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EXHIBIT 10.3
THE SECURITY REPRESENTED BY THIS CERTIFICATE HAS BEEN ACQUIRED FOR INVESTMENT
AND NOT WITH A VIEW TO, OR IN CONNECTION WITH, THE SALE OR DISTRIBUTION
THEREOF. NO SUCH SALE OR DISPOSITION MAY BE EFFECTED WITHOUT AN EFFECTIVE
REGISTRATION STATEMENT RELATED THERETO OR AN OPINION OF COUNSEL SATISFACTORY TO
THE COMPANY THAT SUCH REGISTRATION IS NOT REQUIRED UNDER THE SECURITIES ACT OF
1933.
CIENA CORPORATION
INCENTIVE STOCK OPTION AGREEMENT
THIS INCENTIVE STOCK OPTION AGREEMENT (the "OPTION AGREEMENT")
is made and entered into as of {date}, by and between Ciena Corporation, a
Delaware corporation (the "COMPANY"), and {employee} (the "OPTIONEE").
The Company granted to the Optionee an option to purchase
certain shares of common stock of the Company, in the manner and subject to the
provisions of this Option Agreement (the "OPTION"). If the Optionee (and the
Optionee's spouse, if married) does not execute and return the Option Agreement
to the Company within sixty (60) days of the date first written above, the
Option shall terminate and be without further force and effect.
1. Definitions:
(a) "DATE OF OPTION GRANT" shall mean the date
set forth on Exhibit A annexed hereto and made a part hereof.
(b) "NUMBER OF OPTION SHARES" shall mean the
number of shares of common stock of the Company set forth on Exhibit A as
adjusted from time to time pursuant to paragraph 9 below.
(c) "EXERCISE PRICE" shall mean the price per
share set forth on Exhibit A as adjusted from time to time pursuant to
paragraph 9 below.
(d) "INITIAL EXERCISE DATE" shall be the Initial
Vesting Date.
(e) "INITIAL VESTING DATE" shall be the last day
of the calendar month in which occurs the date one (1) year after the date set
forth on Exhibit A.
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(f) Determination of "VESTED PERCENTAGE":
Vested Percentage
-----------------
Prior to Initial Vesting Date 0%
On Initial Vesting Date, provided 25%
the Optionee is continuously
employed by a Participating
Company from the Date of Option
Grant until the Initial Vesting Date
Plus
----
For each full month of the 2.084%
Optionee's continuous employment
by a Participating Company from
the Initial Vesting Date
In no event shall the Vested
Percentage exceed 100%
(g) "OPTION TERM DATE" shall mean the date ten
(10) years after the Date of Option Grant.
(h) "CODE" shall mean the Internal Revenue Code
of 1986, as amended.
(i) "COMPANY" shall mean Ciena Corporation, a
Delaware corporation, and any successor corporation thereto.
(j) "PARTICIPATING COMPANY" shall mean (i) the
Company and (ii) any present or future parent and/or subsidiary corporation of
the Company while such corporation is a parent or subsidiary of the Company.
For purposes of this Option Agreement, a parent corporation and a subsidiary
corporation shall be as defined in sections 424(e) and 424(f) of the Code.
(k) "PARTICIPATING COMPANY GROUP" shall mean at
any point in time all corporations collectively which are then a Participating
Company.
(l) "PLAN" shall mean the Ciena Corporation 1994
Stock Option Plan.
(m) On any given date, the number of "VESTED
SHARES" shall be equal to the Number of Option Shares multiplied by the Vested
Percentage determined as of such date pursuant to paragraph 1(f) above and
rounded down to the nearest whole share. On
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such date, the number of UNVESTED SHARES shall be equal to the Number of Option
Shares reduced by the number of Vested Shares determined as of such date.
2. Status of the Option. This Option is intended to be
an incentive stock option as described in section 422 of the Code, but the
Company does not represent or warrant that this Option qualifies as such. The
Optionee should consult with the Optionee's own tax advisors regarding the tax
effects of this Option and the requirements necessary to obtain favorable
income tax treatment under section 422 of the Code, including, but not limited
to, holding period requirements.
3. Administration. All questions of interpretation
concerning this Option Agreement shall be determined by the Board of Directors
of the Company (the "BOARD") and/or by a duly appointed committee of the Board
having such powers as shall be specified by the Board. Any subsequent
references herein to the Board shall also mean the committee if such committee
has been appointed and, unless the powers of the committee have been
specifically limited, the committee shall have all of the powers of the Board
granted in the Plan, including, without limitation, the power to terminate or
amend the Plan at any time, subject to the terms of the Plan and any applicable
limitations imposed by law. All determinations by the Board shall be final and
binding upon all persons having an interest in the Option. Any officer of a
Participating Company shall have the authority to act on behalf of the Company
with respect to any matter, right, obligation, or election which is the
responsibility of or which is allocated to the Company herein, provided the
officer has apparent authority with respect to such matter, right, obligation,
or election.
4. Exercise of the Option.
(a) Right to Exercise. The Option shall be first
exercisable on and after the Initial Vesting Date, and then only to the extent
vested. Notwithstanding the foregoing, except as provided in paragraph 16, the
aggregate fair market value of the stock with respect to which the Optionee may
exercise the Option for the first time during any calendar year, together with
any other incentive stock options which are exercisable for the first time
during any such year, as determined in accordance with section 422(d) of the
Code, shall not exceed One Hundred Thousand Dollars ($100,000). Such
limitation on exercise described in section 422(d) of the Code shall be
referred to in this Option Agreement as the "$100,000 EXERCISE LIMITATION".
Furthermore, notwithstanding the foregoing, the Option may be exercised only in
multiples of one hundred (100) shares unless all shares subject to the Option
are being exercised; provided, however, that the foregoing restriction shall
not apply so as to prevent an exercise (i) following the Optionee's termination
of employment as set forth in paragraph 7 below or (ii) during the thirty (30)
day periods immediately preceding and following an Ownership Change as defined
in paragraph 8 below. In addition to the foregoing, in the event that the
adoption of the Plan or any amendment of the Plan is subject to the approval of
the Company's stockholders in order for the Option to comply with the
requirements of Rule 16b-3, promulgated under the Securities Exchange Act of
1934, as amended (the "EXCHANGE ACT"), the Option shall not be exercisable
prior to such stockholder
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approval if the Optionee is subject to Section 16(b) of the Exchange Act,
unless the Board, in its sole discretion, approves the exercise of the Option
prior to such stockholder approval.
(b) Method of Exercise. Exercise of the Option
must be by written notice to the Company which must state the election to
exercise the Option, the number of shares for which the Option is being
exercised and such other representations and agreements as to the Optionee's
investment intent with respect to such shares as may be required pursuant to
the provisions of this Option Agreement. The written notice must be signed by
the Optionee and must be delivered in person, by certified or registered mail,
return receipt requested, or by facsimile transmission, to the Chief Financial
Officer of the Company, or other authorized representative of the Participating
Company Group, prior to the termination of the Option as set forth in paragraph
6 below, accompanied by (i) full payment of the exercise price for the number
of shares being purchased and (ii) an executed copy, if required herein, of the
then current forms of escrow and security agreements referenced below.
(c) Payment of Exercise Price.
(i) Forms of Payment Authorized.
Payment of the exercise price for the number of shares for which the Option is
being exercised shall be made
(A) in cash, by check, or cash
equivalent;
(B) by tender to the Company of
shares of the Company's common stock owned by the Optionee having a fair market
value, as determined by the Board, not less than the exercise price, which
either have been owned by the Optionee for more than six (6) months or were not
acquired, directly or indirectly, from the Company;
(C) if expressly authorized by the
Company at the time of Option exercise, in its sole discretion, by the
Optionee's recourse promissory note in a form approved by the Company;
(D) by Immediate Sales Proceeds, as
defined below;
(E) by any combination of the
foregoing.
(ii) Tender of Company Stock.
Notwithstanding the foregoing, the Option may not be exercised by tender to the
Company of shares of the Company's common stock to the extent such tender of
stock would constitute a violation of the provisions of any law, regulation
and/or agreement restricting the redemption of the Company's common stock or,
if in the opinion of Company counsel, might impair the ability of purchasers of
stock from the Company from taking full advantage of the provisions of Section
1202 of the Code relating to capital gains treatment of stock issued by the
Company. Unless otherwise provided by the Board, an Option may not be
exercised by tender to the Company of shares of the Company's common stock
unless such shares of the Company's
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stock either have been owned by the Optionee for more than six (6) months or
were not acquired, directly or indirectly, from the Company.
(iii) Promissory Note. Unless otherwise
specified by the Board at the time the Option is granted, a promissory note
permitted in accordance with clause (c)(i)(C) above shall not exceed the amount
permitted by law to be paid by a promissory note and shall be a full recourse
note in a form satisfactory to the Company, with principal payable four (4)
years after the date the Option is exercised. Interest on the principal
balance of the promissory note shall be payable in annual installments at the
minimum interest rate necessary to avoid imputed interest pursuant to all
applicable sections of the Code. Such recourse promissory note shall be
secured by the shares of stock acquired pursuant to the then current form of
security agreement as approved by the Company. In the event the Company at any
time is subject to the regulations promulgated by the Board of Governors of the
Federal Reserve System or any other governmental entity affecting the extension
of credit in connection with the Company's securities, any promissory note
shall comply with such applicable regulations, and the Optionee shall pay the
unpaid principal and accrued interest, if any, to the extent necessary to
comply with such applicable regulations. Except as the Company in its sole
discretion shall determine, the Optionee shall pay the unpaid principal balance
of the promissory note and any accrued interest thereon upon termination of the
Optionee's employment with the Participating Company Group for any reason, with
or without cause.
(iv) Immediate Sales Proceeds.
"IMMEDIATE SALES PROCEEDS" shall mean the assignment in form acceptable to the
Company of the proceeds of a sale of some or all of the shares acquired upon
the exercise of the Option pursuant to a program and/or procedure approved by
the Company (including, without limitation, through an exercise complying with
the provisions of Regulation T as promulgated from time to time by the Board
of Governors of the Federal Reserve System). The Company reserves, at any and
all times, the right, in the Company's sole and absolute discretion, to decline
to approve any such program and/or procedure.
(d) Tax Withholding. At the time the Option is
exercised, in whole or in part, or at any time thereafter as requested by the
Company, the Optionee hereby authorizes payroll withholding and otherwise
agrees to make adequate provision for foreign, federal and state tax
withholding obligations of the Company, if any, which arise in connection with
the Option, including, without limitation, obligations arising upon (i) the
exercise, in whole or in part, of the Option, (ii) the transfer, in whole or in
part, of any shares acquired on exercise of the Option, or (iii) the operation
of any law or regulation providing for the imputation of interest, or (iv) the
lapsing of any restriction with respect to any shares acquired on exercise of
the Option. The Optionee is cautioned that the Option is not exercisable
unless the Company's withholding obligations are satisfied. Accordingly, the
Optionee may not be able to exercise the Option when desired even though the
Option is vested and the Company shall have no obligation to issue a
certificate for such shares.
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(e) Certificate Registration. Except in the
event the exercise price is paid by Immediate Sales Proceeds, the certificate
or certificates for the shares as to which the Option is exercised shall be
registered in the name of the Optionee, or, if applicable, the heirs of the
Optionee.
(f) Restrictions of Grant of the Option and
Issuance of Shares. The grant of the Option and the issuance of the shares
upon exercise of the Option shall be subject to compliance with all applicable
requirements of federal, state or foreign law with respect to such securities.
The Option may not be exercised if the issuance of shares upon such exercise
would constitute a violation of any applicable federal, state, or foreign
securities laws or other law or regulations. In addition, the Option may not
be exercised unless (i) a registration statement under the Securities Act of
1933, as amended (the "SECURITIES ACT"), shall at the time of exercise of the
Option be in effect with respect to the shares issuable upon exercise of the
Option or (ii) in the opinion of legal counsel to the Company, the shares
issuable upon exercise of the Option may be issued in accordance with the terms
of an applicable exemption from the registration requirements of the Securities
Act. THE OPTIONEE IS CAUTIONED THAT THE OPTION MAY NOT BE EXERCISABLE UNLESS
THE FOREGOING CONDITIONS ARE SATISFIED. ACCORDINGLY, THE OPTIONEE MAY NOT BE
ABLE TO EXERCISE THE OPTION WHEN DESIRED EVEN THOUGH THE OPTION IS VESTED.
Questions concerning this restriction should be directed to the Chief Financial
Officer of the Company. As a condition to the exercise of the Option, the
Company may require the Optionee to satisfy any qualifications that may be
necessary or appropriate, to evidence compliance with any applicable law or
regulation and to make any representation or warranty with respect thereto as
may be requested by the Company.
(g) Fractional Shares. The Company shall not be
required to issue fractional shares upon the exercise of the Option.
5. Non-Transferability of the Option; Non-Alienation of
Benefits. The Option may be exercised during the lifetime of the Optionee only
by the Optionee and may not be assigned or transferred in any manner except by
will or by the laws of descent and distribution. Following the death of the
Optionee, the Option, to the extent unexercised and vested to the Optionee on
the date of death, may be exercised by the Optionee's legal representative or
by any person empowered to do so under the deceased Optionee's will or under
the then applicable laws of descent and distribution.
Except with the prior written consent of the Company, subject
to the foregoing, or as otherwise provided herein, no right or benefit under
this Option Agreement shall be subject to anticipation, alienation, sale,
assignment, pledge, encumbrance or charge, and any attempt to anticipate,
alienate, sell, assign, pledge, encumber or charge the same without such
consent, if applicable, shall be void. Except with such consent, no right or
benefit under this Option Agreement shall in any manner be liable for or
subject to the debts, contacts, liabilities or torts of the person entitled to
such benefit. Except to the extent previously approved by the Company in
writing, or as otherwise provided herein, if the Optionee should become
bankrupt or attempt to anticipate, alienate, sell, assign, pledge, encumber or
charge any right or benefit
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hereunder, then such right or benefit shall cease and terminate, and in such
event, the Company may hold or apply the same or any part thereof for the
benefit of the Optionee, the Optionee's spouse, children or other dependents,
or any of them, in such manner and in such proportion as the Company may in its
sole determination deem proper.
6. Termination of the Option. The Option shall
terminate and may no longer be exercised on the first to occur of (a) the
Option Term Date as defined above, (b) the last date for exercising the Option
following termination of employment as described in paragraph 7 below, or (c) a
Transfer of Control to the extent provided in paragraph 8 below.
7. Termination of Employment.
(a) Termination Other Than by Death or
Disability. Except as otherwise provided below, if the Optionee ceases to be
an employee of the Participating Company Group for any reason, except death or
disability within the meaning of section 422(c) of the Code, the Option, to the
extent unexercised and exercisable by the Optionee on the date on which the
Optionee ceased to be an employee, may be exercised by the Optionee within
thirty (30) days after the date on which the Optionee's employment terminated,
but in any event no later than the Option Term Date.
(b) Termination by Death or Disability. Except
as otherwise provided below, if the Optionee's employment with the Company is
terminated because of the death or disability of the Optionee within the
meaning of section 422(c) of the Code, the Option, to the extent unexercised
and exercisable by the Optionee on the date on which the Optionee ceased to be
an employee, may be exercised by the Optionee (or the Optionee's legal
representative) at any time prior to the expiration of twelve (12) months from
the date on which the Optionee's employment terminated, but in any event no
later than the Option Term Date. The Optionee's employment shall be deemed to
have terminated on account of death if the Optionee dies within three (3)
months after the Optionee's termination of employment.
(c) Limitations on Exercise After Termination.
Notwithstanding the provisions of paragraphs 7(a) and (b), the Option may not
be exercised after the Optionee's termination of employment if the shares to be
acquired on exercise of the Option would be Unvested Shares as that term is
defined in paragraph 11 below. Except as provided in this paragraph 7, the
Option shall terminate and may not be exercised after the Optionee ceases to be
an employee of the Participating Company Group. Furthermore, the Board may at
any time after the Optionee's termination of employment cancel the Option with
respect to all or a portion of the shares otherwise remaining exercisable under
the Option, if the Company finds or has found that the Optionee:
(i) Engaged in willful, deliberate or
gross misconduct toward the Company;
(ii) Has violated the terms of any
confidentiality agreement or obligation between the Optionee and the Company;
or
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(iii) Has accepted employment with an
entity which the Company determines is in a business that could result in
compromising any confidentiality agreement or obligation between the Optionee
and the Company.
(d) Employee and Termination of Employment
Defined. For purposes of this paragraph 7, the term "employee" shall mean any
person, including officers and directors, employed by a Participating Company
or performing services for a Participating Company as a director, consultant,
advisor or other independent contractor. For purposes of this paragraph 7, the
Optionee's employment shall be deemed to have terminated if the Optionee ceases
to be employed by a Participating Company (whether upon an actual termination
of employment or upon the Optionee's employer ceasing to be a Participating
Company). The Optionee's employment shall not be deemed to have terminated
merely because of a change in the capacity in which the Optionee serves as an
employee, provided that there is no interruption or termination of the
Optionee's service as an employee. (THE OPTIONEE IS CAUTIONED THAT IF THE
OPTION IS EXERCISED MORE THAN THREE (3) MONTHS AFTER THE DATE ON WHICH THE
OPTIONEE'S EMPLOYMENT (OTHER THAN AS A DIRECTOR, CONSULTANT, ADVISOR OR OTHER
INDEPENDENT CONTRACTOR) TERMINATED, THE OPTION MAY CEASE TO BE AN INCENTIVE
STOCK OPTION. THE OPTIONEE SHOULD CONSULT WITH THE OPTIONEE'S OWN TAX ADVISORS
AS TO THE TAX CONSEQUENCES OF ANY SUCH DELAYED EXERCISE.)
(e) Extension if Exercise Prevented by Law.
Notwithstanding the foregoing, if the exercise of the Option within the
applicable time periods set forth above is prevented by the provisions of
paragraph 4(f) above, the Option shall remain exercisable until three (3)
months after the date the Optionee is notified by the Company that the Option
is exercisable, but in any event no later than the Option Term Date. The
Company makes no representation as to the tax consequences of any such delayed
exercise. The Optionee should consult with the Optionee's own tax advisors as
to the tax consequences to the Optionee of any such delayed exercise.
(f) Extension if Optionee Subject to Section
16(b). Notwithstanding the foregoing, if the exercise of the Option within the
applicable time periods set forth above would subject the Optionee to suit
under Section 16(b) of the Exchange Act, the Option shall remain exercisable
until the earliest to occur of (i) the tenth (10th) day following the date on
which the Optionee would no longer be subject to such suit, (ii) the one
hundred and ninetieth (190th) day after the Optionee's termination of
employment, or (iii) the Option Term Date. The Company makes no representation
as to the tax consequences of any such delayed exercise. The Optionee should
consult with the Optionee's own tax advisors as to the tax consequences to the
Optionee of any such delayed exercise.
(g) Leave of Absence. For purposes
hereof, the Optionee's employment with the Participating Company Group shall
not be deemed to terminate if the Optionee takes any military leave, sick
leave, or other bona fide leave of absence approved by
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the Company of ninety (90) days or less. In the event of a leave in excess of
ninety (90) days, the Optionee's employment shall be deemed to terminate on the
ninety-first (91st) day of the leave unless the Optionee's right to re
employment with the Participating Company Group remains guaranteed by statute
or contract. Notwithstanding the foregoing, unless otherwise designated by the
Company (or required by law) a leave of absence shall not be treated as
employment for purposes of determining the Optionee's Vested Percentage.
8. A "Transfer of Control"
(a) A "TRANSFER OF CONTROL" shall be deemed to
have occurred in the event any of the events described in Paragraph 11 of the
Plan occurs with respect to the Company.
(b) In the event of Transfer of Control, the
surviving, continuing, successor, or purchasing corporation or parent
corporation thereof, as the case may be (the "ACQUIRING CORPORATION"), shall
either assume the Company's rights and obligations under this Option Agreement
or substitute an option for the Acquiring Corporation's stock for the Option.
In the event the Acquiring Corporation elects not to assume the Company's
rights and obligations under this Option Agreement or substitute an option for
the Acquiring Corporation's stock for the Option, all shares subject to this
Option Agreement shall become Vested Shares (as defined in paragraph 11(b)
below) effective as of the date thirty (30) days prior to the Proposed
Effective Date.
(c) The exercise and/or vesting of any shares
that was permissible solely by reason of this paragraph 8 shall be conditioned
upon the consummation of the Transfer of Control. The Option shall terminate
and cease to be outstanding effective upon the Transfer of Control to the
extent that the Option is neither assumed or substituted for by the Acquiring
Corporation in connection with the Transfer of Control nor exercised as of the
date of the Transfer of Control.
9. Effect of Change in Stock Subject to the Option.
Appropriate adjustments shall be made in the number, exercise price and class
of shares of stock subject to the Option in the event of a stock dividend,
stock split, reverse stock split, recapitalization, combination,
reclassification, or like change in the capital structure of the Company. In
the event a majority of the shares which are of the same class as the shares
that are subject to the Option are exchanged for, converted into, or otherwise
become (whether or not pursuant to an Ownership Change) shares of another
corporation (the "NEW SHARES"), the Company may unilaterally amend the Option
to provide that the Option is exercisable for New Shares. In the event of any
such amendment, the number of shares and the exercise price shall be adjusted
in a fair and equitable manner.
10. Rights as a Stockholder or Employee. The Optionee
shall have no rights as a stockholder with respect to any shares covered by the
Option until the date of the issuance of a certificate or certificates for the
shares for which the Option has been exercised. No adjustment shall be made
for dividends or distributions or other rights for which the record
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date is prior to the date such certificate or certificates are issued, except
as provided in paragraph 9 above. Nothing in the Option shall confer upon the
Optionee any right to continue in the employ of a Participating Company or
interfere in any way with any right of the Participating Company Group to
terminate the Optionee's employment at any time.
11. Right of First Refusal.
(a) Right of First Refusal. Except as
provided in paragraph 11(g) below, in the event the Optionee proposes to sell,
pledge, or otherwise transfer any Vested Shares (the "TRANSFER SHARES") to any
person or entity, including, without limitation, any stockholder of the
Participating Company Group, the Company shall have the right to repurchase the
Transfer Shares under the terms and subject to the conditions set forth in this
paragraph 12 (the "RIGHT OF FIRST REFUSAL").
(b) Notice of Proposed Transfer. Prior to any
proposed transfer of the Transfer Shares, the Optionee shall give a written
notice (the "TRANSFER NOTICE") to the Company describing fully the proposed
transfer, including the number of Transfer Shares, the name and address of the
proposed transferee (the "PROPOSED TRANSFEREE") and, if the transfer is
voluntary, the proposed transfer price and containing such information
necessary to show the bona fide nature of the proposed transfer. In the event
of a bona fide gift or involuntary transfer, the proposed transfer price shall
be deemed to be the fair market value of the Transfer Shares as determined by
the Company in good faith. In the event the Optionee proposes to transfer any
Transfer Shares to more than one (1) Proposed Transferee, the Optionee shall
provide a separate Transfer Notice for the proposed transfer to each Proposed
Transferee. The Transfer Notice shall be signed by both the Optionee and the
Proposed Transferee and must constitute a binding commitment of the Optionee
and the Proposed Transferee for the transfer of the Transfer Shares to the
Proposed Transferee subject only to the Right of First Refusal.
(c) Bona Fide Transfer. In the event that
the Company shall determine that the information provided by the Optionee in
the Transfer Notice is insufficient to establish the bona fide nature of a
proposed voluntary transfer, the Company shall give the Optionee written notice
of the Optionee's failure to comply with the procedure described in this
paragraph 12 and the Optionee shall have no right to transfer the Transfer
Shares without first complying with the procedure described in this paragraph
12. The Optionee shall not be permitted to transfer the Transfer Shares if the
proposed transfer is not bona fide.
(d) Exercise of Right of First Refusal. In
the event the proposed transfer is deemed to be bona fide, the Company shall
have the right to purchase all, but not less than all, of the Transfer Shares
(except as the Company and the Optionee otherwise agree) at the purchase price
and on the terms set forth in the Transfer Notice by delivery to the Optionee
of a notice of exercise of the Right of First Refusal within thirty (30) days
after the date the Transfer Notice is delivered to the Company. The Company's
exercise or failure to exercise the Right of First Refusal with respect to any
proposed transfer described in a Transfer Notice shall not affect the Company's
right to exercise the Right of First Refusal with respect to any proposed
transfer described in any other Transfer Notice, whether or not
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such other Transfer Notice is issued by the Optionee or issued by a person
other than the Optionee with respect to a proposed transfer to the same
Proposed Transferee. If the Company exercises the Right of First Refusal, the
Company and the Optionee shall thereupon consummate the sale of the Transfer
Shares to the Company on the terms set forth in the Transfer Notice within
sixty (60) days after the date the Transfer Notice is delivered to the Company
(unless a longer period is offered by the Proposed Transferee); provided,
however, that in the event the Transfer Notice provides for the payment for the
Transfer Shares by the present value cash equivalent of the consideration
described in the Transfer Notice as reasonably determined by the Company. For
purposes of the foregoing, cancellation of any indebtedness of the Optionee to
any Participating Company shall be treated as payment to the Optionee in cash
to the extent of the unpaid principal and any accrued interest canceled.
(e) Failure to Exercise Right of First Refusal.
If the Company fails to exercise the Right of First Refusal in full within the
period specified in paragraph 11(d) above, the Optionee may conclude a transfer
to the Proposed Transferee of the Transfer Shares on the terms and conditions
described in the Transfer Notice, provided such transfer occurs not later than
ninety (90) days following delivery to the Company of the Transfer Notice. The
Company shall have the right to demand further assurances from the Optionee and
the Proposed Transferee (in a form satisfactory to the Company) that the
transfer of the Transfer Shares was actually carried out on the terms and
conditions described in the Transfer Notice. No Transfer Shares shall be
transferred on the books of the Company until the Company has received such
assurances, if so demanded, and has approved the proposed transfer as bona
fide. Any proposed transfer on terms and conditions different from those
described in the Transfer Notice, as well as any subsequent proposed transfer
by the Optionee, shall again be subject to the Right of First Refusal and shall
require compliance by the Optionee with the procedure described in this
paragraph 11.
(f) Transferees of Transfer Shares. All
transferees of the Transfer Shares or any interest therein, other than the
Company, shall be required as a condition of such transfer to agree in writing
(in a form satisfactory to the Company) that such transferee shall receive and
hold such Transfer Shares or interests subject to the provisions of this
paragraph 11 providing for the Right of First Refusal with respect to any
subsequent transfer. Any sale or transfer of any shares acquired upon exercise
of the Option shall be void unless the provisions of this paragraph 11 are met.
(g) Transfers Not Subject to Right of First
Refusal. Notwithstanding the foregoing, the Right of First Refusal shall not
apply to any transfer or exchange of the shares acquired pursuant to the
exercise of the Option if such transfer or exchange is in connection with an
Ownership Change. If the consideration received pursuant to such transfer or
exchange consists of stock of a Participating Company, such consideration shall
remain subject to the Right of First Refusal unless the provisions of paragraph
11(i) below result in a termination of the Right of First Refusal.
Furthermore, notwithstanding the foregoing, the Right of First Refusal shall
not apply to a transfer of Transfer Shares to the Optionee's ancestors,
descendants, or spouse or to a trustee solely for the benefit of the Optionee
or Optionee's ancestors, descendants, or spouse, or to a charitable
institution;
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provided, however, that such transferee shall agree in writing (in a form
satisfactory to the Company) to take the stock subject to all the terms and
conditions of this paragraph 12 providing for a Right of First Refusal with
respect to any subsequent transfer.
(h) Assignment of Right of First Refusal. The
Company shall have the right to assign the Right of First Refusal at any time,
whether or not the Optionee has attempted a transfer, to one (1) or more
persons as may be selected by the Company.
(i) Early Termination of Right of First Refusal.
The other provisions of this paragraph 11 notwithstanding, the Right of First
Refusal shall terminate, and be of no further force and effect, upon (i) the
occurrence of a Transfer of Control, unless the surviving, continuing,
successor, or purchasing corporation or parent corporation thereof, as the case
may be, assumes the Company's rights and obligations under the Plan, or (ii)
the existence of a public market for the class of shares subject to the Right
of First Refusal. A "public market" shall be deemed to exist if (x) such
stock is listed on a national securities exchange (as that term is used in the
Exchange Act) or (y) such is traded on the over-the-counter market and prices
therefor are published daily on business days in a recognized financial
journal.
12. Escrow.
(a) Establishment of Escrow. To ensure that
shares subject to the Right of First Refusal and/or security for any promissory
note will be available for purchase, the Company may require the Optionee to
deposit the certificate or certificates evidencing the shares which the
Optionee purchases upon exercise of the Option with the Company or other escrow
agent designated by the Company under the terms and conditions of escrow and
security agreements approved by the Company. If the Company does not require
such deposit as a condition of exercise of the Option, or if the Company
releases the certificate or certificates from escrow prior to the lapsing of
all such restrictions and/or security interest, the Company reserves the right
at any time to require the Optionee to so deposit the certificates in escrow.
The Company shall bear the expenses of the escrow.
(b) Delivery of Shares to Optionee. As soon
as practicable after the expiration of the Right of First Refusal, and after
full repayment on any promissory note secured by the shares in escrow, the
escrow agent shall deliver to the Optionee the shares no longer subject to such
restrictions and no longer security for any promissory note.
(c) Notices and Payments. In the event the
shares held in escrow are subject to the Company's exercise of the Right of
First Refusal, the notices required to be given to the Optionee shall be given
to the escrow agent any payment required to be given to the Optionee shall be
given to the escrow agent. Within thirty (30) days after payment by the
Company, the escrow agent shall deliver the shares which the Company has
purchased to the Company and shall deliver the payment received from the
Company to the Optionee.
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13. Stock Dividends Subject to Option Agreement. If,
from time to time, there is any stock dividend, stock split, or other change in
the character or amount of any of the outstanding stock of the corporation the
stock of which is subject to the provisions of this Option Agreement, then in
such event any and all new, substituted or additional securities to which the
Optionee is entitled by reason of the Optionee's ownership of the shares
acquired upon exercise of the Option shall be immediately subject to the Right
of First Refusal, and/or any security interest held by the Company with the
same force and effect as the shares subject to the Right of First Refusal, and
such security interest immediately before such event.
14. Notice of Sales Upon Disqualifying Disposition.
The Optionee shall dispose of the shares acquired pursuant to the Option only
in accordance with the provisions of this Option Agreement. In addition, the
Optionee shall promptly notify the Chief Financial Officer of the Company if
the Optionee disposes of any of the shares acquired pursuant to the Option
within one (1) year from the date the Optionee exercises all or part of the
Option or within two (2) years of the date of grant of the Option. Until such
time as the Optionee disposes of such shares in a manner consistent with the
provisions of this Option Agreement, the Optionee shall hold all shares
acquired pursuant to the Option in the Optionee's name (and not in the name of
any nominee) for the one-year period immediately after exercise of the Option
and the two-year period immediately after grant of the Option. At any time
during the one-year or two-year periods set forth above, the Company may place
a legend or legends on any certificate or certificates representing shares
acquired pursuant to the Option requesting the transfer agent for the Company's
stock to notify the Company of any such transfers. The obligation of the
Optionee to notify the Company of any such transfer shall continue
notwithstanding that a legend has been placed on the certificate or
certificates pursuant to the preceding sentence.
15. Legends. The Company may at any time place
legends referencing the Right of First Refusal set forth in paragraph 11 above,
and any applicable federal, state or foreign securities law restrictions on all
certificates representing shares of stock subject to the provisions of this
Option Agreement. The Optionee shall, at the request of the Company, promptly
present to the Company any and all certificates representing shares acquired
pursuant to the Option in the possession of the Optionee in order to carry out
the provisions of this paragraph. Unless otherwise specified by the Company,
legends placed on such certificates may include, but shall not be limited to,
the following:
(a) "THE SECURITIES EVIDENCED BY THIS CERTIFICATE
HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND MAY
NOT BE SOLD, TRANSFERRED, ASSIGNED OR HYPOTHECATED UNLESS THERE IS AN EFFECTIVE
REGISTRATION STATEMENT UNDER SUCH ACT COVERING SUCH SECURITIES, THE SALE IS
MADE IN ACCORDANCE WITH RULE 144 OR RULE 701 UNDER THE ACT, OR THE COMPANY
RECEIVES AN OPINION OF COUNSEL FOR THE HOLDER OF THESE SECURITIES REASONABLY
SATISFACTORY TO THE COMPANY, STATING THAT SUCH SALE, TRANSFER, ASSIGNMENT OR
HYPOTHECATION IS EXEMPT FROM
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THE REGISTRATION AND PROSPECTUS DELIVERY REQUIREMENTS OF SUCH ACT."
(b) "THE SHARES REPRESENTED BY THIS CERTIFICATE
ARE SUBJECT TO A RIGHT OF FIRST REFUSAL OPTION IN FAVOR OF THE CORPORATION OR
ITS ASSIGNEE SET FORTH IN AN AGREEMENT BETWEEN THE CORPORATION AND THE
REGISTERED HOLDER OR SUCH HOLDER'S PREDECESSOR IN INTEREST, A COPY OF WHICH IS
ON FILE AT THE PRINCIPAL OFFICE OF THIS CORPORATION."
(c) "THE SHARES EVIDENCED BY THIS CERTIFICATE
WERE ISSUED BY THE CORPORATION TO THE REGISTERED HOLDER UPON EXERCISE OF AN
INCENTIVE STOCK OPTION AS DEFINED IN SECTION 422 OF THE INTERNAL REVENUE CODE
OF 1986, AS AMENDED ("ISO"). IN ORDER TO OBTAIN THE PREFERENTIAL TAX TREATMENT
AFFORDED TO ISOs, THE SHARES SHOULD NOT BE TRANSFERRED PRIOR TO TWO YEARS AFTER
GRANT OF THE ISO AND ONE YEAR AFTER EXERCISE OF THE ISO. SHOULD THE REGISTERED
HOLDER ELECT TO TRANSFER ANY OF THE SHARES PRIOR THERETO AND FOREGO ISO TAX
TREATMENT, THE TRANSFER AGENT FOR THE SHARES SHALL NOTIFY THE CORPORATION
IMMEDIATELY. THE REGISTERED HOLDER SHALL HOLD ALL SHARES PURCHASED UNDER THE
INCENTIVE STOCK OPTION IN THE REGISTERED HOLDER'S NAME (AND NOT IN THE NAME OF
ANY NOMINEE) PRIOR TO THIS DATE OR UNTIL TRANSFERRED AS DESCRIBED ABOVE."
16. Initial Public Offering. The Optionee hereby agrees
that in the event of an initial public offering of stock made by the Company
pursuant to an effective registration statement filed under the Securities Act,
the Optionee shall not offer, sell, contract to sell, pledge, hypothecate,
grant any option to purchase or make any short sale of, or otherwise dispose of
any shares of stock of the Company or any rights to acquire stock of the
Company for such period of time from and after the effective date of such
registration statement as may be established by the underwriter for such
initial public offering; provided, however, that such period of time shall
not exceed two hundred seventy (270) days from the effective date of the
registration statement to be filed in connection with such initial public
offering. The foregoing limitation shall not apply to shares registered in the
initial public offering under the Securities Act. The Optionee shall be
subject to this paragraph provided and only if the officers and directors of
the Company are also subject to similar arrangements.
17. Binding Effect. This Option Agreement shall inure to
the benefit of and be binding upon the parties hereto and their respective
heirs, executors, administrators, successors and assigns.
18. Termination or Amendment. The Board, including any
duly appointed committee of the Board, may terminate or amend the Plan and /or
the Option at any time; provided, however, that no such termination or
amendment may adversely affect the Option or
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15
any unexercised portion hereof without the consent of the Optionee unless such
amendment is required to enable the Option to qualify as an Incentive Stock
Option.
19. Integrated Agreement. This Option Agreement
constitutes the entire understanding and agreement of the Optionee and the
Participating Company Group with respect to the subject matter contained
herein, and there are no agreement, understandings, restrictions,
representations, or warranties among the Optionee and the Company other than
those as set forth or provided for herein. To the extent contemplated herein,
the provisions of this Option Agreement shall survive any exercise of the
Option and shall remain in full force and effect.
20. Applicable Law. This Option Agreement shall be
governed by the laws of the State of Delaware as such laws are applied to
agreements between Delaware residents entered into and to be performed entirely
within the State of Delaware.
CIENA CORPORATION
By:
-----------------------------
Title: Vice President, Finance
Chief Financial Officer
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The Optionee represents that the Optionee is familiar with the
terms and provisions of this Option Agreement, including the Right of First
Refusal set forth in paragraph 11 and hereby accepts the Option subject to all
of the terms and provisions thereof. The Optionee hereby agrees to accept as
binding, conclusive and final all decisions or interpretations of the Board
upon any questions arising under this Option Agreement. The undersigned
acknowledges receipt of a copy of the Plan.
OPTIONEE
Date:
-------------------- ----------------------------
The undersigned, being the spouse of the above-named Optionee,
does hereby acknowledge that the undersigned has read and is familiar with the
provisions of the above Option Agreement, and the undersigned hereby agrees
thereto and joins therein to the extent, if any, that the agreement and xxxxxx
of the undersigned may be necessary.
OPTIONEE
Date:
-------------------- ----------------------------
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EXHIBIT A
TO
STOCK OPTION AGREEMENT
(a) "Date of Option Grant" shall mean {grant date}.
(b) "Number of Option Shares" shall mean {shares} shares
of common stock of the Company.
(c) "Exercise Price" shall mean {price} per share.
(d) "Initial Vesting Date" shall be the last day of the
calendar month in which occurs the date one (1) year after the following date:
{vesting_date}.
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THE SECURITY REPRESENTED BY THIS CERTIFICATE HAS BEEN ACQUIRED FOR INVESTMENT
AND NOT WITH A VIEW TO, OR IN CONNECTION WITH, THE SALE OR DISTRIBUTION
THEREOF. NO SUCH SALE OR DISPOSITION MAY BE EFFECTED WITHOUT AN EFFECTIVE
REGISTRATION STATEMENT RELATED THERETO OR AN OPINION OF COUNSEL SATISFACTORY TO
THE COMPANY THAT SUCH REGISTRATION IS NOT REQUIRED UNDER THE SECURITIES ACT OF
1933.
CIENA CORPORATION
IMMEDIATELY EXERCISABLE
NON-STATUTORY STOCK OPTION AGREEMENT
THIS IMMEDIATELY EXERCISABLE NON-STATUTORY STOCK OPTION AGREEMENT (the "Option
Agreement") is made and entered into as of ___________, 199___, by and between
CIENA Corporation, a Delaware corporation (the "Company"), and
___________________________ (the "Optionee").
The Company granted to the Optionee an option to purchase certain
shares of common stock of the Company, in the manner and subject to the
provisions of this Option Agreement (the "Option"). If the Optionee (and the
Optionee's spouse, if married) does not execute and return this Option
Agreement to the Company within sixty (60) days of the date first written
above, the Option shall terminate and be without further force and effect.
1. Definitions:
(a) "DATE OF OPTION GRANT" shall mean the date set forth
on Exhibit A annexed hereto and made a part hereof.
(b) "NUMBER OF OPTION SHARES" shall mean the number of
shares of common stock of the Company set forth on Exhibit A as adjusted from
time to time pursuant to paragraph 9 below.
(c) "EXERCISE PRICE" shall mean the price per share set
forth on Exhibit A as adjusted from time to time pursuant to paragraph 9 below.
(d) "INITIAL EXERCISE DATE" shall be the Date of Option
Grant.
19
(e) "INITIAL VESTING DATE" shall be the last day of the
calendar month in which occurs the date one (1) year after (check one):
____ the Date of Option Grant.
____ _______________ (specify other date).
(f) Determination of "VESTED PERCENTAGE":
Vested Ratio
------------
Prior to Initial Vesting Date 0
On Initial Vesting Date, provided the Optionee is 25%
continuously employed by a Participating Company from the
Date of Option Grant until the Initial Vesting Date
Plus
----
For each full month of the Optionee's continuous 2.084%
employment by a Participating Company from the
Initial Vesting Date
In no event shall the Vested Percentage exceed
100%.
(g) "OPTION TERM DATE" shall mean the date ten (10) years
after the Date of Option Grant.
(h) "CODE" shall mean the Internal Revenue Code of 1986,
as amended.
(i) "COMPANY" shall mean CIENA Corporation, a Delaware
corporation, or any successor corporation thereto.
(j) "PARTICIPATING COMPANY" shall mean (i) the Company
and (ii) any present or future parent and/or subsidiary corporation of the
Company while such corporation is a parent or subsidiary of the Company. For
purposes of this Option Agreement, a parent corporation and a subsidiary
corporation shall be as defined in sections 424(e) and 424(f) of the Code.
(k) "PARTICIPATING COMPANY GROUP" shall mean at any point
in time all corporations collectively which are then a Participating Company.
(l) "PLAN" shall mean the CIENA Corporation 1994 Stock
Option Plan.
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2. Status of the Option. This Option is intended to be a
non-statutory stock option and shall not be treated as an incentive stock
option as described in section 422 of the Code.
3. Administration. All questions of interpretation concerning
this Option Agreement shall be determined by the Board of Directors of the
Company (the "Board") and/or by a duly appointed committee of the Board having
such powers as shall be specified by the Board. Any subsequent references
herein to the Board shall also mean the committee if such committee has been
appointed and, unless the powers of the committee have been specifically
limited, the committee shall have all of the powers of the Board granted in the
Plan, including, without limitation, the power to terminate or amend the Plan
at any time, subject to the terms of the Plan and any applicable limitations
imposed by law. All determinations by the Board shall be final and binding
upon all persons having an interest in the Option. Any officer of a
Participating Company shall have the authority to act on behalf of the Company
with respect to any matter, right, obligation, or election which is the
responsibility of or which is allocated to the Company herein, provided the
officer has apparent authority with respect to such matter, right, obligation,
or election.
4. Exercise of the Option.
(a) Right to Exercise. The Option shall be immediately
exercisable in its entirety on and after the Initial Exercise Date subject to
the Optionee's agreement that any shares purchased upon exercise are subject to
the Company's repurchase rights set forth in paragraph 11 and paragraph 12
below. Notwithstanding the foregoing, the Option may be exercised only in
multiples of one hundred (100) shares unless all shares subject to the Option
are being exercised; provided, however, that the foregoing restriction shall
not apply so as to prevent an exercise (i) following the Optionee's termination
of employment as set forth in paragraph 7 below or (ii) during the thirty (30)
day periods immediately preceding and following an Ownership Change as defined
in paragraph 8 below. In addition to the foregoing, in the event that the
adoption of the Plan or any amendment of the Plan is subject to the approval of
the Company's stockholders in order for the Option to comply with the
requirements of Rule 16b-3, promulgated under the Securities Exchange Act of
1934, as amended (the "Exchange Act"), the Option shall not be exercisable
prior to such stockholder approval if the Optionee is subject to Section 16(b)
of the Exchange Act, unless the Board, in its sole discretion, approves the
exercise of the Option prior to such stockholder approval.
(b) Method of Exercise. Exercise of the Option must be
by written notice to the Company which must state the election to exercise the
Option, the number of shares for which the Option is being exercised and such
other representations and agreements as to the Optionee's investment intent
with respect to such shares as may be required pursuant to the provisions of
this Option Agreement. The written notice must be signed by the Optionee and
must be delivered in person, by certified or registered mail, return receipt
requested, or by confirmed facsimile transmission, to the Chief Financial
Officer of the Company, or other authorized representative of the Participating
Company Group, prior to the termination of the Option as set forth in paragraph
6 below, accompanied by (i) full payment of the exercise price
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21
for the number of shares being purchased and (ii) an executed copy, if required
herein, of the then current forms of escrow and security agreements referenced
below.
(c) Payment of Exercise Price.
(i) Forms of Payment Authorized. Payment of the
exercise price for the number of shares for which the Option is being exercised
shall be made
(A) in cash, by check, or cash
equivalent;
(B) by tender to the Company of shares
of the Company's common stock owned by the Optionee having a fair market value,
as determined by the Board, not less than the exercise price, which either have
been owned by the Optionee for more than six (6) months or were not acquired,
directly or indirectly, from the Company;
(C) if expressly authorized by the
Company at the time of Option exercise, in its sole discretion, by the
Optionee's recourse promissory note in a form approved by the Company;
(D) by Immediate Sales Proceeds, as
defined below;
(E) by any combination of the foregoing.
(ii) Tender of Company Stock. Notwithstanding the
foregoing, the Option may not be exercised by tender to the Company of shares
of the Company's common stock to the extent such tender of stock would
constitute a violation of the provisions of any law, regulation and/or
agreement restricting the redemption of the Company's common stock.
(iii) Promissory Note. Unless otherwise specified
by the Board at the time the Option is granted, a promissory note permitted in
accordance with clause (c)(i)(C) above shall not exceed the amount permitted by
law to be paid by a promissory note and shall be a full recourse note in a form
satisfactory to the Company, with principal payable four (4) years after the
date the Option is exercised. Interest on the principal balance of the
promissory note shall be payable in annual installments at the minimum interest
rate necessary to avoid imputed interest pursuant to all applicable sections of
the Code. Such recourse promissory note shall be secured by the shares of
stock acquired pursuant to the then current form of security agreement as
approved by the Company. In the event the Company at any time is subject to
the regulations promulgated by the Board of Governors of the Federal Reserve
System or any other governmental entity affecting the extension of credit in
connection with the Company's securities, any promissory note shall comply with
such applicable regulations, and the Optionee shall pay the unpaid principal
and accrued interest, if any, to the extent necessary to comply with such
applicable regulations. Except as the Company in its sole discretion shall
determine, the Optionee shall pay the unpaid principal balance of the
promissory note and any accrued interest thereon upon termination of the
Optionee's employment with the Participating Company Group for any reason, with
or without cause.
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(iv) Immediate Sales Proceeds. "IMMEDIATE SALES
PROCEEDS" shall mean the assignment in form acceptable to the Company of the
proceeds of a sale of some or all of the shares acquired upon the exercise of
the Option pursuant to a program and/or procedure approved by the Company
(including, without limitation, through an exercise complying with the
provisions of Regulation T as promulgated from time to time by the Board of
Governors of the Federal Reserve System). The Company reserves, at any and all
times, the right, in the Company's sole and absolute discretion, to decline to
approve any such program and/or procedure.
(d) Tax Withholding. At the time the Option is
exercised, in whole or in part, or at any time thereafter as requested by the
Company, the Optionee hereby authorizes payroll withholding and otherwise
agrees to make adequate provision for foreign, federal and state tax
withholding obligations of the Company, if any, which arise in connection with
the Option, including, without limitation, obligations arising upon (i) the
exercise, in whole or in part, of the Option, (ii) the transfer, in whole or in
part, of any shares acquired on exercise of the Option, or (iii) the operation
of any law or regulation providing for the imputation of interest, or (iv) the
lapsing of any restriction with respect to any shares acquired on exercise of
the Option. The Optionee is cautioned that the Option is not exercisable
unless the Company's withholding obligations are satisfied. Accordingly, the
Optionee may not be able to exercise the Option when desired even though the
Option is vested and the Company shall have no obligation to issue a
certificate for such shares.
(e) Certificate Registration. Except in the event the
exercise price is paid by Immediate Sales Proceeds, the certificate or
certificates for the shares as to which the Option is exercised shall be
registered in the name of the Optionee, or, if applicable, the heirs of the
Optionee.
(f) Restrictions on Grant of the Option and Issuance of
Shares. The grant of the Option and the issuance of shares upon exercise of
the Option shall be subject to compliance with all applicable requirements of
federal, state or foreign law with respect to such securities. The Option may
not be exercised if the issuance of shares upon such exercise would constitute
a violation of any applicable federal, state or foreign securities laws or
other law or regulations. In addition, the Option may not be exercised unless
(i) a registration statement under the Securities Act of 1933, as amended (the
"SECURITIES ACT"), shall at the time of exercise of the Option be in effect
with respect to the shares issuable upon exercise of the Option, or (ii) in the
opinion of legal counsel to the Company, the shares issuable upon exercise of
the Option may be issued in accordance with the terms of an applicable
exemption from the registration requirements of the Securities Act. THE
OPTIONEE IS CAUTIONED THAT THE OPTION MAY NOT BE EXERCISABLE UNLESS THE
FOREGOING CONDITIONS ARE SATISFIED. ACCORDINGLY, THE OPTIONEE MAY NOT BE ABLE
TO EXERCISE THE OPTION WHEN DESIRED EVEN THOUGH THE OPTION IS VESTED.
Questions concerning this restriction should be directed to the Chief Financial
Officer of the Company. As a condition to the exercise of the Option, the
Company may require the Optionee to satisfy any qualifications that may be
necessary or appropriate, to evidence compliance with any applicable law or
regulation, and to make any representation or warranty with respect thereto as
may be requested by the Company.
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23
(g) Fractional Shares. The Company shall not be required
to issue fractional shares upon the exercise of the Option.
5. Non-Transferability of the Option; Non-Alienation of Benefits.
The Option may be exercised during the lifetime of the Optionee only by the
Optionee and may not be assigned or transferred in any manner except by will or
by the laws of descent and distribution. Following the death of the Optionee,
the Option, to the extent unexercised and exercisable by the Optionee on the
date of death, may be exercised by the Optionee's legal representative or by
any person empowered to do so under the deceased Optionee's will or under the
then applicable laws of descent and distribution.
Except with the prior written consent of the Company, subject
to the foregoing, or as otherwise provided herein, no right or benefit under
this Option Agreement shall be subject to anticipation, alienation, sale,
assignment, pledge, encumbrance or charge, and any attempt to anticipate,
alienate, sell, assign, pledge, encumber or charge the same without such
consent, if applicable, shall be void. Except with such consent, no right or
benefit under this Option Agreement shall in any manner be liable for or
subject to the debts, contracts, liabilities or torts of the person entitled to
such benefit. Except to the extent previously approved by the Company in
writing, or as otherwise provided herein, if the Optionee should become
bankrupt or attempt to anticipate, alienate, sell, assign, pledge, encumber or
charge any right or benefit hereunder, then such right or benefit shall cease
and terminate, and in such event, the Company may hold or apply the same or any
part thereof for the benefit of the Optionee, the Optionee's spouse, children
or other dependents, or any of them, in such manner and in such proportion as
the Company may in its sole determination deem proper.
6. Termination of the Option. The Option shall terminate and may
no longer be exercised on the first to occur of (a) the Option Term Date as
defined above, (b) the last date for exercising the Option following
termination of employment as described in paragraph 7 below, or (c) a Transfer
of Control to the extent provided in paragraph 8 below.
7. Termination of Employment.
(a) Termination Other Than by Death or Disability.
Except as otherwise provided below, if the Optionee ceases to be an employee of
the Participating Company Group for any reason, except death or disability
within the meaning of section 422(c) of the Code, the Option, to the extent
unexercised and exercisable by the Optionee on the date on which the Optionee
ceased to be an employee, may be exercised by the Optionee within thirty (30)
days after the date on which the Optionee's employment terminated, but in any
event no later than the Option Term date.
(b) Termination by Death or Disability. Except as
otherwise provided below, if the Optionee's employment with the Company is
terminated because of the death or disability of the Optionee within the
meaning of section 422(c) of the Code, the Option, to the extent unexercised
and exercisable by the Optionee on the date on which the Optionee ceased to be
an employee, may be exercised by the Optionee (or the Optionee's legal
representative) at any time
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prior to the expiration of twelve (12) months from the date on which the
Optionee's employment terminated, but in any event no later than the Option
Term Date. The Optionee's employment shall be deemed to have terminated on
account of death if the Optionee dies within three (3) months after the
Optionee's termination of employment.
(c) Limitations on Exercise After Termination.
Notwithstanding the provisions of paragraphs 7(a) and (b), the Option may not
be exercised after the Optionee's termination of employment if the shares to be
acquired on exercise of the Option would be Unvested Shares as that term is
defined in paragraph 11 below. Except as provided in this paragraph 7, the
Option shall terminate and may not be exercised after the Optionee ceases to be
an employee of the Participating Company Group. Furthermore, the Board may at
any time after the Optionee's termination of employment cancel the Option with
respect to all or a portion of the shares otherwise remaining exercisable under
the Option, if the Company finds or has found that the Optionee:
(i) Engaged in willful, deliberate or gross
misconduct toward the Company;
(ii) Has violated the terms of any confidentiality
agreement or obligation between the Optionee and the Company; or
(iii) Has accepted employment with an entity which
the Company determines is in a business that could result in compromising any
confidentiality agreement or obligation between the Optionee and the Company.
(d) Employee and Termination of Employment Defined. For
purposes of this paragraph 7, the term "EMPLOYEE" shall mean any person,
including officers and directors, employed by a Participating Company or
performing services for a Participating Company as a director, consultant,
advisor or other independent contractor. For purposes of this paragraph 7, the
Optionee's employment shall be deemed to have terminated if the Optionee ceases
to be employed by a Participating Company (whether upon an actual termination
of employment or upon the Optionee's employer ceasing to be a Participating
Company). The Optionee's employment shall not be deemed to have terminated
merely because of a change in the capacity in which the Optionee serves as an
employee, provided that there is no interruption or termination of the
Optionee's service as an employee.
(e) Extension if Exercise Prevented by Law.
Notwithstanding the foregoing, if the exercise of the Option within the
applicable time periods set forth above is prevented by the provisions of
paragraph 4(f) above, the Option shall remain exercisable until three (3)
months after the date the Optionee is notified by the Company that the Option
is exercisable, but in any event no later than the Option Term Date.
(f) Extension if Optionee Subject to Section 16(b).
Notwithstanding the foregoing, if the exercise of the Option within the
applicable time periods set forth above would subject the Optionee to suit
under Section 16(b) of the Exchange Act, the Option shall remain exercisable
until the earliest to occur of (i) the tenth (10th) day following the date on
which the
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Optionee would no longer be subject to such suit, (ii) the one hundred and
ninetieth (190th) day after the Optionee's termination of employment, or (iii)
the Option Term Date.
(g) Leave of Absence. For purposes hereof, the
Optionee's employment with the Participating Company Group shall not be deemed
to terminate if the Optionee takes any military leave, sick leave, or other
bona fide leave of absence approved by the Company of ninety (90) days or less.
In the event of a leave in excess of ninety (90) days, the Optionee's
employment shall be deemed to terminate on the ninety-first (91st) day of the
leave unless the Optionee's right to reemployment with the Participating
Company Group remains guaranteed by statute or contract. Notwithstanding the
foregoing, unless otherwise designated by the Company (or required by law) a
leave of absence shall not be treated as employment for purposes of determining
the Optionee's Vested Percentage.
8. A Transfer of Control.
(a) A "TRANSFER OF CONTROL" shall be deemed to have
occurred in the event any of the events described in paragraph 11 of the Plan
occurs with respect to the Company.
(b) In the event of a Transfer of Control, the surviving,
continuing, successor, or purchasing corporation or parent corporation thereof,
as the case may be (the "ACQUIRING CORPORATION"), shall either assume the
Company's rights and obligations under this Option Agreement or substitute an
option for the Acquiring Corporation's stock for the Option. In the event the
Acquiring Corporation elects not to assume the Company's rights and obligations
under this Option Agreement or substitute an option for the Acquiring
Corporation's stock for the Option, all shares subject to this Option Agreement
shall become Vested Shares (as defined in paragraph 11(b) below) effective as
of the date thirty (30) days prior to the Proposed Effective Date.
(c) The exercise and/or vesting of any shares that was
permissible solely by reason of this paragraph 8 shall be conditioned upon the
consummation of the Transfer of Control. The Option shall terminate and cease
to be outstanding effective upon the Transfer of Control to the extent that the
Option is neither assumed or substituted for by the Acquiring Corporation in
connection with the Transfer of Control nor exercised as of the date of the
Transfer of Control.
9. Effect of Change in Stock Subject to the Option.
Appropriate adjustments shall be made in the number, exercise price, and class
of shares of stock subject to the Option in the event of a stock dividend,
stock split, reverse stock split, recapitalization, combination,
reclassification, or like change in the capital structure of the Company. In
the event a majority of the shares which are of the same class as the shares
that are subject to the Option are exchanged for, converted into, or otherwise
become (whether or not pursuant to an Ownership Change) shares of another
corporation (the "NEW SHARES"), the Company may unilaterally amend the Option
to provide that the Option is exercisable for New Shares. In the event of any
such amendment, the number of shares and the exercise price shall be adjusted
in a fair and equitable manner.
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10. Rights as a Stockholder or Employee.
The Optionee shall have no rights as a stockholder with respect to any shares
covered by the Option until the date of the issuance of a certificate or
certificates for the shares for which the Option has been exercised. No
adjustment shall be made for dividends or distributions or other rights for
which the record date is prior to the date such certificate or certificates
are issued, except as provided in paragraph 9 above. Nothing in the Option
shall confer upon the Optionee any right to continue in the employ of a
Participating Company or interfere in any way with any right of the
Participating Company Group to terminate the Optionee's employment at any time.
11. Unvested Share Repurchase Option.
(a) Unvested Share Repurchase Option. In the event the
Optionee's employment with the Participating Company Group is terminated 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 (other than pursuant to an Ownership Change) any shares acquired
upon exercise of the Option which exceed the Optionee's Vested Shares as
defined in paragraph 11(b) below (the "UNVESTED SHARES"), the Company shall
have the right to repurchase the Unvested Shares under the terms and subject to
the conditions set forth in this paragraph 11 (the "UNVESTED SHARE REPURCHASE
OPTION").
(b) Vested Shares and Unvested Shares Defined. On any
given date, the number of "VESTED SHARES" shall be equal to the Number of
Option Shares multiplied by the Vested Percentage determined as of such date
pursuant to paragraph 1(f) above and rounded down to the nearest whole share.
On such date, the number of Unvested Shares shall be equal to the Number of
Option Shares reduced by the number of Vested Shares determined as of such
date.
(c) Exercise of Unvested Share Repurchase Option. The
Company may exercise the Unvested Share Repurchase Option by written notice to
the Optionee within six (6) months after (i) such termination of employment (or
exercise of the Option, if later), or (ii) the Company has received notice of
the attempted disposition. If the Company fails to give notice within such six
(6) month period, the Unvested Share Repurchase Option shall terminate unless
the Company and the Optionee have extended the time for the exercise of the
Unvested Share Repurchase Option. The Unvested Share Repurchase Option must be
exercised, if at all, for all of the Unvested Shares, except as the Company and
the Optionee otherwise agree.
(d) Payment for Shares and Return of Shares. Payment by
the Company to the Optionee shall be made in cash within thirty (30) days after
the date of the mailing of the written notice of exercise of the Unvested Share
Repurchase Option. For purposes of the foregoing, cancellation of any
indebtedness of the Optionee to any Participating Company shall be treated as
payment to the Optionee in cash to the extent of the unpaid principal and any
accrued interest canceled. The purchase price per share being repurchased by
the Company shall be an amount equal to the Optionee's original cost per share,
as adjusted pursuant to paragraph 9 above (the "REPURCHASE PRICE"). The shares
being repurchased shall be delivered to the Company by the Optionee at the same
time as the delivery of the Repurchase Price to the Optionee.
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(e) Assignment of Unvested Share Repurchase Option. The
Company shall have the right to assign the Unvested Share Repurchase Option at
any time, whether or not such option is then exercisable, to one (1) or more
persons as may be selected by the Company.
(f) Ownership Change. In the event of an Ownership
Change, any and all new, substituted or additional securities or other property
to which the Optionee is entitled by reason of his or her ownership of Unvested
Shares, determined after application of paragraph 8 above, shall be immediately
subject to the Unvested Share Repurchase Option and included in the terms
"shares" and "Unvested Shares" for all purposes of the Unvested Share
Repurchase Option with the same force and effect as the Unvested Shares
immediately prior to the Ownership Change. While the aggregate Repurchase
Price shall remain the same after such Ownership Change, the Repurchase Price
per Unvested Share upon exercise of the Unvested Share Repurchase Option
following such Ownership Change shall be appropriately adjusted. For purposes
of determining the Vested Percentage following an Ownership Change, credited
service shall include (i) all service with any corporation which is a
Participating Company at the time the services are rendered, whether or not
such corporation is a Participating Company both before and after the event
constituting the Ownership Change, and (ii) any additional service credited
pursuant to paragraph 8(c).
12. Right of First Refusal.
(a) Right of First Refusal. Except as provided in
paragraph 12(g) below, in the event the Optionee proposes to sell, pledge, or
otherwise transfer any Vested Shares (the "TRANSFER SHARES") to any person or
entity, including, without limitation, any stockholder of the Participating
Company Group, the Company shall have the right to repurchase the Transfer
Shares under the terms and subject to the conditions set forth in this
paragraph 12 (the "RIGHT OF FIRST REFUSAL").
(b) Notice of Proposed Transfer. Prior to any proposed
transfer of the Transfer Shares, the Optionee shall give a written notice (the
"TRANSFER NOTICE") to the Company describing fully the proposed transfer,
including the number of Transfer Shares, the name and address of the proposed
transferee (the "PROPOSED TRANSFEREE") and, if the transfer is voluntary, the
proposed transfer price and containing such information necessary to show the
bona fide nature of the proposed transfer. In the event of a bona fide gift or
involuntary transfer, the proposed transfer price shall be deemed to be the
fair market value of the Transfer Shares as determined by the Company in good
faith. In the event the Optionee proposes to transfer any Transfer Shares to
more than one (1) Proposed Transferee, the Optionee shall provide a separate
Transfer Notice for the proposed transfer to each Proposed Transferee. The
Transfer Notice shall be signed by both the Optionee and the Proposed
Transferee and must constitute a binding commitment of the Optionee and the
Proposed Transferee for the transfer of the Transfer Shares to the Proposed
Transferee subject only to the Right of First Refusal.
(c) Bona Fide Transfer. In the event that the Company
shall determine that the information provided by the Optionee in the Transfer
Notice is insufficient to establish the bona fide nature of a proposed
voluntary transfer, the Company shall give the Optionee written
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notice of the Optionee's failure to comply with the procedure described in this
paragraph 12 and the Optionee shall have no right to transfer the Transfer
Shares without first complying with the procedure described in this paragraph
12. The Optionee shall not be permitted to transfer the Transfer Shares if the
proposed transfer is not bona fide.
(d) Exercise of Right of First Refusal. In the event the
proposed transfer is deemed to be bona fide, the Company shall have the right
to purchase all, but not less than all, of the Transfer Shares (except as the
Company and the Optionee otherwise agree) at the purchase price and on the
terms set forth in the Transfer Notice by delivery to the Optionee of a notice
of exercise of the Right of First Refusal within thirty (30) days after the
date the Transfer Notice is delivered to the Company. The Company's exercise
or failure to exercise the Right of First Refusal with respect to any proposed
transfer described in a Transfer Notice shall not affect the Company's right to
exercise the Right of First Refusal with respect to any proposed transfer
described in any other Transfer Notice, whether or not such other Transfer
Notice is issued by the Optionee or issued by a person other than the Optionee
with respect to a proposed transfer to the same Proposed Transferee. If the
Company exercises the Right of First Refusal, the Company and the Optionee
shall thereupon consummate the sale of the Transfer Shares to the Company on
the terms set forth in the Transfer Notice within sixty (60) days after the
date the Transfer Notice is delivered to the Company (unless a longer period is
offered by the Proposed Transferee); provided, however, that in the event the
Transfer Notice provides for the payment for the Transfer Shares other than in
cash, the Company shall have the option of paying for the Transfer Shares by
the present value cash equivalent of the consideration described in the
Transfer Notice as reasonably determined by the Company. For purposes of the
foregoing, cancellation of any indebtedness of the Optionee to any
Participating Company shall be treated as payment to the Optionee in cash to
the extent of the unpaid principal and any accrued interest canceled.
(e) Failure to Exercise Right of First Refusal. If the
Company fails to exercise the Right of First Refusal in full within the period
specified in paragraph 12(d) above, the Optionee may conclude a transfer to the
Proposed Transferee of the Transfer Shares on the terms and conditions
described in the Transfer Notice, provided such transfer occurs not later than
ninety (90) days following delivery to the Company of the Transfer Notice. The
Company shall have the right to demand further assurances from the Optionee and
the Proposed Transferee (in a form satisfactory to the Company) that the
transfer of the Transfer Shares was actually carried out on the terms and
conditions described in the Transfer Notice. No Transfer Shares shall be
transferred on the books of the Company until the Company has received such
assurances, if so demanded, and has approved the proposed transfer as bona
fide. Any proposed transfer on terms and conditions different from those
described in the Transfer Notice, as well as any subsequent proposed transfer
by the Optionee, shall again be subject to the Right of First Refusal and shall
require compliance by the Optionee with the procedure described in this
paragraph 12.
(f) Transferees of Transfer Shares. All transferees of
the Transfer Shares or any interest therein, other than the Company, shall be
required as a condition of such transfer to agree in writing (in a form
satisfactory to the Company) that such transferee shall receive and hold such
Transfer Shares or interests subject to the provisions of this paragraph 12
providing for the Right of First Refusal with respect to any subsequent
transfer. Any sale or transfer of any
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shares acquired upon exercise of the Option shall be void unless the provisions
of this paragraph 12 are met.
(g) Transfers Not Subject to Right of First Refusal.
Notwithstanding the foregoing, the Right of First Refusal shall not apply to
any transfer or exchange of the shares acquired pursuant to the exercise of the
Option if such transfer or exchange is in connection with an Ownership Change.
If the consideration received pursuant to such transfer or exchange consists of
stock of a Participating Company, such consideration shall remain subject to
the Right of First Refusal unless the provisions of paragraph 12(i) below
result in a termination of the Right of First Refusal. Furthermore,
notwithstanding the foregoing, the Right of First Refusal shall not apply to a
transfer of Transfer Shares to the Optionee's ancestors, descendants, or spouse
or to a trustee solely for the benefit of the Optionee or the Optionee's
ancestors, descendants, or spouse, or to a charitable institution; provided,
however, that such transferee shall agree in writing (in a form satisfactory to
the Company) to take the stock subject to all the terms and conditions of this
paragraph 12 providing for a Right of First Refusal with respect to any
subsequent transfer.
(h) Assignment of Right of First Refusal. The Company
shall have the right to assign the Right of First Refusal at any time, whether
or not the Optionee has attempted a transfer, to one (1) or more persons as may
be selected by the Company.
(i) Early Termination of Right of First Refusal. The
other provisions of this paragraph 12 notwithstanding, the Right of First
Refusal shall terminate, and be of no further force and effect, upon (i) the
occurrence of a Transfer of Control, unless the surviving, continuing,
successor, or purchasing corporation or parent corporation thereof, as the case
may be, assumes the Company's rights and obligations under the Plan, or (ii)
the existence of a public market for the class of shares subject to the Right
of First Refusal. A "public market" shall be deemed to exist if (x) such stock
is listed on a national securities exchange (as that term is used in the
Exchange Act), or (y) such stock is traded on the over-the-counter market and
prices therefor are published daily on business days in a recognized financial
journal.
13. Escrow.
(a) Establishment of Escrow. To ensure that shares
subject to the Unvested Share Repurchase Option, the Right of First Refusal
and/or security for any promissory note will be available for repurchase, the
Company may require the Optionee to deposit the certificate or certificates
evidencing the shares which the Optionee purchases upon exercise of the Option
with the Company or other escrow agent designated by the Company under the
terms and conditions of escrow and security agreements approved by the Company.
If the Company does not require such deposit as a condition of exercise of the
Option, or if the Company releases the certificate or certificates from escrow
prior to the lapsing of all such restrictions and/or security interest, the
Company reserves the right at any time to require the Optionee to so deposit
the certificate or certificates in escrow. The Company shall bear the expenses
of the escrow.
(b) Delivery of Shares to Optionee. As soon as
practicable after the expiration of the Unvested Share Repurchase Option and
the Right of First Refusal, and after full repayment
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on any promissory note secured by the shares in escrow, the escrow agent shall
deliver to the Optionee the shares no longer subject to such restrictions and
no longer security for any promissory note.
(c) Notices and Payments. In the event the shares held
in escrow are subject to the Company's exercise of the Unvested Share
Repurchase Option or the Right of First Refusal, the notices required to be
given to the Optionee shall be given to the escrow agent and any payment
required to be given to the Optionee shall be given to the escrow agent.
Within thirty (30) days after payment by the Company, the escrow agent shall
deliver the shares which the Company has purchased to the Company and shall
deliver the payment received from the Company to the Optionee.
14. Stock Dividends Subject to Option Agreement.
If, from time to time, there is any stock dividend, stock split, or other
change in the character or amount of any of the outstanding stock of the
corporation the stock of which is subject to the provisions of this Option
Agreement, then in such event any and all new, substituted or additional
securities to which the Optionee is entitled by reason of the Optionee's
ownership of the shares acquired upon exercise of the Option shall be
immediately subject to the Unvested Share Repurchase Option, the Right of
First Refusal, and/or any security interest held by the Company with the same
force and effect as the shares subject to the Unvested Share Repurchase Option,
the Right of First Refusal, and such security interest immediately before such
event.
15. Legends.
The Company may at any time place legends referencing the Unvested Share
Repurchase Option set forth in paragraph 11 above, the Right of First Refusal
set forth in paragraph 12 above, and any applicable federal, state or foreign
securities law restrictions on all certificates representing shares of stock
subject to the provisions of this Option Agreement. The Optionee shall, at
the request of the Company, promptly present to the Company any and all
certificates representing shares acquired pursuant to the Option in the
possession of the Optionee in order to carry out the provisions of this
paragraph. Unless otherwise specified by the Company, legends placed on such
certificates may include, but shall not be limited to, the following:
(a) "THE SECURITIES EVIDENCED BY THIS CERTIFICATE HAVE
NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND MAY NOT
BE SOLD, TRANSFERRED, ASSIGNED OR HYPOTHECATED UNLESS THERE IS AN EFFECTIVE
REGISTRATION STATEMENT UNDER SUCH ACT COVERING SUCH SECURITIES, THE SALE IS
MADE IN ACCORDANCE WITH RULE 144 OR RULE 701 UNDER THE ACT, OR THE COMPANY
RECEIVES AN OPINION OF COUNSEL FOR THE HOLDER OF THESE SECURITIES REASONABLY
SATISFACTORY TO THE COMPANY, STATING THAT SUCH SALE, TRANSFER, ASSIGNMENT OR
HYPOTHECATION IS EXEMPT FROM THE REGISTRATION AND PROSPECTUS DELIVERY
REQUIREMENTS OF SUCH ACT."
(b) "THE SHARES REPRESENTED BY THIS CERTIFICATE ARE
SUBJECT TO AN UNVESTED SHARE REPURCHASE OPTION IN FAVOR OF THE CORPORATION OR
ITS ASSIGNEE SET FORTH IN AN AGREEMENT BETWEEN THE
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CORPORATION AND THE REGISTERED HOLDER, OR SUCH HOLDER'S PREDECESSOR IN
INTEREST, A COPY OF WHICH IS ON FILE AT THE PRINCIPAL OFFICE OF THIS
CORPORATION."
(c) "THE SHARES REPRESENTED BY THIS CERTIFICATE ARE
SUBJECT TO A RIGHT OF FIRST REFUSAL OPTION IN FAVOR OF THE CORPORATION OR ITS
ASSIGNEE SET FORTH IN AN AGREEMENT BETWEEN THE CORPORATION AND THE REGISTERED
HOLDER, OR SUCH HOLDER'S PREDECESSOR IN INTEREST, A COPY OF WHICH IS ON FILE AT
THE PRINCIPAL OFFICE OF THIS CORPORATION."
16. Initial Public Offering.
The Optionee hereby agrees that in the event of an initial public offering of
stock made by the Company pursuant to an effective registration statement
filed under the Securities Act, the Optionee shall not offer, sell, contract
to sell, pledge, hypothecate, grant any option to purchase or make any short
sale of, or otherwise dispose of any shares of stock of the Company or any
rights to acquire stock of the Company for such period of time from and after
the effective date of such registration statement as may be established by the
underwriter for such initial public offering; provided, however, that such
period of time shall not exceed two hundred seventy (270) days from the
effective date of the registration statement to be filed in connection with
such initial public offering. The foregoing limitation shall not apply to
shares registered in the initial public offering under the Securities Act.
The Optionee shall be subject to this paragraph provided and only if the
officers and directors of the Company are also subject to similar arrangements.
17. Binding Effect.
This Option Agreement shall inure to the benefit of and be binding upon the
parties hereto and their respective heirs, executors, administrators,
successors and assigns.
18. Termination or Amendment.
The Board, including any duly appointed committee of the Board, may terminate
or amend the Plan and/or the Option at any time; provided, however, that no
such termination or amendment may adversely affect the Option or any
unexercised portion hereof without the consent of the Optionee.
19. Integrated Agreement.
This Option Agreement constitutes the entire understanding and agreement of
the Optionee and the Participating Company Group with respect to the subject
matter contained herein, and there are no agreements, understandings,
restrictions, representations, or warranties among the Optionee and the
Company other than those as set forth or provided for herein. To the extent
contemplated herein, the provisions of this Option Agreement shall survive any
exercise of the Option and shall remain in full force and effect.
20. Applicable Law.
This Option Agreement shall be governed by the laws of the State of Maryland
as such laws are applied to agreements between Maryland residents entered into
and to be performed entirely within the State of Maryland.
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CIENA CORPORATION
By:
---------------------------------
Title: Vice President, Finance
Chief Financial Officer
The Optionee represents that the Optionee is familiar with the terms
and provisions of this Option Agreement including the Unvested Share Repurchase
Option set forth in paragraph 11 and the Right of First Refusal set forth in
paragraph 12 and hereby accepts the Option subject to all of the terms and
provisions thereof. The Optionee hereby agrees to accept as binding,
conclusive and final all decisions or interpretations of the Board upon any
questions arising under this Option Agreement. The undersigned acknowledges
receipt of a copy of the Plan.
OPTIONEE
Date:
------------------------ --------------------------
The undersigned, being the spouse of the above-named Optionee, does
hereby acknowledge that the undersigned has read and is familiar with the
provisions of the above Option Agreement, and the undersigned hereby agrees
thereto and joins therein to the extent, if any, that the agreement and joinder
of the undersigned may be necessary.
OPTIONEE
Date:
------------------------- --------------------------
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EXHIBIT A
TO
STOCK OPTION AGREEMENT
(a) "Date of Option Grant" shall mean {grant_date}.
(b) "Number of Option Shares" shall mean {shares} shares
of common stock of the Company.
(c) "Exercise Price" shall mean {price} per share.
(d) "Initial Vesting Date" shall be the last day of the
calendar month in which occurs the date one (1) year after the following date:
{vesting_date}.
16
