Document:

Form of Stock Option Agreement for grants of stock options to non-employee

 Exhibit 10.C 

 

	                  shares 
	 $                 per share

 STOCK OPTION AGREEMENT 

Mentor Graphics Corporation 

2010 Omnibus Incentive Plan 

                 , 20__ 

 

					
	 Mentor Graphics Corporation
 an
Oregon corporation
 8005 S.W. Boeckman Road

Wilsonville, Oregon 97070-7777
	  	Company	  	
			
	NAME	  	Optionee	  	
	ADDRESS	  		  	

 The Company is pleased to inform you that it has granted you an automatic nondiscretionary option to purchase shares
under its 2010 Omnibus Incentive Plan (2010 Omnibus Plan). The 2010 Omnibus Plan is administered by the Compensation Committee (Committee) of the Board of Directors. 

The option agreement is as follows: 
 1.
Grant of Option. The Company grants to you an option to purchase              shares of the Company’s common stock for
$             per share. 
 2. Vesting Provisions; Change in Control.

 2.1 This option will terminate on             
    , 20__, unless it is earlier terminated because you cease to be a director as provided below. 

2.2 Until it expires or is terminated and except as provided in 2.4 or 4, you may exercise this option from time to time to purchase
shares up to the following limits: 
  

			
	Years After __/__/20__	  	Percent Exercisable
	Less than 1	  	0%
	_______	  	__%
	_______	  	__%
	_______	  	__%
	_______	  	__%
	Over __	  	100%

 2.3 The table in 2.2
is based on an Option Year. An Option Year is a 12-month period starting on the date specified in the table or an anniversary of that date. 
  

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 2.4 Upon the occurrence of a Change in Control, this option shall automatically become
exercisable in full for the remainder of its term. “Change in Control” means the occurrence of any of the following events: 

2.4.1 the approval by the Company’s shareholders of: 

(a) any consolidation, merger or plan of share exchange involving the Company (Merger) in which the Company is not the
continuing or surviving corporation or pursuant to which shares of Common Stock would be converted into cash, securities or other property, other than a Merger involving the Company in which the holders of the Company’s Common Stock immediately
prior to the Merger have the same proportionate ownership of Common Stock of the surviving corporation immediately after the Merger; 

(b) any sale, lease, exchange or other transfer (in one transaction or a series of related transactions) of all, or
substantially all, the assets of the Company; or 
 (c) the adoption of any plan or proposal for the liquidation
or dissolution of the Company; 
 2.4.2 at any time during a period of two consecutive years, individuals who at the beginning
of such period constituted the Board of Directors (Incumbent Directors) shall cease for any reason to constitute at least a majority thereof, unless each new director elected during such two-year period was nominated or appointed by two-thirds of
the Incumbent Directors then in office and voting (new directors nominated or appointed by two-thirds of the Incumbent Directors shall also be deemed to be Incumbent Directors); or 

2.4.3 any person (as such term is used in Section 13(d) of the Securities Exchange Act of 1934 (1934 Act) shall, as a result of a
tender or exchange offer, open market purchases, privately negotiated purchases or otherwise, have become the beneficial owner (within the meaning of Rule 13d-3 under the 1934 Act), directly or indirectly, of securities of the Company ordinarily
having the right to vote in the election of directors (Voting Securities) representing twenty percent (20%) or more of the combined voting power of the then outstanding Voting Securities. 

 

	3.	Limited Stock Appreciation Rights. 

3.1 This option is granted in tandem with a limited stock appreciation right. 

3.2 The limited stock appreciation right shall entitle you to receive from the Company an amount equal to the excess of the fair market
value at the time of exercise of one share of the Company’s Common Stock over the option price per share under this option, multiplied by the number of shares exercised pursuant to the limited stock appreciation right. 

3.3 The limited stock appreciation right shall be exercisable only during the 60 calendar days immediately following a Change in Control
and only if the immediate resale of shares acquired upon exercise of this option would subject you to liability under Section 16(b) of the 1934 Act, provided, however, that the limited stock appreciation right may not be exercised within six
months of its date of grant. Upon exercise of the limited stock appreciation right, the option or portion thereof to which the right relates must be surrendered. 

3.4 Payment upon exercise of the limited stock appreciation right by the Company may be made only in cash. 

3.5 The limited stock appreciation right may not be assigned or transferred except on death, by will or operation of law and may be
exercised only by you or by your successor or representative after death. 
 4. Termination of Service as a Director. 

4.1 If you cease to be a director for any reason, the Company will establish an Option Reference Date, which will be your last day as a
director. Any portion of the option that is not exercisable on the Option Reference Date will immediately become exercisable in full. You may exercise any portion of the option that is or becomes exercisable on the Option Reference Date up to the
earlier of the date in 2.1 or a date fixed as follows: 
 4.1.1 If you ceased to be a director due to death or disability - one
year after the Option Reference Date. You are disabled if as a result of illness or injury you suffer from a condition of mind or body that permanently prevents you from serving in your capacity as a director. The Committee will conclusively
determine disability. 
 4.1.2 If 4.1.1 does not apply - one month after the Option Reference Date. 

5. Nonassignability. You may not assign or transfer this option except on death, by will or operation of law. Only you or your successor or
representative after death may exercise this option. 
  

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 6. Method of Exercise; Closing. 

6.1 You may exercise this option by written notice to the Company, attention: General Counsel, stating the number of shares you want to
buy and the proposed date of closing. Unless otherwise agreed to by you and the Company, the Company will fix the date of closing as the date the Company receives your exercise notice or the date the Company receives full payment for the shares,
whichever is later. 
 6.2 You or your successor purchaser must furnish to the Company before closing such other documents or
representations as the Company may require to assure compliance with applicable laws and regulations. 
 6.3 You must pay the
full purchase price in cash or by delivery of Company stock at or before closing. The Company will not issue any of the purchased shares and you will not have shareholder rights in them until you have made full payment. 

6.4 The Company will value stock you deliver in payment of the option in accordance with Section 2.17 of the 2010 Omnibus Plan.

 6.5 You, or your successor purchaser, must deposit sufficient funds with the Company at closing to cover any income or other
taxes to be withheld on account of the exercise. If funds are not deposited or other arrangements made for withholding, the Company may refuse to close or may retain shares having a value equal to the amount it is required to withhold. If, after
closing, withholding becomes required beyond any amount deposited at closing, you, or your successor purchaser, will pay such amount to the Company on demand. 

7. Changes in Capital Structure. 

7.1 If any change is made in the outstanding common shares of the Company without the Company’s receiving any consideration, the
Company will make a corresponding change in the shares under this option so that you will be in the same position after exercise of the option as would have been the case if you had exercised the option before the change. The Company will not change
the total purchase price for the unexercised portion of the option. The Company will disregard fractional shares. 
 7.2 If the
Company consolidates with another corporation or merges into another corporation, this will be a change to which 7.1 applies. The new corporation will revise the option or issue a new option giving you an equivalent right to buy the shares of the
new corporation. 
 7.3 The Board will make the adjustment under 7.1 or 7.2 and its determination will be conclusive.

 8. Successorship. Subject to the limits in 5, this agreement will be binding upon and benefit the parties, their successors and
assigns. 
 9. Notices. Any notices under this option must be in writing and will be effective when actually delivered or, if mailed,
when deposited postpaid. Each party shall direct mail to the address stated in this option or to such other address as a party may certify by notice to the other party. Each party will send notices to the Board at the Company’s address.

  

									
	MENTOR GRAPHICS CORPORATION	 		 	OPTIONEE
					
	By:	 	 	 		 		 	 
		 	Dean Freed	 		 		 	NAME
		 	Vice President and General Counsel	 		 		 	

  

 3Form of Deferral Agreement and Distribution Election related to non-employee

 Exhibit 10.D 

MENTOR GRAPHICS CORPORATION 

IRREVOCABLE RSU DEFERRED DISTRIBUTION ELECTION FORM 

JULY 1, 2010 OUTSIDE DIRECTOR RSU AWARDS 

To be submitted on or before July 31, 2010 

Name:
                                         
            
 On July 1, 2010 you received a grant of Restricted
Stock Units (“RSUs”) with respect to Shares of Mentor Graphics Corporation (the “Company’s”) Common Stock (the “RSU Award”). The RSU Award is scheduled to vest 50% on July 1, 2011 (the “First
Tranche”) and 50% on July 1, 2012 (the “Second Tranche”). You may elect to defer delivery of all or a portion of the Second Tranche of your RSU Award by making an irrevocable written deferral election within 30 days of the grant
(i.e., on or before July 31, 2010). This deferral is permitted under the “ad hoc” exception to the general rules on deferrals under Internal Revenue Section 409A. You may not defer distribution of the shares subject to the First
Tranche. 
 However, even if you elect to defer delivery of all or a portion of the shares underlying the Second Tranche to a
fixed future date, distribution to you of those shares will be automatically accelerated as of the date of the first to occur of the following specific events (provided that such date is after the original vesting date applicable to the shares of
stock subject to the Second Tranche of the RSU award): (i) a change in control of the Corporation (as defined under Code Section 409A), (ii) a separation from service (as defined under Code Section 409A) with the Company,
(iii) upon a Disability (as defined under Code Section 409A), or (iv) the date of your death. Your distribution election is effective only with respect to shares subject to the Second Tranche of your Restricted Stock Unit Award that
vest. 
 Your timely and effective distribution election may be amended at a later date, but any amendment will be subject to specific and
complex rules and requirements which may limit your ability to change the timing of your distribution. 
 PLEASE NOTE THAT A DEFERRAL
ELECTION WILL ONLY BE TIMELY IF THIS FORM IS COMPLETED AND DELIVERED TO DEAN FREED, GENERAL COUNSEL, NO LATER THAN JULY 31, 2010 AT 5:00 P.M. PST. IF THE FORM IS NOT COMPLETED, OR IS DELIVERED AFTER THAT TIME OR DATE, THEN IT CANNOT BE
CONSIDERED EFFECTIVE AND YOU WILL BE DEEMED TO HAVE ELECTED TO RECEIVE A DISTRIBUTION OF SHARES IN CONJUNCTION WITH THE ORIGINAL VESTING SCHEDULE FOR YOUR RSU AWARD. 

 MENTOR GRAPHICS CORPORATION (THE “COMPANY”) 

DEFERRAL AGREEMENT AND DISTRIBUTION ELECTION 

JULY 1, 2010 OUTSIDE DIRECTOR RSU AWARDS 
  

	
	 1.      Director Information (please print)

Last Name:
                                     First Name:
                             Middle Initial:
                 
 Social Security
Number:
            -            -                
         
  

	
	 2.      Deferral Agreement and Distribution Election

This Deferral Agreement and Distribution Election which includes, without limitation, the attached cover letter, the terms of which are
incorporated by reference (the “Agreement”), is made this              day of July, 2010 between the Outside Director identified in item 1 above and the Company.

 On July 1, 2010, I received a grant of restricted stock units with respect to shares of the Company’s common stock
(the “RSU Award”). The RSU Award is scheduled to vest 50% on July 1, 2011 (the “First Tranche”) and 50% on July 1, 2012 (the “Second Tranche”). By signing this Agreement, I am irrevocably deferring the
delivery of              percent (        %) of the shares underlying the Second Tranche of the RSU Award. 

 

	
	 3.      Deferred Delivery Date

If you want your Deferred Delivery Date to be a specific date check the box and complete the information below. If you select a fixed date
your Deferred Delivery Date will be the first to occur of the date you (i) select, (ii) die, (iii) become “Disabled” (as defined under Code Section 409A), (iv) ”Separate from Service” (as defined under
Code Section 409A), or (v) the Company experiences a “Change in Control” (as defined under Code Section 409A). If you do not select a fixed date your Deferred Delivery Date will be the first to occur of the date you
(i) die, (ii) become Disabled, (iii) Separate from Service or (iv) the Company experiences a Change in Control. 

 ̈          I wish my Deferred Delivery
Date to be a fixed date. Pay me on the first day of                      (month), 20    . 

 

	 	*	Payment of any dividends attributable to the RSUs I elected to defer above will also be paid on my Deferred Delivery Date. 

Upon attainment of my Deferred Delivery Date I understand that the shares underlying the portion of the RSU Award I elect to defer will be
distributed in a single payment. 
  

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	 4.      Code Section 409A

It is intended that this Agreement will comply with the provisions of Code Section 409A of the Internal Revenue Code of 1986, as
amended (the “Code”) and the Treasury Regulation relating thereto, and the Agreement will be interpreted, operated, and administered in a manner consistent with these intentions. Anything to the contrary in this Agreement notwithstanding,
the Company may adopt such amendments to the Agreement or take any other actions, in each case, without your consent, that the Company determines are reasonable, necessary or appropriate to comply with the requirements of Code Section 409A and
the related Department of Treasury guidance. The Company makes no representation or covenant to ensure that the payments under the Agreement are compliant with, Code Section 409A, and will have no liability to you or any other party if a
payment under the Agreement that is intended to comply with, Code Section 409A is not so exempt or compliant or for any action taken by the Company with respect thereto. 

 

	
	 5.      Director Acknowledgments and Signature

I acknowledge each of the foregoing: 
  

	 	•	 	 My determination to defer delivery of shares under the RSU Award may have direct implications for my personal tax obligations. I understand that the
Company strongly advises that I consult with a tax or legal advisor before making any deferral election, in order to understand the tax consequences particular to me; 

 

	 	•	 	 My deferral election is irrevocable once made; 

  

	 	•	 	 Delivery of the deferred portion of my RSU Award may not be accelerated, other than in accordance with Code Section 409A;

  

	 	•	 	 The Company reserves the right to terminate this Agreement in accordance with Code Section 409A; 

 

	 	•	 	 The deferral arrangement is unfunded; and 

  

	 	•	 	 The shares underlying the portion of the RSU Award that is deferred may lose all of their value in the event of the Company’s bankruptcy or
insolvency and the value of the Company’s shares may decline over the deferral period. 

Date: _______________________ 

Signed: _______________________ 
  

 
 FOR ADMINISTRATIVE USE ONLY 

 Date Received: _________________________ 

Signed: _______________________ 
  

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