Exhibit 10.1

FINISAR CORPORATION
STOCK OPTION AGREEMENT

     Finisar Corporation has granted to the individual (the “Optionee”) named in
the Notice of Grant of Stock Options (the “Notice”) to which this Stock Option
Agreement (the “Option Agreement”) is attached an option (the “Option”) to
purchase certain shares of Stock upon the terms and conditions set forth in the
Notice and this Option Agreement. The Option has been granted pursuant to and
shall in all respects be subject to the terms and conditions of the Finisar
Corporation 1999 Stock Option Plan (the “Plan”), as amended to the Date of
Option Grant, the provisions of which are incorporated herein by reference. By
signing the Notice, the Optionee: (a) represents that the Optionee has received
copies of and has read and is familiar with the terms and conditions of the
Notice, the Plan and this Option Agreement, (b) accepts the Option subject to
all of the terms and conditions of the Notice and this Option Agreement and
(c) agrees to accept as binding, conclusive and final all decisions or
interpretations of the Board upon any questions arising under the Notice, the
Plan or this Option Agreement.

     1. Definitions and Construction.

          1.1 Definitions. Whenever used herein, capitalized terms shall have
the meanings assigned to such terms in the Notice or as set forth below:

               (a) “Board” means the Board of Directors of the Company. If one
or more Committees have been appointed by the Board to administer the Plan,
“Board” also means such Committee(s).

               (b) “Code” means the Internal Revenue Code of 1986, as amended,
and any applicable regulations promulgated thereunder.

               (c) “Committee” means the Compensation Committee or other
committee of the Board duly appointed to administer the Plan and having such
powers as shall be specified by the Board. Unless the powers of the Committee
have been specifically limited, the Committee shall have all of the powers of
the Board granted herein, including, without limitation, the power to amend or
terminate the Plan at any time, subject to the terms of the Plan and any
applicable limitations imposed by law.

               (d) “Company” means Finisar Corporation, a Delaware corporation,
or any successor corporation thereto.

               (e) “Consultant” means a person engaged to provide consulting or
advisory services (other than as an Employee or a Director) to a Participating
Company, provided that the identity of such person, the nature of such services
or the entity to which such services are provided would not preclude the Company
from offering or selling securities to such person pursuant to the Plan in
reliance on registration on a Form S-8 Registration Statement under the
Securities Act.

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               (f) “Date of Option Grant” means the effective date of grant of
the Option as set forth in the Notice.

               (g) “Director” means a member of the Board or of the board of
directors of any other Participating Company.

               (h) “Disability” means the inability of the Optionee, in the
opinion of a qualified physician acceptable to the Company, to perform the major
duties of the Optionee’s position with the Participating Company Group because
of the sickness or injury of the Optionee.

               (i) “Employee” means any person treated as an employee (including
an officer or a Director who is also treated as an employee) in the records of a
Participating Company and, if the Notice designates this Option as an Incentive
Stock Option, who is an employee for purposes of Section 422 of the Code;
provided, however, that neither service as a Director nor payment of a
director’s fee shall be sufficient to constitute employment for purposes of the
Plan.

               (j) “Exchange Act” means the Securities Exchange Act of 1934, as
amended.

               (k) “Exercise Price” means the purchase price per share of Stock
as set forth in the Notice and as adjusted from time to time pursuant to
Section 9.

               (l) “Fair Market Value” means, as of any date, the value of a
share of Stock or other property as determined by the Board, in its discretion,
or by the Company, in its discretion, if such determination is expressly
allocated to the Company herein, subject to the following:

                    (i) If, on such date, the Stock is listed on a national or
regional securities exchange or market system, the Fair Market Value of a share
of Stock shall be the closing price of a share of Stock (or the mean of the
closing bid and asked prices of a share of Stock if the Stock is so quoted
instead) as quoted on the Nasdaq National Market, The Nasdaq SmallCap Market or
such other national or regional securities exchange or market system
constituting the primary market for the Stock, as reported in The Wall Street
Journal or such other source as the Company deems reliable. If the relevant date
does not fall on a day on which the Stock has traded on such securities exchange
or market system, the date on which the Fair Market Value shall be established
shall be the last day on which the Stock was so traded prior to the relevant
date, or such other appropriate day as shall be determined by the Board, in its
discretion.

                    (ii) If, on such date, the Stock is not listed on a national
or regional securities exchange or market system, the Fair Market Value of a
share of Stock shall be as determined by the Board in good faith without regard
to any restriction other than a restriction which, by its terms, will never
lapse.

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               (m) “Number of Option Shares” means the total number of shares of
Stock subject to the Option as set forth in the Notice and as adjusted from time
to time pursuant to Section 9.

               (n) “Option Expiration Date” means the date listed under the
heading “Expiration” in the Notice.

               (o) “Parent Corporation” means any present or future “parent
corporation” of the Company, as defined in Section 424(e) of the Code.

               (p) “Participating Company” means the Company or any Parent
Corporation or Subsidiary Corporation.

               (q) “Participating Company Group” means, at any point in time,
all corporations collectively which are then Participating Companies.

               (r) “Securities Act” means the Securities Act of 1933, as
amended.

               (s) “Service” means the Optionee’s employment or service with the
Participating Company Group, whether in the capacity of an Employee, a Director
or a Consultant. The Optionee’s Service shall not be deemed to have terminated
merely because of a change in the capacity in which the Optionee renders Service
to the Participating Company Group or a change in the Participating Company for
which the Optionee renders such Service, provided that there is no interruption
or termination of the Optionee’s Service. Furthermore, the Optionee’s Service
with the Participating Company Group shall not be deemed to have terminated if
the Optionee takes any military leave, sick leave, or other bona fide leave of
absence approved by the Company; provided, however, that if any such leave
exceeds ninety (90) days, on the one hundred eighty-first (181st) day following
the commencement of such leave the Option shall thereafter be treated as a
Nonstatutory Stock Option (that is, an option not intended to be an Incentive
Stock Option within the meaning of Section 422(b) of the Code) unless the
Optionee’s right to return to Service with the Participating Company Group is
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 Service for purposes of determining the Optionee’s Vested
Shares.. The Optionee’s Service shall be deemed to have terminated either upon
an actual termination of Service or upon the corporation for which the Optionee
performs Service ceasing to be a Participating Company. Subject to the
foregoing, the Company, in its discretion, shall determine whether the
Optionee’s Service has terminated and the effective date of such termination.

               (t) “Stock” means the common stock of the Company, as adjusted
from time to time in accordance with Section 9.

               (u) “Subsidiary Corporation” means any present or future
“subsidiary corporation” of the Company, as defined in Section 424(f) of the
Code.

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               (v) “Vested Shares” mean, on any relevant date, that portion of
the Number of Option Shares which has vested in accordance with vesting schedule
set forth in the Notice. Provided that the Optionee’s Service has not terminated
prior to the relevant date, that number of shares set forth in the Notice
opposite each respective “Full Vest” date shall become Vested Shares on such
date.

          1.2 Construction. Captions and titles contained herein are for
convenience only and shall not affect the meaning or interpretation of any
provision of this Option Agreement. Except when otherwise indicated by the
context, the singular shall include the plural and the plural shall include the
singular. Use of the term “or” is not intended to be exclusive, unless the
context clearly requires otherwise.

     2. Tax Consequences.

          2.1 Tax Status of Option. This Option is intended to have the tax
status designated in the Notice.

               (a) Incentive Stock Option. If the Notice so designates, this
Option is intended to be an Incentive Stock Option within the meaning of Section
422(b) 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 advisor 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. (NOTE TO
OPTIONEE: If the Option is exercised more than three (3) months after the date
on which you cease to be an Employee (other than by reason of your death or
permanent and total disability as defined in Section 22(e)(3) of the Code), the
Option will be treated as a Nonstatutory Stock Option and not as an Incentive
Stock Option to the extent required by Section 422 of the Code.)

               (b) Nonstatutory Stock Option. If the Notice so designates, this
Option is intended to be a Nonstatutory Stock Option and shall not be treated as
an Incentive Stock Option within the meaning of Section 422(b) of the Code.

          2.2 ISO Fair Market Value Limitation. If the Notice designates this
Option as an Incentive Stock Option, then to the extent that the Option
(together with all Incentive Stock Options granted to the Optionee under all
stock option plans of the Participating Company Group, including the Plan)
becomes exercisable for the first time during any calendar year for shares
having a Fair Market Value greater than One Hundred Thousand Dollars ($100,000),
the portion of such options which exceeds such amount will be treated as
Nonstatutory Stock Options. For purposes of this Section 2.2, options designated
as Incentive Stock Options are taken into account in the order in which they
were granted, and the Fair Market Value of stock is determined as of the time
the option with respect to such stock is granted. If the Code is amended to
provide for a different limitation from that set forth in this Section 2.2, such
different limitation shall be deemed incorporated herein effective as of the
date required or permitted by such amendment to the Code. If the Option is
treated as an Incentive Stock Option in part and as a Nonstatutory Stock Option
in part by reason of the limitation set forth in this Section 2.2, the

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Optionee may designate which portion of such Option the Optionee is exercising.
In the absence of such designation, the Optionee shall be deemed to have
exercised the Incentive Stock Option portion of the Option first. Separate
certificates representing each such portion shall be issued upon the exercise of
the Option. (NOTE TO OPTIONEE: If the aggregate Exercise Price of the Option
(that is, the Exercise Price multiplied by the Number of Option Shares) plus the
aggregate exercise price of any other Incentive Stock Options you hold (whether
granted pursuant to the Plan or any other stock option plan of the Participating
Company Group) is greater than $100,000, you should contact the Chief Financial
Officer of the Company to ascertain whether the entire Option qualifies as an
Incentive Stock Option.)

     3. Administration.

     All questions of interpretation concerning this Option Agreement shall be
determined by the Board. 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.

          4.1 Right to Exercise. Except as otherwise provided herein, the Option
shall be exercisable prior to the termination of the Option (as provided in
Section 6) in an amount not to exceed the number of Vested Shares less the
number of shares previously acquired upon exercise of the Option. In no event
shall the Option be exercisable for more shares than the Number of Option
Shares.

          4.2 Method of Exercise. Exercise of the Option shall be by notice
given in the form authorized by Company (whether written or electronic) prior to
the termination of the Option as set forth in Section 6, accompanied by full
payment of the aggregate Exercise Price for the number of shares of Stock being
purchased. Such notice must state the election to exercise the Option, the
number of whole shares of Stock 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. If exercise of the Option is by written notice, such notice
must be signed by the Optionee and must be delivered in person, by certified or
registered mail, return receipt requested, by confirmed facsimile transmission,
or by such other means as the Company may permit, to the Chief Financial Officer
of the Company, or other authorized representative of the Participating Company
Group. The Option shall be deemed to be exercised upon receipt by the Company of
notice in the authorized form and the aggregate Exercise Price.

          4.3 Payment of Exercise Price.

               (a) Forms of Consideration Authorized. Except as otherwise
provided below, payment of the aggregate Exercise Price for the number of shares
of Stock for

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which the Option is being exercised shall be made (i) in cash, by check, or cash
equivalent; (ii) by tender to the Company, or attestation to the ownership, of
whole shares of Stock owned by the Optionee having a Fair Market Value not less
than the aggregate Exercise Price; (iii) by means of a Cashless Exercise, as
defined in Section 4.3(b); or (iv) by any combination of the foregoing.

               (b) Limitations on Forms of Consideration.

                    (i) Tender of Stock. Notwithstanding the foregoing, the
Option may not be exercised by tender to the Company, or attestation to the
ownership, of shares of Stock to the extent such tender or attestation would
constitute a violation of the provisions of any law, regulation or agreement
restricting the redemption of the Company’s stock. The Option may not be
exercised by tender to the Company, or attestation to the ownership, of shares
of Stock unless such shares either have been owned by the Optionee for more than
six (6) months (and not used for another option exercise by attestation during
such period) or were not acquired, directly or indirectly, from the Company.

                    (ii) Cashless Exercise. A “Cashless Exercise” means the
delivery of notice of exercise in the form authorized pursuant to Section 4.2
together with irrevocable instructions to a broker in a form acceptable to the
Company providing for the assignment to the Company of the proceeds of a sale or
loan with respect to some or all of the shares of Stock acquired upon the
exercise of the Option pursuant to a program 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 or terminate any such program or procedure.

          4.4 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 withholding from payroll and any other amounts payable to the
Optionee, and otherwise agrees to make adequate provision for (including by
means of a Cashless Exercise to the extent permitted by the Company), any sums
required to satisfy the federal, state, local and foreign tax withholding
obligations of the Participating Company Group, if any, which arise in
connection with the Option. The Company shall have no obligation to deliver
shares of Stock until the tax withholding obligations of the Participating
Company Group have been satisfied by the Optionee.

          4.5 Certificate Registration. Except in the event the Exercise Price
is paid by means of a Cashless Exercise, the certificate for the shares as to
which the Option is exercised shall be registered in the name of the Optionee,
or, if applicable, in the names of the heirs of the Optionee.

          4.6 Restrictions on Grant of the Option and Issuance of Shares. The
grant of the Option and the issuance of shares of Stock upon exercise of the
Option shall be subject to

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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 of Stock upon exercise would constitute a violation of any applicable
federal, state or foreign securities laws or other law or regulations or the
requirements of any stock exchange or market system upon which the Stock may
then be listed. In addition, the Option may not be exercised unless (i) a
registration statement under 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 EXERCISED 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. The inability
of the Company to obtain from any regulatory body having jurisdiction the
authority, if any, deemed by the Company’s legal counsel to be necessary to the
lawful issuance and sale of any shares subject to the Option shall relieve the
Company of any liability in respect of the failure to issue or sell such shares
as to which such requisite authority shall not have been obtained. 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.

          4.7 Fractional Shares. The Company shall not be required to issue
fractional shares upon the exercise of the Option.

     5. Nontransferability of the Option.

          The Option may be exercised during the lifetime of the Optionee only
by the Optionee or the Optionee’s guardian or legal representative 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 provided in Section 7, 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.

     6. Termination of the Option.

          The Option shall terminate and may no longer be exercised after the
first to occur of (a) the Option Expiration Date, (b) the last date for
exercising the Option following termination of the Optionee’s Service as
described in Section 7, or (c) a Change in Control to the extent provided in
Section 8.

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     7. Effect of Termination of Service.

          7.1 Option Exercisability.

               (a) Disability. If the Optionee’s Service terminates because of
the Disability of the Optionee, the Option, to the extent unexercised and
exercisable on the date on which the Optionee’s Service terminated, may be
exercised by the Optionee (or the Optionee’s guardian or legal representative)
at any time prior to the expiration of twelve (12) months after the date on
which the Optionee’s Service terminated, but in any event no later than the
Option Expiration Date.

               (b) Death. If the Optionee’s Service terminates because of the
death of the Optionee, the Option, to the extent unexercised and exercisable on
the date on which the Optionee’s Service terminated, may be exercised by the
Optionee’s legal representative or other person who acquired the right to
exercise the Option by reason of the Optionee’s death at any time prior to the
expiration of twelve (12) months after the date on which the Optionee’s Service
terminated, but in any event no later than the Option Expiration Date. The
Optionee’s Service shall be deemed to have terminated on account of death if the
Optionee dies within thirty (30) days after the Optionee’s termination of
Service.

               (c) Termination After Change in Control. If the Optionee’s
Service ceases as a result of Termination After Change in Control (as defined
below), (i) the Option, to the extent unexercised and exercisable on the date on
which the Optionee’s Service terminated, may be exercised by the Optionee (or
the Optionee’s guardian or legal representative) at any time prior to the
expiration of six (6) months after the date on which the Optionee’s Service
terminated, but in any event no later than the Option Expiration Date, and
(ii) the Option shall become immediately vested and exercisable in full as of
the date on which the Optionee’s Service terminated.

               (d) Other Termination of Service. If the Optionee’s Service
terminates for any reason, except Disability, death or Termination After Change
in Control, the Option, to the extent unexercised and exercisable by the
Optionee on the date on which the Optionee’s Service terminated, may be
exercised by the Optionee at any time prior to the expiration of thirty
(30) days (or such other longer period of time as determined by the Board, in
its discretion) after the date on which the Optionee’s Service terminated, but
in any event no later than the Option Expiration Date.

          7.2 Extension if Exercise Prevented by Law. Notwithstanding the
foregoing, if the exercise of the Option within the applicable time periods set
forth in Section 7.1 is prevented by the provisions of Section 4.6, 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 Expiration Date.

          7.3 Extension if Optionee Subject to Section 16(b). Notwithstanding
the foregoing, if a sale within the applicable time periods set forth in
Section 7.1 of shares acquired

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upon the exercise of the Option 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 a sale
of such shares by the Optionee would no longer be subject to such suit, (ii) the
one hundred and ninetieth (190th) day after the Optionee’s termination of
Service, or (iii) the Option Expiration Date.

          7.4 Certain Definitions.

               (a) “Termination After Change in Control” shall mean either of
the following events occurring upon or within twelve (12) months after a Change
in Control:

                    (i) termination by the Participating Company Group of the
Optionee’s Service for any reason other than for Cause (as defined below); or

                    (ii) the Optionee’s resignation for Good Reason (as defined
below) from all capacities in which the Optionee is then rendering Service
within a reasonable period of time following the event constituting Good Reason.

Notwithstanding any provision herein to the contrary, Termination After Change
in Control shall not include any termination of the Optionee’s Service with the
Participating Company Group which (1) is for Cause (as defined below); (2) is a
result of the Optionee’s death or disability; (3) is a result of the Optionee’s
voluntary termination of Service other than for Good Reason; or (4) occurs prior
to the effectiveness of a Change in Control.

               (b) “Cause” shall mean any of the following: (i) the Optionee’s
theft, dishonesty, or falsification of any Participating Company documents or
records; (ii) the Optionee’s improper use or disclosure of a Participating
Company’s confidential or proprietary information; (iii) any action by the
Optionee which has a detrimental effect on a Participating Company’s reputation
or business; (iv) the Optionee’s failure or inability to perform any reasonable
assigned duties after written notice from a Participating Company of, and a
reasonable opportunity to cure, such failure or inability; (v) any material
breach by the Optionee of any employment agreement between the Optionee and a
Participating Company, which breach is not cured pursuant to the terms of such
agreement; or (vi) the Optionee’s conviction (including any plea of guilty or
nolo contendere) of any criminal act which impairs the Optionee’s ability to
perform his or her duties with a Participating Company.

               (c) “Good Reason” shall mean any one or more of the following:

                    (i) without the Optionee’s express written consent, the
assignment to the Optionee of any duties, or any limitation of the Optionee’s
responsibilities, substantially inconsistent with the Optionee’s positions,
duties, responsibilities and status with the Participating Company Group
immediately prior to the date of the Change in Control;

                    (ii) without the Optionee’s express written consent, the
relocation of the principal place of the Optionee’s Service to a location that
is more than fifty

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(50) miles from the Optionee’s principal place of Service immediately prior to
the date of the Change in Control, or the imposition of travel requirements
substantially more demanding of the Optionee than such travel requirements
existing immediately prior to the date of the Change in Control;

                    (iii) any failure by the Participating Company Group to pay,
or any material reduction by the Participating Company Group of, (1) the
Optionee’s base salary in effect immediately prior to the date of the Change in
Control (unless reductions comparable in amount and duration are concurrently
made for all other employees of the Participating Company Group with
responsibilities, organizational level and title comparable to the Optionee’s),
or (2) the Optionee’s bonus compensation, if any, in effect immediately prior to
the date of the Change in Control (subject to applicable performance
requirements with respect to the actual amount of bonus compensation earned by
the Optionee); or

                    (iv) any failure by the Participating Company Group to
(1) continue to provide the Optionee with the opportunity to participate, on
terms no less favorable than those in effect for the benefit of any employee or
service provider group which customarily includes a person holding the
employment or service provider position or a comparable position with the
Participating Company Group then held by the Optionee, in any benefit or
compensation plans and programs, including, but not limited to, the
Participating Company Group’s life, disability, health, dental, medical,
savings, profit sharing, stock purchase and retirement plans, if any, in which
the Optionee was participating immediately prior to the date of the Change in
Control, or their equivalent, or (2) provide the Optionee with all other fringe
benefits (or their equivalent) from time to time in effect for the benefit of
any employee or service provider group which customarily includes a person
holding the employment or service provider position or a comparable position
with the Participating Company Group then held by the Optionee.

     8. Change in Control.

          8.1 Definitions.

               (a) An “Ownership Change Event” shall be deemed to have occurred
if any of the following occurs with respect to the Company: (i) the direct or
indirect sale or exchange in a single or series of related transactions by the
stockholders of the Company of more than fifty percent (50%) of the voting stock
of the Company; (ii) a merger or consolidation in which the Company is a party;
(iii) the sale, exchange, or transfer of all or substantially all of the assets
of the Company; or (iv) a liquidation or dissolution of the Company.

               (b) A “Change in Control” shall mean an Ownership Change Event or
a series of related Ownership Change Events (collectively, a “Transaction”)
wherein the stockholders of the Company immediately before the Transaction do
not retain immediately after the Transaction, in substantially the same
proportions as their ownership of shares of the Company’s voting stock
immediately before the Transaction, direct or indirect beneficial ownership of
more than fifty percent (50%) of the total combined voting power of the

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outstanding voting securities of the Company or, in the case of a Transaction
described in Section 8.1(a)(iii), the corporation or other business entity to
which the assets of the Company were transferred (the “Transferee”), as the case
may be. For purposes of the preceding sentence, indirect beneficial ownership
shall include, without limitation, an interest resulting from ownership of the
voting securities of one or more corporations or other business entities which,
as a result of the Transaction, own the Company or the Transferee, as the case
may be, either directly or through one or more subsidiary corporations or other
business entities. The Board shall have the right to determine whether multiple
sales or exchanges of the voting securities of the Company or multiple Ownership
Change Events are related, and its determination shall be final, binding and
conclusive.

          8.2 Effect of Change in Control on Option. In the event of a Change in
Control, the surviving, continuing, successor, or purchasing corporation or
parent corporation thereof, as the case may be (the “Acquiring Corporation”),
may, without the consent of the Optionee, either assume the Company’s rights and
obligations under the Option or substitute for the Option a substantially
equivalent option for the Acquiring Corporation’s stock. In the event the
Acquiring Corporation elects not to assume the Company’s rights and obligations
under the Option or substitute for the Option in connection with the Change in
Control, and provided that the Optionee’s Service has not terminated prior to
such date, any unexercised portion of the Option shall be immediately
exercisable and vested in full as of the date ten (10) days prior to the date of
the Change in Control. Any exercise of the Option that was permissible solely by
reason of this Section 8.2 shall be conditioned upon the consummation of the
Change in Control. The Option shall terminate and cease to be outstanding
effective as of the date of the Change in Control to the extent that the Option
is neither assumed or substituted for by the Acquiring Corporation in connection
with the Change in Control nor exercised as of the date of the Change in
Control. Notwithstanding the foregoing, shares acquired upon exercise of the
Option prior to the Change in Control and any consideration received pursuant to
the Change in Control with respect to such shares shall continue to be subject
to all applicable provisions of this Option Agreement except as otherwise
provided herein. Furthermore, notwithstanding the foregoing, if the corporation
the stock of which is subject to the Option immediately prior to an Ownership
Change Event described in Section 8.1(a)(i) constituting a Change in Control is
the surviving or continuing corporation and immediately after such Ownership
Change Event less than fifty percent (50%) of the total combined voting power of
its voting stock is held by another corporation or by other corporations that
are members of an affiliated group within the meaning of Section 1504(a) of the
Code without regard to the provisions of Section 1504(b) of the Code, the Option
shall not terminate unless the Board otherwise provides in its discretion.

          8.3 Fair Market Value Limitation. If the Notice designates this Option
as an Incentive Stock Option, should the exercisability of this Option be
accelerated in connection with a Change in Control in accordance with
Section 7.1(c) or 8.2, then to the extent that the aggregate Fair Market Value
of the shares of Stock with respect to which the Optionee may exercise the
Option for the first time during the calendar year of such acceleration, when
added to the aggregate Fair Market Value of the shares subject to any other
options designated as Incentive Stock Options granted to the Optionee under all
stock option plans of the Participating Company Group prior to the Date of
Option Grant with respect to which such options are

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exercisable for the first time during the same calendar year, exceeds One
Hundred Thousand Dollars ($100,000) (or such other limit, if any, imposed by
Section 422 of the Code), the portion of the Option which exceeds such amount
shall be treated as a Nonstatutory Stock Option. For purposes of the preceding
sentence, options designated as Incentive Stock Options shall be taken into
account in the order in which they were granted, and the Fair Market Value of
shares of stock shall be determined as of the time the option with respect to
such shares is granted.

     9. Adjustments for Changes in Capital Structure.

          In the event of any stock dividend, stock split, reverse stock split,
recapitalization, combination, reclassification, or similar change in the
capital structure of the Company, appropriate adjustments shall be made in the
number, Exercise Price and class of shares of stock subject to the Option. If 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 Event) shares of another
corporation (the “New Shares”), the Board 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 Option Shares and the Exercise Price shall be adjusted
in a fair and equitable manner, as determined by the Board, in its discretion.
Notwithstanding the foregoing, any fractional share resulting from an adjustment
pursuant to this Section 9 shall be rounded down to the nearest whole number,
and in no event may the Exercise Price be decreased to an amount less than the
par value, if any, of the stock subject to the Option. The adjustments
determined by the Board pursuant to this Section 9 shall be final, binding and
conclusive.

     10. Rights as a Stockholder, Employee or Consultant.

          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 for
the shares for which the Option has been exercised (as evidenced by the
appropriate entry on the books of the Company or of a duly authorized transfer
agent of the Company). No adjustment shall be made for dividends, distributions
or other rights for which the record date is prior to the date such certificate
is issued, except as provided in Section 9. If the Optionee is an Employee, the
Optionee understands and acknowledges that, except as otherwise provided in a
separate, written employment agreement between a Participating Company and the
Optionee, the Optionee’s employment is “at will” and is for no specified term.
Nothing in this Option Agreement shall confer upon the Optionee any right to
continue in the Service of a Participating Company or interfere in any way with
any right of the Participating Company Group to terminate the Optionee’s Service
as an Employee or Consultant, as the case may be, at any time.

     11. 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, if the Notice designates this Option as an Incentive Stock Option, the
Optionee shall (a) promptly notify the Chief Financial Officer of the Company if
the Optionee disposes of any of the shares acquired pursuant

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to the Option within one (1) year after the date the Optionee exercises all or
part of the Option or within two (2) years after the Date of Option Grant and
(b) provide the Company with a description of the circumstances of such
disposition. Until such time as the Optionee disposes of such shares in a manner
consistent with the provisions of this Option Agreement, unless otherwise
expressly authorized by the Company, 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 the exercise of the Option
and the two-year period immediately after Date of Option Grant. At any time
during the one-year or two-year periods set forth above, the Company may place a
legend on any certificate 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 pursuant to the preceding sentence.

     12. Legends.

          The Company may at any time place legends referencing 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 Section. Unless otherwise specified by the Company, legends placed on such
certificates may include, but shall not be limited to, the following:

          “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 [INSERT DISQUALIFYING DISPOSITION DATE
HERE]. SHOULD THE REGISTERED HOLDER ELECT TO TRANSFER ANY OF THE SHARES PRIOR TO
THIS DATE 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.”

     13. Miscellaneous Provisions.

          13.1 Binding Effect. Subject to the restrictions on transfer set forth
herein, 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.

          13.2 Termination or Amendment. The Board may terminate or amend the
Plan or the Option at any time; provided, however, that except as provided in
Section 8.2 in

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connection with a Change in Control, no such termination or amendment may
adversely affect the Option or any unexercised portion hereof without the
consent of the Optionee unless such termination or amendment is necessary to
comply with any applicable law or government regulation or is required to enable
the Option, if designated an Incentive Stock Option in the Notice, to qualify as
an Incentive Stock Option. No amendment or addition to this Option Agreement
shall be effective unless in writing.

          13.3 Notices. Any notice required or permitted hereunder shall be
given in writing (except to the extent that electronic notice is authorized by
the Company) and shall be deemed effectively given (except to the extent that
this Option Agreement provides for effectiveness only upon actual receipt of
such notice) upon personal delivery or upon deposit in the United States Post
Office, by registered or certified mail, with postage and fees prepaid,
addressed to the other party at the address shown below that party’s signature
or at such other address as such party may designate in writing from time to
time to the other party.

          13.4 Integrated Agreement. The Notice and this Option Agreement
constitute the entire understanding and agreement of the Optionee and the
Participating Company Group with respect to the subject matter contained herein
or therein and supersedes any prior agreements, understandings, restrictions,
representations, or warranties among the Optionee and the Participating Company
Group with respect to such subject matter other than those as set forth or
provided for herein or therein. To the extent contemplated herein or therein,
the provisions of the Notice and the Option Agreement shall survive any exercise
of the Option and shall remain in full force and effect.

          13.5 Applicable Law. This Option Agreement shall be governed by the
laws of the State of California as such laws are applied to agreements between
California residents entered into and to be performed entirely within the State
of California.

          13.6 Counterparts. The Notice may be executed in counterparts, each of
which shall be deemed an original, but all of which together shall constitute
one and the same instrument.

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