LUMENTUM HOLDINGS INC.
EXECUTIVE OFFICER PERFORMANCE-BASED INCENTIVE PLAN
SECTION 1
BACKGROUND, PURPOSE AND DURATION
1.1    Effective Date. The Plan will become effective upon ratification by an
affirmative vote of the holders of a majority of the Shares that are present in
person or by proxy and entitled to vote at the 2016 Annual Meeting of
Stockholders of the Company.
1.2    Purpose of the Plan. The Plan is intended to increase shareholder value
and the success of the Company by motivating key executives (1) to perform to
the best of their abilities, and (2) to achieve the Company’s objectives. The
Plan’s goals are to be achieved by providing such executives with incentive
awards based on the achievement of goals relating to the performance of the
Company. The Plan is intended to permit the payment of bonuses that qualify as
performance-based compensation under Section 162(m) of the Code.
SECTION 2
DEFINITIONS
The following words and phrases shall have the following meanings unless a
different meaning is plainly required by the context:
2.1    “Actual Award” means as to any Performance Period, the actual award (if
any) payable to a Participant for the Performance Period. Each Actual Award is
determined by the Payout Formula for the Performance Period, subject to the
Committee’s authority under Section 3.6 to eliminate or reduce the award
otherwise determined by the Payout Formula. For purposes of applying the Maximum
Award limitation, the Actual Award will be deemed to have been determined on the
last day of the applicable Performance Period, so that if there are multiple
Performance Periods ending in a particular Fiscal Year, in no event may the
Actual Awards with respect to all such Performance Periods in the aggregate
exceed the Maximum Award.
2.2    “Affiliate” means any corporation or other entity (including, but not
limited to, partnerships and joint ventures) controlled by the Company.
2.3    “Base Salary” means as to any Performance Period, unless the Committee
provides otherwise when establishing the Target Award, the Participant’s
annualized salary rate on the last day of the Performance Period. Such Base
Salary shall be before both (a) deductions for taxes or benefits, and
(b) deferrals of compensation pursuant to Company-sponsored plans. For avoidance
of doubt, “Base Salary” does not include performance-based cash incentives,
commissions, equity compensation, incentive or other compensation.
2.4    “Board” means the Board of Directors of the Company.
2.5    “Change of Control” means
(a)    The acquisition by any person (or related group of persons), whether by
tender or exchange offer made directly to the Company’s stockholders, open
market purchases or any other transaction or series of transactions, of stock of
the Company that, together with stock of the Company held by such person or
group, constitutes more than 50% of the total fair market value or total voting
power of the then outstanding stock of Company entitled to vote generally in the
election of the members of Board;

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(b)    a merger or consolidation in which the Company is not the surviving
entity, except for a transaction in which both (i) securities representing more
than 50% of the total combined voting power of the surviving entity are
beneficially owned (within the meaning of Rule 13d-3 promulgated under the
Securities Exchange Act of 1934), directly or indirectly, immediately after such
merger or consolidation by persons who beneficially owned Company common stock
immediately prior to such merger or consolidation and (ii) the members of Board
immediately prior to the transaction (the “Existing Board”) constitute a
majority of the Board of the surviving entity or its parent entity immediately
after such merger or consolidation;
(c)    any reverse merger in which Company is the surviving entity but in which
either (i) persons who beneficially owned, directly or indirectly, Company
common stock immediately prior to such reverse merger do not retain immediately
after such reverse merger direct or indirect beneficial ownership of securities
representing more than 50% of the total combined voting power of Company’s
outstanding securities or (ii) the members of the Existing Board do not
constitute a majority of the Board’s parent entity immediately after such
reverse merger; or
(d)    the sale, transfer or other disposition of all or substantially all of
the assets of Company (other than a sale, transfer or other disposition to one
or more subsidiaries of Company).
Notwithstanding the foregoing, to the extent that any amount constituting
nonqualified deferred compensation within the meaning of Section 409A of the
Code (including any applicable final, proposed or temporary regulations and
other administrative guidance promulgated thereunder) would become payable under
this Plan by reason of a Change of Control, such amount shall become payable
only if the event constituting a Change of Control would also constitute a
change in ownership or effective control of Company or a change in the ownership
of a substantial portion of the assets of Company within the meaning of Section
409A of the Code.
2.6     “Code” means the Internal Revenue Code of 1986, as amended. Reference to
a specific section of the Code or regulation thereunder shall include such
section or regulation, any valid regulation promulgated thereunder, and any
comparable provision of any future legislation or regulation amending,
supplementing or superseding such section or regulation.
2.7    “Committee” means the Compensation Committee of the Board, or such other
committee as may be designated by the Board to administer the Plan.
2.8    “Company” means Lumentum Holdings Inc., a Delaware corporation, or any
successor thereto.
2.9    “Determination Date” means the latest possible date that will not
jeopardize a Target Award or Actual Award’s qualification as performance-based
compensation under Section 162(m) of the Code.
2.10    “Disability” means a permanent and total disability determined in
accordance with uniform and nondiscriminatory standards adopted by the Committee
from time to time.
2.11    “Employee” means any employee of the Company or of an Affiliate, whether
such employee is so employed at the time the Plan is adopted or becomes so
employed subsequent to the adoption of the Plan.
2.12    “Fiscal Year” means the fiscal year of the Company.

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2.13    “Maximum Award” means as to any Participant for all Performance Periods
ending during a Fiscal Year, $2,500,000.
2.14    “Participant” means as to any Performance Period, an Employee who has
been selected by the Committee for participation in the Plan for that
Performance Period.
2.15    “Payout Formula” means as to any Performance Period, the formula or
payout matrix established by the Committee pursuant to Section 3.4 in order to
determine the Actual Awards (if any) to be paid to Participants. The formula or
matrix may differ from Participant to Participant.
2.16     “Performance Goals” means the goal(s) (or combined goal(s)) determined
by the Committee (in its discretion) to be applicable to a Participant for a
Target Award for a Performance Period. As determined by the Committee, the
Performance Goals for any Target Award applicable to a Participant may provide
for a targeted level or levels of achievement using one or more of the following
measures: share price, earnings per share, total stockholder return, operating
margin, gross margin, return on equity, return on assets, return on investment,
operating income, net operating income, pre-tax profit, net income, cash flow,
revenue, expenses, earnings before any one or more of share-based compensation
expense, interest, taxes, depreciation and amortization, economic value added,
market share, personal management objectives, product development, completion of
an identified special project, completion of a joint venture or other corporate
transaction, and other measures of performance selected by the Committee. The
Performance Goals may differ from Participant to Participant and from award to
award. Any criteria used may be (A) measured in absolute terms, (B) measured in
terms of growth, (C) compared to another company or companies, (D) measured
against the market as a whole and/or according to applicable market indices,
(E) measured against the performance of the Company as a whole or a segment of
the Company and/or (F) measured on a pre-tax or post-tax basis (if applicable).
Further, any Performance Goals may be used to measure the performance of the
Company as a whole or a business unit or other segment of the Company, or one or
more product lines or specific markets and may be measured relative to a peer
group or index. Prior to the Determination Date, the Committee will determine
whether any significant element(s) will be included in or excluded from the
calculation of any Performance Goal with respect to any Participant. In all
other respects, Performance Goals will be calculated in accordance with the
Company’s financial statements, generally accepted accounting principles
(“GAAP”), or under a methodology (including non-GAAP adjustments) established by
the Committee prior to the Determination Date and which is consistently applied
with respect to a Performance Goal in the relevant Performance Period. In
addition, the Committee will adjust any performance criteria, Performance Goal
or other feature of an Actual or Target Award that relates to or is wholly or
partially based on the number of, or the value of, any stock of the Company, to
reflect any stock dividend or split, repurchase, recapitalization, combination,
or exchange of shares or other similar changes in such stock.
2.17    “Performance Period” means any Fiscal Year or such other period as
determined by the Committee in its sole discretion.
2.18    “Plan” means the Lumentum Holdings Inc. Executive Officer
Performance-Based Incentive Plan, as amended and restated, as set forth in this
instrument and as hereafter amended from time to time.
2.19    “Target Award” means the target award payable under the Plan to a
Participant for the Performance Period, expressed as a percentage of his or her
Base Salary, as determined by the Committee in accordance with Section 3.3.

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2.20    “Termination of Employment” means a cessation of the employee-employer
relationship between an Employee and the Company or an Affiliate for any reason,
including, but not by way of limitation, a termination by resignation,
discharge, death, Disability, retirement, or the disaffiliation of an Affiliate,
but excluding any such termination where there is a simultaneous reemployment by
the Company or an Affiliate.
SECTION 3
SELECTION OF PARTICIPANTS AND DETERMINATION OF AWARDS
3.1    Selection of Participants. The Committee, in its sole discretion, shall
select the Employees who shall be Participants for any Performance Period.
Participation in the Plan is in the sole discretion of the Committee, and on a
Performance Period by Performance Period basis. Accordingly, an Employee who is
a Participant for a given Performance Period in no way is guaranteed or assured
of being selected for participation in any subsequent Performance Period.
3.2    Determination of Performance Goals. The Committee, in its sole
discretion, shall establish the Performance Goals for each Participant for each
Performance Period. Such Performance Goals shall be set forth in writing.
3.3    Determination of Target Awards.
(a)    The Committee, in its sole discretion, shall establish a Target Award for
each Participant. Each Participant’s Target Award shall be determined by the
Committee in its sole discretion, and each Target Award shall be set forth in
writing. The Committee, in its discretion, may adjust any Performance Goal (or
actual performance versus the Performance Goal) for the effects of charges for
restructurings, discontinued operations, extraordinary items and all items of
gain, loss or expense determined to be extraordinary or unusual in nature or
related to the disposal of a segment of a business or related to a change in
accounting principle, asset write-downs, litigation, claims, judgments or
settlements, the effect of changes in tax law or other such laws or provisions
affecting reported results, accruals for reorganization and restructuring
programs, provided that any such adjustment is intended not to jeopardize the
qualification of an Actual Award as performance-based compensation under Section
162(m) of the Code.
(b)    If a Performance Goal is based on, or calculated with respect to, the
Company’s common stock (such as increases in earnings per share, book value per
share or other similar measures), then, if any corporate transaction occurs
involving the Company (including, without limitation, any subdivision or
combination or exchange of the outstanding shares of common stock, stock
dividend, stock split, spin-off, split-off, recapitalization, capital
reorganization, liquidation, reclassification of shares of common stock, merger,
consolidation, extraordinary cash distribution, redemption, stock issuance, or
sale, lease or transfer of substantially all of the assets of the Company), the
Compensation Committee shall make or provide for such adjustments in such
Performance Goal as the Compensation Committee may in good faith determine to be
equitably required to prevent dilution or enlargement of any increase or
decrease in the rights of Participants.
3.4    Determination of Payout Formula or Formulae. On or prior to the
Determination Date, the Committee, in its sole discretion, shall establish a
Payout Formula or Formulae for purposes of determining the Actual Award (if any)
payable to each Participant. Each Payout Formula shall (a) be in writing, (b) be
based on a comparison of actual performance to the Performance Goals,
(c) provide for the payment of a Participant’s Target Award if the Performance
Goals for the Performance Period are achieved, and (d) provide for an Actual
Award greater than or less than the Participant’s Target Award, depending upon
the extent to which actual

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performance exceeds or falls below the Performance Goals. Notwithstanding the
preceding, in no event shall a Participant’s Actual Award for any Fiscal Year
exceed the Maximum Award.
3.5    Date for Determinations. The Committee shall make all determinations
under Sections 3.1 through 3.4 on or before the Determination Date.
3.6    Determination of Actual Awards. After the end of each Performance Period,
the Committee shall certify in writing the extent to which the Performance Goals
applicable to each Participant for the Performance Period were achieved or
exceeded. The Actual Award for each Participant shall be determined by applying
the Payout Formula to the level of actual performance that has been certified by
the Committee. Notwithstanding any contrary provision of the Plan, the
Committee, in its sole discretion, may (a) eliminate or reduce the Actual Award
payable to any Participant below that which otherwise would be payable under the
Payout Formula, and (b) determine what Actual Award, if any, will be paid in the
event of a Termination of Employment as the result of a Participant’s death or
Disability or upon a Change of Control or in the event of a Termination of
Employment following a Change of Control prior to the end of the Performance
Period, and (c) determine what Actual Award, if any, will be paid in the event
of a Termination of Employment other than as the result of a Participant’s death
or Disability prior to a Change of Control and prior to the end of the
Performance Period to the extent an Actual Award would have otherwise been
achieved had the Participant remained employed through the end of the
Performance Period.
SECTION 4
PAYMENT OF AWARDS
4.1    Right to Receive Payment. Each Actual Award that may become payable under
the Plan shall be paid solely from the general assets of the Company. Nothing in
this Plan shall be construed to create a trust or to establish or evidence any
Participant’s claim of any right to payment of an Actual Award other than as an
unsecured general creditor with respect to any payment to which he or she may be
entitled.
4.2    Timing of Payment. Payment of each Actual Award shall be made as soon as
practical following the determination and certification of the Actual Award as
set forth in Section 3.6, but in no event later than the fifteenth day of the
third month of the Fiscal Year following the date the Participant’s Actual Award
has been earned and is no longer subject to a substantial risk of forfeiture;
provided that the Committee may permit Participants to elect to defer payment of
their Actual Awards in a manner satisfying the requirements of Section 409A of
the Code.
4.3    Form of Payment. Each Actual Award shall be paid in cash (or its
equivalent) in a single lump sum unless otherwise deferred in accordance with
Section 4.2.
4.4    Compensation Recovery Policy. The Committee, in its sole discretion, may
require Participant to forfeit, return or reimburse to the Company all or a
portion of any Actual Award received in accordance with any then-effective
Company compensation clawback or recovery policy, as may be established or
amended from time to time. Any such policy generally shall be intended to apply
substantially equally to all officers of the Company, except as the Committee
(or the Board or a committee of the Board, as determined by the Board), in its
discretion, determines is reasonably necessary or appropriate to comply with
applicable laws.
SECTION 5
ADMINISTRATION

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5.1    Committee is the Administrator. The Plan shall be administered by the
Committee. The Committee shall consist of not less than two (2) members of the
Board. The members of the Committee shall be appointed from time to time by, and
serve at the pleasure of, the Board. Each member of the Committee shall qualify
as an “outside director” under Section 162(m) of the Code. If it is later
determined that one or more members of the Committee do not so qualify, actions
taken by the Committee prior to such determination shall be valid despite such
failure to qualify.
5.2    Committee Authority. It shall be the duty of the Committee to administer
the Plan in accordance with the Plan's provisions. The Committee shall have all
powers and discretion necessary or appropriate to administer the Plan and to
control its operation, including, but not limited to, the power to (a) determine
which Employees shall be granted awards, (b) prescribe the terms and conditions
of awards, (c) interpret the Plan and the awards, (d) adopt such procedures and
subplans as are necessary or appropriate to permit participation in the Plan by
Employees, (e) adopt rules for the administration, interpretation and
application of the Plan as are consistent therewith, and (f) interpret, amend or
revoke any such rules.
5.3    Decisions Binding. All determinations and decisions made by the
Committee, the Board, and any delegate of the Committee pursuant to the
provisions of the Plan shall be final, conclusive, and binding on all persons,
and shall be given the maximum deference permitted by law.
5.4    Delegation by the Committee. The Committee, in its sole discretion and on
such terms and conditions as it may provide, may delegate all or part of its
authority and powers under the Plan to one or more directors and/or officers of
the Company to the extent that the delegation would not jeopardize the
qualification of an Actual Award as performance-based compensation under Section
162(m) of the Code.
SECTION 6
GENERAL PROVISIONS
6.1    Tax Withholding. The Company shall withhold all applicable taxes from any
Actual Award, including any federal, state and local taxes (including, but not
limited to, the Participant employment tax obligations).
6.2    Section 409A of the Code. It is intended that all bonuses payable under
this Plan will be exempt from the requirements of Section 409A of the Code
pursuant to the “short-term deferral” exemption or, in the alternative, will
comply with the requirements of Section 409A of the Code so that none of the
payments and benefits to be provided under this Plan will be subject to the
additional tax imposed under Section 409A of the Code, and any ambiguities or
ambiguous terms herein shall be interpreted to so comply or be exempt. Each
payment and benefit payable under this Plan is intended to constitute a separate
payment for purposes of Section 1.409A-2(b)(2) of the Treasury Regulations. The
Company may, in good faith and without the consent of any Participant, make any
amendments to this Plan and take such reasonable actions which it deems
necessary, appropriate or desirable to avoid imposition of any additional tax or
income recognition under Section 409A of the Code prior to actual payment to the
Participant. However, unless explicitly determined otherwise in writing by the
Committee, in no event will the Company or any Affiliate pay or reimburse any
Participant for any taxes or other costs that may be imposed on the Participant
as a result of Section 409A of the Code or any other section of the Code or
other tax rule or regulation.
6.3    No Effect on Employment. Nothing in the Plan shall interfere with or
limit in any way the right of the Company or an Affiliate, as applicable, to
terminate any Participant’s employment or service at any time, with or without
cause. For purposes of the Plan, transfer of employment of a Participant between
the Company

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and any one of its Affiliates (or between Affiliates) shall not be deemed a
Termination of Employment. Employment with the Company and its Affiliates is on
an at-will basis only. The Company expressly reserves the right, which may be
exercised at any time and without regard to when during and after a Performance
Period such exercise occurs, to terminate any individual’s employment with or
without cause, and to treat him or her without regard to the effect which such
treatment might have upon him or her as a Participant.
6.4    Participation. No Employee shall have the right to be selected to receive
an award under this Plan, or, having been so selected, to be selected to receive
a future award.
6.5    Indemnification. Each person who is or shall have been a member of the
Committee, or of the Board, shall be indemnified and held harmless by the
Company against and from (a) any loss, cost, liability, or expense that may be
imposed upon or reasonably incurred by him or her in connection with or
resulting from any claim, action, suit, or proceeding to which he or she may be
a party or in which he or she may be involved by reason of any action taken or
failure to act under the Plan or any award, and (b) from any and all amounts
paid by him or her in settlement thereof, with the Company’s approval, or paid
by him or her in satisfaction of any judgment in any such claim, action, suit,
or proceeding against him or her, provided he or she shall give the Company an
opportunity, at its own expense, to handle and defend the same before he or she
undertakes to handle and defend it on his or her own behalf. The foregoing right
of indemnification shall not be exclusive of any other rights of indemnification
to which such persons may be entitled under the Company’s Certificate of
Incorporation or Bylaws, by contract, as a matter of law, or otherwise, or under
any power that the Company may have to indemnify them or hold them harmless.
6.6    Successors. All obligations of the Company and any Affiliate under the
Plan, with respect to awards granted hereunder, shall be binding on any
successor to the Company and/or such Affiliate, whether the existence of such
successor is the result of a direct or indirect purchase, merger, consolidation,
or otherwise, of all or substantially all of the business or assets of the
Company or such Affiliate.
6.7    Beneficiary Designations. If permitted by the Committee, a Participant
under the Plan may name a beneficiary or beneficiaries to whom any vested but
unpaid award shall be paid in the event of the Participant’s death. Each such
designation shall revoke all prior designations by the Participant and shall be
effective only if given in a form and manner acceptable to the Committee. In the
absence of any such designation, any vested benefits remaining unpaid at the
Participant's death shall be paid to the Participant’s estate.
6.8    Nontransferability of Awards. No award granted under the Plan may be
sold, transferred, pledged, assigned, or otherwise alienated or hypothecated,
other than by will, by the laws of descent and distribution, or to the limited
extent provided in Section 6.6. All rights with respect to an award granted to a
Participant shall be available during his or her lifetime only to the
Participant.
SECTION 7
AMENDMENT, SUSPENSION, TERMINATION
7.1    Amendment and Termination. The Board or Compensation Committee of the
Board may amend, alter, suspend or terminate the Plan.
7.2    Stockholder Approval. The Company will obtain stockholder approval of any
Plan amendment to the extent necessary or desirable to comply with applicable
laws.

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7.3    Consent of Participants Generally Required. Subject to Section 7.4, no
amendment, alteration, suspension or termination of the Plan or an award under
it will materially impair the rights of any Participant, unless mutually agreed
otherwise between the Participant and the Compensation Committee, which
agreement must be in writing and signed by the Participant and the Company.
Termination of the Plan will not affect the Compensation Committee’s ability to
exercise the powers granted to it regarding awards established under the Plan
prior to such termination.
7.4    Exceptions to Consent Requirement.
(a)    A Participant’s rights will not be deemed to have been impaired by any
amendment, alteration, suspension or termination if the Compensation Committee,
in its sole discretion, determines that the amendment, alteration, suspension or
termination does not materially impair the Participant’s rights, and
(b)    Subject to any limitations of applicable laws, the Compensation Committee
may amend the terms of any awards under the Plan without the affected
Participant’s consent even if it does materially impair the Participant’s right
if such amendment is done:
(i)    in a manner permitted under the Plan;
(ii)    to avoid imposition of any additional tax or income recognition under
Section 409A of the Code prior to actual payment to the Participant;
(iii)    to comply with other applicable laws; or
(iv)    as necessary based on rulings or guidance issued to ensure compliance
with the requirements of Section 162(m) of the Code.
SECTION 8
LEGAL CONSTRUCTION
8.1    Gender and Number. Except where otherwise indicated by the context, any
masculine term used herein also shall include the feminine; the plural shall
include the singular and the singular shall include the plural.
8.2    Severability. In the event any provision of the Plan shall be held
illegal or invalid for any reason, the illegality or invalidity shall not affect
the remaining parts of the Plan, and the Plan shall be construed and enforced as
if the illegal or invalid provision had not been included.
8.3    Requirements of Law. The granting of awards under the Plan shall be
subject to all applicable laws, rules and regulations, and to such approvals by
any governmental agencies or national securities exchanges as may be required.
8.4    Governing Law. The Plan and all awards shall be construed in accordance
with and governed by the laws of the State of California, but without regard to
its conflict of law provisions.
8.5    Captions. Captions are provided herein for convenience only, and shall
not serve as a basis for interpretation or construction of the Plan.