Exhibit 10.1A
Form of Option Award Agreement for Officers
NON-QUALIFIED STOCK OPTION AWARD
PURSUANT TO THE VERILINK CORPORATION
2004 STOCK INCENTIVE PLAN
THIS AWARD is made as of the Grant Date by VERILINK CORPORATION (the
"Company") to ____________________________________ (the "Optionee").
Upon and subject to the Terms and Conditions attached hereto and
incorporated herein by reference, the Company hereby awards as of the Grant Date
to Optionee an option (the "Option"), as described below, to purchase the Option
Shares.
X. Xxxxx Date: _______________________.
B. Type of Option: Non-Qualified Stock Option issued under the Verilink
Corporation 2004 Stock Incentive Plan (the "Plan").
C. Plan under which granted: Verilink Corporation 2004 Stock Incentive
Plan.
D. Option Shares: All or any part of __________ shares of the Company's
common stock, $.01 par value per share (the "Stock"), subject to
adjustment as provided in the attached Terms and Conditions.
E. Exercise Price: $_______ per share, subject to adjustment as
provided in the attached Terms and Conditions.
F. Option Period: The Option may be exercised only during the Option
Period which commences on the Grant Date and ends on the earlier of
(a) the tenth (10th) anniversary of the Grant Date; (b) the later of
the date (i) three (3) months following the date the Optionee ceases
to be an employee of the Company or any Subsidiary for any reason
other than due to death or Disability; or (ii) twelve (12) months
following the date the Optionee ceases to be an employee of the
Company or any Subsidiary due to death or Disability.
G. Vesting: The Option Shares shall be immediately vested and
exercisable in their entirety as of the Grant Date, subject to the
Company's Repurchase Rights (as defined in Section 9 below) in
accordance with the attached Terms and Conditions and Repurchase
Schedule.
IN WITNESS WHEREOF, the Company and Optionee have executed and sealed this
Award as of the Grant Date set forth above.
OPTIONEE VERILINK CORPORATION
____________________________ By: ________________________________
[Name]
Title: _____________________________
TERMS AND CONDITIONS
TO THE
NON-QUALIFIED STOCK OPTION AWARD
PURSUANT TO THE VERILINK CORPORATION
2004 STOCK INCENTIVE PLAN
1. Exercise of Option. Subject to the provisions of the Plan and the Award
which is made pursuant to the Verilink Corporation 2004 Stock Incentive Plan and
subject also to these Terms and Conditions, which are incorporated in and made a
part of the attached Award:
(a) the Option may be exercised with respect to all or any portion
of the Option Shares at any time during the Option Period by the delivery
to the Company, at its principal place of business, of a written notice of
exercise in substantially the form attached hereto as Exhibit 1;
(b) payment to the Company of the Exercise Price multiplied by the
number of Option Shares being purchased (the "Purchase Price") as provided
in Section 2; and
(c) payment of any tax withholding liability pursuant to Section 3
below.
Upon acceptance of such notice and receipt of payment in full of the Purchase
Price and any tax withholding liability, the Company shall cause to be issued a
certificate representing the Option Shares purchased.
2. Purchase Price. Payment of the Purchase Price for all Option Shares
purchased pursuant to the exercise of an Option shall be made
(a) in cash or certified check;
(b) by delivery to the Company of a number of shares of Stock which
have been owned by the Optionee for at least six (6) months prior to the
date of the Option's exercise having a fair market value, as determined
under the Plan, on the date of exercise either equal to the Purchase Price
or in combination with cash or a certified check to equal the Purchase
Price;
(c) by receipt of the Purchase Price in cash from a broker, dealer
or other "creditor" as defined by Regulation T issued by the Board of
Governors of the Federal Reserve System following delivery by the Optionee
to the Committee of instructions in a form acceptable to the Committee
regarding delivery to such broker, dealer or other creditor of that number
of Option Shares with respect to which the Option is exercised; provided,
however, that any such cashless exercise must be effected in a manner
consistent with the restrictions of Section 13(k) of the Securities
Exchange Act of 1934 (Section 402 of the Xxxxxxxx-Xxxxx Act of 2002); or
(d) or any combination of the foregoing.
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3. Condition to Delivery of Option Shares.
(a) The Optionee must deliver to the Company, on the earlier of: (i)
the later of the date on which Option Shares are purchased by the Optionee
or the date on which the Repurchase Rights applicable to such Option
Shares expire or (ii) the date of the Optionee's timely election pursuant
to Code Section 83(b) as to all or any portion of the Option Shares
purchased by the Optionee, either cash or a certified check payable to the
Company in the amount of all tax withholding obligations (whether federal,
state or local), imposed on the Company by reason of the exercise of the
Option Shares or, if later in time, the lapse of the corresponding
Repurchase Rights, or the making of an election pursuant to Code Section
83(b), as applicable, except as provided in Section 3(b).
(b) If the Optionee does not make an election pursuant to Code
Section 83(b), in lieu of paying the withholding tax obligation in cash or
by certified check as described in Section 3(a), the Optionee may elect to
have the actual number of shares of Stock issuable upon exercise reduced
by the smallest number of whole shares of Stock which, when multiplied by
the Fair Market Value of the Stock as of the Tax Date (as defined below),
is sufficient to satisfy the amount of the tax withholding obligations
imposed on the Company by reason of the exercise of the Options Shares or,
if later in time, the lapse of the corresponding Repurchase Rights (the
"Withholding Election"). The Optionee may make a Withholding Election only
if all of the following conditions are met:
(i) the Withholding Election is made on or prior to the date
on which the amount of tax required to be withheld is determined
(the "Tax Date") by executing and delivering to the Company a
properly completed Notice of Withholding Election, in substantially
the form attached hereto as Exhibit 2; and
(ii) any Withholding Election made will be irrevocable;
however, the Committee may, in its sole discretion, disapprove and
give no effect to any Withholding Election.
4. Rights as Shareholder. Until the stock certificates reflecting the
Option Shares accruing to the Optionee upon exercise of the Option are issued,
the Optionee shall have no rights as a shareholder with respect to such Option
Shares. The Company shall make no adjustment for any dividends or distributions
or other rights on or with respect to Option Shares for which the record date is
prior to the issuance of that stock certificate, except as the Plan or the
attached Award otherwise provides.
5. Restriction on Transfer of Option and of Option Shares. Except as
otherwise expressly permitted by the Committee in writing, the Option evidenced
hereby is nontransferable other than by will or the laws of descent and
distribution and shall be exercisable during the lifetime of the Optionee only
by the Optionee (or in the event of his/her disability, by his/her personal
representative) and after his/her death, only by his/her legatee or the executor
of his/her estate.
6. Changes in Capitalization.
(a) Except as provided in Subsection (b) below, if the number of
shares of Stock shall be increased or decreased by reason of a subdivision
or combination of shares of Stock, the payment of an ordinary stock
dividend in shares of Stock or any other increase or decrease in the
number of shares of Stock outstanding effected without receipt of
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consideration by the Company, an appropriate adjustment shall be made by
the Committee, in a manner determined in its sole discretion, in the
number and kind of Option Shares and in the Exercise Price.
(b) In the event of a merger, consolidation, reorganization,
extraordinary dividend or other change in the corporate structure of the
Company, including a Change in Control (as defined in Section 19 below),
or tender offer for shares of Stock, the Company shall provide for an
appropriate, proportionate adjustment to the Option or provide for the
substitution of a new option which adjustment or substitution shall be
consistent with the event requiring the adjustment or substitution;
provided, however, in the event the Company will not be the surviving
entity as a result of the event and the surviving entity does not agree to
the adjustment or substitution, the Committee may elect to terminate the
Option Period as of the date of the Change in Control in consideration of
the payment to the Optionee of the sum of the difference between the then
Fair Market Value of the Stock and the Exercise Price for each Option
Share as to which the Company's Repurchase Rights have lapsed and as to
which the Option has not been exercised as of the date of the Change in
Control.
(c) The existence of the Plan and the Option granted pursuant to
this Agreement shall not affect in any way the right or power of the
Company to make or authorize any adjustment, reclassification,
reorganization or other change in its capital or business structure, any
merger or consolidation of the Company, any issue of debt or equity
securities having preferences or priorities as to the Stock or the rights
thereof, the dissolution or liquidation of the Company, any sale or
transfer of all or any part of its business or assets, or any other
corporate act or proceeding. Any adjustment pursuant to this Section may
provide, in the Committee's discretion, for the elimination without
payment therefor of any fractional shares that might otherwise become
subject to any Option.
7. Special Limitation on Exercise. No purported exercise of the Option
shall be effective without the approval of the Committee, which may be withheld
to the extent that the exercise, either individually or in the aggregate
together with the exercise of other previously exercised stock options and/or
offers and sales pursuant to any prior or contemplated offering of securities,
would, in the sole and absolute judgment of the Committee, require the filing of
a registration statement with the United States Securities and Exchange
Commission or with the securities commission of any state. If a registration
statement is not in effect under the Securities Act of 1933, or any applicable
state securities law with respect to shares of Stock purchasable or otherwise
deliverable under the Option, the Optionee (a) shall deliver to the Company,
prior to the exercise of the Option or as a condition to the delivery of Stock
pursuant to the exercise of an Option exercise, such information,
representations and warranties as the Company may reasonably request in order
for the Company to be able to satisfy itself that the Option Shares are being
acquired in accordance with the terms of an applicable exemption from the
securities registration requirements of applicable federal and state securities
laws and (b) shall agree that the shares of Stock so acquired will not be
disposed of except pursuant to an effective registration statement, unless the
Company shall have received an opinion of counsel that such disposition is
exempt from such requirement under the Securities Act of 1933 and any applicable
state securities law.
8. Legend on Stock Certificates. In addition to any legends required under
applicable securities laws at the time the Option Shares are issued, the
certificates evidencing Option Shares that are subject to Repurchase Rights at
the time of issuance shall be endorsed with the following legend and the
Optionee shall not make any transfer of the Option Shares without first
complying with the restrictions on transfer described in such legend:
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TRANSFER IS RESTRICTED
THE SECURITIES EVIDENCED BY THIS CERTIFICATE ARE SUBJECT TO
RESTRICTIONS ON TRANSFER AND FORFEITURE PROVISIONS WHICH ALSO APPLY
TO THE TRANSFEREE AS SET FORTH IN A NON-QUALIFIED STOCK OPTION
AWARD, DATED ___________, A COPY OF WHICH IS AVAILABLE FROM THE
COMPANY.
9. Repurchase Rights. In the event the Optionee ceases to be an employee
of the Company or any Affiliate for any reason, with or without cause, or if the
Optionee or the Optionee's legal representative attempts to sell, exchange,
transfer, pledge or otherwise dispose of any shares of Stock acquired upon
exercise of the Option, the Company shall have the right to repurchase such
shares ("Repurchase Rights") in the number provided in the Repurchase Schedule
attached hereto and subject to the Terms and Conditions set forth in this
Section 9.
(a) Change in Control. In the event of a Change in Control, the
Committee shall provide for the lapse of any and all of the Company's
outstanding Repurchase Rights under the Option as of a date no later than
immediately prior to the effective date of the Change in Control.
(b) Option Shares Held by the Share Custodian. The Optionee hereby
authorizes and directs the Company to deliver any certificate issued by
the Company to evidence Option Shares acquired upon exercise of the Option
to the Secretary of the Company or such other officer of the Company as
may be designated by the Committee (the "Share Custodian") to be held by
the Share Custodian until such Option Shares are no longer subject to the
Company's Repurchase Rights in accordance with the Repurchase Schedule.
When such Option Shares are no longer subject to the Company's Repurchase
Rights in accordance with the Repurchase Schedule, the Share Custodian
shall deliver such Option Shares to the Optionee. In the event that the
number of such Option Shares that cease to be subject to the Company's
Repurchase Rights include a fraction of a share, the Share Custodian shall
not be required to deliver the fractional share, and the Company may pay
the Optionee the amount determined by the Company to be the estimated fair
market value therefor. The Optionee hereby irrevocably appoints the Share
Custodian, and any successor thereto, as the true and lawful
attorney-in-fact of Optionee with full power and authority to execute any
stock transfer power or other instrument necessary to transfer such Option
Shares to the Company in accordance with this Award, in the name, place,
and stead of the Optionee. The term of such appointment shall commence on
the Grant Date and shall continue until such Option Shares are delivered
to the Optionee as provided above or are repurchased by the Company
pursuant to Section 9(c) below. During the period that the Share Custodian
holds the Option Shares subject to this Section 9, the Optionee shall be
entitled to all rights applicable to shares of Stock not so held, except
as provided in this Award. In the event the number of shares of Stock is
increased or reduced by a change in the par value, split-up, stock split,
reverse stock split, reclassification, merger, reorganization,
consolidation, or otherwise, the Optionee agrees that any certificate
representing shares of Stock or other securities of the Company issued as
a result of any of the foregoing in respect of the Option Shares shall be
delivered to the Share Custodian and shall be subject to all of the
provisions of this Award as if initially granted thereunder.
(c) Exercise of Repurchase Rights The Company may exercise the
Repurchase Rights by written notice to the Share Custodian and to the
Optionee or the Optionee's legal
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representative within sixty (60) days after such termination of employment
(or exercise of the Option, if later) or after the Company has received
notice of the attempted disposition. The Repurchase Rights must be
exercised, if at all, for all of the Option Shares purchased to date by
the Optionee to the extent the same remain subject to the Repurchase
Rights. If the Company fails to give notice within such sixty (60) day
period, the Repurchase Rights shall terminate unless the Company and
Optionee have extended the time for the exercise of the Repurchase Rights.
In the event that the Company fails to exercise its Repurchase Rights, the
Share Custodian shall deliver a certificate representing such Option
Shares to the Optionee or the Optionee's legal representative.
(d) Payment for Shares and Return of Shares. Payment by the Company
to the Share Custodian on behalf of Optionee or Optionee's legal
representative shall be made in cash within sixty (60) days after the date
of the mailing of the written notice of exercise of the Repurchase Rights.
For purposes of the foregoing, cancellation of any indebtedness of
Optionee to the Company shall be treated as payment to Optionee in cash to
the extent of the unpaid principal and any accrued interest canceled. The
purchase price per share of Stock being purchased by the Company shall be
an amount equal to Optionee's original cost per share, as adjusted, if
applicable, pursuant to Section 6 herein. Within thirty (30) days after
payment by the Company, the Share Custodian shall deliver the Option
Shares which the Company has purchased to the Company and shall deliver
the payment received from the Company to the Optionee.
(e) Transfers Not Subject to the Repurchase Rights. The Repurchase
Rights shall not apply to a transfer to Optionee's ancestors, descendants
or spouse or to a trustee solely for the benefit of Optionee or Optionee's
ancestors, descendants or spouse, provided that such transferee shall
agree in writing (in a form satisfactory to the Committee) to take the
shares of Stock subject to all the terms and conditions of this Section 9
providing for Repurchase Rights.
10. Governing Laws. This Award and the Terms and Conditions shall be
construed, administered and enforced according to the laws of the State of
Delaware; provided, however, the Option may not be exercised except in
compliance with exemptions available under applicable state securities laws of
the state in which the Optionee resides and/or any other applicable securities
laws.
11. Successors. This Award and the Terms and Conditions shall be binding
upon and inure to the benefit of the heirs, legal representatives, successors
and permitted assigns of the Optionee and the Company.
12. Notice. Except as otherwise specified herein, all notices and other
communications under this Award shall be in writing and shall be deemed to have
been given if personally delivered or if sent by registered or certified United
States mail, return receipt requested, postage prepaid, addressed to the
proposed recipient at the last known address of the recipient. Any party may
designate any other address to which notices shall be sent by giving notice of
the address to the other parties in the same manner as provided herein.
13. Severability. In the event that any one or more of the provisions or
portion thereof contained in the Award and these Terms and Conditions shall for
any reason be held to be invalid, illegal or unenforceable in any respect, the
same shall not invalidate or otherwise affect any other provisions of the Award
and these Terms and Conditions, and the Award and these Terms and
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Conditions shall be construed as if the invalid, illegal or unenforceable
provision or portion thereof had never been contained herein.
14. Entire Agreement. Subject to the terms and conditions of the Plan, the
Award and the Terms and Conditions express the entire understanding of the
parties with respect to the Option.
15. Violation. Any transfer, pledge, sale, assignment, or hypothecation of
the Option or any portion thereof shall be a violation of the terms of the Award
or these Terms and Conditions and shall be void and without effect.
16. Headings and Capitalized Terms. Section headings used herein are for
convenience of reference only and shall not be considered in construing the
Award or these Terms and Conditions. Capitalized terms used, but not defined, in
either the Award or the Terms and Conditions shall be given the meaning ascribed
to them in the Plan.
17. Specific Performance. In the event of any actual or threatened default
in, or breach of, any of the terms, conditions and provisions of the Award and
these Terms and Conditions, the party or parties who are thereby aggrieved shall
have the right to specific performance and injunction in addition to any and all
other rights and remedies at law or in equity, and all such rights and remedies
shall be cumulative.
18. No Right to Continued Employment. Neither the establishment of the
Plan nor the award of Option Shares hereunder shall be construed as giving the
Optionee the right to continued service as an employee of the Company or any
affiliate.
19. Definition of Change in Control. As used in the Award and these Terms
and Conditions, the term "Change in Control" means any one of the following
events occurring after the Grant Date:
(a) the acquisition by any individual, entity or group (within the
meaning of Section 13(d)(3) or 14(d)(2) of the Securities Exchange Act of
1934, as amended (the "Exchange Act")) (a "Person") of beneficial
ownership (within the meaning of Rule 13d-3 promulgated under the Exchange
Act) of voting securities of the Company where such acquisition causes
such Person to own more than fifty percent (50%) of the combined voting
power of the then outstanding voting securities of the Company entitled to
vote generally in the election of directors (the "Outstanding Employer
Voting Securities");
(b) individuals who as of the Grant Date, constitute the Board of
Directors (the "Incumbent Board") cease for any reason to constitute at
least a majority of the Board of Directors; provided, however, that any
individual becoming a director subsequent to the Grant Date hereof whose
election, or nomination for election by the Company's shareholders, was
approved by a vote of at least two-thirds of the directors then comprising
the Incumbent Board shall be considered as though such individual were a
member of the Incumbent Board, but excluding, for this purpose, any such
individual whose initial assumption of office occurs as a result of an
actual or threatened election contest with respect to the election or
removal of directors or other actual or threatened solicitation of proxies
or consents by or on behalf of a Person other than the Board of Directors;
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(c) the approval by the shareholders of the Company of a
reorganization, merger or consolidation or sale or other disposition of
all or substantially all of the assets of the Company ("Business
Combination") or, if consummation of such Business Combination is subject,
at the time of such approval by shareholders, to the consent of any
government or governmental agency, the obtaining of such consent (either
explicitly or implicitly by consummation); excluding, however, such a
Business Combination pursuant to which all or substantially all of the
Persons who were the beneficial owners of the Outstanding Employer Voting
Securities immediately prior to such Business Combination beneficially
own, directly or indirectly, more than fifty percent (50%) of,
respectively, the then outstanding shares of common stock and the combined
voting power of the then outstanding voting securities entitled to vote
generally in the election of directors, as the case may be, of the
corporation resulting from such Business Combination (including, without
limitation, a corporation that as a result of such transaction owns the
Company or all or substantially all of the Company's assets either
directly or through one or more subsidiaries) in substantially the same
proportions as their ownership, immediately prior to such Business
Combination of the Outstanding Employer Voting Securities; or
(d) approval by the shareholders of the Company of a complete
liquidation or dissolution of the Company.
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EXHIBIT 1
NOTICE OF EXERCISE OF
STOCK OPTION TO PURCHASE
COMMON STOCK OF
VERILINK CORPORATION
Name _______________________
Address ____________________
____________________________
Date _______________________
Verilink Corporation
000 Xxxxxxx Xxxxxx
Xxxxxxx, Xxxxxxx 00000-0000
Attn: Corporate Secretary
Re: Exercise of Non-Qualified Stock Option
Gentlemen:
Subject to acceptance hereof by Verilink Corporation (the "Company")
pursuant to the provisions of the Verilink Corporation 2004 Stock Incentive Plan
(the "Plan") I hereby give notice of my election to exercise options granted to
me to purchase ______________ shares of common stock $.01 par value ("Common
Stock"), of the Company under the Non-Qualified Stock Option Award (the "Award")
dated as of ____________. The purchase shall take place as of __________, 200__
(the "Exercise Date").
On or before the Exercise Date, I will pay the applicable purchase price
as follows:
[ ] by delivery of cash or a certified check for $___________ for
the full purchase price payable to the order of Verilink
Corporation.
[ ] by delivery of cash or a certified check for $___________
representing a portion of the purchase price with the balance to
consist of shares of Common Stock that I have owned for at least six
months and that are represented by a stock certificate I will
surrender to the Company with my endorsement. If the number of
shares of Common Stock represented by such stock certificate exceeds
the number to be applied against the purchase price, I understand
that a new stock certificate will be issued to me reflecting the
excess number of shares.
[ ] by delivery of a stock certificate representing shares of Common
Stock that I have owned for at least six months which I will
surrender to the Company with my endorsement as payment of the
purchase price. If the number of shares of Common Stock represented
by such certificate exceeds the number to be applied against the
purchase price, I understand that a new certificate will be issued
to me reflecting the excess number of shares.
Exhibit 1 - Page 1
[ ] by delivery of the purchase price by _________________________,
a broker, dealer or other "creditor" as defined by Regulation T
issued by the Board of Governors of the Federal Reserve System. I
hereby authorize the Company to issue a stock certificate for the
number of shares indicated above in the name of said broker, dealer
or other creditor or its nominee pursuant to instructions received
by the Company and to deliver said stock certificate directly to
that broker, dealer or other creditor (or to such other party
specified in the instructions received by the Company from the
broker, dealer or other creditor) upon receipt of the purchase
price.
The required federal, state and local income tax withholding obligations,
if any, on the exercise of the Award shall also be satisfied in accordance with
Section 3 of the Terms and Conditions.
As soon as the stock certificate is registered in my name, please deliver
it to me at the above address or to the Share Custodian, if required by Section
9 of the Terms and Conditions.
If the Common Stock being acquired is not registered for issuance to the
Optionee pursuant to an effective registration statement on Form S-8 (or
successor form) filed under the Securities Act of 1933, as amended (the "1933
Act"), I understand and agree that I may be required to make such additional
representations, warranties, covenants, and agreements with the Company as the
Company may reasonably request.
I understand that the certificates representing the shares being purchased
by me in accordance with this notice shall bear a legend referring to the
foregoing covenants, representations and warranties and restrictions on
transfer, and I agree that a legend to that effect may be placed on any
certificate which may be issued to me as a substitute for the certificates being
acquired by me in accordance with this notice.
Very truly yours,
____________________________
AGREED TO AND ACCEPTED:
VERILINK CORPORATION
By: ________________________________
Title: _____________________________
Number of Shares
Exercised: _________________________
Number of Shares
Remaining: _________________________ Date: ______________________
Exhibit 1 - Page 2
EXHIBIT 2
NOTICE OF WITHHOLDING ELECTION
VERILINK CORPORATION 2004 STOCK INCENTIVE PLAN
TO: Verilink Corporation
Attn: Corporate Secretary
FROM: __________________________
RE: Withholding Election
This election relates to the Option identified in Paragraph 3 below. I
hereby certify that:
(1) My correct name and social security number and my current address
are set forth at the end of this document.
(2) I am (check one, whichever is applicable).
[ ] the original recipient of the Option.
[ ] the legal representative of the estate of the original
recipient of the Option.
[ ] a legatee of the original recipient of the Option.
[ ] the legal guardian of the original recipient of the Option.
(3) The Option pursuant to which this election relates was issued under
the Verilink Corporation 2004 Stock Incentive Plan in the name of
_____________________ for the purchase of a total of __________
shares of Common Stock. This election relates to _____________
shares of Common Stock issuable upon exercise of the Option (the
"Stock"), provided that the numbers set forth above shall be deemed
changed as appropriate to reflect the applicable Plan provisions.
(4) In connection with any exercise of the Option with respect to Stock,
I hereby elect:
[ ] to have certain of the shares otherwise issuable pursuant to
the exercise withheld by the Company for the purpose of having
the value of the shares applied to pay federal, state, and
local, if any, taxes arising from the exercise.
[ ] to tender shares held by me for a period of at least six (6)
months prior to the exercise of the Option for the purpose of
having the value of the shares applied to pay such taxes.
The shares to be withheld or tendered, as the case may be, shall have, as
of the Tax Date applicable to the exercise, a fair market value equal to
the minimum statutory tax withholding requirement under federal, state and
local law in connection with the exercise.
Exhibit 2 - Page 1
(5) This Withholding Election is made no later than the Tax Date and is
otherwise timely made pursuant to the Plan.
(6) I understand that this Withholding Election may not be revised,
amended or revoked by me.
(7) The Plan has been made available to me by the Company, I have read
and understand the Plan and I have no reason to believe that any of
the conditions therein to the making of this Withholding Election
have not been met. Capitalized terms used in this Notice of
Withholding Election shall have the meanings given to them in the
Plan.
(8) Capitalized terms used in this Notice of Withholding Election
without definition shall have the meanings given to them in the
Plan.
Dated: ____________________
____________________________
Signature
____________________________
Name (printed)
____________________________
Street Address
____________________________
City, State, Zip Code
Exhibit 2 - Page 2
[NAME OF OPTIONEE]
SCHEDULE 1
VERILINK CORPORATION
NON-QUALIFIED STOCK OPTION AWARD
Repurchase Schedule
A. Option Shares are subject to the Company's Repurchase Rights with respect to
the shares of Stock that have been exercised as indicated in the schedule below.
Percentage of Option Shares Months of Service
Subject to the Repurchase Rights after Grant Date
100% Less than 12
75% 12 but less than 13
For every full Month of Service following the completion of twelve (12) months
after the Grant Date, the percentage of Option Shares subject to the Repurchase
Rights shall be reduced by an additional 2.083% until the fourth anniversary of
the Grant Date at which point no Option Shares shall be subject to the
Repurchase Rights.
B. In determining which Option Shares are no longer subject to the Company's
Repurchase Rights, the following order of priority shall be applied: (i) Option
Shares purchased by the Optionee in the order of their date of purchase from the
earliest purchase date to the most recent purchase date; and then (ii) Option
Shares which have not been purchased by the Optionee.
C. For purposes of the Repurchase Schedule, the Optionee shall be granted a
Month of Service for each monthly period (i.e., from a date of one calendar
month to the date immediately preceding the same date of the immediately
succeeding calendar month) following the Grant Date and during which Optionee
continues, at all times, as an employee of the Company or Subsidiary.
Schedule 1 - Page 1
