**Exhibit10.1**

**IKANOS COMMUNICATIONS, INC.AMENDED AND RESTATED 1999 STOCK PLAN**

1.              Purposes of the Plan.  The purposes of this Stock Plan are toattract and retain the best available personnel for positions of substantialresponsibility, to provide additional incentive to Employees, Directors andConsultants and to promote the success of the Company’s business.  Options granted under the Plan may beIncentive Stock Options or Nonstatutory Stock Options, as determined by theAdministrator at the time of grant. Stock Purchase Rights may also be granted under the Plan.

2.              Definitions.  As used herein, the following definitionsshall apply:

(a)             “Administrator” means theBoard or any of its Committees as shall be administering the Plan in accordancewith Section 4 hereof.

(b)             “Applicable Laws” means therequirements relating to the administration of stock option plans under U.S.state corporate laws, U.S. federal and state securities laws, the Code, anystock exchange or quotation system on which the Common Stock is listed orquoted and the applicable laws of any foreign country or jurisdiction whereOptions or Stock Purchase Rights are granted under the Plan.

(c)             “Board” means the Board ofDirectors of the Company.

(d)             “Code” means the InternalRevenue Code of 1986, as amended.

(e)             “Committee” means acommittee of Directors appointed by the Board in accordance with Section 4hereof.

(f)              “Common Stock” means theCommon Stock of the Company.

(g)             “Company” means IKANOS COMMUNICATIONS, INC., a Delawarecorporation.

(h)             “Consultant” means anyperson who is engaged by the Company or any Parent or Subsidiary to renderconsulting or advisory services and is compensated for such services.

(i)              “Director” means a memberof the Board of Directors of the Company.

(j)              “Employee” means anyperson, including Officers and Directors, employed by the Company or any Parentor Subsidiary of the Company.  A ServiceProvider shall not cease to be an Employee in the case of (i) any leave ofabsence approved by the Company or (ii) transfers between locations of theCompany or between the Company, its Parent, any Subsidiary, or anysuccessor.  For purposes of IncentiveStock Options, no such leave may exceed ninety days, unless reemployment uponexpiration of such leave is guaranteed by statute or contract.  If reemployment 

 

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upon expiration of aleave of absence approved by the Company is not so guaranteed, on the 181st dayof such leave any Incentive Stock Option held by the Optionee shall cease to betreated as an Incentive Stock Option and shall be treated for tax purposes as aNonstatutory Stock Option.  Neitherservice as a Director nor payment of a director’s fee by the Company shall besufficient to constitute “employment” by the Company.

(k)             “Exchange Act” means theSecurities Exchange Act of 1934, as amended.

(l)              “Fair Market Value” means,as of any date, the value of Common Stock determined as follows:

(i)               If the Common Stock is listed onany established stock exchange or a national market system, including withoutlimitation the Nasdaq National Market or The Nasdaq SmallCap Market of TheNasdaq Stock Market, its Fair Market Value shall be the closing sales price forsuch stock (or the closing bid, if no sales were reported) as quoted on suchexchange or system for the last market trading day prior to the time ofdetermination, as reported in *The Wall Street Journal*or such other source as the Administrator deems reliable;

(ii)              If the Common Stock is regularlyquoted by a recognized securities dealer but selling prices are not reported, itsFair Market Value shall be the mean between the high bid and low asked pricesfor the Common Stock on the last market trading day prior to the day ofdetermination; or

(iii)             In the absence of an establishedmarket for the Common Stock, the Fair Market Value thereof shall be determinedin good faith by the Administrator.

(m)            “Incentive Stock Option”means an Option intended to qualify as an incentive stock option within themeaning of Section 422 of the Code.

(n)             “Nonstatutory Stock Option”means an Option not intended to qualify as an Incentive Stock Option.

(o)             “Officer” means a person whois an officer of the Company within the meaning of Section 16 of the ExchangeAct and the rules and regulations promulgated thereunder.

(p)             “Option” means a stock optiongranted pursuant to the Plan.

(q)             “Option Agreement” means anagreement between the Company and an Optionee evidencing the terms andconditions of an individual Option grant. The Option Agreement is subject to the terms and conditions of the Plan.

(r)              “Option Exchange Program”means a program whereby outstanding Options are exchanged for Options with alower exercise price.

 

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(s)             “Optioned Stock” meansthe Common Stock subject to an Option or a Stock Purchase Right.

(t)              “Optionee” means the holderof an outstanding Option or Stock Purchase Right granted under the Plan.

(u)             “Parent” means a “parentcorporation,” whether now or hereafter existing, as defined inSection 424(e) of the Code.

(v)             “Plan” means this Amendedand Restated 1999 Stock Plan.

(w)            “Restricted Stock” meansshares of Common Stock acquired pursuant to a grant of a Stock Purchase Rightunder Section 11 below.

(x)             “Section 16(b)” meansSection 16(b) of the Securities Exchange Act of 1934, as amended.

(y)             “Service Provider” means anEmployee, Director or Consultant.

(z)             “Share” means a share of theCommon Stock, as adjusted in accordance with Section 12 below.

(aa)           “Stock Purchase Right” means aright to purchase Common Stock pursuant to Section 11 below.

(bb)          “Subsidiary” means a “subsidiarycorporation,” whether now or hereafter existing, as defined inSection 424(f) of the Code.

3.              Stock Subject to the Plan.  Subject to the provisions of Section 12of the Plan, the maximum aggregate number of Shares which may be subject tooption and sold under the Plan is 58,602,000 Shares.  The Shares may be authorized but unissued, orreacquired Common Stock.

If an Option orStock Purchase Right expires or becomes unexercisable without having beenexercised in full, or is surrendered pursuant to an Option Exchange Program,the unpurchased Shares which were subject thereto shall become available forfuture grant or sale under the Plan (unless the Plan has terminated).  However, Shares that have actually beenissued under the Plan, upon exercise of either an Option or Stock PurchaseRight, shall not be returned to the Plan and shall not become available forfuture distribution under the Plan, except that if Shares of Restricted Stockare repurchased by the Company at their original purchase price, such Sharesshall become available for future grant under the Plan.

4.              Administration of the Plan.

(a)             The Plan shall be administered bythe Board or a Committee appointed by the Board, which Committee shall beconstituted to comply with Applicable Laws.

 

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(b)             Powers of the Administrator.  Subject to the provisions of the Plan and, inthe case of a Committee, the specific duties delegated by the Board to suchCommittee, and subject to the approval of any relevant authorities, theAdministrator shall have the authority in its discretion:

(i)               to determine the Fair MarketValue;

(ii)              to select the Service Providers towhom Options and Stock Purchase Rights may from time to time be grantedhereunder;

(iii)             to determine the number of Sharesto be covered by each such award granted hereunder;

(iv)             to approve forms of agreement foruse under the Plan;

(v)              to determine the terms andconditions, of any Option or Stock Purchase Right granted hereunder.  Such terms and conditions include, but arenot limited to, the exercise price, the time or times when Options or StockPurchase Rights may be exercised (which may be based on performance criteria),any vesting acceleration or waiver of forfeiture restrictions, and anyrestriction or limitation regarding any Option or Stock Purchase Right or theCommon Stock relating thereto, based in each case on such factors as theAdministrator, in its sole discretion, shall determine;

(vi)             to determine whether and under whatcircumstances an Option may be settled in cash under subsection 9(f) insteadof Common Stock;

(vii)            to reduce the exercise price of anyOption to the then current Fair Market Value if the Fair Market Value of theCommon Stock covered by such Option has declined since the date the Option wasgranted;

(viii)           to initiate an Option ExchangeProgram;

(ix)             to prescribe, amend and rescindrules and regulations relating to the Plan, including rules and regulationsrelating to sub-plans established for the purpose of qualifying for preferredtax treatment under foreign tax laws;

(x)              to allow Optionees to satisfywithholding tax obligations by electing to have the Company withhold from theShares to be issued upon exercise of an Option or Stock Purchase Right thatnumber of Shares having a Fair Market Value equal to the amount required to bewithheld.  The Fair Market Value of theShares to be withheld shall be determined on the date that the amount of tax tobe withheld is to be determined.  Allelections by Optionees to have Shares withheld for this purpose shall be madein such form and under such conditions as the Administrator may deem necessaryor advisable; and

 

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(xi)             to construe and interpret the termsof the Plan and awards granted pursuant to the Plan.

(c)             Effect of Administrator’sDecision.  All decisions,determinations and interpretations of the Administrator shall be final andbinding on all Optionees.

5.              Eligibility.

(a)             Nonstatutory Stock Options andStock Purchase Rights may be granted to Service Providers.  Incentive Stock Options may be granted onlyto Employees.

(b)             Each Option shall be designated inthe Option Agreement as either an Incentive Stock Option or a NonstatutoryStock Option.  However, notwithstandingsuch designation, to the extent that the aggregate Fair Market Value of theShares with respect to which Incentive Stock Options are exercisable for thefirst time by the Optionee during any calendar year (under all plans of theCompany and any Parent or Subsidiary) exceeds $100,000, such Options shall betreated as Nonstatutory Stock Options. For purposes of this Section 5(b), Incentive Stock Optionsshall be taken into account in the order in which they were granted.  The Fair Market Value of the Shares shall bedetermined as of the time the Option with respect to such Shares is granted.

(c)             Neither the Plan nor any Option orStock Purchase Right shall confer upon any Optionee any right with respect tocontinuing the Optionee’s relationship as a Service Provider with the Company,nor shall it interfere in any way with his or her right or the Company’s rightto terminate such relationship at any time, with or without cause.

6.              Term of Plan.  The Plan shall become effective upon itsadoption by the Board.  It shall continuein effect for a term of ten (10) years unless sooner terminated under Section14 of the Plan.

7.              Term of Option.  The term of each Option shall be stated inthe Option Agreement; provided, however, that the term shall be no more thanten (10) years from the date of grant thereof.  In the case of an Incentive Stock Optiongranted to an Optionee who, at the time the Option is granted, owns stockrepresenting more than ten percent (10%) of the voting power of all classes ofstock of the Company or any Parent or Subsidiary, the term of the Option shallbe five (5) years from the date of grant or such shorter term as may beprovided in the Option Agreement.

8.              Option Exercise Price andConsideration.

(a)             The per share exercise price forthe Shares to be issued upon exercise of an Option shall be such price as isdetermined by the Administrator, but shall be subject to the following:

(i)               In the case of an Incentive StockOption

 

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(A)              granted to an Employee who, at thetime of grant of such Option, owns stock representing more than ten percent(10%) of the voting power of all classes of stock of the Company or any Parentor Subsidiary, the exercise price shall be no less than 110% of the Fair MarketValue per Share on the date of grant.

(B)              granted to any other Employee, theper Share exercise price shall be no less than 100% of the Fair Market Valueper Share on the date of grant.

(ii)              In the case of a NonstatutoryStock Option

(A)              granted to a Service Provider who,at the time of grant of such Option, owns stock representing more than tenpercent (10%) of the voting power of all classes of stock of the Company or anyParent or Subsidiary, the exercise price shall be no less than 110% of the FairMarket Value per Share on the date of the grant.

(B)              granted to any other ServiceProvider, the per Share exercise price shall be no less than 85% of the FairMarket Value per Share on the date of grant.

(iii)             Notwithstanding the foregoing,Options may be granted with a per Share exercise price other than as requiredabove pursuant to a merger or other corporate transaction.

(b)             The consideration to be paid forthe Shares to be issued upon exercise of an Option, including the method ofpayment, shall be determined by the Administrator (and, in the case of anIncentive Stock Option, shall be determined at the time of grant).  Such consideration  may consist of (1) cash, (2) check,(3) promissory note, (4) other Shares which (x) in the case ofShares acquired upon exercise of an Option, have been owned by the Optionee formore than six months on the date of surrender, and (y) have a Fair MarketValue on the date of surrender equal to the aggregate exercise price of theShares as to which such Option shall be exercised, (5) consideration receivedby the Company under a cashless exercise program implemented by the Company inconnection with the Plan, or (6) any combination of the foregoing methodsof payment.  In making its determinationas to the type of consideration to accept, the Administrator shall consider ifacceptance of such consideration may be reasonably expected to benefit theCompany.

9.              Exercise of Option.

(a)             Procedure for Exercise;Rights as a Shareholder. Any Option granted hereunder shall be exercisableaccording to the terms hereof at such times and under such conditions asdetermined by the Administrator and set forth in the Option Agreement, but inno case at a rate of less than 20% per year over five (5) years from the datethe Option is granted.  Unless theAdministrator provides otherwise, vesting of Options granted hereunder shall betolled during any unpaid leave of absence. An Option may not be exercised for a fraction of a Share.

An Option shall bedeemed exercised when the Company receives: (i) written or electronic notice ofexercise (in accordance with the Option Agreement) from the person entitled toexercise the Option, and (ii) full payment for the Shares with respect to whichthe Option is 

 

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exercised.  Full payment may consist of any considerationand method of payment authorized by the Administrator and permitted by theOption Agreement and the Plan.  Sharesissued upon exercise of an Option shall be issued in the name of the Optioneeor, if requested by the Optionee, in the name of the Optionee and his or herspouse.  Until the Shares are issued (asevidenced by the appropriate entry on the books of the Company or of a dulyauthorized transfer agent of the Company), no right to vote or receivedividends or any other rights as a shareholder shall exist with respect to theShares, notwithstanding the exercise of the Option.  The Company shall issue (or cause to beissued) such Shares promptly after the Option is exercised.  No adjustment will be made for a dividend orother right for which the record date is prior to the date the Shares areissued, except as provided in Section 12 of the Plan.

Exercise of anOption in any manner shall result in a decrease in the number of Sharesthereafter available, both for purposes of the Plan and for sale under theOption, by the number of Shares as to which the Option is exercised.

(b)             Termination of Relationshipas a Service Provider.  If anOptionee ceases to be a Service Provider, such Optionee may exercise his or herOption within such period of time as is specified in the Option Agreement (ofat least thirty (30) days) to the extent that the Option is vested on the dateof termination (but in no event later than the expiration of the term of theOption as set forth in the Option Agreement). To the extent that the Optionee is not entitled to exercise the Optionon the date of such termination, or if the Optionee does not exercise suchOption to the extent so entitled within the time specified herein, the Optionshall terminate, and the Shares covered by such Option shall revert to thePlan.

(c)             Disability of Optionee.  If an Optionee ceases to be a ServiceProvider as a result of Optionee’s disability, the Optionee may within twelve(12) months from the date of such termination (but in no event later than theexpiration date of the term of such Option as set forth in the OptionAgreement), exercise an Option to the extent otherwise entitled to exercise it atthe date of such termination.  If suchdisability is not a “disability” as such term is defined in Section 22(e)(3) ofthe Code, in the case of an Incentive Stock Option such Incentive Stock Optionshall automatically cease to be treated as an Incentive Stock Option and shallbe treated for tax purposes as a Nonstatutory Stock Option on the day threemonths and one day following such termination. To the extent that the Optionee is not entitled to exercise the Optionon the date of termination, or if the Optionee does not exercise such Option tothe extent so entitled within the time specified herein, the Option shallterminate, and the Shares covered by such Option shall revert to the Plan.

(d)             Death of Optionee.If an Optionee dies while a Service Provider, the Option may be exercised atany time within twelve (12) months following the date of death (but in no eventlater than the expiration of the term of such Option as set forth in the Noticeof Grant) to the extent vested on the date of death.  If, at the time of death, the Optionee is notvested as to the entire Option, the Shares covered by the unvested portion ofthe Option shall revert to the Plan.  TheOption may be exercised by the executor or administrator of the Optionee’sestate or, if none, by the person(s) entitled to exercise the Option under theOptionee’s will or the laws of descent or distribution.  If the Option is not so exercised within thetime specified herein, the Option shall terminate, and the Shares covered bysuch Option shall revert to the Plan.

 

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(e)             Buyout Provisions.  The Administrator may at any time offer tobuy out for a payment in cash or Shares, an Option previously granted, based onsuch terms and conditions as the Administrator shall establish and communicateto the Optionee at the time that such offer is made.

10.            LimitedTransferability of Options and Stock Purchase Rights.  Unless determined otherwise by theAdministrator, Options and Stock Purchase Rights may not be sold, pledged,assigned, hypothecated, transferred, or disposed of in any manner other than bywill or the laws of descent and distribution, and may be exercised during thelifetime of the Optionee, only by the Optionee. If the Administrator in itssole discretion makes an Option or Stock Purchase Right transferable, suchOption or Stock Purchase Right may only be transferred (i) by will, (ii) by thelaws of descent and distribution, or (iii) to family members (within themeaning of Rule 701 of the Securities Act) through gifts or domestic relationsorders, as permitted by Rule 701 of the Securities Act.

11.            Stock Purchase Rights.

(a)             Rights to Purchase.  Stock Purchase Rights may be issued eitheralone, in addition to, or in tandem with other awards granted under the Planand/or cash awards made outside of the Plan. After the Administrator determines that it will offer Stock PurchaseRights under the Plan, it shall advise the offeree in writing or electronicallyof the terms, conditions and restrictions related to the offer, including thenumber of Shares that such person shall be entitled to purchase, the price tobe paid, and the time within which such person must accept such offer.  The terms of the offer shall comply in allrespects with Section 260.140.42 of Title 10 of the California Code ofRegulations.  The offer shall be acceptedby execution of a Restricted Stock purchase agreement in the form determined bythe Administrator.

(b)             Repurchase Option.  Unless the Administrator determinesotherwise, the Restricted Stock purchase agreement shall grant the Company arepurchase option exercisable upon the voluntary or involuntary termination ofthe purchaser’s service with the Company for any reason (including death ordisability).  The purchase price forShares repurchased pursuant to the Restricted Stock purchase agreement shall bethe original price paid by the purchaser and may be paid by cancellation of anyindebtedness of the purchaser to the Company. The repurchase option shall lapse at such rate as the Administrator maydetermine, but in no case at a rate of less than 20% per year over five yearsfrom the date of purchase.

(c)             Other Provisions.  The Restricted Stock purchase agreement shallcontain such other terms, provisions and conditions not inconsistent with thePlan as may be determined by the Administrator in its sole discretion.

(d)             Rights as a Shareholder.  Once the Stock Purchase Right is exercised,the purchaser shall have rights equivalent to those of a shareholder and shallbe a shareholder when his or her purchase is entered upon the records of theduly authorized transfer agent of the Company. No adjustment shall be made for a dividend or other right for which therecord date is prior to the date the Stock Purchase Right is exercised, exceptas provided in Section 12 of the Plan.

 

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12.            Adjustments Upon Changes in Capitalization,Merger or Asset Sale.

(a)             Changes in Capitalization.  Subject to any required action by theshareholders of the Company, the number of shares of Common Stock covered byeach outstanding Option or Stock Purchase Right, and the number of shares ofCommon Stock which have been authorized for issuance under the Plan but as towhich no Options or Stock Purchase Rights have yet been granted or which havebeen returned to the Plan upon cancellation or expiration of an Option or StockPurchase Right, as well as the price per share of Common Stock covered by eachsuch outstanding Option or Stock Purchase Right, shall be proportionatelyadjusted for any increase or decrease in the number of issued shares of CommonStock resulting from a stock split, reverse stock split, stock dividend,combination or reclassification of the Common Stock, or any other increase ordecrease in the number of issued shares of Common Stock effected withoutreceipt of consideration by the Company. The conversion of any convertible securities of the Company shall not bedeemed to have been “effected without receipt of consideration.”  Such adjustment shall be made by the Board,whose determination in that respect shall be final, binding and conclusive.  Except as expressly provided herein, noissuance by the Company of shares of stock of any class, or securitiesconvertible into shares of stock of any class, shall affect, and no adjustmentby reason thereof shall be made with respect to, the number or price of sharesof Common Stock subject to an Option or Stock Purchase Right.

(b)             Dissolution or Liquidation.  In the event of the proposed dissolution orliquidation of the Company, the Administrator shall notify the Optionee atleast fifteen (15) days prior to such proposed action.  To the extent it has not been previouslyexercised, the Option or Stock Purchase Right shall terminate immediately priorto the consummation of such proposed action.

(c)             Merger or Asset Sale.  In the event of a merger of the Company withor into another corporation, or the sale of substantially all of the assets ofthe Company, each outstanding Option and Stock Purchase Right shall be assumedor an equivalent option or right substituted by the successor corporation or aParent or Subsidiary of the successor corporation.  In the event that the successor corporationrefuses to assume or substitute for the Option or Stock Purchase Right, theOptionee shall fully vest in and have the right to exercise the Option or StockPurchase Right as to all of the Optioned Stock, including Shares as to which itwould not otherwise be vested or exercisable. If an Option or Stock Purchase Right becomes fully vested andexercisable in lieu of assumption or substitution in the event of a merger or saleof assets, the Administrator shall notify the Optionee in writing orelectronically that the Option or Stock Purchase Right shall be fullyexercisable for a period of fifteen (15) days from the date of such notice, andthe Option or Stock Purchase Right shall terminate upon the expiration of suchperiod.  For the purposes of thisparagraph, the Option or Stock Purchase Right shall be considered assumed if,following the merger or sale of assets, the option or right confers the rightto purchase or receive, for each Share of Optioned Stock subject to the Optionor Stock Purchase Right immediately prior to the merger or sale of assets, theconsideration (whether stock, cash, or other securities or property) receivedin the merger or sale of assets by holders of Common Stock for each Share heldon the effective date of the transaction (and if holders were offered a choiceof consideration, the type of consideration chosen 

 

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by the holders of amajority of the outstanding Shares); provided, however, that if suchconsideration received in the merger or sale of assets is not solely commonstock of the successor corporation or its Parent, the Administrator may, withthe consent of the successor corporation, provide for the consideration to bereceived upon the exercise of the Option or Stock Purchase Right, for eachShare of Optioned Stock subject to the Option or Stock Purchase Right, to besolely common stock of the successor corporation or its Parent equal in fairmarket value to the per share consideration received by holders of Common Stockin the merger or sale of assets.

13.            Time of Granting Optionsand Stock Purchase Rights.  The dateof grant of an Option or Stock Purchase Right shall, for all purposes, be thedate on which the Administrator makes the determination granting such Option orStock Purchase Right, or such other date as is determined by theAdministrator.  Notice of thedetermination shall be given to each Employee or Consultant to whom an Optionor Stock Purchase Right is so granted within a reasonable time after the dateof such grant.

14.            Amendment and Termination of the Plan.

(a)             Amendment and Termination.  The Board may at any time amend, alter,suspend or terminate the Plan.

(b)             Shareholder Approval.  The Board shall obtain shareholder approvalof any Plan amendment to the extent necessary and desirable to comply withApplicable Laws.

(c)             Effect of Amendment or Termination.  No amendment, alteration, suspension ortermination of the Plan shall impair the rights of any Optionee, unless mutuallyagreed otherwise between the Optionee and the Administrator, which agreementmust be in writing and signed by the Optionee and the Company.  Termination of the Plan shall not affect theAdministrator’s ability to exercise the powers granted to it hereunder withrespect to Options granted under the Plan prior to the date of suchtermination.

15.            Conditions Upon Issuance of Shares.

(a)             Legal Compliance.  Shares shall not be issued pursuant to theexercise of an Option  unless theexercise of such Option and the issuance and delivery of such Shares shallcomply with Applicable Laws and shall be further subject to the approval ofcounsel for the Company with respect to such compliance.

(b)             Investment Representations.  As a condition to the exercise of an Option,the Administrator may require the person exercising such Option to representand warrant at the time of any such exercise that the Shares are beingpurchased only for investment and without any present intention to sell ordistribute such Shares if, in the opinion of counsel for the Company, such arepresentation is required.

16.            Inability to Obtain Authority.  The inability of the Company to obtainauthority from any regulatory body having jurisdiction, which authority isdeemed by the Company’s counsel to be 

 

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necessary to the lawfulissuance and sale of any Shares hereunder, shall relieve the Company of anyliability in respect of the failure to issue or sell such Shares as to whichsuch requisite authority shall not have been obtained.

17.            Reservation of Shares.  The Company, during the term of this Plan,shall at all times reserve and keep available such number of Shares as shall besufficient to satisfy the requirements of the Plan.

18.            Shareholder Approval.  The Plan shall be subject to approval by theshareholders of the Company within twelve (12) months after the date the Planis adopted.  Such shareholder approvalshall be obtained in the degree and manner required under Applicable Laws.

19.            Information to Optionees andPurchasers.  The Company shallprovide to each Optionee and to each individual who acquires Shares pursuant tothe Plan, not less frequently than annually during the period such Optionee orpurchaser has one or more Options or Stock Purchase Rights outstanding, and, inthe case of an individual who acquires Shares pursuant to the Plan, during theperiod such individual owns such Shares, copies of annual financialstatements.  The Company shall not berequired to provide such statements to key employees whose duties in connectionwith the Company assure their access to equivalent information.

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