Document:

Exhibit 10.2

Exhibit 10.2

RF MICRO DEVICES, INC.

DIRECTOR COMPENSATION PLAN

(As Amended and Restated Effective August 16, 2012)

    

RF MICRO DEVICES, INC.
DIRECTOR COMPENSATION PLAN
(As Amended and Restated Effective August 16, 2012)

1.Purpose.
The purpose of the RF Micro Devices, Inc. Director Compensation Plan (the “Plan”) is to formally establish and document the terms of cash and equity compensation payable to non-employee members of the Board of Directors (the “Board” or the “Board of Directors”) of RF Micro Devices, Inc., a North Carolina corporation (the “Company”).
2.    Eligibility.  
Each member of the Board who is not an employee of the Company or any of its subsidiaries (each, a “Director”) is eligible to receive compensation for services as a director under the Plan.
3.    Administration.  
The Plan shall be administered by the Board unless the Board delegates all or part of its authority to administer the Plan to the Compensation Committee (the “Committee”) in a manner that is consistent with the Company’s Corporate Governance Guidelines, the Compensation Committee charter and applicable laws, rules and regulations (“Applicable Law”).  Unless the Board determines otherwise, the Committee shall be comprised solely of two or more “non-employee directors,” as such term is defined in Rule 16b-3 under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or as may otherwise be permitted under Rule 16b-3.  In addition, Committee members shall qualify as “independent directors” under applicable stock exchange rules if and to the extent required.  For the purposes of the Plan, the term “Administrator” shall refer to the Board, and upon its delegation to the Committee of authority to administer the Plan, the Committee.  The Administrator may also delegate to one or more officers or employees of the Company the authority to manage the record-keeping and other routine administrative duties under the Plan. 
4.    Payment of Annual Fees.  
The Board, after due consideration of any recommendation from the Committee, shall establish the annual retainer fees, committee chair fees and any additional cash fees to be paid to Directors for any Plan year (“Plan Year”).  Such fees shall be referred to herein as the “Annual Fees.”  A Plan Year shall coincide with the Company’s fiscal year unless the Board determines otherwise.  Annual Fees shall be paid in cash quarterly on, or as close as practicable to, the first business day following the end of the fiscal quarter during which the Annual Fees were earned.  Quarterly payments of Annual Fees shall be pro rated if a Director’s service on the Board terminates or commences during a fiscal quarter.  The Board may modify the Annual Fees, or any component of such fees, at any time and from time to time, as reflected in an amendment to the Plan, by Board resolution or by other means.  In addition, the Board may at any time and from time to time authorize the payment of additional fees for service on the Board (for instance, due to service on a special committee or for other extra service). 
5.    Terms of Initial Equity Awards and Annual Equity Awards. 

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(a)    Types of Equity Awards; Applicable Stock Plans.  
(i)    Each Director may be eligible to receive equity awards (“Equity Awards”) for shares of the Company’s common stock (the “Common Stock”) in the form of nonqualified stock options (“Options”) and/or restricted stock units (“RSUs”) as provided in the Plan and subject to the terms of the Company’s 2012 Stock Incentive Plan (the “2012 Plan”), the 2006 Directors Stock Option Plan (As Amended and Restated Effective May 7, 2009) (the “2006 Plan”), the 2003 Stock Incentive Plan, as amended through June 11, 2010 (the “2003 Plan”), and/or other applicable stock plan (each of the 2012 Plan, the 2003 Plan, the 2006 Plan and any other applicable stock plan(s) being also referred to herein as a “Stock Plan”).  The terms of such Equity Awards shall be governed by the Plan, the applicable Stock Plan under which the Equity Award is granted and the related individual award agreement.  An initial Equity Award (“Initial Award”) may be in the form of an initial stock option (an “Initial Option”) and/or an initial restricted stock unit award (an “Initial RSU”).  An annual Equity Award (“Annual Award”) may be in the form of an annual stock option (an “Annual Option”) and/or an annual restricted stock unit award (an “Annual RSU”).
(ii)    For the purposes of the Plan, (A) Options shall be granted under the 2006 Plan prior to August 19, 2012, and under the 2012 Plan on and after August 20, 2012; and (B) RSUs shall be granted under the 2003 Plan prior to August 19, 2012, and under the 2012 Plan on and after August 20, 2012.  Shares of Common Stock subject to Equity Awards shall only be issued under the applicable Stock Plan, and no shares shall be issued under this Plan. 
(b)    Amount of Equity Awards.  The Board, after due consideration of any recommendation from the Committee, shall establish the initial and annual amount or value of compensation to be paid to Directors for their service on the Board or any committee thereof or otherwise in the form of Equity Awards for shares of the Company’s Common Stock for any Plan Year.  The “Total Value” of an Equity Award shall be the total dollar value assigned to the Equity Award pursuant to the terms of the Plan.  The number of shares of Common Stock subject to an Equity Award shall be equal to that number that results by dividing the Total Value of such Equity Award by (i) the Black-Scholes value (as defined below) (in the case of Options) or (ii) the fair market value (as determined in accordance with the applicable Stock Plan, the “Fair Market Value”) of the Common Stock (in the case of RSUs), or similar methodology, as determined on or as close in time as practicable to the grant date of an Equity Award (the “Grant Date”) and in accordance with the terms of the Plan and applicable Stock Plan.  For the purposes herein, the “Black-Scholes value” shall be the value as used for compensation expense valuation purposes in the Company’s financial statements.  As of August 16, 2012, the Total Value of an Initial Award shall be $225,000.  As of August 16, 2012, the Total Value of an Annual Award shall be $150,000 for all Directors other than the Chairman of the Board, and $180,000 for the Chairman.  The Board, after due consideration of any recommendation from the Committee, may in the exercise of its discretion at any time and from time to time, modify the Total Value of an Initial Award or the Total Value of an Annual Award, otherwise modify, supplement or discontinue prospectively any Initial Award or Annual Award or provide for an additional Equity Award for service on the Board (for instance, due to service on a special committee or for other extra service), as reflected in an amendment to the Plan, by Board resolution or by other means.
(c)    Grant of Initial Options and Annual Options.  Unless a Director makes an election to receive Initial RSUs or Annual RSUs as provided in Section 5(d) or Section 5(g) herein, each eligible Director shall be granted Initial Options or Annual Options as provided herein and under the applicable Stock Plan.  If a Director makes a timely election to receive 50% of the Total Value of an Equity Award in the form of an Initial RSU, the remaining 50% of the Total Value of such Equity Award shall be in the form of an Initial Option, which shall be subject to all of the other terms applicable to Initial Options under the Plan and the 

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applicable Stock Plan.  If a Director makes a timely election to receive 50% of the Total Value of an Equity Award in the form of an Annual RSU, the remaining 50% of the Total Value of such Equity Award shall be in the form of an Annual Option, which shall be subject to all the other terms applicable to Annual Options under the Plan and the applicable Stock Plan  If a Director makes a timely election to receive all of his Initial Award in the form of an Initial RSU, he will not also be granted an Initial Option.  If a Director makes a timely election to receive all of his Annual Award in the form of an Annual RSU, he will not also be granted an Annual Option. 
(d)    Elections Related to Initial Equity Awards; Grant of Initial Awards.  Each Director who is first elected or appointed to the Board shall receive an Initial Option for such number of shares of Common Stock as shall have a Total Value equal to the Total Value of the Initial Award unless he makes a timely election to receive an Initial RSU with respect to all or 50% of the Total Value of the Initial Award.  Such election must be in writing and must be made within such time period as may be determined by the Administrator prior to the Grant Date of the Initial Option, and such election shall (unless the Administrator determines otherwise) be irrevocable by the Director.  If a Director makes a proper election to receive an Initial RSU in lieu of the grant of all of the Initial Option, the Director shall not also be granted an Initial Option.  If a Director makes a proper election to receive an Initial RSU with respect to 50% of the Total Value an Initial Award, the Director shall receive an Initial Option for such number of shares of Common Stock as is determined by dividing fifty percent (50%) of the Total Value of the Initial Award by the Black-Scholes value of the Option, and an Initial RSU for such number of shares of Common Stock as is determined by dividing the remaining fifty percent (50%) of the Total Value of the Initial Award by the Fair Market Value of the Common Stock as determined in each case on or as close in time as practicable to the Grant Date.  Such Initial Option shall be subject to all of the other terms applicable to Initial Options as provided in the Plan and applicable Stock Plan, except for the reduction in the number of shares subject to the Option.  If the Director elects to receive all of his Initial Award in the form of an Initial RSU, the number of shares subject to the Initial RSU will be equal to the Total Value of the Initial Award divided by the Fair Market Value of the Common Stock as determined on or as close in time as practicable to the Grant Date.  The Total Value of a Director’s Initial RSU plus the Total Value of the Director’s Initial Option shall be as close as practicable to, but may not exceed, the Total Value of the Initial Award.
(e)    Terms of Initial Options.  An Initial Option shall be granted under, and subject to the terms of, the applicable Stock Plan and related option agreement.  Without limiting the foregoing, unless the Administrator determines otherwise, the following terms shall apply:
(i)    The Grant Date shall be the fifth business day after the date of the annual meeting of shareholders as to those Directors who are first elected at an annual meeting of shareholders and the fifth business day after the date of election or appointment to the Board as to those Directors who are first elected or appointed to the Board other than at an annual meeting of shareholders.  The term of an Initial Option (the “Option Period”) shall be 10 years from the Grant Date.  The price per share of Common Stock at which an Initial Option may be exercised (the “Option Price”) shall be 100% of the Fair Market Value  per share of the Common Stock on the Grant Date.
(ii)    An Initial Option shall vest with respect to one-third of the shares subject to the Initial Option on the Grant Date and shall vest with respect to the remaining two thirds of the shares subject to the Initial Option in two equal annual installments on each of the first and second anniversaries of the Grant Date, so that the Initial Option will be vested in full on the second anniversary of the Grant Date, provided that the Director remains in service on the Board on each such vesting date.  An Initial Option shall vest in full upon a change of control (as defined under the 

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applicable Stock Plan, a “Change of Control”) of the Company if and to the extent provided under the applicable Stock Plan and related award agreement.
(iii)    In the event that a Director terminates service as a member of the Board, (A) any Initial Option may be exercised only to the extent vested and exercisable on the date of the Director’s termination of service on the Board (the “Termination Date”) (unless the termination was for “Cause,” as defined in the applicable Stock Plan), and must be exercised, if at all, prior to the close of the Option Period, and (B) any Initial Option (or portion thereof) which has not vested and become exercisable as of the Director’s Termination Date shall terminate as of the Director’s Termination Date.  If the services of a Director are terminated for Cause, his Initial Option (whether vested or unvested) shall lapse and no longer be exercisable as of his Termination Date. 
(f)    Terms of Initial RSUs.  An Initial RSU shall be granted under, and subject to the terms of, the applicable Stock Plan and related RSU award agreement.  Without limiting the foregoing, unless the Administrator determines otherwise, the following terms shall apply:
(i)    The Grant Date of an Initial RSU shall be the fifth business day after the date of the annual meeting of shareholders as to those Directors who are first elected at an annual meeting of shareholders and the fifth business day after the date of election or appointment to the Board as to those Directors who are first elected or appointed to the Board other than at an annual meeting of shareholders.
(ii)    An Initial RSU shall vest with respect to one-third of the shares subject to the Initial RSU on the Grant Date and shall vest with respect to the remaining two thirds of the shares subject to the Initial RSU in two equal annual installments on each of the first and second anniversaries of the Grant Date, so that the Initial RSU will be vested in full on the second anniversary of the Grant Date, provided that the Director remains in service on the Board on each such vesting date.  An Initial RSU shall vest in full upon a Change of Control of the Company if and to the extent provided in the applicable Stock Plan and related award agreement.
(iii)    Unless the Administrator determines otherwise, if the Director’s service as a member of the Board is terminated for any reason and all or part of his Initial RSU has not vested, the Initial RSU, to the extent not then vested, shall be forfeited immediately upon such termination and the Director shall have no further rights with respect thereto. 
(g)    Elections Related to Annual Equity Grants; Grant of Annual Awards.
(i)    Each Director shall, provided that he continues to serve as a member of the Board on the Grant Date, receive an Annual Option for the Total Value of the Annual Award applicable to such Director unless he makes a timely election to receive an Annual RSU with respect to all or 50% of the Total Value of the Annual Award.  Such election must be in writing and must be made within such time period as may be determined by the Administrator prior to the Grant Date of the Annual Option, and such election shall (unless the Administrator determines otherwise) be irrevocable by the Director.  However, notwithstanding the foregoing, with respect to a new Director who is appointed or elected other than at an annual meeting of shareholders, the number of shares subject to the first Annual Option to be granted to such Director shall be reduced by 25% for each three-month period (or portion thereof) that the Director is not in office since the most recent annual meeting of shareholders held prior to such Director’s election or appointment.  Further, a Director elected for the first time to the Board at an annual meeting of shareholders shall only receive an 

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Initial Option in connection with such election, and shall not also receive an Annual Option on the fifth business day following such meeting.  
(ii)    If a Director makes a proper election to receive an Annual RSU with respect to all of the Total Value of an Annual Award, he shall not also be granted an Annual Option for that year.  If a Director makes a proper election to receive an Annual RSU with respect to 50% of the Total Value of an Annual Award, the Director shall receive an Annual Option for such number of shares of Common Stock as is determined by dividing fifty percent (50%) of the Total Value of the Annual Award by the Black-Scholes value of the Option, and an Annual RSU for such number of shares of Common Stock as is determined by dividing the remaining fifty percent (50%) of the Total Value of the Annual Award by the Fair Market Value of the Common Stock, as determined in each case on or as close in time as practicable to the Grant Date.  Such Annual Option shall be subject to all of the other terms applicable to Annual Options as provided in the Plan and applicable Stock Plan, except for the reduction in the number of shares subject to the Option.  If the Director elects to receive all of his Annual Award in the form of an Annual RSU, the number of shares subject to the Annual RSU will be equal to the Total Value of the Annual Award divided by the Fair Market Value of the Common Stock as determined on or as close in time as practicable to the Grant Date. The Total Value of a Director’s Annual RSU plus the Total Value of the Director’s Annual Option shall be as close as practicable to, but may not exceed, the Total Value of the Annual Award.
(h)    Terms of Annual Options.  An Annual Option shall be granted under, and subject to the terms of, the applicable Stock Plan and related option agreement.  Without limiting the foregoing, unless the Administrator determines otherwise, the following terms shall apply:
(i)    The Grant Date shall be the date the fifth business day after the date of the annual or other shareholders meeting at which the Director is elected.  The Option Period of an Annual Option shall be 10 years from the Grant Date.  The Option Price of an Annual Option shall be 100% of the Fair Market Value per share of the Common Stock on the Grant Date.
(ii)    An Annual Option shall vest on the Grant Date, provided that the Director is in service as a member of the Board on such date. 
(iii)    In the event that a Director terminates service as a member of the Board, (A) any Annual Option may be exercised only to the extent vested and exercisable on the Director’s Termination Date (unless the termination was for Cause), and must be exercised, if at all, prior to the close of the Option Period, and (B) any Annual Option (or portion thereof) which has not vested and become exercisable as of the Director’s Termination Date shall terminate as of the Director’s Termination Date.  If the services of a Director are terminated for Cause, his Annual Option (whether vested or unvested) shall lapse and no longer be exercisable as of his Termination Date. 
(i)    Terms of Annual RSUs.  An Annual RSU shall be granted under, and subject to the terms of, the applicable Stock Plan and related RSU award agreement.  Without limiting the foregoing, unless the Administrator determines otherwise, the following terms shall apply:
(i)    The Grant Date shall be the fifth business day after the date of the annual or other shareholders meeting at which the Director is elected.
(ii)    An Annual RSU shall vest on the first anniversary of the Grant Date, subject to the continued service of the Director on the vesting date.  An Annual RSU shall vest in full in the event 

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of a Change of Control of the Company if and to the extent provided in the applicable Stock Plan and related award agreement.  
(iii)    Unless the Administrator determines otherwise, if the Director’s service as a member of the Board is terminated for any reason and all or part of his Annual RSU has not vested, the Annual RSU, to the extent not then vested, shall be forfeited immediately upon such termination and the Director shall have no further rights with respect thereto. 
6.    Terms of Supplemental Equity Awards.  
(a)    General:  In addition to the grant of Initial Equity Awards and Annual Equity Awards, the Administrator may from time to time approve the grant of supplemental Equity Awards (“Supplemental Equity Awards”) to one or more Directors.  Supplemental Equity Awards may be in the form of supplemental Options (“Supplemental Options”) and/or supplemental RSUs (“Supplemental RSUs”).  The grant of a Supplemental Equity Award at any one time does not create a right to any future grant of such awards.  Supplemental Equity Awards may but are not required to be designed to augment the equity compensation provided to Directors in the form of Initial Awards and Annual Awards.  In addition, the Administrator shall have discretion to grant Supplemental Equity Awards that are not intended to supplement Initial Equity Awards or Annual Equity Awards.  Each  Supplemental Equity Award shall be subject to such terms and conditions as may be established by the Administrator, or as may apply under the Plan, the applicable Stock Plan and the applicable award agreement.  A Supplemental Equity Award may be based on a fixed dollar amount, a fixed number of shares of Common Stock,  a fixed Black-Scholes value or such other valuation formula or factors as the Administrator determines in its discretion.
(b)    Form of Supplemental Equity Award:  If and to the extent applicable, and unless the Administrator determines otherwise, the form of a Supplemental Equity Award (Supplemental Option, Supplemental RSU or a combination) shall be based on the election made by the Director with respect to the applicable Plan Year.
(c)    Terms of Supplemental Equity Awards:  Unless the Administrator determines otherwise, if the Administrator grants a Supplemental Equity Award that is intended to supplement an Initial Equity Award, the Supplemental Equity Award shall have the same Grant Date, vesting, Option Price, Option Period and exercise (in the case of Supplemental Options) and other terms and conditions as the corresponding Initial Option and/or Initial RSU, as the case may be.  Similarly, unless the Administrator determines otherwise, if the Administrator grants a Supplemental Equity Award that is intended to supplement an Annual Equity Award, the Supplemental Equity Award shall have the same Grant Date, vesting, Option Price, Option Period and exercise (in the case of Supplemental Options) and other terms and conditions as the corresponding Annual Option and/or Annual RSU, as the case may be.  
7.    Plan Effective Date; Amendment and Termination. 
The Plan shall be effective as of May 7, 2009, and shall continue until terminated by the Board.  The Plan was amended and restated effective August 16, 2012.  The Plan and any award may be amended, altered, suspended and/or terminated at any time by the Board; provided, that approval of an amendment to the Plan by the shareholders of the Company shall be required to the extent, if any, that shareholder approval of such amendment is required by Applicable Law.  
8.    No Right or Obligation of Continued Service.

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Neither the Plan, the grant of a benefit under the Plan nor any other action related to the Plan shall confer upon any Director any right to continue in the service of the Company as a Director or to interfere in any way with the right of the Company or its shareholders to terminate the Director’s service at any time.  Except as may be otherwise provided in the Plan, the applicable Stock Plan or related award agreement (or as may be otherwise determined by the Administrator), all rights of a Director with respect to benefits conferred under the Plan shall terminate immediately upon the Director’s termination of service as a Director.  

9.    Restrictions on Benefits. 
The Company may impose such restrictions on Equity Awards, shares of Common Stock, cash or any other benefits contemplated under the Plan as it may deem advisable, including without limitation restrictions that may apply under Applicable Law.  Notwithstanding any other Plan provision to the contrary, the Company shall not be obligated to provide any benefits or take any other action unless such action is in compliance with all Applicable Law.  
10.    Compliance with Code Section 409A.
Notwithstanding any other provision in the Plan to the contrary, if and to the extent that Code Section 409A is deemed to apply to the Plan or any benefit granted under the Plan, it is the general intention of the Company that the Plan and all such benefits shall, to the extent practicable, comply with, or be exempt from, Code Section 409A, and the Plan and any such benefit shall, to the extent practicable, be construed in accordance therewith.  Deferrals pursuant to a benefit otherwise exempt from Code Section 409A in a manner that would cause Code Section 409A to apply shall not be permitted unless such deferrals are in compliance with Code Section 409A.  Without limiting the effect of the foregoing, Annual Fees and shares of Common Stock subject to an RSU (and other awards, if and to the extent required under Code Section 409A) shall, upon vesting of the award, be distributed to the Director (or his beneficiary) no later than the later of (a) the 15th day of the third month following the end of the Director’s first taxable year in which the amount is no longer subject to a substantial risk of forfeiture, or (b) the 15th day of the third month following the end of the Company’s first taxable year in which the amount is no longer subject to a substantial risk of forfeiture, or otherwise in accordance with Code Section 409A.  In addition, in the event that Code Section 409A requires that any special terms, provisions or conditions be included in the Plan or any benefit, then such terms, provisions and conditions shall, to the extent practicable, be deemed to be made a part of the Plan or benefit, as applicable.  Further, in the event that the Plan or any benefit shall be deemed not to comply with Code Section 409A, then neither the Company, the Administrator nor its or their designees or agents shall be liable to any Participant or other person for actions, decisions or determinations made in good faith.  
11.    General Provisions.
(a)    Unfunded Plan; No Effect on Other Plans:  
(i)    The Plan shall be unfunded, and the Company shall not be required to create a trust or segregate any assets that may at any time be represented by benefits conferred under the Plan.  The Plan shall not establish any fiduciary relationship between the Company and any Director or other person.  Neither a Director nor any other person shall, by reason of the Plan, acquire any right in or title to any assets, funds or property of the Company, including, without limitation, any specific funds, assets or other property which the Company, in its discretion, may set aside in anticipation of a liability under the Plan.  A Director shall have only a contractual right to benefits, if any, payable under the Plan, unsecured by any assets of the Company.  Nothing contained in the Plan shall 

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constitute a guarantee that the assets of such entities shall be sufficient to pay any benefits to any person.
(ii)    The amount of any compensation deemed to be received by a Director pursuant to the Plan shall not constitute compensation with respect to which any other benefits of such Director are determined, except as otherwise specifically provided by the terms of such plan or as may be determined by the Administrator.
(iii)    The adoption of the Plan shall not affect any other stock incentive or other compensation plans in effect for the Company, nor shall the Plan preclude the Company from establishing any other forms of stock incentive or other compensation for employees or service providers of the Company.
(b)    Applicable Law:  The Plan shall be governed by and construed in accordance with the laws of the State of North Carolina, without regard to the conflict of laws provisions of any state, and in accordance with applicable federal laws of the United States.
(c)    Beneficiary Designation:  The Administrator may permit a Director to designate in writing a person or persons as beneficiary, which beneficiary shall be entitled to receive settlement of benefits (if any) to which the Director is otherwise entitled in the event of death.  In the absence of such designation by a Director, and in the event of the Director’s death, the estate of the Director shall be treated as beneficiary for purposes of the Plan, unless the Administrator determines otherwise. The Administrator shall have sole discretion to approve and interpret the form or forms of such beneficiary designation.  A beneficiary, legal guardian, legal representative or other person claiming any rights pursuant to the Plan is subject to all terms and conditions of the Plan, and to any additional restrictions deemed necessary or appropriate by the Administrator.
(d)    Gender and Number:  Except where otherwise indicated by the context, words in any gender shall include any other gender, words in the singular shall include the plural and words in the plural shall include the singular.
(e)    Severability:  If any provision of the Plan shall be held illegal or invalid for any reason, such illegality or invalidity shall not affect the remaining parts of the Plan, and the Plan shall be construed and enforced as if the illegal or invalid provision had not been included.
(f)    Rules of Construction:  Headings are given to the sections of this Plan solely as a convenience to facilitate reference.  The reference to any statute, regulation or other provision of law shall be construed to refer to any amendment to or successor of such provision of law, unless the Administrator determines otherwise.
(g)    Successors and Assigns:  The Plan shall be binding upon the Company, its successors and assigns, and Directors, their executors, administrators and permitted transferees and beneficiaries.
(h)    Right of Offset:  Notwithstanding any other provision of the Plan or any award conferred under the Plan, the Company may (subject to any Code Section 409A considerations) reduce the amount of any benefit otherwise distributable to or on behalf of a Director by the amount of any obligation of the Director to the Company that is or becomes due and payable.
(i)    Nontransferability:  Benefits provided under the Plan shall not be transferable (including by sale, assignment, pledge or hypothecation) other than by will or the laws of intestate succession (unless 

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the Administrator determines otherwise in accordance with Applicable Law).  The designation of a beneficiary in accordance with the Plan does not constitute a transfer.  
(j)    Compliance with Recoupment, Ownership and Other Policies: Notwithstanding anything in the Plan to the contrary, the Administrator may at any time and in its discretion provide that any benefits provided under the Plan shall be forfeited and/or recouped if the Director, during service or following termination of service for any reason, engages in certain specified conduct, including but not limited to violation of policies of the Company or an affiliate, breach of non-solicitation, noncompetition, confidentiality or other restrictive covenants, or other conduct by the Director that is determined by the Administrator to be detrimental to the business or reputation of the Company or any affiliate.  In addition, without limiting the effect of the foregoing, as a condition to the grant of an award or receipt or retention of shares of Common Stock, cash or any other benefit under the Plan, the Administrator may at any time require that a Director agree to abide by the any equity retention policy, stock ownership guidelines, compensation recovery policy and/or other policies adopted by the Company or an affiliate, each as in effect from time to time and to the extent applicable to the Director.  Further, each Director shall be subject to such compensation recovery, recoupment, forfeiture or other similar provisions as may apply under Applicable Law. 
IN WITNESS WHEREOF, this RF Micro Devices, Inc. Director Compensation Plan, as Amended and Restated Effective August 16, 2012, is, by the authority of the Board of Directors of the Company, executed in behalf of the Company as of the 28th day of June, 2012.
	
		
	RF MICRO DEVICES, INC.

	 
	 

	By:
	/s/ Robert A. Bruggeworth                               

	 
	Robert A. Bruggeworth

	 
	Chief Executive Officer

	
		
	ATTEST:

	 
	 

	/s/ William A. Priddy, Jr. 

	Secretary/Asst. Secretary

	 

	[Corporate Seal]

9Exhibit 10.3

Exhibit 10.3

RF MICRO DEVICES, INC.
2012 STOCK INCENTIVE PLAN
Stock Option Agreement 
(Director Annual/Supplemental Option)
THIS AGREEMENT (together with Schedule A, attached hereto, the “Agreement”) is made effective as of the date specified as the “Grant Date” on Schedule A hereto (the “Grant Date”) between RF MICRO DEVICES, INC., a North Carolina corporation (the “Company”), and ________________, a Director of the Company or an Affiliate (the “Participant”).
RECITALS:
In furtherance of the purposes of the RF Micro Devices, Inc. 2012 Stock Incentive Plan, as it may be amended (the “Plan”), and in consideration of the services of the Participant and such other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Company and the Participant hereby agree as follows:
1.Incorporation of Plan.  The rights and duties of the Company and the Participant under this Agreement shall in all respects be subject to and governed by the provisions of the Plan, the terms of which are incorporated herein by reference.  In the event of any conflict between the provisions in this Agreement and those of the Plan, the provisions of the Plan shall govern, unless the Administrator determines otherwise.  Unless otherwise defined herein, capitalized terms in this Agreement shall have the same definitions as set forth in the Plan.
2.Grant of Option; Term of Option.  The Company hereby grants to the Participant pursuant to the Plan, as a matter of separate inducement and agreement in connection with his or her service to the Company, and not in lieu of any salary or other compensation for his or her services, the right and option (the “Option”) to purchase all or any part of such aggregate number of shares (the “Shares”) of common stock of the Company (the “Common Stock”) at a purchase price (the “Option Price”) as specified on Schedule A, attached hereto, and subject to such other terms and conditions as may be stated herein or in the Plan or on Schedule A.  The Participant expressly acknowledges that the terms of Schedule A shall be incorporated herein by reference and shall constitute part of this Agreement.  The Company and the Participant further acknowledge that the Company’s signature on the signature page hereof, and the Participant’s signature on the Grant Letter contained in Schedule A, shall constitute their acceptance of all of the terms of this Agreement.  The Option shall be designated as a Nonqualified Option.  The term of the Option (the “Option Period”) shall be specified in Schedule A and, except as otherwise provided in the Plan or this Agreement, the Option will expire if not exercised in full by the expiration date specified in Schedule A.
3.Shareholder Rights.  The Participant or his or her legal representatives, legatees or distributes shall not be deemed to be the holder of any Shares subject to the Option and shall not have any dividend rights, voting rights or other rights as a shareholder unless and until (and then only to the extent that) certificates for such Shares have been issued and delivered to him, her or them (or, in the case of uncertificated shares, other written evidence of ownership in accordance with Applicable Law shall have been provided).
4.Exercise of Option.  Subject to the terms of the Plan and this Agreement, the Option shall become exercisable on the date or dates set forth on Schedule A attached hereto.  To the extent that the Option is exercisable but is not exercised, the Option shall accumulate and be exercisable by the Participant in whole or in part at any time prior to expiration of an Option, subject to the terms of the Plan and this Agreement.  

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The Participant expressly acknowledges that the Option may vest and be exercisable only upon such terms and conditions as are provided in this Agreement and the Plan.  Upon the exercise of an Option in whole or in part, payment of the Option Price in accordance with the provisions of the Plan and this Agreement, and satisfaction of such other conditions as may be established by the Administrator or this Agreement, the Company shall as soon thereafter as practicable deliver to the Participant a certificate or certificates for the Shares purchased.  Except where prohibited by the Administrator or Applicable Law (and subject to such terms and conditions as may be established by the Administrator), payment of the Option Price may be made: (a) in cash or cash equivalent; (b) by delivery (by either actual delivery or attestation) of shares of Common Stock owned by the Participant for such time period, if any, as may be determined by the Administrator; (c) by shares of Common Stock withheld upon exercise; (d) by delivery of written notice of exercise to the Company and delivery to a broker of written notice of exercise and irrevocable instructions to promptly deliver to the Company the amount of sale or loan proceeds to pay the Option Price; or (e) by a combination of the foregoing methods.  Shares delivered or withheld in payment of the Option Price shall be valued at their Fair Market Value on the date of exercise.  The total number of Shares that may be acquired upon exercise of the Option shall be rounded down to the nearest whole share.  
5.Effect of Termination of Service.  In the event that the Participant terminates his or her service as a Director, (a) the Option may be exercised only to the extent vested and exercisable on the Participant’s Termination Date (unless the termination was for Cause), and must be exercised, if at all, prior to the close of the Option Period, and (b) any portion of the Option which has not vested and become exercisable as of the Participant’s Termination Date shall terminate as of the Participant’s Termination Date.  If the services of the Participant are terminated for Cause, the Option (whether vested or unvested) shall lapse and no longer be exercisable as of the Termination Date.  
6.No Right of Continued Service; Forfeiture of Option.  Nothing contained in this Agreement or the Plan shall confer upon the Participant any right to continue in the service of the Company or an Affiliate or interfere with the right of the Company or its shareholders to terminate the Participant’s service at any time.  Except as otherwise expressly provided in the Plan and this Agreement (including but not limited to Schedule A), all rights of the Participant under the Plan with respect to the unexercised portion of his or her Option shall terminate as of the Participant’s Termination Date.  The Participant expressly acknowledges and agrees that the termination of his or her service shall (except as may otherwise be provided in this Agreement or the Plan) result in forfeiture of the Option and any Shares subject to the Option to the extent the Option has not been exercised as of the date of his or her termination of service.  The grant of the Option does not create any obligation to grant further awards.
7.Nontransferability of Option.  The Option shall not be transferable (including by sale, assignment, pledge or hypothecation) other than by will or the laws of intestate succession, except for transfers if and to the extent permitted by the Administrator in a manner consistent with the Plan and the registration provisions of the Securities Act.  Except as may be permitted by the preceding sentence, this Option shall be exercisable during the Participant’s lifetime only by the Participant or his guardian or legal representative.
8.Withholding; Tax Consequences.
(a)    The Participant acknowledges that the Company shall require the Participant to pay the Company the amount, if any, of any federal, state, local, foreign or other tax or other amount required by any governmental authority to be withheld and paid over by the Company to such authority for the account of the Participant, and the Participant agrees, as a condition to the grant of the Option and delivery of any Shares, to satisfy such obligations.  Notwithstanding the foregoing, the Administrator may in its discretion establish procedures to permit the Participant to satisfy such obligation in whole or in part, and any local, state, federal, foreign or other income tax obligations 

2

relating to the Option, by electing (the “election”) to have the Company withhold shares of Common Stock from the Shares to which the recipient is otherwise entitled. The number of Shares to be withheld shall have a Fair Market Value as of the date that the amount of tax to be withheld is determined as nearly equal as possible to (but not exceeding) the amount of such obligations being satisfied. Each election must be made in writing to the Administrator in accordance with election procedures established by the Administrator.
(b)    The Participant acknowledges that the Company has made no warranties or representations to the Participant with respect to the tax consequences (including but not limited to income tax consequences) with respect to the transactions contemplated by this Agreement, and the Participant is in no manner relying on the Company or its representatives for an assessment of such tax consequences.  The Participant acknowledges that there may be adverse tax consequences upon the grant or exercise of the Option and/or the acquisition or disposition of the Shares subject to the Option and that he or she has been advised that he or she should consult with his or her own attorney, accountant and/or tax advisor regarding the decision to enter into this Agreement and the consequences thereof.  The Participant also acknowledges that the Company has no responsibility to take or refrain from taking any actions in order to achieve a certain tax result for the Participant.
9.Administration.  The authority to construe and interpret this Agreement and the Plan, and to administer all aspects of the Plan, shall be vested in the Administrator, and the Administrator shall have all powers with respect to this Agreement as are provided in the Plan, including but not limited to the sole authority to determine whether and to what degree the Option has been earned and vested.  Any interpretation of this Agreement by the Administrator and any decision made by it with respect to this Agreement is final and binding.
10.Superseding Agreement; Successors and Assigns.  This Agreement supersedes any statements, representations or agreements of the Company with respect to the grant of the Option, any other equity-based awards or any related rights, and the Participant hereby waives any rights or claims related to any such statements, representations or agreements.  Except as may be otherwise provided in the Plan, this Agreement does not supersede or amend any existing Change in Control Agreement, Inventions, Confidentiality and Nonsolicitation Agreement, Noncompetition Agreement, Severance Agreement, Employment Agreement or any other similar agreement between the Participant and the Company, including, but not limited to, any restrictive covenants contained in such agreements.  This Agreement shall be binding upon and shall inure to the benefit of the parties hereto and their respective executors, administrators, next-of-kin, successors and assigns.
11.Governing Law.  Except as otherwise provided in the Plan or herein, this Agreement shall be construed and enforced according to the laws of the State of North Carolina, without regard to the conflict of laws provisions of any state, and in accordance with applicable federal laws of the United States.
12.Amendment; Waiver.  Subject to the terms of the Plan and this Agreement, this Agreement may be modified or amended only by the written agreement of the parties. Notwithstanding the foregoing, the Administrator shall have unilateral authority to amend this Agreement (without Participant consent) to the extent necessary to comply with Applicable Law or changes to Applicable Law (including but not limited to federal securities laws and Code Section 409A).  The waiver by the Company of a breach of any provision of this Agreement by the Participant shall not operate or be construed as a waiver of any subsequent breach by the Participant.
13.Notices.  Except as may be otherwise provided by the Plan, any written notices provided for in this Agreement or the Plan shall be in writing and shall be deemed sufficiently given if either hand 

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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 mailed but in no event later than the date of actual receipt.  Notice may also be provided by electronic submission, if and to the extent permitted by the Administrator.  Notices shall be directed, if to the Participant, at the Participant’s address indicated by the Company’s records, or if to the Company, at the Company’s principal office, attention Treasurer, RF Micro Devices, Inc.
14.Severability.  The provisions of this Agreement are severable and if any one or more provisions may be determined to be illegal or otherwise unenforceable, in whole or in part, the remaining provisions shall nevertheless be binding and enforceable.
15.Restrictions on Option and Shares.  The Company may impose such restrictions on the Option and any Shares or other benefits underlying the Option as it may deem advisable, including without limitation restrictions under the federal securities laws, the requirements of any stock exchange or similar organization and any blue sky, state or foreign securities laws applicable to such Option or Shares.  Notwithstanding any other provision in the Plan or this Agreement to the contrary, the Company shall not be obligated to issue, deliver or transfer shares of Common Stock, to make any other distribution of benefits, or to take any other action, unless such delivery, distribution or action is in compliance with all Applicable Law (including but not limited to the requirements of the Securities Act).  The Company may cause a restrictive legend to be placed on any certificate for Shares issued pursuant to the Option in such form as may be prescribed from time to time by Applicable Law or as may be advised by legal counsel.
16.Counterparts; Further Instruments.  This Agreement may be executed in two or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument.  The parties hereto agree to execute such further instruments and to take such further action as may be reasonably necessary to carry out the purposes and intent of this Agreement.
17.Compliance with Recoupment, Ownership and Other Policies or Agreements.  As a condition to receiving this Option, the Participant agrees that he or she shall abide by all provisions of any equity retention policy, compensation recovery policy, stock ownership guidelines and/or other similar policies maintained by the Company, each as in effect from time to time and to the extent applicable to Participant from time to time.  In addition, the Participant shall be subject to such compensation recovery, recoupment, forfeiture, or other similar provisions as may apply at any time to the Participant under Applicable Law. 
IN WITNESS WHEREOF, this Agreement has been executed on behalf of the Company and by the Participant effective as of the Grant Date stated herein.
	
			
	 
	RF MICRO DEVICES, INC.

	 
	 
	 

	 
	By:
	______________________________________

	 
	 
	Robert A. Bruggeworth

	 
	 
	President and Chief Executive Officer

	Attest:
	 
	 

	__________________________________
	 
	 

	William Priddy
	 
	 

	Secretary and Chief Financial Officer
	 
	 

[Signature Page of Participant to Follow on Schedule A/Grant Letter]

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RF Micro Devices, Inc. 
2012 Stock Incentive Plan 
Stock Option Agreement
(Director Annual/Supplemental Option)

Schedule A/Grant Letter

1.    Grant Terms.  Pursuant to the terms and conditions of the Company’s 2012 Stock Incentive Plan, as it may be amended (the “Plan”), and the Stock Option Agreement (Director Annual/Supplemental Option) attached hereto (the “Agreement”), you (the “Participant”) have been granted an Option to purchase _______________ shares of Common Stock (the “Shares”) as outlined below.  Unless otherwise defined herein, capitalized terms in this Schedule A shall have the same definitions as set forth in the Agreement and the Plan.            
	
			
	Granted To:
	 
	________________________

	Grant Date:
	 
	________________________

	Number of Shares Subject to Option:
	 
	________________________

	Option Price per Share:
	 
	________________________

	Option Period:
	 
	________________________

	Expiration Date:
	 
	________________________

2.    Vesting of Option.* The Option shall be deemed vested with respect to one hundred percent (100%) of the Shares subject to the Option on the Grant Date.
[Modify vesting schedule as appropriate.]
By my signature below, I, the Participant, hereby acknowledge receipt of this Grant Letter and the Agreement.  I understand that the Grant Letter and other provisions of Schedule A herein are incorporated by reference into the Agreement and constitute a part of the Agreement.  By my signature below, I further agree to be bound by the terms of the Plan and the Agreement, including but not limited to the terms of this Grant Letter and the other provisions of Schedule A contained herein.  The Company reserves the right to treat the Option and the Agreement as cancelled, void and of no effect if the Participant fails to return a signed copy of the Grant Letter within 30 days of receipt.

	
		
	Signature:                                                                                                 
	Date:                                    

Note:  If there are any discrepancies in the name shown above, please make the appropriate corrections on this form and return to Treasury Department, RF Micro Devices, Inc., 7628 Thorndike Road, Greensboro, NC  27409-9421. Please retain a copy of the Agreement, including this Grant Letter, for your files.
_________________
 *Subject to terms and conditions of the Plan and/or the Agreement.

A-1

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