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Exhibit 99.5
ARROWPOINT COMMUNICATIONS, INC.
Nonstatutory Stock Option Agreement
Granted Under 2000 Non-Employee Director Stock Option Plan
1. Grant of Option.
This agreement evidences the grant by ArrowPoint Communications, Inc., a
Delaware corporation (the "Company"), on , 200_ (the "Grant Date") to ___, a
non-employee director of the Company (the "Optionee"), of an option to purchase,
in whole or in part, on the terms provided herein and in the Company's 2000
Non-Employee Director Stock Option Plan (the "Plan"), a total of [20,000/10,000]
shares (the "Shares") of common stock, $.001 par value per share, of the Company
("Common Stock") at $ per Share. Unless earlier terminated, this option shall
expire on the tenth anniversary of the Grant Date (the "Final Exercise Date").
It is intended that the option evidenced by this agreement shall not be
an incentive stock option as defined in Section 422 of the Internal Revenue Code
of 1986, as amended and any regulations promulgated thereunder (the "Code").
Except as otherwise indicated by the context, the term "Optionee", as used in
this option, shall be deemed to include any person who acquires the right to
exercise this option validly under its terms.
2. Vesting Schedule.
This option will become exercisable ("vest") as to 100% of the original
number of Shares on the date one year following the Grant Date. This vesting of
this option shall also accelerate under the conditions provided in the Plan.
Notwithstanding the foregoing, in the event of a Change in Control Event (as
defined in the Plan), 50% of the number of shares which are not then vested
shall become vested upon the occurrence of a Change in Control Event.
Notwithstanding the provisions of this Section 2, the Optionee may
exercise this option for the unvested Shares covered hereby at any time prior to
its expiration or termination, provided the Optionee executes a restricted stock
agreement, in a form acceptable to the Company, granting the Company the right
to repurchase any unvested Shares, at the exercise price paid by the Optionee,
upon the termination of the Optionee's service as a director of the Company.
3. Exercise of Option.
(a) Form of Exercise. Each election to exercise this option shall be in
writing, signed by the Optionee, and received by the Company at its principal
office, accompanied by this agreement, and payment in full in the manner
provided in the Plan. An exercise notice shall be substantially in the form
attached hereto as Exhibit A. The Optionee may purchase less than the number of
shares covered hereby, provided that no partial exercise of this option may be
for any fractional share or for fewer than ten whole shares.
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(b) Termination of Relationship with the Company. If the Optionee ceases
to be a director of the Company for any reason, then the right to exercise this
option shall terminate one year after such cessation (but in no event after the
Final Exercise Date), provided that this option shall be exercisable only to the
extent that the Optionee was entitled to exercise this option on the date of
such cessation.
4. Withholding.
No Shares will be issued pursuant to the exercise of this option unless
and until the Optionee pays to the Company, or makes provision satisfactory to
the Company for payment of, any federal, state or local withholding taxes
required by law to be withheld in respect of this option.
5. Nontransferability of Option.
This option may not be sold, assigned, transferred, pledged or otherwise
encumbered by the Optionee, either voluntarily or by operation of law, except by
will or the laws of descent and distribution, and, during the lifetime of the
Optionee, this option shall be exercisable only by the Optionee or the
Optionee's guardian or legal representative.
6. Provisions of the Plan.
This option is subject to the provisions of the Plan, a copy of which is
furnished to the Optionee with this option.
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IN WITNESS WHEREOF, the Company has caused this option to be executed
under its corporate seal by its duly authorized officer. This option shall take
effect as a sealed instrument.
ArrowPoint Communications, Inc.
Dated: By:
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Name:
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Title:
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OPTIONEE'S ACCEPTANCE
The undersigned hereby accepts the foregoing option and agrees to the
terms and conditions thereof. The undersigned hereby acknowledges receipt of a
copy of the Company's 2000 Non-Employee Director Stock Option Plan.
OPTIONEE:
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Address:
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EXHIBIT A
NOTICE OF STOCK OPTION EXERCISE
DATE:
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ArrowPoint Communications, Inc.
00 Xxxxx Xxxx
Xxxxx, XX 00000
Attention: Treasurer:
Dear Sir:
I am the holder of a Non-statutory Stock Option granted to me under the
2000 Non-Employee Director Stock Option Plan on _______________ for the purchase
of ______________ shares of Common Stock at a purchase price of $______________
per share.
I hereby exercise my option to purchase ________________ shares of
Common Stock, (the "Shares") for which I have enclosed [a check in the amount of
$___________]. Please register my stock certificate as follows:
Name(s):
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Address:
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Tax I.D. #:
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Very truly yours,
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(Signature)
