Document:

2003 DIRECTOR STOCK OPTION PLAN

 EXHIBIT 10.1 
  
 PARTHUSCEVA, INC. 
  
 2003 DIRECTOR STOCK OPTION PLAN 
  
 1. Purpose 
  
 The purpose of this 2003 Director Stock Option Plan (the “Plan”) of ParthusCeva, Inc. (the “Company”) is to encourage ownership in the
Company by non-employee directors of the Company whose continued services are considered essential to the Company’s future progress and to provide them with a further incentive to remain as directors of the Company. 
  
 2. Administration 
  
 The Board of Directors (the “Board”) shall supervise and
administer the Plan. All questions concerning interpretation of the Plan or any options granted under it shall be resolved by the Board and such resolution shall be final and binding upon all persons having an interest in the Plan. The Board may, to
the full extent permitted by or consistent with applicable laws or regulations, delegate any or all of its powers under the Plan to a committee appointed by the Board, and if a committee is so appointed, all references to the Board in the Plan shall
mean and relate to such committee. 
  
 3.
Participation in the Plan 
  
 Each director of the Company
who is not an employee of the Company or any parent or subsidiary of the Company (“Non-Employee Director”) shall be eligible to receive options under the Plan (the “Optionee”). 
  
 4. Stock Subject to the Plan 
  
 (a) The maximum number of shares of the Company’s common stock, par
value $.001 per share (“Common Stock”), which may be issued under the Plan shall be 700,000 shares, subject to adjustment as provided in Section 7. 
  
 (b) If any outstanding option under the Plan for any reason expires or is terminated without having been exercised in full, the shares covered by the
unexercised portion of such option shall again become available for issuance pursuant to the Plan. 
  
 (c) All options granted under the Plan shall be non-statutory options not entitled to special tax treatment under Section 422 of the Internal Revenue Code
of 1986, as amended (the “Code”). 
  
 (d) Shares issued
under the Plan may consist in whole or in part of authorized but unissued shares or treasury shares. 

 5. Terms, Conditions and Form of Options 
  
 Each option granted under the Plan shall be evidenced by a written agreement
in such form as the Board shall from time to time approve, which agreements shall comply with and be subject to the following terms and conditions: 
  
 (a) Option Grants. 
  
 (i) Each person who is a Non-Employee Director on the Effective Date and each person who subsequently becomes a Non-Employee Director shall be
automatically granted an option to purchase 38,000 shares of Common Stock on the date of which the later of the following events occurs: (A) the Effective Date; or (B) the date on which such person first becomes a Non-Employee Director, whether
through election by the stockholders of the Company or appointment by the Board to fill a vacancy. 
  
 (ii) On the Effective Date, each Non-Employee Director shall be automatically granted (A) an option to purchase 13,000 shares of Common Stock, if on such
date he or she shall have served on the Board for at least six (6) months, and (B) an option to purchase 13,000 shares of Common Stock for each committee of the Board on which he or she shall have served as chairperson for at least six (6) months on
such date. Beginning on June 30, 2004, on June 30 of each year, each Non-Employee Director shall be automatically granted (A) an option to purchase 13,000 shares of Common Stock, if on such date he or she shall have served on the Board for at least
six (6) months, and (B) an option to purchase 13,000 shares of Common Stock for each committee of the Board on which he or she shall have served as chairperson for at least six (6) months on such date. 
  
 (iii) Subject to the execution by the Optionee of an appropriate option
agreement, the Board may grant additional options to purchase a number of shares to be determined by the Board in recognition of services provided by an Optionee in his or her capacity as a director, provided that such grants are in compliance with
the requirements of Rule 16b-3, as promulgated under the Securities Exchange Act of 1934, as amended. 
  
 Each date of grant of an option pursuant to this Section 5(a) is hereinafter referred to as an “Option Grant Date.” 
  
 (b) Option Exercise Price. The option exercise price per share for each option granted under the Plan shall equal (i) the closing price of the
Common Stock on The NASDAQ National Market, (ii) the closing price of the Common Stock on The NASDAQ SmallCap Market or any national securities exchange on which the Common Stock is listed or (iii) the average of the closing bid and asked prices of
the Common Stock in the over-the-counter market, whichever is applicable, as published in The Wall Street Journal, on the last trading day immediately preceding the Option Grant Date. If no sales of Common Stock were made on the last trading day
immediately preceding the Option Grant Date, the price of the Common Stock for purposes of Section 5(a) above shall be the reported price for the next preceding day on which such sales were made. 
  
 (c) Transferability of Options. Except as the Board may otherwise
determine or provide in an option granted under the Plan, any option granted under the Plan shall not be sold, 
  

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 assigned, transferred, pledged or otherwise encumbered by the Optionee, either voluntarily or by operation of law, except
by will or the laws of descent and distribution, and, during the life of the Optionee, shall be exercisable only by the Optionee. References to an Optionee, to the extent relevant in the context, shall include references to authorized transferees.

  
 (d) Vesting Period. Each option granted pursuant to
Section 5(a)(i) or Section 5(a)(ii) above shall vest and become exercisable as to 25% of the shares of Common Stock subject to the option on the first anniversary of the Option Grant Date, and shall vest and become exercisable as to 25% of the
shares of Common Stock subject to the option at the end of each twelve-month period thereafter, subject to the provisions of Section 7. Each option granted under the Plan pursuant to Section 5(a)(iii) above shall become exercisable on such terms as
shall be determined by the Board and set forth in the option agreement with the respective Optionee, subject to the provisions of Section 7. 
  
 (e) Termination. Each option shall terminate, and may no longer be exercised, on the earlier of (i) the date ten years after the Option Grant Date
of such option or (ii) the date which is 90 days after the date on which the Optionee ceases to serve as a Non-Employee Director. 
  
 (f) Exercise of Option. An option may be exercised only by written notice to the Company at its principal office accompanied by (i) payment in cash
or by certified or bank check of the full consideration for the shares as to which they are exercised or (ii) an irrevocable undertaking by a creditworthy broker to deliver promptly to the Company sufficient funds to pay the exercise price or
delivery of irrevocable instructions to a creditworthy broker to deliver promptly to the Company cash or a check sufficient to pay the exercise price. 
  
 6. Limitation of Rights 
  
 (a) No Right to Continue as a Director. Neither the Plan, nor the granting of an option nor any other action taken pursuant to the Plan, shall
constitute or be evidence of any agreement or understanding, express or implied, that the Company will retain the Optionee as a Non-Employee Director for any period of time. 
  
 (b) No Stockholder’s Rights for Options. An Optionee shall have no rights as a stockholder with respect to the
shares covered by his or her option until the date of the issuance to him or her of a stock certificate therefor, and no adjustment will be made for dividends or other rights (except as provided in Section 7) for which the record date is prior to
the date such certificate is issued. 
  
 (c) Compliance with
Securities Laws. Each option shall be subject to the requirement that if, at any time, counsel to the Company shall determine that the listing, registration or qualification of the shares subject to such option upon any securities exchange or
under any state or federal law, or the consent or approval of any governmental or regulatory body, or the disclosure of non-public information or the satisfaction of any other condition is necessary as a condition of, or in connection with, the
issuance or purchase of shares thereunder, such option may not be exercised, in whole or in part, unless such listing, registration, qualification, consent or approval, or satisfaction of such condition shall have been effected or obtained on
conditions acceptable to the Board. Nothing herein shall be deemed to require the 
  

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 Company to apply for or to obtain such listing, registration or qualification, or to satisfy such condition. 

 
 7. Adjustments for Changes in Common Stock and Certain
Other Events. 
  
 (a) Changes in Capitalization. In
the event of any stock split, reverse stock split, stock dividend, recapitalization, combination of shares, reclassification of shares, spin-off or other similar change in capitalization or event, or any distribution to holders of Common Stock other
than a normal cash dividend, (i) the number and class of securities available under this Plan and (ii) the number and class of securities and exercise price per share subject to each outstanding option under the Plan shall be appropriately adjusted
by the Company (or substituted options may be made, if applicable) to the extent the Board shall determine, in good faith, that such an adjustment (or substitution) is necessary and appropriate. If this Section 7(a) applies and Section 7(c) or
Section 7(d) also applies to any event, Section 7(c) or Section 7(d), as applicable, shall be applicable to such event, and this Section 7(a) shall not be applicable. 
  
 (b) Liquidation or Dissolution. In the event of a proposed liquidation or dissolution of the Company, the Board shall
upon written notice to the Optionees provide that all then unexercised options under the Plan will (i) become exercisable in full as of a specified time at least 10 business days prior to the effective date of such liquidation or dissolution and
(ii) terminate effective upon such liquidation or dissolution, except to the extent exercised before such effective date. 
  
 (c) Reorganization Events. 
  
 (i) Definition. A “Reorganization Event” shall mean: (a) any merger or consolidation of the Company with or into another entity as a
result of which all of the Common Stock is converted into or exchanged for the right to receive cash, securities or other property or (b) any exchange of all of the Common Stock for cash, securities or other property pursuant to a share exchange
transaction, in each case other than an Acquisition Event (as defined below). 
  
 (ii) Consequences of a Reorganization Event on Options. Upon the occurrence of a Reorganization Event, or the execution by the Company of any agreement with respect to a Reorganization Event, the Board shall
provide that all outstanding options under the Plan shall be assumed, or equivalent options shall be substituted, by the acquiring or succeeding corporation (or an affiliate thereof). For purposes hereof, an option shall be considered to be assumed
if, following consummation of the Reorganization Event, the option confers the right to purchase, for each share of Common Stock subject to the option immediately prior to the consummation of the Reorganization Event, the consideration (whether
cash, securities or other property) received as a result of the Reorganization Event by holders of Common Stock for each share of Common Stock held immediately prior to the consummation of the Reorganization Event (and if holders were offered a
choice of consideration, the type of consideration chosen by the holders of a majority of the outstanding shares of Common Stock); provided, however, that if the consideration received as a result of the Reorganization Event is not solely common
stock of the acquiring or succeeding corporation (or an affiliate thereof), the Company may, with the consent of the acquiring or succeeding corporation, provide for the consideration to be received upon the exercise of options to consist solely of
common stock of the acquiring or succeeding 
  

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 corporation (or an affiliate thereof) equivalent in fair market value to the per share consideration received by holders
of outstanding shares of Common Stock as a result of the Reorganization Event. 
  
 Notwithstanding the foregoing, if the acquiring or succeeding corporation (or an affiliate thereof) does not agree to assume, or substitute for, such options, then the Board shall, upon written notice to the
Participants, provide that all then unexercised options under the Plan will become exercisable in full as of a specified time prior to the Reorganization Event and will terminate immediately prior to the consummation of such Reorganization Event,
except to the extent exercised by the Participants before the consummation of such Reorganization Event; provided, however, that in the event of a Reorganization Event under the terms of which holders of Common Stock will receive upon consummation
thereof a cash payment for each share of Common Stock surrendered pursuant to such Reorganization Event (the “Acquisition Price”), then the Board may instead provide that all outstanding options under the Plan shall terminate upon
consummation of such Reorganization Event and that each Participant shall receive, in exchange therefor, a cash payment equal to the amount (if any) by which (A) the Acquisition Price multiplied by the number of shares of Common Stock subject to
such outstanding options (whether or not then exercisable), exceeds (B) the aggregate exercise price of such options. 
  
 (d) Acquisition Events. 
  
 (i) Definition. An “Acquisition Event” shall mean (a) any merger or consolidation which results in the voting securities of the Company
outstanding immediately prior thereto representing immediately thereafter (either by remaining outstanding or by being converted into voting securities of the surviving or acquiring entity) less than 50% of the combined voting power of the voting
securities of the Company or such surviving or acquiring entity outstanding immediately after such merger or consolidation, or (b) any sale of all or substantially all of the assets of the Company. 
  
 (ii) Consequences of an Acquisition Event on Options. Upon the
occurrence of an Acquisition Event, each outstanding option granted under the Plan shall immediately become exercisable in full. 
  
 8. Termination and Amendment of the Plan 
  

The Board may suspend or terminate the Plan or amend it in any respect whatsoever. 
  
 9. Notice 
  

Any written notice to the Company required by any of the provisions of the Plan shall be addressed to the Treasurer of the Company and shall become
effective when it is received. 
  
 10.
Governing Law 
  
 The Plan and all determinations made and
actions taken pursuant hereto shall be governed by the internal laws of the State of Delaware (without regard to any applicable conflicts of laws or principles). 
  

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 11. Effective Date 
  
 The Plan shall take effect upon its adoption by the Board and receipt of stockholder approval at the Company’s 2003
Annual Meeting of Stockholders (the “Effective Date”). 
  
 Adopted by
the Board of Directors on April 25, 2003. 
  
 Adopted by the Stockholders on June
18, 2003. 
  

 6LETTER AGREEMENT

 EXHIBIT 10.2 
  
 April 7, 2003 
  
 Mr. Kevin Fielding 
 ParthusCeva, Inc. 
 32-34 Harcourt Street 
 Dublin 2 
 Ireland 
  
 Dear Kevin: 
  
 ParthusCeva, Inc. (the
“Company”) appreciates the efforts you have made as Chief Executive Officer of the Company, and wishes to provide for a fair and orderly transition of your duties to a new CEO. As you know, we have been constituted as a duly authorized
committee of the Board of Directors of the Company to finalize those arrangements with you, as summarized in this letter. 
  

	 	1.	 	By signing the letter, you and the Company agree that for all purposes your separation from the Company on the date hereof will be treated as a termination by the Company without
cause pursuant to Section 4.4 of your Employment Agreement with the Company dated as of the 1st of November, 2002
(the “Employment Agreement”). By signing this letter, the Company confirms its obligations under the Employment Agreement, including Section 5.2(b), and you agree to continue to abide by your obligations under the Employment Agreement as
provided therein, including Section 6. In particular, and in furtherance of the provisions of the Employment Agreement, the Company confirms: 

  

	 	•	 	It will pay you severance of €186,200 on the date hereof as provided for in the Employment Agreement and will cooperate to do so in a tax efficient manner as determined by the
Company in good faith. 

  

	 	•	 	You will retain any pension benefits you have under the Company’s pension plans on the date hereof. 

  

	 	•	 	The Company will pay you €32,308 on the date hereof in satisfaction of all accrued vacation pay through the date hereof. 

  

	 	•	 	The Company will also continue to fund your membership in the Company’s VHI Scheme (E) health plan for a period of two years after the date hereof. 

  

	 	•	 	The Company will pay you a bonus for the year 2002 of €84,000 on the date hereof. 

  

	 	2.	 	As provided in the Employment Agreement, all of your outstanding stock options will accelerate in full on the date hereof and will be treated as fully vested. The exercise period
provided in such options shall be extended to expire on the date 

 April 7, 2003 
 Page 2

  
 two years from the date hereof. On that date your options, to
the extent not exercised, will lapse and cease to be exercisable. 
  

	 	3.	 	You agree to resign in writing effective the date hereof from all of your statutory offices. You also agree to serve as a consultant to the Company at your current rate of
compensation until June 23, 2003, to facilitate a transition in management of the Company and to preserve the value of the assets and business of the Company. For your service as a consultant in connection with the transition program, you shall also
be entitled to a transition bonus of up to a maximum of €50,000, as determined by Sven-Christer Nilsson and Zvi Limon in good faith on or before the June 23, 2003, it being understood that the intention is to pay such bonus if you cooperate
fully in the transition. If a Chief Executive Officer of the Company is not appointed by June 23, 2003, then at the written request of Mr. Nilsson and Mr. Limon, in consultation with the interim CEO, you agree to continue as a consultant to the
Company on a month-to-month basis. 

  

	 	4.	 	On or after the date hereof, subject to the good faith discharge of your obligations under the Employment Agreement and hereunder, the Company shall provide you with a reference
upon the terms set forth in Exhibit A, it being understood that the intention is to provide you with such a letter if you cooperate fully in the transition. The Company agrees that it shall deliver such reference to third parties upon request and
confirm that such reference is a fair assessment of your performance as an officer and employee of the Company. The Company agrees that it shall direct those officers and employees it makes privy to the terms of this Agreement not to make directly
or by inference any negative or adverse remarks concerning you and your services to the Company as an employee or executive, and you agree that you will not at any time make directly or by inference any negative or adverse remarks concerning the
Company, its officers, directors or employees, or its business or financial affairs. 

  

	 	5.	 	If you would like, you are welcome to retain your lap top computer, computer monitor, personal organizer and laser printer, as well as the mobile telephone and related telephone
number the Company has supplied you. 

  

	 	6.	 	You agree that the terms of this letter agreement are a full and complete settlement of any claims you might have against the Company, other than any claims for breach of this
agreement in the future, and you fully and finally release the Company from any and all such claims. In particular, and without limitation of the foregoing, you acknowledge and agree that you have no claim against the Company, its affiliates, agents
or employees, under and in relation to the provisions of the Unfair Dismissal Acts, the Redundancy Payments Acts, the Organization of Working Time Act or any other Irish or other applicable legislation governing employment relationships in any
jurisdiction. The Company agrees that the terms of this Agreement provide a full and final settlement of all claims that the Company has or may have against you arising out of your employment, and the Company hereby fully and finally releases you
from 

 April 7, 2003 
 Page 3

  
 all such claims, except any claims that may
arise as a result of any violation by you of applicable securities laws. 
  

	 	7.	 	It is agreed that the parties shall cooperate in the preparation of any press release regarding the matters contemplated therein subject to the obligations of the Company to comply
with the provisions of applicable securities laws. 

  

	 	8.	 	You acknowledge that before signing this agreement you received independent legal advice regarding your legal rights and the consequences and the legal effects of this letter
agreement. This agreement is governed by Irish law, is for the benefit of both you and the Company, and shall be binding upon the respective parties and the personal representatives and successors. 

  

	 	9.	 	Where the Company is under a legal obligation to deduct tax in respect of any sum due to you under the Employment Agreement or these arrangements, such sum will only be paid to you
after the Company has deducted the appropriate tax. 

  
 We trust that these arrangements reflect our understanding, and would appreciate acknowledgement of your agreement to the terms of this letter agreement by signing a copy in the space provided below. We value the contribution that you have
made to Parthus and ParthusCeva over the years and your commitment to supporting a smooth transition in the coming months. 
  
 Sincerely, 
  
 ParthusCeva, Inc. 
  
 By: 
  
 /s/ SVEN-CHRISTER
NILSSON             
 Sven-Christer Nilsson 
  
 /s/ ZVI LIMON             
 Zvi Limon 

 April 7, 2003 
 Page 4

  
 Agreed to and accepted by: 
  
 /s/ KEVIN
FIELDING             
 Kevin Fielding 
  

 Exhibit A 
  

[date] 
  
 To Whom It May Concern: 
  
 In June 1998 Kevin
Fielding joined Parthus Technologies plc in the position of chief operating officer (COO), reporting directly to the CEO. In December 2000 Kevin was nominated to the board of Parthus Technologies in recognition of his contribution to a successful
public listing in May 2000. Kevin was further promoted to the position of President of Parthus Technologies in March 2001. 
  
 On 1 November 2002, following the merger of Parthus Technologies plc and Ceva, Inc., Kevin was appointed to the position of chief executive officer (CEO) and president of
ParthusCeva, Inc. and also joined the board of the company as an executive director. 
  
 It was agreed by the board of ParthusCeva, Inc. to base the corporate headquarters of the newly formed company in San Jose, California USA. However, for personal and family reasons Kevin was not in a position to move from Dublin to San
Jose. Consequently, in February 2003 Kevin communicated to the board that he would be stepping down as CEO and would be resigning as a director of the company. 
  

In his role as CEO, Kevin had ultimate responsibility for all activities in the company, with the key executive positions of chief financial officer, chief technology
officer, vice-president sales, vice-president human resources and three division general managers reporting directly to him. 
  
 Throughout his time at ParthusCeva and at Parthus Technologies, Kevin performed his work with enthusiasm and a very high degree of competency. The nature of the work was
such that it required excellent communication and problem solving skills, with the ability to consistently deliver on objectives in a high-pressure working environment. Kevin had a great understanding of the technology employed by the company as
well as the targeted end markets and application areas. He also had a thorough and detailed knowledge of the company finances, an attribute that was especially appreciated by the investment/financial community. Kevin had all of the necessary
qualities for a CEO position at a public company and performed well in that role in ParthusCeva. 
  
 I worked closely with Kevin in my role as founder and CEO of Parthus Technologies and as vice-chairman of ParthusCeva and am sorry to see him leave. I would have no hesitation in recommending him for a similar role in
any organization. If any further information is required, please do not hesitate to contact me. 
  
 Yours sincerely, 
  
  
 Brian Long 
 Vice-Chairman

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