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EXHIBIT 99.4
FORM OF ADDENDUM TO STOCK OPTION AGREEMENT
The following provisions are hereby incorporated into, and are hereby
made a part of, that certain Stock Option Agreement (the "Option Agreement") by
and between Digital Lightwave, Inc. (the "Corporation") and _________________
("Optionee") evidencing the stock option (the "Option") granted this day to
Optionee under the terms of the Corporation's 2001 Stock Option Plan (the
"Plan"), and such provisions are effective immediately. All capitalized terms in
this Addendum, to the extent not otherwise defined herein, shall have the
meanings assigned to them in the Option Agreement.
INVOLUNTARY TERMINATION FOLLOWING CORPORATE TRANSACTION
1. To the extent the Option is to be assumed in connection with a
Corporate Transaction, the Option shall not, pursuant to the provisions of
Paragraph 6 of the Option Agreement, accelerate upon the occurrence of that
Corporate Transaction, and the Option shall accordingly continue, over
Optionee's period of Service after the Corporate Transaction, to become
exercisable for the Option Shares in one or more installments in accordance with
the provisions of the Option Agreement. However, immediately upon an Involuntary
Termination of Optionee's Service within twelve (12) months following such
Corporate Transaction, the assumed Option, to the extent outstanding at the time
but not otherwise fully exercisable, shall automatically accelerate so that the
Option shall become immediately exercisable for all the Option Shares at the
time subject to the Option and may be exercised for any or all of those Option
Shares as fully vested shares.
2. The Option as accelerated pursuant to this Addendum shall remain so
exercisable until the earlier of (i) the Expiration Date or (ii) the expiration
of the ninety (90) day period measured from the date of the Optionee's
Involuntary Termination; provided however, that if optionee is prohibited from
selling shares during such ninety (90) day period by reason of a regulatory
requirement (including a prohibition on sale imposed by the Corporation to
assure compliance with regulatory rules concerning xxxxxxx xxxxxxx), such ninety
(90) day period shall be extended by the number of days that the sale is so
prohibited.
3. For purposes of this Addendum the following definitions shall be in
effect:
(i) An INVOLUNTARY TERMINATION shall mean the termination of
Optionee's Service by reason of:
(A) Optionee's involuntary dismissal or discharge by
the Corporation for reasons other than Misconduct, or
(B) Optionee's voluntary resignation following (A) a
change in Optionee's position with the Corporation which
materially reduces Optionee's duties and responsibilities or
the level of management to which Optionee reports, (B) a
reduction in Optionee's level of compensation (including base
salary, fringe benefits and target bonus under any corporate
performance based bonus or incentive programs) by more than
fifteen percent (15%) or (C) a relocation of Optionee's place
of employment by more than fifty (50) miles, provided and only
if such change, reduction or relocation is effected by the
Corporation without Optionee's consent.
4. The provisions of this Addendum and, to the extent not inconsistent
herewith, the Option Agreement shall (a) govern the exercisability of the
Option, and (b) supersede any inconsistent provisions of any prior agreement
(including any employment arrangement) between Optionee and the Corporation
relating to the terms of the Option, including terms relating to acceleration of
exercisability of the Option upon a change in control or other transaction.
Optionee agrees that the terms of the Option and future option grants under the
Plan shall not be governed by any such prior agreement entered into between the
Company and the Optionee.
5. The provisions of this Addendum shall not be amended or modified
unless Optionee consents in writing to such amendment or modification.
IN WITNESS WHEREOF, Digital Lightwave, Inc. has caused this Addendum to
be executed by its duly authorized officer as of the Effective Date specified
below.
DIGITAL LIGHTWAVE, INC.
By: _______________________________________
Title: _____________________________________
EFFECTIVE DATE: ________________________
