definitions 

 

	  	 F.	  	 Example 

 

	  	 G.	  	 Procedure 

 
 
 
Attachment:  Letter Acknowledging Participation

 

 

	 A.	  	 Purpose 

 
The purpose of the Executive Special Stock Based Incentive Program for Fiscal Year 2004 is to encourage and reward performance which contributes to
the company’s growth and success. Stock option incentives which complement base salary will be awarded to eligible Exar executives. 
 

	 B.	  	 Management Participant Qualifications 

 

	  	 1.	  	 Direct participation is limited to a small group of executives who have a major influence on the operation, profits, and future of Exar. 

 

	  	 2.	  	 Participation shall be recommended by the President/CEO and is subject to approvals by the Compensation and Stock Option Committees of the Board of Directors.

 

	  	 3.	  	 An invitation to participate and the information divulged in connection with the program must be considered private and not be discussed with others.

 

	 C.	  	 Plan Changes 

 
As business conditions, participants’ positions, or the corporation’s needs change, the Compensation and Stock Option Committees reserve
the right to modify or cancel at any time this Incentive Program, with prior notice, and participants should not presume continued participation in an Incentive Program. 
 

	 D.	  	 Rules 

 

	  	 1.	  	 This is a plan especially designed for FY2004. Participants in previous year(s) are not automatically included in subsequent years. A number of factors may change from year
to year, such as: business conditions, individual employee contribution, criticality of certain positions, etc. 

 

	  	 2.	  	 The President/CEO will make stock option recommendations for all participants, other than self, to be submitted to the Compensation and Stock Option Committees for final
approval. 

 

	  	 3.	  	 The Stock Option and Compensation Committees will have final authority and determination for the number of incentive stock options awarded under the terms of this Plan,
including to the President/CEO. 

 

	  	 4.	  	 Inclusion in the plan does not constitute a guarantee of employment, or specific award of future stock options. 

 

	 E.	  	 Overall Plan Concepts and Definitions 

 

	  	 1.	  	 Base Salary: current annual base salary. 

 

	  	 2.	  	 Target Cash Incentive: a percentage of the annual base salary used to calculate the stock option award, as determined by the Compensation Committee.

 

	  	 3.	  	 Stock Option Award: the basis for the number of options awarded will be calculated using the employee’s Target Cash Incentive, divided by an estimated gain per
share of $20. The final number of stock options awarded may be adjusted at the discretion of the President/CEO and with the approval of the Stock Option and Compensation Committees of the Board of Directors. Options granted are
“non-qualified” and therefore subject to applicable taxes at the time of exercise. 

 

	  	 4.	  	 Stock Option Price: $12.32 per share (closing price of Exar stock as of December 5, 2002) 

 

	  	 5.	  	 Option Grant Date: December 5, 2002 

 

	  	 6.	  	 Vesting Schedule: stock options granted for this Incentive Plan will vest in equal amounts over a twelve month period beginning April 5, 2003 and ending March 5, 2004.

 

	  	 7.	  	 Expiration of Grant: seven (7) years from the date of grant, or three (3) months from the participant’s date of termination, whichever is sooner.

 

	 F.	  	 Example: 

 

	  Employee annual base salary
	   	  $200,000

	  Target Cash Incentive @ 35%
	   	  $70,000

	  Estimated gain per share
	   	  $20

	
	  Stock Option Award:
	   	  

 

	  $70,000

	  	  =
	  	  3,500 options (may be modified by Board of Directors)

	  $20
	  	  	  	  

 

	 G.	  	 Procedure 

 
The employees selected for inclusion in the Executive Special Stock Based Incentive Program will be notified in writing and provided a copy of the
Plan. Any changes in the plan or the measurement criteria must be approved in writing by the Stock Option and Compensation Committees. 
 
Participants are eligible to exercise their options at any time once they are vested, subject to Insider Trader rules. 

 
Attachment 
 
I acknowledge receiving a copy of the Plan “Executive Special Stock Based Incentive
Program” for the period April 1, 2003 through March 31, 2004. I have read and understand the terms of this Plan, and also understand that this plan neither constitutes a contract of employment nor a representation as to my future earnings or
award of stock options. The Letter of Notification and the Plan constitute the entire agreement and supersede any prior written and oral agreements. Further, I understand that the Compensation and Stock Option Committees of the Board of Directors
have the sole discretionary authority for interpreting the provisions of the plan and determining eligibility. 
 

	
	       

	  Employee Name (PLEASE PRINT)

	
	       

	  Employee Signature

	
	       

	  Date

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