Kazeon Systems Inc 2003 Stock Plan



 Exhibit 10.4 
 KAZEON SYSTEMS, INC. 
 2003 STOCK PLAN 
 (Amended September 20, 2006) 
 (Amended December 13, 2006) 
 (Amended November 14,
2007) 
 1. Purposes of the Plan. The purposes of this Plan are to attract and retain the best available personnel
for positions of substantial responsibility, to provide additional incentive to Employees, Directors and Consultants and to promote the success of the Company’s business. Options granted under the Plan may be Incentive Stock Options or
Nonstatutory Stock Options, as determined by the Administrator at the time of grant. Stock Purchase Rights may also be granted under the Plan. 
 2. Definitions. As used herein, the following definitions shall apply: 
 (a) “Administrator” means the Board or any of its Committees as shall be administering the Plan in accordance with Section 4 hereof. 
 (b) “Applicable Laws” means the requirements relating to the administration of stock option plans under U.S. state corporate laws, U.S. federal and state securities laws, the Code, any
stock exchange or quotation system on which the Common Stock is listed or quoted and the applicable laws of any other country or jurisdiction where Options or Stock Purchase Rights are granted under the Plan. 
 (c) “Board” means the Board of Directors of the Company. 
 (d) “Change in Control” means the occurrence of any of the following events: 
 (i) Any “person” (as such term is used in Sections 13(d) and 14(d) of the Exchange Act) becomes the “beneficial owner”
(as defined in Rule 13d-3 of the Exchange Act), directly or indirectly, of securities of the Company representing fifty percent (50%) or more of the total voting power represented by the Company’s then outstanding voting securities; or

 (ii) The consummation of the sale or disposition by the Company of all or substantially all of the Company’s assets; or

 (iii) The consummation of a merger or consolidation of the Company with any other corporation, other than a merger or
consolidation which would result in the voting securities of the Company outstanding immediately prior thereto continuing to represent (either by remaining outstanding or by being converted into voting securities of the surviving entity or its
parent) at least fifty percent (50%) of the total voting power represented by the voting








 
securities of the Company or such surviving entity or its parent outstanding immediately after such merger or consolidation. 
 (e) “Code” means the Internal Revenue Code of 1986, as amended. 
 (f) “Committee” means a committee of Directors or of other individuals satisfying Applicable Laws appointed by the Board in
accordance with Section 4 hereof. 
 (g) “Common Stock” means the Common Stock of the Company. 

(h) “Company” means Kazeon Systems, Inc., a Delaware corporation. 
 (i) “Consultant” means any person who is engaged by the Company or any Parent or Subsidiary to render consulting or
advisory services to such entity. 
 (j) “Director” means a member of the Board. 
 (k) “Disability” means total and permanent disability as defined in Section 22(e)(3) of the Code. 
 (l) “Employee” means any person, including officers and Directors, employed by the Company or any Parent or Subsidiary of
the Company. Neither service as a Director nor payment of a director’s fee by the Company shall be sufficient to constitute “employment” by the Company. 
 (m) “Exchange Act” means the Securities Exchange Act of 1934, as amended. 
 (n) “Fair Market Value” means, as of any date, the value of Common Stock determined as follows: 
 (i) If the Common Stock is listed on any established stock exchange or a national market system, including without limitation the Nasdaq National Market or The Nasdaq SmallCap Market of The Nasdaq Stock
Market, its Fair Market Value shall be the closing sales price for such stock (or the closing bid, if no sales were reported) as quoted on such exchange or system on the day of determination, as reported in The Wall Street Journal or such
other source as the Administrator deems reliable; 
 (ii) If the Common Stock is regularly quoted by a recognized securities
dealer but selling prices are not reported, its Fair Market Value shall be the mean between the high bid and low asked prices for the Common Stock on the day of determination; or 
 (iii) In the absence of an established market for the Common Stock, the Fair Market Value thereof shall be determined in good faith by the
Administrator. 
  

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 (o) “Incentive Stock Option” means an Option intended to qualify as an
incentive stock option within the meaning of Section 422 of the Code. 
 (p) “Nonstatutory Stock Option”
means an Option not intended to qualify as an Incentive Stock Option. 
 (q) “Option” means a stock option
granted pursuant to the Plan. 
 (r) “Option Agreement” means a written or electronic agreement between the
Company and an Optionee evidencing the terms and conditions of an individual Option grant. The Option Agreement is subject to the terms and conditions of the Plan. 
 (s) “Optioned Stock” means the Common Stock subject to an Option or a Stock Purchase Right. 
 (t) “Optionee” means the holder of an outstanding Option or Stock Purchase Right granted under the Plan. 
 (u) “Parent” means a “parent corporation,” whether now or hereafter existing, as defined in Section 424(e) of the Code. 
 (v) “Plan” means this 2003 Stock Plan. 
 (w) “Restricted Stock” means Shares issued pursuant to a Stock Purchase Right or Shares of restricted stock issued pursuant to an Option. 
 (x) “Restricted Stock Purchase Agreement” means a written agreement between the Company and the Optionee evidencing the
terms and restrictions applying to Shares purchased under a Stock Purchase Right. The Restricted Stock Purchase Agreement is subject to the terms and conditions of the Plan and the notice of grant. 
 (y) “Securities Act” means the Securities Act of 1933, as amended. 
 (z) “Service Provider” means an Employee, Director or Consultant. 
 (aa) “Share” means a share of the Common Stock, as adjusted in accordance with Section 13 below. 
 (bb) “Stock Purchase Right” means a right to purchase Common Stock pursuant to Section 11 below. 
 (cc) “Subsidiary” means a “subsidiary corporation,” whether now or hereafter existing, as defined in
Section 424(f) of the Code. 
 3. Stock Subject to the Plan. Subject to the provisions of Section 13 of the
Plan, the maximum aggregate number of Shares that may be subject to Options or Stock Purchase Rights

  

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and sold under the Plan is 12,339,994 Shares. The Shares may be authorized but unissued, or reacquired Common Stock. 
 If an Option or Stock Purchase Right expires or becomes unexercisable without having been exercised in full, the unpurchased Shares that were subject thereto shall become available for future grant or
sale under the Plan (unless the Plan has terminated). However, Shares that have actually been issued under the Plan, upon exercise of either an Option or Stock Purchase Right, shall not be returned to the Plan and shall not become available for
future distribution under the Plan, except that if unvested Shares of Restricted Stock are repurchased by the Company at their original purchase price, such Shares shall become available for future grant under the Plan. 
 4. Administration of the Plan. 
 (a) Administrator. The Plan shall be administered by the Board or a Committee appointed by the Board, which Committee shall be constituted to comply with Applicable Laws. 
 (b) Powers of the Administrator. Subject to the provisions of the Plan and, in the case of a Committee, the specific duties delegated
by the Board to such Committee, and subject to the approval of any relevant authorities, the Administrator shall have the authority in its discretion: 
 (i) to determine the Fair Market Value; 
 (ii) to select the Service Providers to
whom Options and Stock Purchase Rights may from time to time be granted hereunder; 
 (iii) to determine the number of Shares
to be covered by each such award granted hereunder; 
 (iv) to approve forms of agreement for use under the Plan; 

(v) to determine the terms and conditions of any Option or Stock Purchase Right granted hereunder. Such terms and conditions include,
but are not limited to, the exercise price, the time or times when Options or Stock Purchase Rights may be exercised (which may be based on performance criteria), any vesting acceleration or waiver of forfeiture restrictions, and any restriction or
limitation regarding any Option or Stock Purchase Right or the Common Stock relating thereto, based in each case on such factors as the Administrator, in its sole discretion, shall determine; 
 (vi) to prescribe, amend and rescind rules and regulations relating to the Plan, including rules and regulations relating to sub-plans
established for the purpose of satisfying applicable foreign laws; 
 (vii) to allow Optionees to satisfy withholding tax
obligations by electing to have the Company withhold from the Shares to be issued upon exercise of an Option or Stock Purchase Right that number of Shares having a Fair Market Value equal to the

  

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minimum amount required to be withheld. The Fair Market Value of the Shares to be withheld shall be determined on the date that the amount of tax to be withheld is to be determined. All elections
by Optionees to have Shares withheld for this purpose shall be made in such form and under such conditions as the Administrator may deem necessary or advisable; and 
 (viii) to construe and interpret the terms of the Plan and Options granted pursuant to the Plan. 
 (c) Effect of Administrator’s Decision. All decisions, determinations and interpretations of the Administrator shall be final and binding on all Optionees. 
 5. Eligibility. Nonstatutory Stock Options and Stock Purchase Rights may be granted to Service Providers. Incentive Stock Options may
be granted only to Employees. 
 6. Limitations. 
 (a) Incentive Stock Option Limit. Each Option shall be designated in the Option Agreement as either an Incentive Stock Option or a
Nonstatutory Stock Option. However, notwithstanding such designation, to the extent that the aggregate Fair Market Value of the Shares with respect to which Incentive Stock Options are exercisable for the first time by the Optionee during any
calendar year (under all plans of the Company and any Parent or Subsidiary) exceeds $100,000, such Options shall be treated as Nonstatutory Stock Options. For purposes of this Section 6(a), Incentive Stock Options shall be taken into account in
the order in which they were granted. The Fair Market Value of the Shares shall be determined as of the time the Option with respect to such Shares is granted. 
 (b) At-Will Employment. Neither the Plan nor any Option or Stock Purchase Right shall confer upon any Optionee any right with respect to continuing 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 right to terminate such relationship at any time, with or without cause, and with or without notice. 
 7. Term of Plan. Subject to stockholder approval in accordance with Section 19, the Plan shall become effective upon its
adoption by the Board. Unless sooner terminated under Section 15, it shall continue in effect for a term of ten (10) years from the later of (i) the effective date of the Plan, or (ii) the earlier of the most recent Board or
stockholder approval of an increase in the number of Shares reserved for issuance under the Plan. 
 8. Term of Option.
The term of each Option shall be stated in the Option Agreement; provided, however, that the term shall be no more than ten (10) years from the date of grant thereof. In the case of an Incentive Stock Option granted to an Optionee who, at the
time the Option is granted, owns stock representing more than ten percent (10%) of the voting power of all classes of stock of the Company or any Parent or Subsidiary, the term of the Option shall be five (5) years from the date of grant
or such shorter term as may be provided in the Option Agreement. 
 9. Option Exercise Price and Consideration.

  

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 (a) Exercise Price. The per share exercise price for the Shares to be issued upon
exercise of an Option shall be such price as is determined by the Administrator, but shall be subject to the following: 
 (i)
In the case of an Incentive Stock Option 
 (A) granted to an Employee who, at the time 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 Parent or Subsidiary, the exercise price shall be no less than 110% of the Fair Market Value per Share on the date of grant. 

(B) granted to any other Employee, the per Share exercise price shall be no less than 100% of the Fair Market Value per Share on the
date of grant. 
 (ii) In the case of a Nonstatutory Stock Option 
 (A) granted to a Service Provider who, at the time 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 Parent or Subsidiary, the exercise price shall be no less than 110% of the Fair Market Value per Share on the date of grant. 
 (B) granted to any other Service Provider, the per Share exercise price shall be no less than 85% of the Fair Market 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
required above pursuant to a merger or other corporate transaction. 
 (b) Forms of Consideration. The consideration to
be paid for the Shares to be issued upon exercise of an Option, including the method of payment, shall be determined by the Administrator (and, in the case of an Incentive Stock Option, shall be determined at the time of grant). Such consideration
may consist of, without limitation, (i) cash, (ii) check, (iii) promissory note, (iv) other Shares, provided Shares that were acquired directly from the Company (x) have been owned by the Optionee for more than six
(6) months on the date of surrender, and (y) have a Fair Market Value on the date of surrender equal to the aggregate exercise price of the Shares as to which such Option shall be exercised, (v) consideration received by the Company
under a cashless exercise program implemented by the Company in connection with the Plan, or (vi) any combination of the foregoing methods of payment. In making its determination as to the type of consideration to accept, the Administrator
shall consider if acceptance of such consideration may be reasonably expected to benefit the Company. 
 10. Exercise of
Option. 
 (a) Procedure for Exercise; Rights as a Stockholder. Any Option granted hereunder shall be exercisable
according to the terms hereof at such times and under such

  

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conditions as determined by the Administrator and set forth in the Option Agreement. An Option may not be exercised for a fraction of a Share. Except in the case of Options granted to officers,
Directors and Consultants, Options shall become exercisable at a rate of no less than 20% per year over five (5) years from the date the Options are granted. 
 An Option shall be deemed exercised when the Company receives (i) written or electronic notice of exercise (in accordance with the Option Agreement) from the person entitled to exercise the Option,
and (ii) full payment for the Shares with respect to which the Option is exercised. Full payment may consist of any consideration and method of payment authorized by the Administrator and permitted by the Option Agreement and the Plan. Shares
issued upon exercise of an Option shall be issued in the name of the Optionee or, if requested by the Optionee, in the name of the Optionee and his or her spouse. Until the Shares are issued (as evidenced by the appropriate entry on the books of the
Company or of a duly authorized transfer agent of the Company), no right to vote or receive dividends or any other rights as a stockholder shall exist with respect to the Shares, notwithstanding the exercise of the Option. The Company shall issue
(or cause to be issued) such Shares promptly after the Option is exercised. No adjustment will be made for a dividend or other right for which the record date is prior to the date the Shares are issued, except as provided in Section 13 of the
Plan. 
 Exercise of an Option in any manner shall result in a decrease in the number of Shares thereafter available for sale
under the Option, by the number of Shares as to which the Option is exercised. 
 (b) Termination of Relationship as a
Service Provider. If an Optionee ceases to be a Service Provider, such Optionee may exercise his or her Option within thirty (30) days of termination, or such longer period of time as specified in the Option Agreement, to the extent that
the Option is vested on the date of termination (but in no event later than the expiration of the term of the Option as set forth in the Option Agreement). If, on the date of termination, the Optionee is not vested as to his or her entire Option,
the Shares covered by the unvested portion of the Option shall revert to the Plan. If, after termination, the Optionee does not exercise his or her Option within the time specified by the Administrator, the Option shall terminate, and the Shares
covered by such Option shall revert to the Plan. 
 (c) Disability of Optionee. If an Optionee ceases to be a Service
Provider as a result of the Optionee’s Disability, the Optionee may exercise his or her Option within six (6) months of termination, or such longer period of time as specified in the Option Agreement, to the extent the Option is vested on
the date of termination (but in no event later than the expiration of the term of such Option as set forth in the Option Agreement). If, on the date of termination, the Optionee is not vested as to his or her entire Option, the Shares covered by the
unvested portion of the Option shall revert to the Plan. If, after termination, the Optionee does not exercise his or her Option within the time specified herein, the Option shall terminate, 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 within six
(6) months following Optionee’s death, or such longer period of time as specified in the Option Agreement, to the extent that the Option is vested on the date of

  

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death (but in no event later than the expiration of the term of such Option as set forth in the Option Agreement) by the Optionee’s designated beneficiary, provided such beneficiary has been
designated prior to Optionee’s death in a form acceptable to the Administrator. If no such beneficiary has been designated by the Optionee, then such Option may be exercised by the personal representative of the Optionee’s estate or by the
person(s) to whom the Option is transferred pursuant to the Optionee’s will or in accordance with the laws of descent and distribution. If, at the time of death, the Optionee is not vested as to his or her entire Option, the Shares covered by
the unvested portion of the Option shall immediately revert to the Plan. If the Option is not so exercised within the time specified herein, the Option shall terminate, and the Shares covered by such Option shall revert to the Plan. 
 (e) Leaves of Absence. 
 (i) Unless the Administrator provides otherwise, vesting of Options granted hereunder to officers and Directors shall be suspended during any unpaid leave of absence. 
 (ii) A Service Provider shall not cease to be an Employee in the case of (A) any leave of absence approved by the Company or
(B) transfers between locations of the Company or between the Company, its Parent, any Subsidiary, or any successor. 
 (iii) For purposes of Incentive Stock Options, no such leave may exceed ninety (90) days, unless reemployment upon expiration of such leave is guaranteed by statute or contract. If reemployment upon
expiration of a leave of absence approved by the Company is not so guaranteed, then three (3) months following the 91st day of such leave, any Incentive Stock Option held by the Optionee shall cease to be treated as an Incentive Stock
Option and shall be treated for tax purposes as a Nonstatutory Stock Option. 
 11. Stock Purchase Rights. 
 (a) Rights to Purchase. Stock Purchase Rights may be issued either alone, in addition to, or in tandem with other awards granted
under the Plan and/or cash awards made outside of the Plan. After the Administrator determines that it will offer Stock Purchase Rights under the Plan, it shall advise the offeree in writing or electronically of the terms, conditions and
restrictions related to the offer, including the number of Shares that such person shall be entitled to purchase, the price to be paid, and the time within which such person must accept such offer. The terms of the offer shall comply in all respects
with Section 260.140.42 of Title 10 of the California Code of Regulations. The offer shall be accepted by execution of a Restricted Stock Purchase Agreement in the form determined by the Administrator. 
 (b) Repurchase Option. Unless the Administrator determines otherwise, the Restricted Stock Purchase Agreement shall grant the Company
a repurchase option exercisable within 90 days of the voluntary or involuntary termination of the purchaser’s service with the Company for any reason (including death or disability). The purchase price for Shares repurchased pursuant to the
Restricted Stock Purchase Agreement shall be the original price paid by the purchaser and may be paid by cancellation of any indebtedness of the purchaser to the

  

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Company. The repurchase option shall lapse at such rate as the Administrator may determine. Except with respect to Shares purchased by officers, Directors and Consultants, the repurchase option
shall in no case lapse at a rate of less than 20% per year over five (5) years from the date of purchase. 
 (c)
Other Provisions. The Restricted Stock Purchase Agreement shall contain such other terms, provisions and conditions not inconsistent with the Plan as may be determined by the Administrator in its sole discretion. 
 (d) Rights as a Stockholder. Once the Stock Purchase Right is exercised, the purchaser shall have rights equivalent to those of a
stockholder and shall be a stockholder when his or her purchase is entered upon the records of the duly authorized transfer agent of the Company. No adjustment shall be made for a dividend or other right for which the record date is prior to the
date the Stock Purchase Right is exercised, except as provided in Section 13 of the Plan. 
 12. Limited Transferability
of Options and Stock Purchase Rights. Unless determined otherwise by the Administrator, Options and Stock Purchase Rights may not be sold, pledged, assigned, hypothecated, transferred, or disposed of in any manner other than by will or the laws
of descent and distribution, and may be exercised during the lifetime of the Optionee, only by the Optionee. If the Administrator in its sole discretion makes an Option or Stock Purchase Right transferable, such Option or Stock Purchase Right may
only be transferred (i) by will, (ii) by the laws of descent and distribution, or (iii) to family members (within the meaning of Rule 701 of the Securities Act) through gifts or domestic relations orders, as permitted by Rule 701 of
the Securities Act. 
 13. Adjustments; Dissolution or Liquidation; Merger or Change in Control. 
 (a) Adjustments. In the event that any dividend or other distribution (whether in the form of cash, Shares, other securities, or
other property), recapitalization, stock split, reverse stock split, reorganization, merger, consolidation, split-up, spin-off, combination, repurchase, or exchange of Shares or other securities of the Company, or other change in the corporate
structure of the Company affecting the Shares occurs, the Administrator, in order to prevent diminution or enlargement of the benefits or potential benefits intended to be made available under the Plan, shall adjust the number and class of Shares
that may be delivered under the Plan and/or the number, class, and price of Shares covered by each outstanding Option or Stock Purchase Right; provided, however, that the Administrator shall make such adjustments to the extent required by
Section 25102(o) of the California Corporations Code. 
 (b) Dissolution or Liquidation. In the event of the
proposed dissolution or liquidation of the Company, the Administrator shall notify each Optionee as soon as practicable prior to the effective date of such proposed transaction. To the extent it has not been previously exercised, an Option or Stock
Purchase Right will terminate immediately prior to the consummation of such proposed action. 
  

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 (c) Merger or Change in Control. In the event of a merger of the Company with or into
another corporation, or a Change in Control, each outstanding Option and Stock Purchase Right shall be assumed or an equivalent option substituted by the successor corporation or a Parent or Subsidiary of the successor corporation. In the event that
the successor corporation in a merger or Change in Control refuses to assume or substitute for the Option or Stock Purchase Right, then the Optionee shall fully vest in and have the right to exercise the Option or Stock Purchase Right as to all of
the Optioned Stock, including Shares as to which it would not otherwise be vested or exercisable. If an Option or Stock Purchase Right becomes fully vested and exercisable in lieu of assumption or substitution in the event of a merger or Change in
Control, the Administrator shall notify the Optionee in writing or electronically that the Option or Stock Purchase Right shall be fully exercisable for a period of fifteen (15) days from the date of such notice, and the Option or Stock
Purchase Right shall terminate upon expiration of such period. For the purposes of this paragraph, the Option or Stock Purchase Right shall be considered assumed if, following the merger or Change in Control, the option or right confers the right to
purchase or receive, for each Share of Optioned Stock subject to the Option or Stock Purchase Right immediately prior to the merger or Change in Control, the consideration (whether stock, cash, or other securities or property) received in the merger
or Change in Control by holders of Common Stock for each Share held on the effective date of the transaction (and if holders were offered a choice of consideration, the type of consideration chosen by the holders of a majority of the outstanding
Shares); provided, however, that if such consideration received in the merger or Change in Control is not solely common stock of the successor corporation or its Parent, the Administrator may, with the consent of the successor corporation, provide
for the consideration to be received upon the exercise of the Option or Stock Purchase Right, for each Share of Optioned Stock subject to the Option or Stock Purchase Right, to be solely common stock of the successor corporation or its Parent equal
in fair market value to the per share consideration received by holders of common stock in the merger or Change in Control. 
 14. Time of Granting Options and Stock Purchase Rights. The date of grant of an Option or Stock Purchase Right shall, for all purposes, be the date on which the Administrator makes the determination granting such Option or Stock
Purchase Right, or such later date as is determined by the Administrator. Notice of the determination shall be given to each Service Provider to whom an Option or Stock Purchase Right is so granted within a reasonable time after the date of such
grant. 
 15. Amendment and Termination of the Plan. 
 (a) Amendment and Termination. The Board may at any time amend, alter, suspend or terminate the Plan. 
 (b) Stockholder Approval. The Board shall obtain stockholder approval of any Plan amendment to the extent necessary and desirable to
comply with Applicable Laws. 
 (c) Effect of Amendment or Termination. No amendment, alteration, suspension or
termination of the Plan shall impair the rights of any Optionee, unless mutually agreed otherwise between the Optionee and the Administrator, which agreement must be in writing and signed by the Optionee and the Company. Termination of the Plan
shall not affect the

  

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Administrator’s ability to exercise the powers granted to it hereunder with respect to Options granted under the Plan prior to the date of such termination. 
 16. Conditions Upon Issuance of Shares. 
 (a) Legal Compliance. Shares shall not be issued pursuant to the exercise of an Option or Stock Purchase Right unless the exercise of such Option or Stock Purchase Right and the issuance and
delivery of such Shares shall comply with Applicable Laws and shall be further subject to the approval of counsel for the Company with respect to such compliance. 
 (b) Investment Representations. As a condition to the exercise of an Option or Stock Purchase Right, the Administrator may require the person exercising such Option or Stock Purchase Right to
represent and warrant at the time of any such exercise that the Shares are being purchased only for investment and without any present intention to sell or distribute such Shares if, in the opinion of counsel for the Company, such a representation
is required. 
 17. Inability to Obtain Authority. The inability of the Company to obtain authority from any regulatory
body having jurisdiction, which authority is deemed by the Company’s counsel to be necessary to the lawful issuance and sale of any Shares hereunder, 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. 
 18. 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 be sufficient to satisfy the requirements of the Plan. 
 19. Stockholder Approval. The Plan shall be subject to approval by the stockholders of the Company within twelve (12) months after the date the Plan is adopted. Such stockholder approval shall
be obtained in the degree and manner required under Applicable Laws. 
 20. Information to Optionees. The Company shall
provide to each Optionee and to each individual who acquires Shares pursuant to the Plan, not less frequently than annually during the period such Optionee has one or more Options or Stock Purchase Rights outstanding, and, in the case of an
individual who acquires Shares pursuant to the Plan, during the period such individual owns such Shares, copies of annual financial statements. The Company shall not be required to provide such statements to key employees whose duties in connection
with the Company assure their access to equivalent information. 
  

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 KAZEON SYSTEMS, INC. 
 2003 STOCK PLAN 
 STOCK OPTION AGREEMENT

 Unless otherwise defined herein, the terms defined in the 2003 Stock Plan shall have the same defined meanings in this
Stock Option Agreement. 
  

	I.	NOTICE OF STOCK OPTION GRANT  

 Name: 
 Address: 
 The undersigned Optionee has been granted an Option to purchase Common Stock of the Company, subject to the terms and conditions of the Plan
and this Option Agreement, as follows: 
  

					
	 Date of Grant
	 	                                       
                                         
        	  	
			
	 Vesting Commencement Date
	 	                                       
                                         
        	  	
			
	 Exercise Price per Share
	 	$                                       
                                         
     	  	
			
	 Total Number of Shares Granted
	 	                                       
                                         
        	  	
			
	 Total Exercise Price
	 	$                                       
                                         
     	  	
			
	 Type of Option:
	 	                    Incentive Stock Option
	  	
			
		 	                    Nonstatutory Stock Option
	  	
			
	 Term/Expiration Date:
	 	                                       
                                         
        	  	

 Vesting Schedule: 
 This Option shall be exercisable, in whole or in part, according to the following vesting schedule: 
 25% of the Shares subject to the Option shall vest on the one (1) year anniversary of the Vesting Commencement
Date, and  1/48 of the Option shall vest each month
thereafter, subject to Optionee continuing to be a Service Provider on such dates. 
 Termination Period:

 This Option shall be exercisable for three (3) months after Optionee ceases to be a Service Provider. Upon
Optionee’s death or Disability, this Option may be exercised for one (1)

  

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year after Optionee ceases to be a Service Provider. In no event may Optionee exercise this Option after the Term/Expiration Date as provided above. 
  

	II.	AGREEMENT 

 1.
Grant of Option. The Plan Administrator of the Company hereby grants to the Optionee named in the Notice of Grant (the “Optionee”), an option (the “Option”) to purchase the number of Shares set
forth in the Notice of Grant, at the exercise price per Share set forth in the Notice of Grant (the “Exercise Price”), and subject to the terms and conditions of the Plan, which is incorporated herein by reference. Subject to
Section 15(c) of the Plan, in the event of a conflict between the terms and conditions of the Plan and this Option Agreement, the terms and conditions of the Plan shall prevail. 
 If designated in the Notice of Grant as an Incentive Stock Option (“ISO”), this Option is intended to qualify as an
Incentive Stock Option as defined in Section 422 of the Code. Nevertheless, to the extent that it exceeds the $100,000 rule of Code Section 422(d), this Option shall be treated as a Nonstatutory Stock Option
(“NSO”). 
 2. Exercise of Option. 
 (a) Right to Exercise. This Option shall be exercisable during its term in accordance with the Vesting Schedule set out in the Notice
of Grant and with the applicable provisions of the Plan and this Option Agreement. 
 (b) Method of Exercise. This Option
shall be exercisable by delivery of an exercise notice in the form attached as Exhibit A (the “Exercise Notice”) which shall state the election to exercise the Option, the number of Shares with respect to which the
Option is being exercised, and such other representations and agreements as may be required by the Company. The Exercise Notice shall be accompanied by payment of the aggregate Exercise Price as to all Exercised Shares. This Option shall be deemed
to be exercised upon receipt by the Company of such fully executed Exercise Notice accompanied by the aggregate Exercise Price. 
 No Shares shall be issued pursuant to the exercise of an Option unless such issuance and such exercise complies with Applicable Laws. Assuming such compliance, for income tax purposes the Shares shall be considered transferred to the
Optionee on the date on which the Option is exercised with respect to such Shares. 
 3. Optionee’s Representations.
In the event the Shares have not been registered under the Securities Act of 1933, as amended, at the time this Option is exercised, the Optionee shall, if required by the Company, concurrently with the exercise of all or any portion of this Option,
deliver to the Company his or her Investment Representation Statement in the form attached hereto as Exhibit B. 
 4.
Lock-Up Period. Optionee hereby agrees that Optionee shall not offer, pledge, sell, contract to sell, sell any option or contract to purchase, purchase any option or contract to sell, grant any option, right or warrant to purchase, lend, or
otherwise transfer or dispose of, directly or indirectly, any Common Stock (or other securities) of the Company or enter into any swap,

  

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hedging or other arrangement that transfers to another, in whole or in part, any of the economic consequences of ownership of any Common Stock (or other securities) of the Company held by
Optionee (other than those included in the registration) for a period specified by the representative of the underwriters of Common Stock (or other securities) of the Company not to exceed one hundred eighty (180) days following the effective
date of any registration statement of the Company filed under the Securities Act. 
 Optionee agrees to execute and deliver such
other agreements as may be reasonably requested by the Company or the underwriter which are consistent with the foregoing or which are necessary to give further effect thereto. In addition, if requested by the Company or the representative of the
underwriters of Common Stock (or other securities) of the Company, Optionee shall provide, within ten (10) days of such request, such information as may be required by the Company or such representative in connection with the completion of any
public offering of the Company’s securities pursuant to a registration statement filed under the Securities Act. The obligations described in this Section shall not apply to a registration relating solely to employee benefit plans on Form S-1
or Form S-8 or similar forms that may be promulgated in the future, or a registration relating solely to a Commission Rule 145 transaction on Form S-4 or similar forms that may be promulgated in the future. The Company may impose stop-transfer
instructions with respect to the shares of Common Stock (or other securities) subject to the foregoing restriction until the end of said one hundred eighty (180) day period. Optionee agrees that any transferee of the Option or shares acquired
pursuant to the Option shall be bound by this Section. 
 5. Method of Payment. Payment of the aggregate Exercise Price
shall be by any of the following, or a combination thereof, at the election of the Optionee: 
 (a) cash or check; 

(b) consideration received by the Company under a formal cashless exercise program adopted by the Company in connection with the Plan; or

 (c) surrender of other Shares which, (i) in the case of Shares acquired from the Company, either directly or indirectly,
have been owned by the Optionee for more than six (6) months on the date of surrender, and (ii) have a Fair Market Value on the date of surrender equal to the aggregate Exercise Price of the Exercised Shares. 
 6. Restrictions on Exercise. This Option may not be exercised until such time as the Plan has been approved by the stockholders of
the Company, or if the issuance of such Shares upon such exercise or the method of payment of consideration for such shares would constitute a violation of any Applicable Law. 
 7. Non-Transferability of Option. This Option may not be transferred in any manner otherwise than by will or by the laws of descent
or distribution and may be exercised during the lifetime of Optionee only by Optionee. The terms of the Plan and this Option Agreement shall be binding upon the executors, administrators, heirs, successors and assigns of the Optionee. 
  

 14 








 8. Term of Option. This Option may be exercised only within the term set out in the
Notice of Grant, and may be exercised during such term only in accordance with the Plan and the terms of this Option. 
 9.
Tax Obligations. 
 (a) Withholding Taxes. Optionee agrees to make appropriate arrangements with the Company (or
the Parent or Subsidiary employing or retaining Optionee) for the satisfaction of all Federal, state, local and foreign income and employment tax withholding requirements applicable to the Option exercise. Optionee acknowledges and agrees that the
Company may refuse to honor the exercise and refuse to deliver Shares if such withholding amounts are not delivered at the time of exercise. 
 (b) Notice of Disqualifying Disposition of ISO Shares. If the Option granted to Optionee herein is an ISO, and if Optionee sells or otherwise disposes of any of the Shares acquired pursuant to the
ISO on or before the later of (1) the date two years after the Date of Grant, or (2) the date one year after the date of exercise, the Optionee shall immediately notify the Company in writing of such disposition. Optionee agrees that
Optionee may be subject to income tax withholding by the Company on the compensation income recognized by the Optionee. 
 10.
Entire Agreement; Governing Law. The Plan is incorporated herein by reference. The Plan and this Option Agreement constitute the entire agreement of the parties with respect to the subject matter hereof and supersede in their entirety all
prior undertakings and agreements of the Company and Optionee with respect to the subject matter hereof, and may not be modified adversely to the Optionee’s interest except by means of a writing signed by the Company and Optionee. This
agreement is governed by the internal substantive laws but not the choice of law rules of the State of California. 
 11. No
Guarantee of Continued Service. OPTIONEE ACKNOWLEDGES AND AGREES THAT THE VESTING OF SHARES PURSUANT TO THE VESTING SCHEDULE HEREOF IS EARNED ONLY BY CONTINUING AS A SERVICE PROVIDER AT THE WILL OF THE COMPANY (NOT THROUGH THE ACT OF BEING
HIRED, BEING GRANTED THIS OPTION OR ACQUIRING SHARES HEREUNDER). OPTIONEE FURTHER ACKNOWLEDGES AND AGREES THAT THIS AGREEMENT, THE TRANSACTIONS CONTEMPLATED HEREUNDER AND THE VESTING SCHEDULE SET FORTH HEREIN DO NOT CONSTITUTE AN EXPRESS OR IMPLIED
PROMISE OF CONTINUED ENGAGEMENT AS A SERVICE PROVIDER FOR THE VESTING PERIOD, FOR ANY PERIOD, OR AT ALL, AND SHALL NOT INTERFERE IN ANY WAY WITH OPTIONEE’S RIGHT OR THE COMPANY’S RIGHT TO TERMINATE OPTIONEE’S RELATIONSHIP AS A SERVICE
PROVIDER AT ANY TIME, WITH OR WITHOUT CAUSE. 
 Optionee acknowledges receipt of a copy of the Plan and represents that he or
she is familiar with the terms and provisions thereof, and hereby accepts this Option subject to all of the terms and provisions thereof. Optionee has reviewed the Plan and this Option in their

  

 15 








 
entirety, has had an opportunity to obtain the advice of counsel prior to executing this Option and fully understands all provisions of the Option. Optionee hereby agrees to accept as binding,
conclusive and final all decisions or interpretations of the Administrator upon any questions arising under the Plan or this Option. Optionee further agrees to notify the Company upon any change in the residence address indicated below. 

 

					
	OPTIONEE	 		 	KAZEON SYSTEMS, INC.
			
	  	 		 	  
	Signature	 		 	By
			
	  	 		 	  
	Print Name	 		 	Title
			
	  	 		 	 
			
	  	 		 	 
	Residence Address	 		 	

  

 16 








 EXHIBIT A 
 2003 STOCK PLAN 
 EXERCISE NOTICE 
 Kazeon Systems, Inc. 
 1161 San Antonio Road

 Mountain View, CA 94043 
 Attention:
Chief Financial Officer 
 1. Exercise of Option. Effective as of today,
                    ,             , the undersigned
(“Optionee”) hereby elects to exercise Optionee’s option to purchase [                    ] shares of the Common
Stock (the “Shares”) of Kazeon Systems, Inc. (the “Company”) under and pursuant to the 2003 Stock Plan (the “Plan”) and the Stock Option Agreement dated
[                    ,              ] (the “Option
Agreement”). 
 2. Delivery of Payment. Optionee herewith delivers to the Company the full purchase price of
the Shares, as set forth in the Option Agreement, and any and all withholding taxes due in connection with the exercise of the Option. 
 3. Representations of Optionee. Optionee acknowledges that Optionee has received, read and understood the Plan and the Option Agreement and agrees to abide by and be bound by their terms and conditions. 
 4. Rights as Stockholder. Until the issuance of the Shares (as evidenced by the appropriate entry on the books of the Company or of a
duly authorized transfer agent of the Company), no right to vote or receive dividends or any other rights as a stockholder shall exist with respect to the Optioned Stock, notwithstanding the exercise of the Option. The Shares shall be issued to the
Optionee as soon as practicable after the Option is exercised in accordance with the Option Agreement. No adjustment shall be made for a dividend or other right for which the record date is prior to the date of issuance except as provided in
Section 13 of the Plan. 
 5. Company’s Right of First Refusal. Before any Shares held by Optionee or any
transferee (either being sometimes referred to herein as the “Holder”) may be sold or otherwise transferred (including transfer by gift or operation of law), the Company or its assignee(s) shall have a right of first refusal
to purchase the Shares on the terms and conditions set forth in this Section (the “Right of First Refusal”). 
 (a) Notice of Proposed Transfer. The Holder of the Shares shall deliver to the Company a written notice (the “Notice”) stating: (i) the Holder’s bona fide intention to sell or otherwise transfer such
Shares; (ii) the name of each proposed purchaser or other transferee (“Proposed Transferee”); (iii) the number of Shares to be transferred to each Proposed Transferee; and (iv) the bona fide cash price or other
consideration for which the Holder proposes to transfer the Shares (the “Offered Price”), and the Holder shall offer the Shares at the Offered Price to the Company or its assignee(s). 
  

 17 








 (b) Exercise of Right of First Refusal. At any time within thirty (30) days
after receipt of the Notice, the Company and/or its assignee(s) may, by giving written notice to the Holder, elect to purchase all, but not less than all, of the Shares proposed to be transferred to any one or more of the Proposed Transferees, at
the purchase price determined in accordance with subsection (c) below. 
 (c) Purchase Price. The purchase price
(“Purchase Price”) for the Shares purchased by the Company or its assignee(s) under this Section shall be the Offered Price. If the Offered Price includes consideration other than cash, the cash equivalent value of the
non-cash consideration shall be determined by the Board of Directors of the Company in good faith. 
 (d) Payment.
Payment of the Purchase Price shall be made, at the option of the Company or its assignee(s), in cash (by check), by cancellation of all or a portion of any outstanding indebtedness of the Holder to the Company (or, in the case of repurchase by an
assignee, to the assignee), or by any combination thereof within thirty (30) days after receipt of the Notice or in the manner and at the times set forth in the Notice. 
 (e) Holder’s Right to Transfer. If all of the Shares proposed in the Notice to be transferred to a given Proposed Transferee are
not purchased by the Company and/or its assignee(s) as provided in this Section, then the Holder may sell or otherwise transfer such Shares to that Proposed Transferee at the Offered Price or at a higher price, provided that such sale or other
transfer is consummated within 120 days after the date of the Notice, that any such sale or other transfer is effected in accordance with any applicable securities laws and that the Proposed Transferee agrees in writing that the provisions of this
Section shall continue to apply to the Shares in the hands of such Proposed Transferee. If the Shares described in the Notice are not transferred to the Proposed Transferee within such period, a new Notice shall be given to the Company, and the
Company and/or its assignees shall again be offered the Right of First Refusal before any Shares held by the Holder may be sold or otherwise transferred. 
 (f) Exception for Certain Family Transfers. Anything to the contrary contained in this Section notwithstanding, the transfer of any or all of the Shares during the Optionee’s lifetime or on
the Optionee’s death by will or intestacy to the Optionee’s immediate family or a trust for the benefit of the Optionee’s immediate family shall be exempt from the provisions of this Section. “Immediate Family” as used
herein shall mean spouse, lineal descendant or antecedent, father, mother, brother or sister. In such case, the transferee or other recipient shall receive and hold the Shares so transferred subject to the provisions of this Section, and there shall
be no further transfer of such Shares except in accordance with the terms of this Section. 
 (g) Termination of Right of
First Refusal. The Right of First Refusal shall terminate as to any Shares upon the earlier of (i) the first sale of Common Stock of the Company to the general public, or (ii) a Change in Control in which the successor corporation has
equity securities that are publicly traded. 
 6. Tax Consultation. Optionee understands that Optionee may suffer adverse
tax consequences as a result of Optionee’s purchase or disposition of the Shares. Optionee represents that Optionee has consulted with any tax consultants Optionee deems advisable in

  

 18 








 
connection with the purchase or disposition of the Shares and that Optionee is not relying on the Company for any tax advice. 
 7. Restrictive Legends and Stop-Transfer Orders. 
 (a) Legends. Optionee understands and agrees that the Company shall cause the legends set forth below or legends substantially equivalent thereto, to be placed upon any certificate(s) evidencing
ownership of the Shares together with any other legends that may be required by the Company or by state or federal securities laws: 
 THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 (THE “ACT”) AND MAY NOT BE OFFERED, SOLD OR OTHERWISE TRANSFERRED, PLEDGED OR HYPOTHECATED UNLESS AND UNTIL REGISTERED UNDER
THE ACT OR, IN THE OPINION OF COMPANY COUNSEL SATISFACTORY TO THE ISSUER OF THESE SECURITIES, SUCH OFFER, SALE OR TRANSFER, PLEDGE OR HYPOTHECATION IS IN COMPLIANCE THEREWITH. 
 THE SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO CERTAIN RESTRICTIONS ON TRANSFER AND A RIGHT OF FIRST REFUSAL HELD BY THE ISSUER
OR ITS ASSIGNEE(S) AS SET FORTH IN THE EXERCISE NOTICE BETWEEN THE ISSUER AND THE ORIGINAL HOLDER OF THESE SHARES, A COPY OF WHICH MAY BE OBTAINED AT THE PRINCIPAL OFFICE OF THE ISSUER. SUCH TRANSFER RESTRICTIONS AND RIGHT OF FIRST REFUSAL ARE
BINDING ON TRANSFEREES OF THESE SHARES. 
 THE SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO RESTRICTIONS ON TRANSFER
FOR A PERIOD NOT TO EXCEED 180 DAYS FOLLOWING THE EFFECTIVE DATE OF THE UNDERWRITTEN PUBLIC OFFERING OF THE COMPANY’S SECURITIES AND MAY NOT BE SOLD OR OTHERWISE DISPOSED OF BY THE HOLDER WITHOUT THE CONSENT OF THE COMPANY OR THE MANAGING
UNDERWRITER. 
 (b) Stop-Transfer Notices. Optionee agrees that, in order to ensure compliance with the restrictions
referred to herein, the Company may issue appropriate “stop transfer” instructions to its transfer agent, if any, and that, if the Company transfers its own securities, it may make appropriate notations to the same effect in its own
records. 
 (c) Refusal to Transfer. The Company shall not be required (i) to transfer on its books any Shares that
have been sold or otherwise transferred in violation of any of the provisions of this Exercise Notice or (ii) to treat as owner of such Shares or to accord the right

  

 19 








 
to vote or pay dividends to any purchaser or other transferee to whom such Shares shall have been so transferred. 
 8. Successors and Assigns. The Company may assign any of its rights under this Exercise Notice to single or multiple assignees, and this Exercise Notice shall inure to the benefit of the successors
and assigns of the Company. Subject to the restrictions on transfer herein set forth, this Exercise Notice shall be binding upon Optionee and his or her heirs, executors, administrators, successors and assigns. 
 9. Interpretation. Any dispute regarding the interpretation of this Exercise Notice shall be submitted by Optionee or by the Company
forthwith to the Administrator which shall review such dispute at its next regular meeting. The resolution of such a dispute by the Administrator shall be final and binding on all parties. 
 10. Governing Law; Severability. This Exercise Notice is governed by the internal substantive laws but not the choice of law rules,
of the State of California. In the event that any provision hereof becomes or is declared by a court of competent jurisdiction to be illegal, unenforceable or void, this Option Agreement will continue in full force and effect. 
 11. Entire Agreement. The Plan and Option Agreement are incorporated herein by reference. This Exercise Notice, the Plan, the Option
Agreement and the Investment Representation Statement constitute the entire agreement of the parties with respect to the subject matter hereof and supersede in their entirety all prior undertakings and agreements of the Company and Optionee with
respect to the subject matter hereof, and may not be modified adversely to the Optionee’s interest except by means of a writing signed by the Company and Optionee. 
  

					
	 Submitted by:
 OPTIONEE
	 		 	 Accepted by:
 Kazeon
Systems, Inc.

			
	  	 		 	  
	Signature	 		 	By
			
	  	 		 	  
	Print Name	 		 	Title
			
	 	 		 	 
	Address:	 		 	Address:
			
	  	 		 	  
			
	  	 		 	  
			
	  	 		 	 
			
	 	 		 	  
		 		 	Date Received

  

 20 








 EXHIBIT B 
 INVESTMENT REPRESENTATION STATEMENT 
  

					
	 OPTIONEE:
	 	 	  	
			
	COMPANY:    	 	KAZEON SYSTEMS, INC.	  	
			
	 SECURITY:
	 	COMMON STOCK	  	
			
	 AMOUNT:
	 	                      SHARES
	  	
			
	 DATE:
	 	 	  	

 In connection with the purchase of the above-listed Securities, the undersigned
Optionee represents to the Company the following: 
 (a) Optionee is aware of the Company’s business affairs and financial
condition and has acquired sufficient information about the Company to reach an informed and knowledgeable decision to acquire the Securities. Optionee is acquiring these Securities for investment for Optionee’s own account only and not with a
view to, or for resale in connection with, any “distribution” thereof within the meaning of the Securities Act of 1933, as amended (the “Securities Act”). 
 (b) Optionee acknowledges and understands that the Securities constitute “restricted securities” under the Securities Act and have
not been registered under the Securities Act in reliance upon a specific exemption therefrom, which exemption depends upon, among other things, the bona fide nature of Optionee’s investment intent as expressed herein. In this connection,
Optionee understands that, in the view of the Securities and Exchange Commission, the statutory basis for such exemption may be unavailable if Optionee’s representation was predicated solely upon a present intention to hold these Securities for
the minimum capital gains period specified under tax statutes, for a deferred sale, for or until an increase or decrease in the market price of the Securities, or for a period of one year or any other fixed period in the future. Optionee further
understands that the Securities must be held indefinitely unless they are subsequently registered under the Securities Act or an exemption from such registration is available. Optionee further acknowledges and understands that the Company is under
no obligation to register the Securities. Optionee understands that the certificate evidencing the Securities will be imprinted with any legend required under applicable state securities laws. 
 (c) Optionee is familiar with the provisions of Rule 701 and Rule 144, each promulgated under the Securities Act, which, in substance,
permit limited public resale of “restricted securities” acquired, directly or indirectly from the issuer thereof, in a non-public offering subject to the satisfaction of certain conditions. Rule 701 provides that if the issuer qualifies
under Rule 701 at the time of the grant of the Option to the Optionee, the exercise will be exempt from registration under the Securities Act. In the event the Company becomes subject to the reporting requirements of

  

 21 








 
Section 13 or 15(d) of the Securities Exchange Act of 1934, ninety (90) days thereafter (or such longer period as any market stand-off agreement may require) the Securities exempt under
Rule 701 may be resold, subject to the satisfaction of certain of the conditions specified by Rule 144, including: (1) the resale being made through a broker in an unsolicited “broker’s transaction” or in transactions directly
with a market maker (as said term is defined under the Securities Exchange Act of 1934); and, in the case of an affiliate, (2) the availability of certain public information about the Company, (3) the amount of Securities being sold during
any three month period not exceeding the limitations specified in Rule 144(e), and (4) the timely filing of a Form 144, if applicable. 
 In the event that the Company does not qualify under Rule 701 at the time of grant of the Option, then the Securities may be resold in certain limited circumstances subject to the provisions of Rule 144,
which requires the resale to occur not less than one year after the later of the date the Securities were sold by the Company or the date the Securities were sold by an affiliate of the Company, within the meaning of Rule 144; and, in the case of
acquisition of the Securities by an affiliate, or by a non-affiliate who subsequently holds the Securities less than two years, the satisfaction of the conditions set forth in sections (1), (2), (3) and (4) of the paragraph immediately
above. 
 (d) Optionee further understands that in the event all of the applicable requirements of Rule 701 or 144 are not
satisfied, registration under the Securities Act, compliance with Regulation A, or some other registration exemption will be required; and that, notwithstanding the fact that Rules 144 and 701 are not exclusive, the Staff of the Securities and
Exchange Commission has expressed its opinion that persons proposing to sell private placement securities other than in a registered offering and otherwise than pursuant to Rules 144 or 701 will have a substantial burden of proof in establishing
that an exemption from registration is available for such offers or sales, and that such persons and their respective brokers who participate in such transactions do so at their own risk. Optionee understands that no assurances can be given that any
such other registration exemption will be available in such event. 
  

	
	Signature of Optionee:
	
	  
	
	Date:                                      
           ,                     


  

 22 








 KAZEON SYSTEMS, INC. 
 2003 STOCK PLAN 
 STOCK OPTION AGREEMENT — EARLY
EXERCISE 
 Unless otherwise defined herein, the terms defined in the 2003 Stock Plan shall have the same defined meanings
in this Stock Option Agreement. 
  

	I.	NOTICE OF STOCK OPTION GRANT 

 Name: 
 Address: 
 The undersigned Optionee has been granted an Option to purchase Common Stock of the Company, subject to the terms and conditions of the Plan
and this Option Agreement, as follows: 
  

			
	 Grant Number
	  	                                       
                                         
                                         
                          
		
	 Date of Grant
	  	                                       
                                         
                                         
                          
		
	 Vesting Commencement Date
	  	                                       
                                         
                                         
                          
		
	 Exercise Price per Share
	  	                                       
                                         
                                         
                          
		
	 Total Number of Shares Granted
	  	                                       
                                         
                                         
                          
		
	 Total Exercise Price
	  	                                       
                                         
                                         
                          
		
	 Type of Option:
	  	             Incentive Stock Option
		
		  	             Nonstatutory Stock Option
		
	Term/Expiration Date:	  	                                       
                                         
                                         
                          

 Vesting Schedule: 
 This Option shall be exercisable in whole or in part, according to the following vesting schedule: 
 25% of the Shares subject to the Option shall vest on the one (1) year anniversary of the Vesting Commencement
Date, and  1/48 of the Shares subject to the Option
shall vest each month thereafter, subject to Optionee continuing to be a Service Provider through each such date. 
  

 23 








 Termination Period: 
 This Option shall be exercisable for three (3) months after Optionee ceases to be a Service Provider. Upon Optionee’s death or
Disability, this Option shall be exercisable for one (1) year after Optionee ceases to be Service Provider. In no event may Optionee exercise this Option after the Term/Expiration Date as provided above. 
  

	II.	AGREEMENT 

 1.
Grant of Option. The Administrator of the Company hereby grants to the Optionee named in the Notice of Grant in Part I of this Agreement (the “Optionee”), an option (the “Option”) to purchase the number of
Shares set forth in the Notice of Grant, at the exercise price per Share set forth in the Notice of Grant (the “Exercise Price”), and subject to the terms and conditions of the Plan, which is incorporated herein by reference.
Subject to Section 15(c) of the Plan, in the event of a conflict between the terms and conditions of the Plan and this Option Agreement, the terms and conditions of the Plan shall prevail. 
 If designated in the Notice of Grant as an Incentive Stock Option (“ISO”), this Option is intended to qualify as an
Incentive Stock Option as defined in Section 422 of the Code. Nevertheless, to the extent that it exceeds the S100,000 rule of Code Section 422(d), this Option shall be treated as a Nonstatutory Stock Option
(“NSO”). 
 2. Exercise of Option. This Option shall be exercisable during its term in accordance
with the provisions of Section 10 of the Plan as follows: 
 (a) Right to Exercise. 
 (i) Subject to subsections 2(a)(ii) and 2(a)(iii) below, this Option shall be exercisable cumulatively according to the vesting schedule
set forth in the Notice of Grant. Alternatively, at the election of the Optionee, this Option may be exercised prior to April 1, 2004 in whole or in part as to Shares that have not yet vested. Following March 31, 2004, the Optionee will no
longer have the ability to exercise this Option as to unvested Shares. Vested Shares shall not be subject to the Company’s repurchase right (as set forth in the Restricted Stock Purchase Agreement, attached hereto as Exhibit C-1).

 (ii) As a condition to exercising this Option for unvested Shares prior to April 1, 2004, the Optionee shall execute
the Restricted Stock Purchase Agreement. 
 (iii) This Option may not be exercised for a fraction of a Share. 
 (b) Method of Exercise. This Option shall be exercisable by delivery of an exercise notice in the form attached as Exhibit A
(the “Exercise Notice”), which shall state the election to exercise the Option, the number of Shares with respect to which the Option is being exercised, and such other representations and agreements as may be required by the
Company. The Exercise Notice shall be accompanied by payment of the aggregate Exercise Price as to all 
  

 24 








 
Exercised Shares. This Option shall be deemed to be exercised upon receipt by the Company of such fully executed Exercise Notice accompanied by the aggregate Exercise Price. 
 No Shares shall be issued pursuant to the exercise of an Option unless such issuance and such exercise comply with Applicable Laws. Assuming
such compliance, for income tax purposes the Shares shall be considered transferred to the Optionee on the date on which the Option is exercised with respect to such Shares. 
 3. Optionee’s Representations. In the event the Shares have not been registered under the Securities Act of 1933, as amended, at
the time this Option is exercised, the Optionee shall, if required by the Company, concurrently with the exercise of all or any portion of this Option, deliver to the Company his or her Investment Representation Statement in the form attached hereto
as Exhibit B. 
 4. Lock-Up Period. Optionee hereby agrees that Optionee shall not offer, pledge, sell, contract
to sell, sell any option or contract to purchase, purchase any option or contract to sell, grant any option, right or warrant to purchase, lend, or otherwise transfer or dispose of, directly or indirectly, any Common Stock (or other securities) of
the Company or enter into any swap, hedging or other arrangement that transfers to another, in whole or in part, any of the economic consequences of ownership of any Common Stock (or other securities) of the Company held by Optionee (other than
those included in the registration) for a period specified by the representative of the underwriters of Common Stock (or other securities) of the Company not to exceed one hundred eighty (180) days following the effective date of any
registration statement of the Company filed under the Securities Act. 
 Optionee agrees to execute and deliver such other
agreements as may be reasonably requested by the Company or the underwriter which are consistent with the foregoing or which are necessary to give further effect thereto. In addition, if requested by the Company or the representative of the
underwriters of Common Stock (or other securities) of the Company, Optionee shall provide, within ten (10) days of such request, such information as may be required by the Company or such representative in connection with the completion of any
public offering of the Company’s securities pursuant to a registration statement filed under the Securities Act. The obligations described in this Section shall not apply to a registration relating solely to employee benefit plans on Form S-1
or Form S-8 or similar forms that may be promulgated in the future, or a registration relating solely to a Commission Rule 145 transaction on Form S-4 or similar forms that may be promulgated in the future. The Company may impose stop-transfer
instructions with respect to the shares of Common Stock (or other securities) subject to the foregoing restriction until the end of said one hundred eighty (180) day period. Optionee agrees that any transferee of the Option or shares acquired
pursuant to the Option shall be bound by this Section. 
 5. Method of Payment. Payment of the aggregate Exercise Price
shall be by any of the following, or a combination thereof, at the election of the Optionee: 
 (a) cash; 
  

 25 








 (b) check; 
 (c) consideration received by the Company under a formal cashless exercise program adopted by the Company in connection with the Plan; or 
 (d) surrender of other Shares which, (i) in the case of Shares acquired from the Company, either directly or indirectly, have been
vested and owned by the Optionee for more than six (6) months on the date of surrender, and (ii) have a Fair Market Value on the date of surrender equal to the aggregate Exercise Price of the Exercised Shares. 
 6. Restrictions on Exercise. This Option may not be exercised until such time as the Plan has been approved by the shareholders of
the Company, or if the issuance of such Shares upon such exercise or the method of payment of consideration for such shares would constitute a violation of any Applicable Law. 
 7. Non-Transferability of Option. This Option may not be transferred in any manner otherwise than by will or by the laws of descent
or distribution and may be exercised during the lifetime of Optionee only by Optionee. The terms of the Plan and this Option Agreement shall be binding upon the executors, administrators, heirs, successors and assigns of the Optionee. 
 8. Term of Option. This Option may be exercised only within the term set out in the Notice of Grant, and may be exercised during such
term only in accordance with the Plan and the terms of this Option. 
 9. Tax Obligations. 
 (a) Withholding Taxes. Optionee agrees to make appropriate arrangements with the Company (or the Parent or Subsidiary employing or
retaining Optionee) for the satisfaction of all Federal, state, local and foreign income and employment tax withholding requirements applicable to the Option exercise. Optionee acknowledges and agrees that the Company may refuse to honor the
exercise and refuse to deliver the Shares if such withholding amounts are not delivered at the time of exercise. 
 (b)
Notice of Disqualifying Disposition of ISO Shares. If the Option granted to Optionee herein is an ISO, and if Optionee sells or otherwise disposes of any of the Shares acquired pursuant to the ISO on or before the later of (1) the date
two years after the Date of Grant, and (2) the date one year after the date of exercise, the Optionee shall immediately notify the Company in writing of such disposition. Optionee agrees that Optionee may be subject to income tax withholding by
the Company on the compensation income recognized by the Optionee. 
 10. Entire Agreement; Governing Law. The Plan is
incorporated herein by reference. The Plan and this Option Agreement constitute the entire agreement of the parties with respect to the subject matter hereof and supersede in their entirety all prior undertakings and agreements of the Company and
Optionee with respect to the subject matter hereof, and may not be modified adversely to the Optionee’s interest except by means of a writing signed by the Company and

  

 26 








 
Optionee. This Agreement is governed by the internal substantive laws but not the choice of law rules of California. 
 11. No Guarantee of Continued Service. OPTIONEE AGREES THAT THE VESTING OF SHARES PURSUANT TO THE VESTING SCHEDULE HEREOF IS EARNED ONLY BY CONTINUING AS A SERVICE PROVIDER AT THE WILL OF THE
COMPANY (NOT THROUGH THE ACT OF BEING HIRED, BEING GRANTED THIS OPTION OR ACQUIRING SHARES HEREUNDER). OPTIONEE FURTHER ACKNOWLEDGES AND AGREES THAT THIS AGREEMENT, THE TRANSACTIONS CONTEMPLATED HEREUNDER AND THE VESTING SCHEDULE SET FORTH HEREIN DO
NOT CONSTITUTE AN EXPRESS OR IMPLIED PROMISE OF CONTINUED ENGAGEMENT AS A SERVICE PROVIDER FOR THE VESTING PERIOD, FOR ANY PERIOD, OR AT ALL, AND SHALL NOT INTERFERE IN ANY WAY WITH OPTIONEE’S RIGHT OR THE COMPANY’S RIGHT TO TERMINATE
OPTIONEE’S RELATIONSHIP AS A SERVICE PROVIDER AT ANY TIME, WITH OR WITHOUT CAUSE. 
 Optionee acknowledges receipt of a
copy of the Plan and represents that he or she is familiar with the terms and provisions thereof, and hereby accepts this Option subject to all of the terms and provisions thereof. Optionee has reviewed the Plan and this Option in their entirety,
has had an opportunity to obtain the advice of counsel prior to executing this Option and fully understands all provisions of the Option. Optionee hereby agrees to accept as binding, conclusive and final all decisions or interpretations of the
Administrator upon any questions arising under the Plan or this Option. Optionee further agrees to notify the Company upon any change in the residence address indicated below. 
  

			
	OPTIONEE	  	KAZEON SYSTEMS, INC.
		
	 	  	 
	Signature	  	By
		
	 	  	 
	Print Name	  	Title
		
	 	  	
		
	 	  	
	Residence Address	  	

  

 27 








 EXHIBIT A 
 2003 STOCK PLAN 
 EXERCISE NOTICE 
 Kazeon Systems, Inc. 
 1161 San Antonio Road

 Mountain View, CA 94043 
 Attention:
Chief Financial Officer 
 1. Exercise of Option. Effective as of today,
                                ,
            ,the undersigned (“Optionee”) hereby elects to exercise Optionee’s option (the “Option”) to purchase
             shares of the Common Stock (the “Shares”) of Kazeon Systems, Inc. (the “Company”) under and pursuant to the 2003 Stock Plan (the
“Plan”) and the Stock Option Agreement dated
                                ,
             (the “Option Agreement”). 
 2. Delivery of Payment. Purchaser herewith delivers to the Company the full purchase price of the Shares, as set forth in the Option Agreement, and any and all withholding taxes due in connection with the exercise of the Option.

 3. Representations of Optionee. Optionee acknowledges that Optionee has received, read and understood the Plan and the
Option Agreement and agrees to abide by and be bound by their terms and conditions. 
 4. Rights as Shareholder. Until
the issuance of the Shares (as evidenced by the appropriate entry on the books of the Company or of a duly authorized transfer agent of the Company), no right to vote or receive dividends or any other rights as a shareholder shall exist with respect
to the Optioned Stock, notwithstanding the exercise of the Option. The Shares shall be issued to the Optionee as soon as practicable after the Option is exercised in accordance with the Option Agreement. No adjustment shall be made for a dividend or
other right for which the record date is prior to the date of issuance except as provided in Section 13 of the Plan. 
 5.
Company’s Right of First Refusal. Before any Shares held by Optionee or any transferee (either being sometimes referred to herein as the “Holder”) may be sold or otherwise transferred (including transfer by gift
or operation of law), the Company or its assignee(s) shall have a right of first refusal to purchase the Shares on the terms and conditions set forth in this Section (the “Right of First Refusal”). 
 (a) Notice of Proposed Transfer. The Holder of the Shares shall deliver to the Company a written notice (the
“Notice”) stating: (i) the Holder’s bona fide intention to sell or otherwise transfer such Shares; (ii) the name of each proposed purchaser or other transferee (“Proposed
Transferee”); (iii) the number of Shares to be transferred to each Proposed Transferee; and (iv) the bona fide cash price or other consideration for which the Holder proposes to transfer the Shares (the “Offered
Price”), and the Holder shall offer the Shares at the Offered Price to the Company or its assignee(s). 
  

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 (b) Exercise of Right of First Refusal. At any time within thirty (30) days
after receipt of the Notice, the Company and/or its assignee(s) may, by giving written notice to the Holder, elect to purchase all, but not less than all, of the Shares proposed to be transferred to any one or more of the Proposed Transferees, at
the purchase price determined in accordance with subsection (c) below. 
 (c) Purchase Price. The purchase price
(“Purchase Price”) for the Shares purchased by the Company or its assignee(s) under this Section shall be the Offered Price. If the Offered Price includes consideration other than cash, the cash equivalent value of the
non-cash consideration shall be determined by the Board of Directors of the Company in good faith. 
 (d) Payment.
Payment of the Purchase Price shall be made, at the option of the Company or its assignee(s), in cash (by check), by cancellation of all or a portion of any outstanding indebtedness of the Holder to the Company (or, in the case of repurchase by an
assignee, to the assignee), or by any combination thereof within 30 days after receipt of the Notice or in the manner and at the times set forth in the Notice. 
 (e) Holder’s Right to Transfer. If all of the Shares proposed in the Notice to be transferred to a given Proposed Transferee are not purchased by the Company and/or its assignee(s) as provided
in this Section, then the Holder may sell or otherwise transfer such Shares to that Proposed Transferee at the Offered Price or at a higher price, provided that such sale or other transfer is consummated within 120 days after the date of the Notice,
that any such sale or other transfer is effected in accordance with any applicable securities laws and that the Proposed Transferee agrees in writing that the provisions of this Section shall continue to apply to the Shares in the hands of such
Proposed Transferee. If the Shares described in the Notice are not transferred to the Proposed Transferee within such period, a new Notice shall be given to the Company, and the Company and/or its assignees shall again be offered the Right of First
Refusal before any Shares held by the Holder may be sold or otherwise transferred. 
 (f) Exception for Certain Family
Transfers. Anything to the contrary contained in this Section notwithstanding, the transfer of any or all of the Shares during the Optionee’s lifetime or on the Optionee’s death by will or intestacy to the Optionee’s immediate
family or a trust for the benefit of the Optionee’s immediate family shall be exempt from the provisions of this Section. “Immediate Family” as used herein shall mean spouse, lineal descendant or antecedent, father, mother, brother or
sister. In such case, the transferee or other recipient shall receive and hold the Shares so transferred subject to the provisions of this Section, and there shall be no further transfer of such Shares except in accordance with the terms of this
Section. 
 (g) Termination of Right of First Refusal. The Right of First Refusal shall terminate as to any Shares upon
the earlier of (i) first sale of Common Stock of the Company to the general public, or (ii) a Change in Control in which the successor corporation has equity securities that are publicly traded. 
 6. Tax Consultation. Optionee understands that Optionee may suffer adverse tax consequences as a result of Optionee’s purchase
or disposition of the Shares. Optionee

  

 29 








 
represents that Optionee has consulted with any tax consultants Optionee deems advisable in connection with the purchase or disposition of the Shares and that Optionee is not relying on the
Company for any tax advice. 
 7. Restrictive Legends and Stop-Transfer Orders. 
 (a) Legends. Optionee understands and agrees that the Company shall cause the legends set forth below or legends substantially
equivalent thereto, to be placed upon any certificate(s) evidencing ownership of the Shares together with any other legends that may be required by the Company or by state or federal securities laws: 
 THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 (THE “ACT”) AND MAY NOT
BE OFFERED, SOLD OR OTHERWISE TRANSFERRED, PLEDGED OR HYPOTHECATED UNLESS AND UNTIL REGISTERED UNDER THE ACT OR, IN THE OPINION OF COUNSEL SATISFACTORY TO THE ISSUER OF THESE SECURITIES, SUCH OFFER, SALE OR TRANSFER, PLEDGE OR HYPOTHECATION IS IN
COMPLIANCE THEREWITH. 
 THE SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO CERTAIN RESTRICTIONS ON TRANSFER AND A RIGHT
OF FIRST REFUSAL HELD BY THE ISSUER OR ITS ASSIGNEE(S) AS SET FORTH IN THE EXERCISE NOTICE BETWEEN THE ISSUER AND THE ORIGINAL HOLDER OF THESE SHARES, A COPY OF WHICH MAY BE OBTAINED AT THE PRINCIPAL OFFICE OF THE ISSUER. SUCH TRANSFER RESTRICTIONS
AND RIGHT OF FIRST REFUSAL ARE BINDING ON TRANSFEREES OF THESE SHARES. 
 THE SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT
TO RESTRICTIONS ON TRANSFER FOR A PERIOD NOT TO EXCEED 180 DAYS FOLLOWING THE EFFECTIVE DATE OF THE UNDERWRITTEN PUBLIC OFFERING OF THE COMPANY’S SECURITIES AND MAY NOT BE SOLD OR OTHERWISE DISPOSED OF BY THE HOLDER WITHOUT THE CONSENT OF THE
COMPANY. 
 (b) Stop-Transfer Notices. Optionee agrees that, in order to ensure compliance with the restrictions referred
to herein, the Company may issue appropriate “stop transfer” instructions to its transfer agent, if any, and that, if the Company transfers its own securities, it may make appropriate notations to the same effect in its own records.

 (c) Refusal to Transfer. The Company shall not be required (i) to transfer on its books any Shares that have been
sold or otherwise transferred in violation of any of the provisions of this Exercise Notice or (ii) to treat as owner of such Shares or to accord the right to vote or pay dividends to any purchaser or other transferee to whom such Shares shall
have been so transferred. 
  

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 8. Successors and Assigns. The Company may assign any of its rights under this
Exercise Notice to single or multiple assignees, and this Exercise Notice shall inure to the benefit of the successors and assigns of the Company. Subject to the restrictions on transfer herein set forth, this Exercise Notice shall be binding upon
Optionee and his or her heirs, executors, administrators, successors and assigns. 
 9. Interpretation. Any dispute
regarding the interpretation of this Exercise Notice shall be submitted by Optionee or by the Company forthwith to the Administrator, which shall review such dispute at its next regular meeting. The resolution of such a dispute by the Administrator
shall be final and binding on all parties. 
 10. Governing Law; Severability. This Exercise Notice is governed by the
internal substantive laws, but not the choice of law rules, of California. 
 11. Entire Agreement. The Plan and Option
Agreement are incorporated herein by reference. This Exercise Notice, the Plan, the Restricted Stock Purchase Agreement, the Option Agreement and the Investment Representation Statement constitute the entire agreement of the parties with respect to
the subject matter hereof and supersede in their entirety all prior undertakings and agreements of the Company and Optionee with respect to the subject matter hereof, and may not be modified adversely to the Optionee’s interest except by means
of a writing signed by the Company and Optionee. 
  

			
	Submitted by:	  	Accepted by:
		
	OPTIONEE	  	KAZEON SYSTEMS, INC.
		
	 	  	 
	Signature	  	By
		
	 	  	 
	Print Name	  	Its
		
	Address:	  	Address:
		
	 	  	1161 San Antonio Road
		  	Mountain View, CA 94043
		
	 	  	
		
		  	 
		  	Date Received

  

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 EXHIBIT B 
 INVESTMENT REPRESENTATION STATEMENT 
  

			
	 OPTIONEE:
	  	___________________________
		
	 COMPANY:
	  	KAZEON SYSTEMS, INC.
		
	 SECURITY:
	  	COMMON STOCK
		
	 AMOUNT:
	  	_________ SHARES
		
	 DATE:
	  	___________________________

 In connection with the purchase of the above-listed Securities, the undersigned Optionee represents
to the Company the following: 
 (a) Optionee is aware of the Company’s business affairs and financial condition and has
acquired sufficient information about the Company to reach an informed and knowledgeable decision to acquire the Securities. Optionee is acquiring these Securities for investment for Optionee’s own account only and not with a view to, or for
resale in connection with, any “distribution” thereof within the meaning of the Securities Act of 1933, as amended (the “Securities Act”). 
 (b) Optionee acknowledges and understands that the Securities constitute “restricted securities” under the Securities Act and have
not been registered under the Securities Act in reliance upon a specific exemption therefrom, which exemption depends upon, among other things, the bona fide nature of Optionee’s investment intent as expressed herein. In this connection,
Optionee understands that, in the view of the Securities and Exchange Commission, the statutory basis for such exemption may be unavailable if Optionee’s representation was predicated solely upon a present intention to hold these Securities for
the minimum capital gains period specified under tax statutes, for a deferred sale, for or until an increase or decrease in the market price of the Securities, or for a period of one year or any other fixed period in the future. Optionee further
understands that the Securities must be held indefinitely unless they are subsequently registered under the Securities Act or an exemption from such registration is available. Optionee further acknowledges and understands that the Company is under
no obligation to register the Securities. Optionee understands that the certificate evidencing the Securities will be imprinted with any legend required under applicable state securities laws. 
 (c) Optionee is familiar with the provisions of Rule 701 and Rule 144, each promulgated under the Securities Act, which, in substance,
permit limited public resale of “restricted securities” acquired, directly or indirectly from the issuer thereof, in a non-public offering subject to the satisfaction of certain conditions. Rule 701 provides that if the issuer qualifies
under Rule 701 at the time of the grant of the Option to the Optionee, the exercise will be exempt from registration under the Securities Act. In the event the Company becomes subject to the reporting requirements of Section 13 or 15(d) of the
Securities Exchange Act of 1934,

  

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ninety (90) days thereafter (or such longer period as any market stand-off agreement may require) the Securities exempt under Rule 701 may be resold, subject to the satisfaction of certain
of the conditions specified by Rule 144, including: (1) the resale being made through a broker in an unsolicited “broker’s transaction” or in transactions directly with a market maker (as said term is defined under the Securities
Exchange Act of 1934); and, in the case of an affiliate, (2) the availability of certain public information about the Company, (3) the amount of Securities being sold during any three month period not exceeding the limitations specified in
Rule 144(e), and (4) the timely filing of a Form 144, if applicable. 
 In the event that the Company does not qualify
under Rule 701 at the time of grant of the Option, then the Securities may be resold in certain limited circumstances subject to the provisions of Rule 144, which requires the resale to occur not less than one year after the later of the date the
Securities were sold by the Company or the date the Securities were sold by an affiliate of the Company, within the meaning of Rule 144; and, in the case of acquisition of the Securities by an affiliate, or by a non-affiliate who subsequently holds
the Securities less than two years, the satisfaction of the conditions set forth in sections (1), (2), (3) and (4) of the paragraph immediately above. 
 (d) Optionee further understands that in the event all of the applicable requirements of Rule 701 or 144 are not satisfied, registration under the Securities Act, compliance with Regulation A, or some
other registration exemption will be required; and that, notwithstanding the fact that Rules 144 and 701 are not exclusive, the Staff of the Securities and Exchange Commission has expressed its opinion that persons proposing to sell private
placement securities other than in a registered offering and otherwise than pursuant to Rules 144 or 701 will have a substantial burden of proof in establishing that an exemption from registration is available for such offers or sales, and that such
persons and their respective brokers who participate in such transactions do so at their own risk. Optionee understands that no assurances can be given that any such other registration exemption will be available in such event. 
  

			
	Signature of Optionee:
	
	 
		
	Date:	 	 


  

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 EXHIBIT C-1 
 KAZEON SYSTEMS, INC. 
 2003 STOCK PLAN

 RESTRICTED STOCK PURCHASE AGREEMENT 
 THIS AGREEMENT is made between
                                         
                                    (the
“Purchaser”) and Kazeon Systems, Inc. (the “Company”) or its assignees of rights hereunder as of
                                        ,
                . 
 Unless otherwise
defined herein, the terms defined in the 2003 Stock Plan shall have the same defined meanings in this Agreement. 
 RECITALS

 A. Pursuant to the exercise of the option (grant number
                ) granted to Purchaser under the Plan and pursuant to the Option Agreement dated
                        ,              by and between
the Company and Purchaser with respect to such grant (the “Option”), which Plan and Option Agreement are hereby incorporated by reference, Purchaser has elected to purchase
             of those shares of Common Stock which have not become vested under the vesting schedule set forth in the Option Agreement (“Unvested Shares”).
The Unvested Shares and the shares subject to the Option Agreement, which have become vested are sometimes collectively referred to herein as the “Shares.” 
 B. As required by the Option Agreement, as a condition to Purchaser’s election to exercise the option, Purchaser must execute this
Agreement, which sets forth the rights and obligations of the parties with respect to Shares acquired upon exercise of the Option. 
 1. Repurchase Option. 
 (a) If Purchaser’s status as a Service Provider is terminated for any reason,
including for death and Disability, the Company shall have the right and option for ninety (90) days from such date to purchase from Purchaser, or Purchaser’s personal representative, as the case may be, all of the Purchaser’s
Unvested Shares as of the date of such termination at the price paid by the Purchaser for such Shares (the “Repurchase Option”). 
 (b) Upon the occurrence of such termination, the Company may exercise its Repurchase Option by delivering personally or by registered mail, to Purchaser (or his transferee or legal representative, as the
case may be) with a copy to the escrow agent described in Section 2 below, a notice in writing indicating the Company’s intention to exercise the Repurchase Option AND, at the Company’s option, (i) by delivering to the Purchaser
(or the Purchaser’s transferee or legal representative) a check in the amount of the aggregate repurchase price, or (ii) by the Company canceling an amount of the Purchaser’s indebtedness to the Company equal to the aggregate
repurchase price, or (iii) by a combination of (i) and (ii) so that the combined payment and cancellation of indebtedness equals such aggregate repurchase price.

  

 34 








 
Upon delivery of such notice and payment of the aggregate repurchase price in any of the ways described above, the Company shall become the legal and beneficial owner of the Unvested Shares being
repurchased and the rights and interests therein or relating thereto, and the Company shall have the right to retain and transfer to its own name the number of Unvested Shares being repurchased by the Company. 
 (c) Whenever the Company shall have the right to repurchase Unvested Shares hereunder, the Company may designate and assign one or more
employees, officers, directors or shareholders of the Company or other persons or organizations to exercise all or a part of the Company’s Repurchase Option under this Agreement and purchase all or a part of such Unvested Shares. 
 (d) If the Company does not elect to exercise the Repurchase Option conferred above by giving the requisite notice within ninety
(90) days following the termination, the Repurchase Option shall terminate. 
 (e) The Repurchase Option shall terminate in
accordance with the vesting schedule contained in Purchaser’s Option Agreement. 
 2. Transferability of the Shares;
Escrow. 
 (a) Purchaser hereby authorizes and directs the Secretary of the Company, or such other person designated by the
Company, to transfer the Unvested Shares as to which the Repurchase Option has been exercised from Purchaser to the Company. 
 (b) To insure the availability for delivery of Purchaser’s Unvested Shares upon repurchase by the Company pursuant to the Repurchase Option under Section 1, Purchaser hereby appoints the Secretary, or any other person designated
by the Company as escrow agent (the “Escrow Agent”), as its attorney-in-fact to sell, assign and transfer unto the Company, such Unvested Shares, if any, repurchased by the Company pursuant to the Repurchase Option and shall,
upon execution of this Agreement, deliver and deposit with the Escrow Agent, the share certificates representing the Unvested Shares, together with the stock assignment duly endorsed in blank, attached hereto as Exhibit C-2. The Unvested
Shares and stock assignment shall be held by the Escrow Agent in escrow, pursuant to the Joint Escrow Instructions of the Company and Purchaser attached as Exhibit C-3 hereto, until the Company exercises its Repurchase Option, until such
Unvested Shares are vested, or until such time as this Agreement no longer is in effect. Upon vesting of the Unvested Shares, the Escrow Agent shall promptly deliver to the Purchaser the certificate or certificates representing such Shares in the
Escrow Agent’s possession belonging to the Purchaser, and the Escrow Agent shall be discharged of all further obligations hereunder; provided, however, that the Escrow Agent shall nevertheless retain such certificate or certificates as Escrow
Agent if so required pursuant to other restrictions imposed pursuant to this Agreement. 
 (c) The Company nor the Escrow Agent
shall be liable for any act it may do or omit to do with respect to holding the Shares in escrow and while acting in good faith and in the exercise of its judgment. 
  

 35 








 (d) Transfer or sale of the Shares is subject to restrictions on transfer imposed by any
applicable state and federal securities laws. Any transferee shall hold such Shares subject to all the provisions hereof and the Exercise Notice executed by the Purchaser with respect to any Unvested Shares purchased by Purchaser and shall
acknowledge the same by signing a copy of this Agreement. 
 3. Ownership, Voting Rights, Duties. This Agreement shall
not affect in any way the ownership, voting rights or other rights or duties of Purchaser, except as specifically provided herein. 
 4. Legends. The share certificate evidencing the Shares issued hereunder shall be endorsed with the following legend (in addition to any legend required under applicable federal and state securities laws): 
 THE SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO CERTAIN RESTRICTIONS UPON TRANSFER AND RIGHTS OF REPURCHASE AS SET FORTH IN AN
AGREEMENT BETWEEN THE COMPANY AND THE STOCKHOLDER, A COPY OF WHICH IS ON FILE WITH THE SECRETARY OF THE COMPANY. 
 5.
Adjustment for Stock Split. All references to the number of Shares and the purchase price of the Shares in this Agreement shall be appropriately adjusted to reflect any stock split, stock dividend or other change in the Shares, which may be
made by the Company pursuant to Section 13 of the Plan after the date of this Agreement. 
 6. Notices. Notices
required hereunder shall be given in person or by registered mail to the address of Purchaser shown on the records of the Company, and to the Company at their respective principal executive offices. 
 7. Survival of Terms. This Agreement shall apply to and bind Purchaser and the Company and their respective permitted assignees and
transferees, heirs, legatees, executors, administrators and legal successors. 
 8. Section 83(b) Election.
Purchaser hereby acknowledges that he or she has been informed that, with respect to the exercise of an Option for Unvested Shares, an election (the “Election”) may be filed by the Purchaser with the Internal Revenue Service,
within thirty (30) days of the purchase of the exercised Shares, electing pursuant to Section 83(b) of the Code to be taxed currently on any difference between the purchase price of the exercised Shares and their Fair Market Value on the
date of purchase. In the case of a Nonstatutory Stock Option, this will result in a recognition of taxable income to the Purchaser on the date of exercise, measured by the excess, if any, of the Fair Market Value of the exercised Shares, at the time
the Option is exercised over the purchase price for the exercised Shares. Absent such an Election, taxable income will be measured and recognized by Purchaser at the time or times on which the Company’s Repurchase Option lapses. In the case of
an Incentive Stock Option, such an Election will result in a recognition of income to the Purchaser for alternative minimum tax purposes on the date of exercise, measured by the excess, if any, of the Fair Market Value of the exercised Shares, at
the time the option is exercised, over the purchase price for the exercised

  

 36 








 
Shares. Absent such an Election, alternative minimum taxable income will be measured and recognized by Purchaser at the time or times on which the Company’s Repurchase Option lapses.
Purchaser is strongly encouraged to seek the advice of his or her own tax consultants in connection with the purchase of the Shares and the advisability of filing of the Election under Section 83(b) of the Code. A form of Election under
Section 83(b) is attached hereto as Exhibit C-4 for reference. 
 PURCHASER ACKNOWLEDGES THAT IT IS PURCHASER’S
SOLE RESPONSIBILITY AND NOT THE COMPANY’S TO FILE TIMELY THE ELECTION UNDER SECTION 83(b) OF THE CODE, EVEN IF PURCHASER REQUESTS THE COMPANY OR ITS REPRESENTATIVE TO MAKE THIS FILING ON PURCHASER’S BEHALF. 
 9. Representations. Purchaser has reviewed with his own tax advisors the federal, state, local and foreign tax consequences of this
investment and the transactions contemplated by this Agreement. Purchaser is relying solely on such advisors and not on any statements or representations of the Company or any of its agents. Purchaser understands that he (and not the Company) shall
be responsible for his own tax liability that may arise as a result of this investment or the transactions contemplated by this Agreement. 
 10. Governing Law. This Agreement shall be governed by the internal substantive laws, but not the choice of law rules, of California. 
 Purchaser represents that he has read this Agreement and is familiar with its terms and provisions. Purchaser hereby agrees to accept as
binding, conclusive and final all decisions or interpretations of the Board upon any questions arising under this Agreement. 
 IN WITNESS WHEREOF, this Agreement is deemed made as of the date first set forth above. 
  

			
	OPTIONEE	  	KAZEON SYSTEMS, INC.
		
	 	  	 
	Signature	  	By
		
	 	  	 
	Print Name	  	Title
		
	 	  	
		
	 	  	
		  	
	Residence Address	  	
		
	 Dated:
                                         
               ,             
	  	

  

 37 








 EXHIBIT C-2 
 ASSIGNMENT SEPARATE FROM CERTIFICATE 
 FOR VALUE
RECEIVED I,
                                        ,
hereby sell, assign and transfer unto Kazeon Systems, Inc.
                                         
    (                ) shares of the Common Stock of Kazeon Systems, Inc. standing in my name of the books of said corporation represented by
Certificate No.                  herewith and do hereby irrevocably constitute and appoint
                         to transfer the said stock on the books of the within named corporation with full power of
substitution in the premises. 
 This Stock Assignment may be used only in accordance with the Restricted Stock Purchase
Agreement between Kazeon Systems, Inc. and the undersigned dated
                                ,
             (the “Agreement”). 
  

			
	Dated:                                      
    ,             	  	Signature:                                      
                        

 INSTRUCTIONS: Please do not fill in any blanks other than the signature line. The
purpose of this assignment is to enable the Company to exercise its “repurchase option,” as set forth in the Agreement, without requiring additional signatures on the part of the Purchaser. 
  

 38 








 EXHIBIT C-3 
 JOINT ESCROW INSTRUCTIONS 
                                     ,
             
 Corporate Secretary 
 Kazeon Systems, Inc. 
 [Address] 

Dear
                                        :

 As Escrow Agent for both Kazeon Systems, Inc. (the “Company”), and the undersigned purchaser of stock
of the Company (the “Purchaser”), you are hereby authorized and directed to hold the documents delivered to you pursuant to the terms of that certain Restricted Stock Purchase Agreement (the
“Agreement”) between the Company and the undersigned, in accordance with the following instructions: 
 1. In the event the Company and/or any assignee of the Company (referred to collectively for convenience herein as the “Company”) exercises the Company’s repurchase option set forth in the Agreement, the Company
shall give to Purchaser and you a written notice specifying the number of shares of stock to be purchased, the purchase price, and the time for a closing hereunder at the principal office of the Company. Purchaser and the Company hereby irrevocably
authorize and direct you to close the transaction contemplated by such notice in accordance with the terms of said notice. 
 2.
At the closing, you are directed (a) to date the stock assignments necessary for the transfer in question, (b) to fill in the number of shares being transferred, and (c) to deliver the stock assignments, together with the certificate
evidencing the shares of stock to be transferred, to the Company or its assignee, against the simultaneous delivery to you of the purchase price (by cash, a check, or some combination thereof) for the number of shares of stock being purchased
pursuant to the exercise of the Company’s repurchase option. 
 3. Purchaser irrevocably authorizes the Company to deposit
with you any certificates evidencing shares of stock to be held by you hereunder and any additions and substitutions to said shares as defined in the Agreement. Purchaser does hereby irrevocably constitute and appoint you as Purchaser’s
attorney-in-fact and agent for the term of this escrow to execute with respect to such securities all documents necessary or appropriate to make such securities negotiable and to complete any transaction herein contemplated, including but not
limited to the filing with any applicable state blue sky authority of any required applications for consent to, or notice of transfer of, the securities. Subject to the provisions of this paragraph 3, Purchaser shall exercise all rights and
privileges of a stockholder of the Company while the stock is held by you. 
 4. Upon written request of the Purchaser, but no
more than once per calendar year, unless the Company’s repurchase option has been exercised, you will deliver to Purchaser a certificate or certificates representing so many shares of stock as are not then subject to the

  

 39 








 
Company’s repurchase option. Within 120 days after cessation of Purchaser’s continuous employment by or services to the Company, or any parent or subsidiary of the Company, you will
deliver to Purchaser a certificate or certificates representing the aggregate number of shares held or issued pursuant to the Agreement and not purchased by the Company or its assignees pursuant to exercise of the Company’s repurchase option.

 5. If at the time of termination of this escrow you should have in your possession any documents, securities, or other
property belonging to Purchaser, you shall deliver all of the same to Purchaser and shall be discharged of all further obligations hereunder. 
 6. Your duties hereunder may be altered, amended, modified or revoked only by a writing signed by all of the parties hereto. 
 7. You shall be obligated only for the performance of such duties as are specifically set forth herein and may rely and shall be protected in relying or refraining from acting on any instrument reasonably
believed by you to be genuine and to have been signed or presented by the proper party or parties. You shall not be personally liable for any act you may do or omit to do hereunder as Escrow Agent or as attorney-in-fact for Purchaser while acting in
good faith, and any act done or omitted by you pursuant to the advice of your own attorneys shall be conclusive evidence of such good faith. 
 8. You are hereby expressly authorized to disregard any and all warnings given by any of the parties hereto or by any other person or corporation, excepting only orders or process of courts of law and are
hereby expressly authorized to comply with and obey orders, judgments or decrees of any court. In case you obey or comply with any such order, judgment or decree, you shall not be liable to any of the parties hereto or to any other person, firm or
corporation by reason of such compliance, notwithstanding any such order, judgment or decree being subsequently reversed, modified, annulled, set aside, vacated or found to have been entered without jurisdiction. 
 9. You shall not be liable in any respect on account of the identity, authorities or rights of the parties executing or delivering or
purporting to execute or deliver the Agreement or any documents or papers deposited or called for hereunder. 
 10. You shall
not be liable for the outlawing of any rights under the Statute of Limitations with respect to these Joint Escrow Instructions or any documents deposited with you. 
 11. You shall be entitled to employ such legal counsel and other experts as you may deem necessary properly to advise you in connection with your obligations hereunder, may rely upon the advice of such
counsel, and may pay such counsel reasonable compensation therefor. 
 12. Your responsibilities as Escrow Agent hereunder shall
terminate if you shall cease to be an officer or agent of the Company or if you shall resign by written notice to each party. In the event of any such termination, the Company shall appoint a successor Escrow Agent. 
  

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 13. If you reasonably require other or further instruments in connection with these Joint
Escrow Instructions or obligations in respect hereto, the necessary parties hereto shall join in furnishing such instruments. 
 14. It is understood and agreed that should any dispute arise with respect to the delivery and/or ownership or right of possession of the securities held by you hereunder, you are authorized and directed to retain in your possession without
liability to anyone all or any part of said securities until such disputes shall have been settled either by mutual written agreement of the parties concerned or by a final order, decree or judgment of a court of competent jurisdiction after the
time for appeal has expired and no appeal has been perfected, but you shall be under no duty whatsoever to institute or defend any such proceedings. 
 15. Any notice required or permitted hereunder shall be given in writing and shall be deemed effectively given upon personal delivery or upon deposit in the United States Post Office, by registered or
certified mail with postage and fees prepaid, addressed to each of the other parties thereunto entitled at the following addresses or at such other addresses as a party may designate by ten days’ advance written notice to each of the other
parties hereto. 
 16. By signing these Joint Escrow Instructions, you become a party hereto only for the purpose of said Joint
Escrow Instructions; you do not become a party to the Agreement. 
 17. This instrument shall be binding upon and inure to the
benefit of the parties hereto, and their respective successors and permitted assigns. 
 18. These Joint Escrow Instructions
shall be governed by the internal substantive laws, but not the choice of law rules, of California. 
  

			
	PURCHASER	  	KAZEON SYSTEMS, INC.
		
	 	  	 
	Signature	  	By
		
	 	  	 
	Print Name	  	Title
		
	 	  	
		
	 	  	
	Residence Address	  	
		
	ESCROW AGENT	  	
		
	 	  	
	Corporate Secretary	  	
		
	 Dated:
                                         
               ,             
	  	

  

 41 








 EXHIBIT C-4 
 ELECTION UNDER SECTION 83(b) 
 OF THE INTERNAL
REVENUE CODE OF 1986 
 The undersigned taxpayer hereby elects, pursuant to Sections 55 and 83(b) of the Internal Revenue Code of 1986, as
amended, to include in taxpayer’s gross income or alternative minimum taxable income, as the case may be, for the current taxable year the amount of any compensation taxable to taxpayer in connection with taxpayer’s receipt of the property
described below 
  

	1.	The name, address, taxpayer identification number and taxable year of the undersigned are as follows: 

  

					
	NAME:	  	TAXPAYER:	  	SPOUSE:
			
	ADDRESS:	  		  	
			
	IDENTIFICATION NO.:	  	TAXPAYER:	  	SPOUSE:
			
	TAXABLE YEAR:	  		  	

  

	2.	The property with respect to which the election is made is described as follows:
                     shares (the “Shares”) of the Common Stock of Kazeon Systems, Inc. (the “Company”).


  

	3.	The date on which the property was transferred is:
                    ,             . 

  

	4.	The property is subject to the following restrictions: 

 The Shares may not be transferred and are subject to forfeiture under the terms of an agreement between the taxpayer and the Company. These restrictions lapse upon the satisfaction of certain conditions
contained in such agreement. 
  

	5.	The fair market value at the time of transfer, determined without regard to any restriction other than a restriction which by its terms will never lapse, of such
property is: $                    . 

  

	6.	The amount (if any) paid for such property is:
$                    . 

 The undersigned has submitted a copy of this statement to the person for whom the services were performed in connection with the undersigned’s receipt of the above-described property. The transferee of such property is the person
performing the services in connection with the transfer of said property. 
 The undersigned understands that the foregoing election may not
be revoked except with the consent of the Commissioner. 
  

			
	Dated:                                      
,             	  	 
		  	Taxpayer

  

 42 








 The undersigned spouse of taxpayer joins in this election. 
  

			
	Dated:                                      
,             	  	 
		  	Spouse of Taxpayer

  

 43 








 KAZEON SYSTEMS, INC. 
 2003 STOCK PLAN 
 STOCK OPTION AGREEMENT —
INDIAN OPTIONEES 
 Unless otherwise defined herein, the terms defined in the 2003 Stock Plan shall have the same defined
meanings in this Stock Option Agreement. 
  

	I.	NOTICE OF STOCK OPTION GRANT 

  

			
	 Name:
	  	 _________________

		
	 Address:
	  	 _________________


 The undersigned Optionee has been granted an Option to purchase Common Stock of the
Company, subject to the terms and conditions of the Plan and this Option Agreement, as follows: 
  

			
	 Date of Grant
	  	____________________________________
		
	 Vesting Commencement Date
	  	____________________________________
		
	 Exercise Price per Share
	  	____________________________________
		
	 Total Number of Shares Granted
	  	____________________________________
		
	 Total Exercise Price
	  	____________________________________
		
	 Type of Option:
	  	_____        Incentive Stock Option
		
		  	_____        Nonstatutory Stock Option
		
	Term/Expiration Date:	  	____________________________________

 Vesting Schedule: 
 This Option shall be exercisable, in whole or in part, according to the following vesting schedule: 
 Twenty-five percent (25%) of the Shares subject to the Option shall vest on the one (1) year anniversary of
the Vesting Commencement Date, and  1/48 of the
Option shall vest each month thereafter, subject to Optionee continuing to be a Service Provider through each such date. 
 Termination Period: 
  

 44 








 This Option shall be exercisable for three (3) months after Optionee ceases to be a
Service Provider. Upon Optionee’s death or Disability, this Option may be exercised for one (1) year after Optionee ceases to be a Service Provider. In no event may Optionee exercise this Option after the Term/Expiration Date as provided
above. 
  

	II.	AGREEMENT 

 1.
Grant of Option. The Plan Administrator of the Company hereby grants to the Optionee named in the Notice of Grant (the “Optionee”), an option (the “Option”) to purchase the number of Shares set
forth in the Notice of Grant, at the exercise price per Share set forth in the Notice of Grant (the “Exercise Price”), and subject to the terms and conditions of the Plan, which is incorporated herein by reference. Subject to
Section 14(c) of the Plan, in the event of a conflict between the terms and conditions of the Plan and this Option Agreement, the terms and conditions of the Plan shall prevail. 
 If designated in the Notice of Grant as an Incentive Stock Option (“ISO”), this Option is intended to qualify as an
Incentive Stock Option as defined in Section 422 of the Code. Nevertheless, to the extent that it exceeds the $100,000 rule of Code Section 422(d), this Option shall be treated as a Nonstatutory Stock Option
(“NSO”). 
 2. Exercise of Option. 
 (a) Right to Exercise. This Option shall be exercisable during its term in accordance with the Vesting Schedule set out in the Notice
of Grant and with the applicable provisions of the Plan and this Option Agreement. 
 (b) Method of Exercise. This Option
shall be exercisable by delivery of an exercise notice in the form attached as Exhibit A (the “Exercise Notice”) which shall state the election to exercise the Option, the number of Shares with respect to which the
Option is being exercised, and such other representations and agreements as may be required by the Company. The Exercise Notice shall be accompanied by payment of the aggregate Exercise Price as to all Exercised Shares. This Option shall be deemed
to be exercised upon receipt by the Company of such fully executed Exercise Notice accompanied by the aggregate Exercise Price. 
 No Shares shall be issued pursuant to the exercise of an Option unless such issuance and such exercise comply with Applicable Laws. Assuming such compliance, for income tax purposes the Shares shall be considered transferred to the Optionee
on the date on which the Option is exercised with respect to such Shares. 
 3. Optionee’s Representations. In the
event the Shares have not been registered under the Securities Act of 1933, as amended, at the time this Option is exercised, the Optionee shall, if required by the Company, concurrently with the exercise of all or any portion of this Option,
deliver to the Company his or her Investment Representation Statement in the form attached hereto as Exhibit B. 
 4.
Lock-Up Period. Optionee hereby agrees that Optionee shall not offer, pledge, sell, contract to sell, sell any option or contract to purchase, purchase any option or contract to

  

 45 








 
sell, grant any option, right or warrant to purchase, lend, or otherwise transfer or dispose of, directly or indirectly, any Common Stock (or other securities) of the Company or enter into any
swap, hedging or other arrangement that transfers to another, in whole or in part, any of the economic consequences of ownership of any Common Stock (or other securities) of the Company held by Optionee (other than those included in the
registration) for a period specified by the representative of the underwriters of Common Stock (or other securities) of the Company not to exceed one hundred eighty (180) days following the effective date of any registration statement of the
Company filed under the Securities Act. 
 Optionee agrees to execute and deliver such other agreements as may be reasonably
requested by the Company or the underwriter which are consistent with the foregoing or which are necessary to give further effect thereto. In addition, if requested by the Company or the representative of the underwriters of Common Stock (or other
securities) of the Company, Optionee shall provide, within ten (10) days of such request, such information as may be required by the Company or such representative in connection with the completion of any public offering of the Company’s
securities pursuant to a registration statement filed under the Securities Act. The obligations described in this Section shall not apply to a registration relating solely to employee benefit plans on Form S-1 or Form S-8 or similar forms that may
be promulgated in the future, or a registration relating solely to a Commission Rule 145 transaction on Form S-4 or similar forms that may be promulgated in the future. The Company may impose stop-transfer instructions with respect to the shares of
Common Stock (or other securities) subject to the foregoing restriction until the end of said one hundred eighty (180) day period. Optionee agrees that any transferee of the Option or shares acquired pursuant to the Option shall be bound by
this Section. 
 5. Method of Payment. Payment of the aggregate Exercise Price will be required upon exercise and will
consist solely of (a) cash or check, to the extent permitted under Applicable Laws, or (b) consideration received by the Company under a formal cashless exercise program adopted by the Company in connection with the Plan, on or after
(x) the closing of the Company’s first firm commitment underwritten public offering of its Common Stock registered under the Securities Act, or (y) a Change in Control in which the successor corporation has equity securities that are
publicly traded. 
 6. Restrictions on Exercise. This Option may not be exercised until such time as the Plan has been
approved by the stockholders of the Company, or if the issuance of such Shares upon such exercise or the method of payment of consideration for such shares would constitute a violation of any Applicable Law. 
 7. Non-Transferability of Option. This Option may not be transferred in any manner otherwise than by will or by the laws of descent
or distribution and may be exercised during the lifetime of Optionee only by Optionee. The terms of the Plan and this Option Agreement shall be binding upon the executors, administrators, heirs, successors and assigns of the Optionee. 
 8. Term of Option. This Option may be exercised only within the term set out in the Notice of Grant, and may be exercised during such
term only in accordance with the Plan and the terms of this Option. 
  

 46 








 9. Withholding Taxes. Optionee agrees to make appropriate arrangements with the
Company (or the Parent or Subsidiary employing or retaining Optionee) for the satisfaction of all Federal / central, state, local and foreign income and employment tax withholding requirements as well as social security charges applicable to the
Option exercise or the disposition of any Shares acquired upon exercise. In this regard, Optionee authorizes the Company (and/or the Parent or Subsidiary employing or retaining Optionee) to withhold all applicable taxes legally payable by Optionee
from the Optionee’s wages or other cash compensation paid to Optionee by the Company (and/or the Parent or Subsidiary employing or retaining Optionee) or from proceeds from the sale of Shares acquired upon exercise of the Option in an amount
sufficient to cover such tax obligations. Optionee acknowledges and agrees that the Company may refuse to honor the exercise and refuse to deliver Shares if such withholding amounts are not delivered at the time of exercise. 
 10. Acknowledgements. 
 (a) Optionee acknowledges receipt of a copy of the Plan and represents that he or she is familiar with the terms and provisions thereof, and hereby accepts this Option subject to all of the terms and
provisions thereof. Optionee has reviewed the Plan and this Option Agreement in their entirety, has had an opportunity to obtain the advice of counsel prior to executing this Option and fully understands all provisions of the Option. Optionee hereby
agrees to accept as binding, conclusive and final all decisions or interpretations of the Administrator upon any questions arising under the Plan or this Option. Optionee further agrees to notify the Company upon any change in the residence address
indicated below. 
 (b) The Company (and not the Optionee’s employer) is granting the Option. The Company will administer
the Plan from outside Optionee’s country of residence and that United States of America law along with FEMA and other applicable Indian laws will govern all Options granted under the Plan. 
 (c) That benefits and rights provided under the Plan are wholly discretionary and, although provided by the Company, do not constitute
regular or periodic payments. The benefits and rights provided under the Plan are not to be considered part of Optionee’s salary or compensation for purposes of calculating any severance, resignation, redundancy or other end of service
payments, vacation, bonuses, long-term service awards, indemnification, pension or retirement benefits, or any other payments, benefits or rights of any kind. Optionee waives any and all rights to compensation or damages as a result of the
termination of employment with the Company for any reason whatsoever insofar as those rights result or may result from: 
 (i)
the loss or diminution in value of such rights under the Plan, or 
 (ii) Optionee ceases to have any rights under, or ceases
to be entitled to any rights under the Plan as a result of such termination. 
 (d) The grant of the Option, and any future
grant of Options under the Plan is entirely voluntary, and at the complete discretion of the Company. Neither the grant of the Option nor any future grant of an Option by the Company will be deemed to create any obligation to grant any further
Options, whether or not such a reservation is explicitly stated at

  

 47 








 
the time of such a grant. The Company has the right, at any time to amend, suspend or terminate the Plan. 
 (e) The Plan will not be deemed to constitute, and will not be construed by Optionee to constitute, part of the terms and conditions of employment, and that the Company will not incur any liability of any
kind to Optionee as a result of any change or amendment, or any cancellation, of the Plan at any time. 
 (f) Participation in
the Plan will not be deemed to constitute, and will not be deemed by Optionee to constitute, an employment or labor relationship of any kind with the Company. 
 (g) By entering into this Option Agreement, and as a condition of the grant of the Option, Optionee consents to the collection, use, and transfer of personal data as described in this subsection to the
full extent permitted by and in full compliance with Applicable Laws. 
 (i) Optionee understands that the Company and its
Subsidiaries hold certain personal information about the Optionee, including, but not limited to, name, home address and telephone number, date of birth, social insurance number, salary, nationality, job title, any Shares or directorships held in
the Company, details of all Options or other entitlement to Shares awarded, canceled, exercised, vested, unvested, or outstanding in Optionee’s favor, for the purpose of managing and administering the Plan (“Data”).

 (ii) Optionee further understands that the Company and/or its Subsidiaries will transfer Data among themselves as necessary
for the purposes of implementation, administration, and management of Optionee’s participation in the Plan, and that the Company and/or its Subsidiary may each further transfer Data to any third parties assisting the Company in the
implementation, administration, and management of the Plan (“Data Recipients”). 
 (iii) Optionee
understands that these Data Recipients may be located in Optionee’s country of residence or elsewhere, such as the United States. Optionee authorizes the Data Recipients to receive, possess, use, retain, and transfer Data in electronic or other
form, for the purposes of implementing, administering, and managing Optionee’s participation in the Plan, including any transfer of such Data, as may be required for the administration of the Plan and/or the subsequent holding of Shares on
Optionee’s behalf, to a broker or third party with whom the Shares acquired on exercise may be deposited. 
 (iv) Optionee
understands that Optionee may, at any time, review the Data, request that any necessary amendments be made to it, or withdraw Optionee’s consent herein in writing by contacting the Company. Optionee further understands that withdrawing consent
may affect Optionee’s ability to participate in the Plan. 
 (h) Optionee has received the terms and conditions of this
Option Agreement and any other related communications, and Optionee consents to having received these documents in English. 
  

 48 








 11. Entire Agreement; Governing Law. The Plan is incorporated herein by reference.
The Plan and this Option Agreement constitute the entire agreement of the parties with respect to the subject matter hereof and supersede in their entirety all prior undertakings and agreements of the Company and Optionee with respect to the subject
matter hereof, and may not be modified adversely to the Optionee’s interest except by means of a writing signed by the Company and Optionee. This agreement is governed by the internal substantive laws but not the choice of law rules of
California. 
 12. No Guarantee of Continued Service. OPTIONEE ACKNOWLEDGES AND AGREES THAT THE VESTING OF SHARES
PURSUANT TO THE VESTING SCHEDULE HEREOF IS EARNED ONLY BY CONTINUING AS A SERVICE PROVIDER AT THE WILL OF THE COMPANY (NOT THROUGH THE ACT OF BEING HIRED, BEING GRANTED THIS OPTION OR ACQUIRING SHARES HEREUNDER). OPTIONEE FURTHER ACKNOWLEDGES AND
AGREES THAT THIS AGREEMENT, THE TRANSACTIONS CONTEMPLATED HEREUNDER AND THE VESTING SCHEDULE SET FORTH HEREIN DO NOT CONSTITUTE AN EXPRESS OR IMPLIED PROMISE OF CONTINUED ENGAGEMENT AS A SERVICE PROVIDER FOR THE VESTING PERIOD, FOR ANY PERIOD, OR AT
ALL, AND SHALL NOT INTERFERE IN ANY WAY WITH OPTIONEE’S RIGHT OR THE COMPANY’S RIGHT TO TERMINATE OPTIONEE’S RELATIONSHIP AS A SERVICE PROVIDER AT ANY TIME, WITH OR WITHOUT CAUSE. 
 Optionee acknowledges receipt of a copy of the Plan and represents that he or she is familiar with the terms and provisions thereof, and
hereby accepts this Option subject to all of the terms and provisions thereof. Optionee has reviewed the Plan and this Option in their entirety, has had an opportunity to obtain the advice of counsel prior to executing this Option and fully
understands all provisions of the Option. Optionee hereby agrees to accept as binding, conclusive and final all decisions or interpretations of the Administrator upon any questions arising under the Plan or this Option. Optionee further agrees to
notify the Company upon any change in the residence address indicated below. 
  

			
	OPTIONEE	  	KAZEON SYSTEMS, INC.
		
	 	  	 
	Signature	  	By
		
	 	  	 
	Print Name	  	Title
		
	 	  	
		
	 	  	
	Residence Address	  	

  

 49 








 EXHIBIT A 
 2003 STOCK PLAN 
 EXERCISE NOTICE 
 Kazeon Systems, Inc. 
 1161 San Antonio Road

 Mountain View, CA 94043 
 Attention:
Chief Financial Officer 
 1. Exercise of Option. Effective as of today,
                                ,
            , the undersigned (“Optionee”) hereby elects to exercise Optionee’s option to purchase
                     shares of the Common Stock (the “Shares”) of Kazeon Systems, Inc. (the
“Company”) under and pursuant to the 2003 Stock Plan (the “Plan”) and the Stock Option Agreement dated
                                ,
            (the “Option Agreement”). 
 2. Delivery of Payment. Optionee herewith delivers to the Company the full purchase price of the Shares, as set forth in the Option Agreement, and any and all withholding taxes due in connection with the exercise of the Option.

 3. Representations of Optionee. Optionee acknowledges that Optionee has received, read and understood the Plan and the
Option Agreement and agrees to abide by and be bound by their terms and conditions. 
 4. Rights as Stockholder. Until
the issuance of the Shares (as evidenced by the appropriate entry on the books of the Company or of a duly authorized transfer agent of the Company), no right to vote or receive dividends or any other rights as a stockholder shall exist with respect
to the Optioned Stock, notwithstanding the exercise of the Option. The Shares shall be issued to the Optionee as soon as practicable after the Option is exercised in accordance with the Option Agreement. No adjustment shall be made for a dividend or
other right for which the record date is prior to the date of issuance except as provided in Section 11 of the Plan. 
 5.
Company’s Right of First Refusal. Before any Shares held by Optionee or any transferee (either being sometimes referred to herein as the “Holder”) may be sold or otherwise transferred (including transfer by gift
or operation of law), the Company or its assignee(s) shall have a right of first refusal to purchase the Shares on the terms and conditions set forth in this Section (the “Right of First Refusal”). 
 (a) Notice of Proposed Transfer. The Holder of the Shares shall deliver to the Company a written notice (the
“Notice”) stating: (i) the Holder’s bona fide intention to sell or otherwise transfer such Shares; (ii) the name of each proposed purchaser or other transferee (“Proposed Transferee”);
(iii) the number of Shares to be transferred to each Proposed Transferee; and (iv) the bona fide cash price or other consideration for which the Holder proposes to transfer the Shares (the “Offered Price”), and the
Holder shall offer the Shares at the Offered Price to the Company or its assignee(s). 
  

 50 








 (b) Exercise of Right of First Refusal. At any time within thirty (30) days
after receipt of the Notice, the Company and/or its assignee(s) may, by giving written notice to the Holder, elect to purchase all, but not less than all, of the Shares proposed to be transferred to any one or more of the Proposed Transferees, at
the purchase price determined in accordance with subsection (c) below. 
 (c) Purchase Price. The purchase price
(“Purchase Price”) for the Shares purchased by the Company or its assignee(s) under this Section shall be the Offered Price. If the Offered Price includes consideration other than cash, the cash equivalent value of the
non-cash consideration shall be determined by the Board of Directors of the Company in good faith. 
 (d) Payment.
Payment of the Purchase Price shall be made, at the option of the Company or its assignee(s), in cash (by check), by cancellation of all or a portion of any outstanding indebtedness of the Holder to the Company (or, in the case of repurchase by an
assignee, to the assignee), or by any combination thereof within thirty (30) days after receipt of the Notice or in the manner and at the times set forth in the Notice. 
 (e) Holder’s Right to Transfer. If all of the Shares proposed in the Notice to be transferred to a given Proposed Transferee are
not purchased by the Company and/or its assignee(s) as provided in this Section, then the Holder may sell or otherwise transfer such Shares to that Proposed Transferee at the Offered Price or at a higher price, provided that such sale or other
transfer is consummated within 120 days after the date of the Notice, that any such sale or other transfer is effected in accordance with any applicable securities laws and that the Proposed Transferee agrees in writing that the provisions of this
Section shall continue to apply to the Shares in the hands of such Proposed Transferee. If the Shares described in the Notice are not transferred to the Proposed Transferee within such period, a new Notice shall be given to the Company, and the
Company and/or its assignees shall again be offered the Right of First Refusal before any Shares held by the Holder may be sold or otherwise transferred. 
 (f) Exception for Certain Family Transfers. Anything to the contrary contained in this Section notwithstanding, the transfer of any or all of the Shares during the Optionee’s lifetime or on
the Optionee’s death by will or intestacy to the Optionee’s immediate family or a trust for the benefit of the Optionee’s immediate family shall be exempt from the provisions of this Section. “Immediate Family”
as used herein shall mean spouse, lineal descendant or antecedent, father, mother, brother or sister. In such case, the transferee or other recipient shall receive and hold the Shares so transferred subject to the provisions of this Section, and
there shall be no further transfer of such Shares except in accordance with the terms of this Section. 
 (g) Termination of
Right of First Refusal. The Right of First Refusal shall terminate as to any Shares upon the earlier of (i) the first sale of Common Stock of the Company to the general public, or (ii) a Change in Control in which the successor
corporation has equity securities that are publicly traded. 
 6. Tax Consultation. Optionee understands that Optionee
may suffer adverse tax consequences as a result of Optionee’s purchase or disposition of the Shares. Optionee

  

 51 








 
represents that Optionee has consulted with any tax consultants Optionee deems advisable in connection with the purchase or disposition of the Shares and that Optionee is not relying on the
Company for any tax advice. 
 7. Restrictive Legends and Stop-Transfer Orders. 
 (a) Legends. Optionee understands and agrees that the Company shall cause the legends set forth below or legends substantially
equivalent thereto, to be placed upon any certificate(s) evidencing ownership of the Shares together with any other legends that may be required by the Company or by state or federal securities laws: 
 THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 (THE “ACT”) AND MAY NOT
BE OFFERED, SOLD OR OTHERWISE TRANSFERRED, PLEDGED OR HYPOTHECATED UNLESS AND UNTIL REGISTERED UNDER THE ACT OR, IN THE OPINION OF COMPANY COUNSEL SATISFACTORY TO THE ISSUER OF THESE SECURITIES, SUCH OFFER, SALE OR TRANSFER, PLEDGE OR HYPOTHECATION
IS IN COMPLIANCE THEREWITH. 
 THE SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO CERTAIN RESTRICTIONS ON TRANSFER AND A
RIGHT OF FIRST REFUSAL HELD BY THE ISSUER OR ITS ASSIGNEE(S) AS SET FORTH IN THE EXERCISE NOTICE BETWEEN THE ISSUER AND THE ORIGINAL HOLDER OF THESE SHARES, A COPY OF WHICH MAY BE OBTAINED AT THE PRINCIPAL OFFICE OF THE ISSUER. SUCH TRANSFER
RESTRICTIONS AND RIGHT OF FIRST REFUSAL ARE BINDING ON TRANSFEREES OF THESE SHARES. 
 THE SHARES REPRESENTED BY THIS
CERTIFICATE ARE SUBJECT TO RESTRICTIONS ON TRANSFER FOR A PERIOD NOT TO EXCEED 180 DAYS FOLLOWING THE EFFECTIVE DATE OF THE UNDERWRITTEN PUBLIC OFFERING OF THE COMPANY’S SECURITIES AND MAY NOT BE SOLD OR OTHERWISE DISPOSED OF BY THE HOLDER
WITHOUT THE CONSENT OF THE COMPANY OR THE MANAGING UNDERWRITER. 
 (b) Stop-Transfer Notices. Optionee agrees that, in
order to ensure compliance with the restrictions referred to herein, the Company may issue appropriate “stop transfer” instructions to its transfer agent, if any, and that, if the Company transfers its own securities, it may make
appropriate notations to the same effect in its own records. 
 (c) Refusal to Transfer. The Company shall not be
required (i) to transfer on its books any Shares that have been sold or otherwise transferred in violation of any of the provisions of this Exercise Notice or (ii) to treat as owner of such Shares or to accord the right to

  

 52 








 
vote or pay dividends to any purchaser or other transferee to whom such Shares shall have been so transferred. 
 8. Successors and Assigns. The Company may assign any of its rights under this Exercise Notice to single or multiple assignees, and this Exercise Notice shall inure to the benefit of the successors
and assigns of the Company. Subject to the restrictions on transfer herein set forth, this Exercise Notice shall be binding upon Optionee and his or her heirs, executors, administrators, successors and assigns. 
 9. Interpretation. Any dispute regarding the interpretation of this Exercise Notice shall be submitted by Optionee or by the Company
forthwith to the Administrator which shall review such dispute at its next regular meeting. The resolution of such a dispute by the Administrator shall be final and binding on all parties. 
 10. Governing Law; Severability. This Exercise Notice is governed by the internal substantive laws but not the choice of law rules,
of California. In the event that any provision hereof becomes or is declared by a court of competent jurisdiction to be illegal, unenforceable or void, this Option Agreement will continue in full force and effect. 
 11. Entire Agreement. The Plan and Option Agreement are incorporated herein by reference. This Exercise Notice, the Plan, the Option
Agreement and the Investment Representation Statement constitute the entire agreement of the parties with respect to the subject matter hereof and supersede in their entirety all prior undertakings and agreements of the Company and Optionee with
respect to the subject matter hereof, and may not be modified adversely to the Optionee’s interest except by means of a writing signed by the Company and Optionee. 
  

			
	Submitted by:	  	Accepted by:
	OPTIONEE	  	KAZEON SYSTEMS, INC.
		
	 	  	 
	Signature	  	By
		
	 	  	 
	Print Name	  	Title
		
	Address:	  	Address:
		
	 	  	1161 San Antonio Road
		  	Mountain View, CA 94043
		
	 	  	
		
		  	 
		  	Date Received

  

 53 








 EXHIBIT B 
 INVESTMENT REPRESENTATION STATEMENT 
  

			
	 OPTIONEE:
	  	___________________________
		
	 COMPANY:
	  	KAZEON SYSTEMS, INC.
		
	 SECURITY:
	  	COMMON STOCK
		
	 AMOUNT:
	  	_________ SHARES
		
	 DATE:
	  	___________________________

 In connection with the purchase of the above-listed Securities, the undersigned
Optionee represents to the Company the following: 
 (a) Optionee is aware of the Company’s business affairs and financial
condition and has acquired sufficient information about the Company to reach an informed and knowledgeable decision to acquire the Securities. Optionee is acquiring these Securities for investment for Optionee’s own account only and not with a
view to, or for resale in connection with, any “distribution” thereof within the meaning of the Securities Act of 1933, as amended (the “Securities Act”). 
 (b) Optionee acknowledges and understands that the Securities constitute “restricted securities” under the Securities Act and have
not been registered under the Securities Act in reliance upon a specific exemption therefrom, which exemption depends upon, among other things, the bona fide nature of Optionee’s investment intent as expressed herein. In this connection,
Optionee understands that, in the view of the Securities and Exchange Commission, the statutory basis for such exemption may be unavailable if Optionee’s representation was predicated solely upon a present intention to hold these Securities for
the minimum capital gains period specified under tax statutes, for a deferred sale, for or until an increase or decrease in the market price of the Securities, or for a period of one year or any other fixed period in the future. Optionee further
understands that the Securities must be held indefinitely unless they are subsequently registered under the Securities Act or an exemption from such registration is available. Optionee further acknowledges and understands that the Company is under
no obligation to register the Securities. Optionee understands that the certificate evidencing the Securities will be imprinted with any legend required under applicable state securities laws. 
 (c) Optionee is familiar with the provisions of Rule 701 and Rule 144, each promulgated under the Securities Act, which, in substance,
permit limited public resale of “restricted securities” acquired, directly or indirectly from the issuer thereof, in a non-public offering subject to the satisfaction of certain conditions. Rule 701 provides that if the issuer qualifies
under Rule 701 at the time of the grant of the Option to the Optionee, the exercise will be exempt from registration under the Securities Act. In the event the Company becomes subject

  

 54 








 
to the reporting requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, ninety (90) days thereafter (or such longer period as any market stand-off agreement may
require) the Securities exempt under Rule 701 may be resold, subject to the satisfaction of certain of the conditions specified by Rule 144, including: (1) the resale being made through a broker in an unsolicited “broker’s
transaction” or in transactions directly with a market maker (as said term is defined under the Securities Exchange Act of 1934); and, in the case of an affiliate, (2) the availability of certain public information about the Company,
(3) the amount of Securities being sold during any three month period not exceeding the limitations specified in Rule 144(e), and (4) the timely filing of a Form 144, if applicable. 
 In the event that the Company does not qualify under Rule 701 at the time of grant of the Option, then the Securities may be resold in
certain limited circumstances subject to the provisions of Rule 144, which requires the resale to occur not less than one year after the later of the date the Securities were sold by the Company or the date the Securities were sold by an affiliate
of the Company, within the meaning of Rule 144; and, in the case of acquisition of the Securities by an affiliate, or by a non-affiliate who subsequently holds the Securities less than two years, the satisfaction of the conditions set forth in
sections (1), (2), (3) and (4) of the paragraph immediately above. 
 (d) Optionee further understands that in the
event all of the applicable requirements of Rule 701 or 144 are not satisfied, registration under the Securities Act, compliance with Regulation A, or some other registration exemption will be required; and that, notwithstanding the fact that Rules
144 and 701 are not exclusive, the Staff of the Securities and Exchange Commission has expressed its opinion that persons proposing to sell private placement securities other than in a registered offering and otherwise than pursuant to Rules 144 or
701 will have a substantial burden of proof in establishing that an exemption from registration is available for such offers or sales, and that such persons and their respective brokers who participate in such transactions do so at their own risk.
Optionee understands that no assurances can be given that any such other registration exemption will be available in such event. 
  

			
	Signature of Optionee:
	
	 
		
	Date:	 	                                       
                 ,                 


  

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 Neither this document, nor any stock option agreement connected with it, is an approved prospectus for
the purposes of section 85(1) of the Financial Services and Markets Act 2000 (“FSMA”) and no offer of transferable securities to the public (for the purposes of section 102B of FSMA) is being made in connection with the UK Sub-Plan of the
Kazeon Systems, Inc. 2003 Stock Plan (the “Sub-Plan”). The Sub-Plan is exclusively available to bona fide employees and former employees of Kazeon Systems, Inc. and Kazeon Systems Europe Limited. 
 UK SUB-PLAN OF THE 
 KAZEON SYSTEMS, INC. 2003 STOCK PLAN 
  

	1.	The purpose of this Sub-Plan is to provide incentive for present and future UK tax resident employees of Kazeon Systems, Inc. (the “Company”) and Kazeon
Systems Europe Limited through the grant of incentive awards. 

  

	2.	This Sub-Plan is governed by the Company’s 2003 Stock Plan (the “Plan”) and all its provisions shall be identical to those of the Plan SAVE THAT
(i) “Sub-Plan” shall be substituted for “Plan” where applicable and (ii) the following provisions shall be as stated in this Sub-Plan in order to accommodate the specific requirements of the laws of England and Wales
and the appropriate UK tax legislation. 

  

	3.	References to Incentive Stock Options and Nonstatutory Stock Options shall not apply to Options granted under the Sub-Plan. Options granted under this Sub-Plan shall be
taxed in the UK as unapproved securities options. 

  

	4.	Section 1. Purposes of the Plan. 

 Section 1 shall be deleted in its entirety and replaced as follows: 
 “Purposes of the Sub-Plan. The purposes of the Sub-Plan are to attract and retain the best available personnel for positions of substantial responsibility, to provide additional incentive to Employees, and to promote the success
of the Company’s business.” 
  

	5.	Section 2. Definitions.  

 The following definitions shall not apply to the Sub-Plan: 
 “Code” 
 “Consultant” 
 “Incentive Stock Option” 
 “Nonstatutory
Stock Option” 
  

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 “Stock Purchase Right” 
  

	6.	Section 4. Administration of the Plan. 

 Section 4(b)(ii) shall be deleted in its entirety and replaced as follows: 
 “(ii) to select the Employees to whom Options may from time to time be granted hereunder;” 
  

	7.	Section 5. Eligibility.  

 Section 5 shall be deleted in its entirety and replaced as follows: 
 “5.
Eligibility. Only Employees shall be eligible for the grant of Options.” 
  

	8.	Section 6. Limitations.  

 Section 6 shall be deleted in its entirety and replaced as follows: 
 (a) Employment. Neither the Plan nor
any Options shall confer upon any Optionee any right with respect to continuing the Optionee’s relationship as an Employee, nor shall it interfere in any way with his or her right or the Company’s right to terminate such relationship.

  

	9.	Section 7. Term of Plan.  

 Section 7 shall be deleted in its entirety and replaced as follows: 
 “7. Term of
Sub-Plan. The Sub-Plan shall become effective upon its adoption by the Board. It shall continue in effect until the earlier of the date of termination of the Plan or the date terminated under Section 15 of the Sub-Plan.” 
  

	10.	Section 9. Option Exercise Price and Consideration.  

 Section 9 shall be deleted in its entirety and replaced as follows: 
 “(a) Exercise Price. 
 (i) The per share exercise price for the Shares to be issued upon
exercise of an Option shall be such price as is determined by the Administrator. Save that the per share exercise price shall be no less than 85% of the Fair Market Value per Share on the date of grant. 
 (ii) Notwithstanding the foregoing, Options may be granted with a per Share exercise price other than as required above
pursuant to a merger or other corporate transaction. 
  

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 (b) Forms of Consideration. The consideration to be paid for the
Shares to be issued upon exercise of an Option, including the method of payment, shall be determined by the Administrator. Such consideration may consist of, without limitation, (i) cash, (ii) cheque, (iii) consideration received by
the Company under a cashless exercise program implemented by the Company in connection with the Plan, or (iv) any combination of the foregoing methods of payment. In making its determination as to the type of consideration to accept, the
Administrator shall consider if acceptance of such consideration may be reasonably expected to benefit the Company.” 
  

	11.	Section 10. Exercise of Option. 

  

	11.1	The third sentence of the first paragraph of section 10(a) shall be deleted and replaced as follows: 

 “Options granted to Employees shall become exercisable at a rate of no less than 20% per year over five
(5) years from the date the Options are granted.” 
  

	11.2	In the second paragraph of Section 10(a) the following words shall be inserted at the end of the first sentence: 

 “and (iii) such tax withholding and elections as required in the Option Agreement.” 
  

	11.3	The first two sentences of Section 10(d) shall be deleted and replaced as follows: 

 “(d) Death of Optionee. If an Optionee dies while a Service Provider, the Option may be exercised within six
(6) months following Optionee’s death, or such longer period of time as specified in the Option Agreement, to the extent that the Option is vested on the date of death (but in no event later than the expiration of the term of such Option
as set forth in the Option Agreement) by the Optionee’s personal representative(s).” 
 For the avoidance of doubt the
rest of section 10(d) shall remain the same. 
  

	11.4	Section 10(e)(iii) shall be deleted in its entirety. 

  

	12.	Section 11. Stock Purchase Rights.  

 Section 11 shall be deleted in its entirety. 
  

	13.	Section 12. Limited Transferability of Options and Stock Purchase Rights. 

 Section 12 shall be deleted in its entirety and replaced as follows: 
 “Limited Transferability of Options. Except as the Administrator may otherwise determine or provide in an
Option, Options shall not be sold, assigned, transferred or encumbered by the person to whom they are granted, either voluntarily or by operation of law, except to the Optionee’s personal representative(s) in the event of the Optionee’s

  

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death. During the life of the Optionee, Options shall be only be exercisable by the Optionee. If the Administrator in its sole discretion makes an Option transferable, such Option may only be
transferred (i) by will, (ii) by the laws of descent and distribution, or (iii) to family members (within the meaning of Rule 701 of the Securities Act) through gifts or domestic relations orders, as permitted by Rule 701 of the
Securities Act.” 
  

	14.	Section 13. Adjustments; Dissolution or Liquidation; Merger or Change in Control. 

 Section 13(c) shall be deleted in its entirety and replaced as follows: 
 “(c) Merger or Change in Control. In the event of a merger of the Company with or into another corporation, or a
Change in Control, each outstanding Option may be replaced (either through assumption or substitution) by an equivalent option granted by the successor corporation or a Parent or Subsidiary of the successor corporation. In the event that the
successor corporation in a merger or Change in Control does not grant a replacement option for the Option, then the Option shall vest fully in the Optionee and the Optionee shall have the right to exercise the Option even though it would not
otherwise be vested or exercisable. If an Option is not replaced in the event of a merger or Change in Control, the Administrator shall notify the Optionee in writing or electronically that this Option shall be exercisable for a period of fifteen
(15) days from the date of such notice, and the Option shall terminate upon expiration of such period. For the purposes of this paragraph, the Option shall be considered replaced if, following the merger or Change in Control, the option confers
the right to purchase or receive, for each Share of subject to the Option immediately prior to the merger or Change in Control, the consideration (whether stock, cash, or other securities or property) received in the merger or Change in Control by
holders of Common Stock for each Share held on the effective date of the transaction (and if holders were offered a choice of consideration, the type of consideration chosen by the holders of a majority of the outstanding Shares); provided, however,
that if such consideration received in the merger or Change in Control is not solely common stock of the successor corporation or its Parent, the Administrator may, with the consent of the successor corporation, provide for the consideration to be
received upon the exercise of the Option, for each Share subject to the Option, to be solely common stock of the successor corporation or its Parent equal in fair market value to the per share consideration received by holders of common stock in the
merger or Change in Control.” 
  

	15.	Section 14. Time of Granting Options and Stock Purchase Rights. 

 Section 14 shall be deleted in its entirety and replaced as follows: 
 “Time of Granting Options. The date of grant of an Option shall, for all purposes, be the date on which the Administrator makes the determination granting such Option, or such later date as is determined by the Administrator.
Notice of the determination shall be given to each Employee to whom an Option is so granted within a reasonable time after the date of such grant.” 
  

 59 









	
	  
 For your records
  



 UK SUB-PLAN OF THE KAZEON SYSTEMS, INC. 2003 STOCK PLAN 
 STOCK OPTION AGREEMENT 
 Unless otherwise defined herein, the terms defined in the UK Sub-Plan of the Kazeon Systems, Inc. 2003 Stock Plan shall have the same defined meanings in this Stock Option Agreement. 
  

	I.	NOTICE OF STOCK OPTION GRANT 

 Name: Optionee 
 The undersigned Optionee has been granted an Option to
purchase Common Stock of the Company, subject to the terms and conditions of the Sub-Plan, this Option Agreement, the Joint Election and the Section 431 Election (as defined in section 10 and 11 of this Option Agreement) as follows: 

 

					
	 Date of Grant
	 	    grantdate	  	
			
	 Grant No.
	 	    gtno	  	
			
	 Vesting Commencement Date
	 	 	  	
			
	 Exercise Price per Share
	 	$                                       
                                      	  	
			
	 Total Number of Shares Granted
	 	 	  	
			
	 Total Exercise Price
	 	$                                       
                                      	  	
			
	 Term/Expiration Date:
	 	 	  	

 Vesting Schedule: 
 This Option shall be exercisable, in whole or in part, according to the following vesting schedule: 
 25% of the Shares subject to the Option shall vest on the one (1) year anniversary of the Vesting Commencement
Date, and  1/48 of the Option shall vest each month
thereafter, subject to Optionee continuing to be a Service Provider on such dates. 
 Termination Period:

 This Option shall be exercisable for three (3) months after Optionee ceases to be a Service Provider. Upon
Optionee’s death or Disability, this Option may be exercised for one (1)

  

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year after Optionee ceases to be a Service Provider. In no event may Optionee exercise this Option after the Term/Expiration Date as provided above. 
 By Optionee’s signature and the signature of the Company’s representative below, Optionee and the Company agree that this Option
is granted under and governed by the terms and conditions of the Sub-Plan, this Option Agreement, the Joint Election and the Section 431 Election. 
 This notice of Stock Option Grant has been executed and delivered as a deed on the date written above. 
 SIGNED as a DEED 
 By Kazeon Systems, Inc. 
 acting by the under-mentioned 
 person acting on the authority 
 of the Company in accordance 
 with the law of the
territory of 
 its incorporation: 
 Authorised signatory 
 SIGNED as a DEED 
 By [Optionee] 
 In the presence of: 
 Witness Signature: 
 Name: 
 Address: 
 Occupation: 
  

	II.	AGREEMENT 

 1.
Grant of Option. The Administrator hereby grants to the Optionee named in the Notice of Grant (the “Optionee”), an option (the “Option”) to purchase the number of Shares set forth in the Notice
of Grant, at the exercise price per Share set forth in the Notice of Grant (the “Exercise Price”), and subject to the terms and conditions of the Sub-Plan, this Option Agreement, the Joint Election and the Section 431
Election, which are incorporated herein by reference. Subject to Section 15(c) of the Sub-Plan, in the event of a conflict between the terms and conditions of the Sub-Plan and this Option Agreement, the terms and conditions of the Sub-Plan
shall prevail SAVE THAT in respect of: 
 (a) any payment or other matter relating to the Option Tax Liability (as defined in
Section 9 of this Option Agreement) the terms of this Option Agreement shall prevail; and 
  

 61 








 (b) any payment of the Secondary NIC Liability (as defined in Section 10 of this Option
Agreement) the terms of the Joint Election shall prevail. 
 2. Exercise of Option. 
 (a) Right to Exercise. This Option shall be exercisable during its term in accordance with the Vesting Schedule set out in the Notice
of Grant and with the applicable provisions of the Sub-Plan, this Option Agreement, the Joint Election and the Section 431 Election. 
 (b) Method of Exercise. This Option shall be exercisable by delivery of an exercise notice in the form attached as Exhibit A (the “Exercise Notice”) which shall state
the election to exercise the Option, the number of Shares with respect to which the Option is being exercised, and such other representations and agreements as may be required by the Company. The Exercise Notice shall be accompanied by payment of
the aggregate Exercise Price, the Option Tax Liability and the Secondary NIC Liability as to all Exercised Shares. This Option shall be deemed to be exercised upon receipt by the Company of such fully executed Exercise Notice accompanied by payment
of the Exercise Price, the Option Tax Liability and the Secondary NIC Liability. 
 (c) Compliance with Law. No Shares
shall be issued pursuant to the exercise of an Option unless such issuance and such exercise complies with Applicable Laws. Assuming such compliance, for income tax purposes the Shares shall be considered transferred to the Optionee on the date on
which the Option is exercised with respect to such Shares. 
 (d) Withholding Taxes. In the event that the Company
determines that it is required to account to HM Revenue & Customs for income tax (under PAYE) or any other taxation provisions and primary class 1 NICs in the United Kingdom to the extent arising from the grant, exercise, assignment,
release, cancellation or any other disposal of an Option or the Secondary NIC Liability as a result of the exercise of this Option, the Optionee, as condition to the exercise of this Option, shall make arrangements satisfactory to the Company to
enable it to satisfy all such requirements in accordance with sections 9 and 10 of this Option Agreement and the terms of the Joint Election. The Optionee shall also make arrangements satisfactory to the Company to enable it to satisfy any
requirement to account for tax that may arise in connection with the disposition of Shares purchased by exercising this option. 
 3. Optionee’s Representations. In the event the Shares have not been registered under the Securities Act of 1933, as amended, at the time this Option is exercised, the Optionee shall, if required by the Company, concurrently
with the exercise of all or any portion of this Option, deliver to the Company his or her Investment Representation Statement in the form attached hereto as Exhibit B. 
 4. Lock-Up Period. Optionee hereby agrees that Optionee shall not offer, pledge, sell, contract to sell, sell any option or contract
to purchase, purchase any option or contract to sell, grant any option, right or warrant to purchase, lend, or otherwise transfer or dispose of, directly or indirectly, any Common Stock (or other securities) of the Company or enter into any swap,

  

 62 








 
hedging or other arrangement that transfers to another, in whole or in part, any of the economic consequences of ownership of any Common Stock (or other securities) of the Company held by
Optionee (other than those included in the registration) for a period specified by the representative of the underwriters of Common Stock (or other securities) of the Company not to exceed one hundred eighty (180) days following the effective
date of any registration statement of the Company filed under the Securities Act. 
 Optionee agrees to execute and deliver such
other agreements as may be reasonably requested by the Company or the underwriter which are consistent with the foregoing or which are necessary to give further effect thereto. In addition, if requested by the Company or the representative of the
underwriters of Common Stock (or other securities) of the Company, Optionee shall provide, within ten (10) days of such request, such information as may be required by the Company or such representative in connection with the completion of any
public offering of the Company’s securities pursuant to a registration statement filed under the Securities Act. The obligations described in this Section shall not apply to a registration relating solely to employee benefit plans on Form S-1
or Form S-8 or similar forms that may be promulgated in the future, or a registration relating solely to a Commission Rule 145 transaction on Form S-4 or similar forms that may be promulgated in the future. The Company may impose stop-transfer
instructions with respect to the shares of Common Stock (or other securities) subject to the foregoing restriction until the end of said one hundred eighty (180) day period. Optionee agrees that any transferee of the Option or shares acquired
pursuant to the Option shall be bound by this Section. 
 5. Method of Payment. Payment of the Exercise Price, the Option
Tax Liability and the Secondary NIC Liability shall be by any of the following, or a combination thereof, at the election of the Optionee: 
 (a) cash or cheque; or 
 (b) consideration received by the Company under a formal
cashless exercise program adopted by the Company in connection with the Plan. 
 6. Restrictions on Exercise. This Option
may not be exercised until such time as the Sub-Plan has been approved by the stockholders of the Company, or if the issuance of such Shares upon such exercise or the method of payment of consideration for such shares would constitute a violation of
any Applicable Law. 
 7. Non-Transferability of Option. This Option may not be transferred in any manner during the
lifetime of the Optionee and may be exercised during the lifetime of the Optionee only by the Optionee. In the event of the Optionee’s death, this Option may be exercised by the Optionee’s personal representative(s). The terms of the
Sub-Plan, this Option Agreement, the Joint Election and the Section 431 Election shall be binding upon the personal representative(s) of the Optionee. 
  

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 8. Term of Option. This Option may be exercised only within the term set out in the
Notice of Grant, and may be exercised during such term only in accordance with the Sub-Plan, this Option Agreement and the Joint Election. 
 9. Optionee’s Tax Indemnity. 
 (a) Indemnity. To the extent
permitted by law, the Optionee hereby agrees to indemnify and keep indemnified the Company, and the Company as trustee for and on behalf of any related corporation, in respect of any liability or obligation of the Company and/or any related
corporation to account for income tax (under PAYE) or any other taxation provisions and primary class 1 NICs in the United Kingdom (the “Option Tax Liability”) to the extent arising from the grant, exercise, assignment, release,
cancellation or any other disposal of an Option or arising out of the acquisition, retention and disposal of the Shares acquired pursuant to this Option. 
 (b) No Obligation to Issue Shares. The Company shall not be obliged to allot and issue any Shares or any interest in Shares pursuant to the exercise of this option unless and until the Optionee has
paid to the Company such sum as is, in the opinion of the Company, sufficient to indemnify the Company in full against the Option Tax Liability, or the Optionee has made such other arrangement as in the opinion of the Company will ensure that the
full amount of any Option Tax Liability will be recovered from the Optionee within such period as the Company may then determine. 
 (c) Right of Retention. In the absence of any such other arrangement being made, the Company shall have the right to retain out of the aggregate number of shares to which the Optionee would have otherwise been entitled upon the
exercise of this option, such number of Shares as, in the opinion of the Company, will enable the Company to sell as agent for the Optionee (at the best price which can reasonably expect to be obtained at the time of the sale) and to pay over to the
Company sufficient monies out of the net proceeds of sale, after deduction of all fees, commissions and expenses incurred in relation to such sale, to satisfy the Optionee’s liability under such indemnity. 
 10. Employer’s NICs. 
 (a) Joint Election. As a condition of the exercise of this Option, the Optionee shall have signed a joint election (in such terms and such form as provided in paragraphs 3A and 3B of Schedule 1 to
the Social Security Contributions and Benefits Act 1992) (“Joint Election”) which has been approved by HM Revenue & Customs for the transfer of the whole or any liability of the Optionee’s employer to employer’s Class 1
NICs (“Secondary NIC Liability”). 
 (b) Section 431 Election. As a further condition of the exercise of
his Option, the Optionee shall have signed a Section 431 election under Section 431 ITEPA in the form set out in Exhibit C or in such other form as may be determined by HM Revenue & Customs from time to time. 
  

 64 








 11. Entire Agreement; Governing Law. The Sub-Plan, the Joint Election and the
Section 431 Election are incorporated herein by reference. The Sub-Plan, this Option Agreement, the Joint Election and the Section 431 Election constitute the entire agreement of the parties with respect to the subject matter hereof and
supersede in their entirety all prior undertakings and agreements of the Company and Optionee with respect to the subject matter hereof, and may not be modified adversely to the Optionee’s interest except by means of a writing signed by the
Company and Optionee. This agreement is governed by the internal substantive laws but not the choice of law rules of the State of California. 
 12. No Guarantee of Continued Service. OPTIONEE ACKNOWLEDGES AND AGREES THAT THE VESTING OF SHARES PURSUANT TO THE VESTING SCHEDULE HEREOF IS EARNED ONLY BY CONTINUING AS A SERVICE PROVIDER AT THE
WILL OF THE COMPANY (NOT THROUGH THE ACT OF BEING HIRED, BEING GRANTED THIS OPTION OR ACQUIRING SHARES HEREUNDER). OPTIONEE FURTHER ACKNOWLEDGES AND AGREES THAT THIS AGREEMENT, THE SUB-PLAN, THE TRANSACTIONS CONTEMPLATED HEREUNDER AND THE VESTING
SCHEDULE SET FORTH HEREIN DO NOT CONSTITUTE AN EXPRESS OR IMPLIED PROMISE OF CONTINUED ENGAGEMENT AS A SERVICE PROVIDER FOR THE VESTING PERIOD, FOR ANY PERIOD, OR AT ALL, AND SHALL NOT INTERFERE IN ANY WAY WITH OPTIONEE’S RIGHT OR THE
COMPANY’S RIGHT TO TERMINATE OPTIONEE’S RELATIONSHIP AS A SERVICE PROVIDER AT ANY TIME, WITH OR WITHOUT CAUSE. 
 13.
Optionee acknowledges receipt of a copy of the Sub-Plan, this Option Agreement and the Joint Election and represents that he or she is familiar with the terms and provisions thereof, and hereby accepts this Option subject to all of the terms and
provisions thereof. Optionee has reviewed the Sub-Plan, this Option Agreement, the Joint Election and the Section 431 Election in their entirety, has had an opportunity to obtain the advice of counsel prior to executing this Option Agreement
and fully understands all provisions of this Option Agreement. Optionee hereby agrees to accept as binding, conclusive and final all decisions or interpretations of the Administrator upon any questions arising under the Sub-Plan, this Option
Agreement, the Joint Election and the Section 431 Election. Optionee further agrees to notify the Company upon any change in the residence address indicated below. 
  

					
	OPTIONEE	 		 	KAZEON SYSTEMS, INC.
			
	  	 		 	  
	Signature	 		 	By
			
	 Optionee
	 		 	 CFO

	Print Name	 		 	Title
			
	  	 		 	 
	 	 		 	
	 Residence Address
	 		 	

  

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 EXHIBIT A 
 2003 STOCK PLAN 
 EXERCISE NOTICE 
 Kazeon Systems, Inc. 
 1161 San Antonio Road

 Mountain View, CA 94043 
 Attention:
Finance: 
 1. Exercise of Option. Effective as of today,
                        ,             , the undersigned
(“Optionee”) hereby elects to exercise Optionee’s option to purchase [            ] shares of the Common Stock (the “Shares”) of
Kazeon Systems, Inc. (the “Company”) under and pursuant to the UK Sub-Plan of the Company’s 2003 Stock Plan (the “Plan”) and the Stock Option Agreement dated grantdate (the
“Option Agreement”) and Grant No. gtno. 
 2. Delivery of Payment. Optionee herewith
delivers to the Company the full payment for the Shares, the Option Tax Liability and the Secondary NIC Liability, as set forth in the Option Agreement. 
 3. Representations of Optionee. Optionee acknowledges that Optionee has received, read and understood the Sub-Plan, the Option Agreement and the Joint Election (as defined in the Option Agreement)
and agrees to abide by and be bound by their terms and conditions. 
 4. Rights as Stockholder. Until the issuance of the
Shares (as evidenced by the appropriate entry on the books of the Company or of a duly authorized transfer agent of the Company), no right to vote or receive dividends or any other rights as a stockholder shall exist with respect to the Optioned
Stock, notwithstanding the exercise of the Option. The Shares shall be issued to the Optionee as soon as practicable after the Option is exercised in accordance with the Option Agreement. No adjustment shall be made for a dividend or other right for
which the record date is prior to the date of issuance except as provided in Section 13 of the Sub-Plan. 
 5.
Company’s Right of First Refusal. Before any Shares held by Optionee or any transferee (either being sometimes referred to herein as the “Holder”) may be sold or otherwise transferred (including transfer by gift
or operation of law), the Company or its assignee(s) shall have a right of first refusal to purchase the Shares on the terms and conditions set forth in this Section (the “Right of First Refusal”). 
 (a) Notice of Proposed Transfer. The Holder of the Shares shall deliver to the Company a written notice (the
“Notice”) stating: (i) the Holder’s bona fide intention to sell or otherwise transfer such Shares; (ii) the name of each proposed purchaser or other transferee (“Proposed Transferee”);
(iii) the number of Shares to be transferred to each Proposed Transferee; and (iv) the bona fide cash price or other consideration for which the Holder

  

 66 








 
proposes to transfer the Shares (the “Offered Price”), and the Holder shall offer the Shares at the Offered Price to the Company or its assignee(s). 
 (b) Exercise of Right of First Refusal. At any time within thirty (30) days after receipt of the Notice, the Company and/or its
assignee(s) may, by giving written notice to the Holder, elect to purchase all, but not less than all, of the Shares proposed to be transferred to any one or more of the Proposed Transferees, at the purchase price determined in accordance with
subsection (c) below. 
 (c) Purchase Price. The purchase price (“Purchase Price”) for the
Shares purchased by the Company or its assignee(s) under this Section shall be the Offered Price. If the Offered Price includes consideration other than cash, the cash equivalent value of the non-cash consideration shall be determined by the Board
of Directors of the Company in good faith. 
 (d) Payment. Payment of the Purchase Price shall be made, at the option of
the Company or its assignee(s), in cash (by cheque) within thirty (30) days after receipt of the Notice or in the manner and at the times set forth in the Notice. 
 (e) Holder’s Right to Transfer. If all of the Shares proposed in the Notice to be transferred to a given Proposed Transferee are not purchased by the Company and/or its assignee(s) as provided
in this Section, then the Holder may sell or otherwise transfer such Shares to that Proposed Transferee at the Offered Price or at a higher price, provided that such sale or other transfer is completed within 120 days after the date of the Notice,
that any such sale or other transfer is effected in accordance with any applicable securities laws and that the Proposed Transferee agrees in writing that the provisions of this Section shall continue to apply to the Shares in the hands of such
Proposed Transferee. If the Shares described in the Notice are not transferred to the Proposed Transferee within such period, a new Notice shall be given to the Company, and the Company and/or its assignees shall again be offered the Right of First
Refusal before any Shares held by the Holder may be sold or otherwise transferred. 
 (f) Exception for Certain Family
Transfers. Anything to the contrary contained in this Section notwithstanding, the transfer of any or all of the Shares during the Optionee’s lifetime or on the Optionee’s death by will or intestacy to the Optionee’s immediate
family or a trust for the benefit of the Optionee’s immediate family shall be exempt from the provisions of this Section. “Immediate Family” as used herein shall mean spouse, lineal descendant or antecedent, father, mother, brother or
sister. In such case, the transferee or other recipient shall receive and hold the Shares so transferred subject to the provisions of this Section, and there shall be no further transfer of such Shares except in accordance with the terms of this
Section. 
 (g) Termination of Right of First Refusal. The Right of First Refusal shall terminate as to any Shares upon
the earlier of (i) the first sale of Common Stock of the Company to the general public, or (ii) a Change in Control in which the successor corporation has equity securities that are publicly traded. 
 6. Tax Consultation. Optionee understands that Optionee may suffer adverse tax consequences as a result of Optionee’s purchase
or disposition of the Shares. Optionee

  

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represents that Optionee has consulted with any tax consultants Optionee deems advisable in connection with the purchase or disposition of the Shares and that Optionee is not relying on the
Company for any tax advice. 
 7. Restrictive Legends and Stop-Transfer Orders. 
 (a) Legends. Optionee understands and agrees that the Company shall cause the legends set forth below or legends substantially
equivalent thereto, to be placed upon any certificate(s) evidencing ownership of the Shares together with any other legends that may be required by the Company or by state or federal securities laws: 
 THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 (THE “ACT”) AND MAY NOT
BE OFFERED, SOLD OR OTHERWISE TRANSFERRED, PLEDGED OR HYPOTHECATED UNLESS AND UNTIL REGISTERED UNDER THE ACT OR, IN THE OPINION OF COMPANY COUNSEL SATISFACTORY TO THE ISSUER OF THESE SECURITIES, SUCH OFFER, SALE OR TRANSFER, PLEDGE OR HYPOTHECATION
IS IN COMPLIANCE THEREWITH. 
 THE SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO CERTAIN RESTRICTIONS ON TRANSFER AND A
RIGHT OF FIRST REFUSAL HELD BY THE ISSUER OR ITS ASSIGNEE(S) AS SET FORTH IN THE EXERCISE NOTICE BETWEEN THE ISSUER AND THE ORIGINAL HOLDER OF THESE SHARES, A COPY OF WHICH MAY BE OBTAINED AT THE PRINCIPAL OFFICE OF THE ISSUER. SUCH TRANSFER
RESTRICTIONS AND RIGHT OF FIRST REFUSAL ARE BINDING ON TRANSFEREES OF THESE SHARES. 
 THE SHARES REPRESENTED BY THIS
CERTIFICATE ARE SUBJECT TO RESTRICTIONS ON TRANSFER FOR A PERIOD NOT TO EXCEED 180 DAYS FOLLOWING THE EFFECTIVE DATE OF THE UNDERWRITTEN PUBLIC OFFERING OF THE COMPANY’S SECURITIES AND MAY NOT BE SOLD OR OTHERWISE DISPOSED OF BY THE HOLDER
WITHOUT THE CONSENT OF THE COMPANY OR THE MANAGING UNDERWRITER. 
 (b) Stop-Transfer Notices. Optionee agrees that, in
order to ensure compliance with the restrictions referred to herein, the Company may issue appropriate “stop transfer” instructions to its transfer agent, if any, and that, if the Company transfers its own securities, it may make
appropriate notations to the same effect in its own records. 
 (c) Refusal to Transfer. The Company shall not be
required (i) to transfer on its books any Shares that have been sold or otherwise transferred in violation of any of the provisions of this Exercise Notice or (ii) to treat as owner of such Shares or to accord the right to

  

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vote or pay dividends to any purchaser or other transferee to whom such Shares shall have been so transferred. 
 8. Successors and Assigns. The Company may assign any of its rights under this Exercise Notice to single or multiple assignees, and this Exercise Notice shall inure to the benefit of the successors
and assigns of the Company. Subject to the restrictions on transfer herein set forth, this Exercise Notice shall be binding upon Optionee and his or her heirs, executors, administrators, successors and assigns. 
 9. Interpretation. Any dispute regarding the interpretation of this Exercise Notice shall be submitted by Optionee or by the Company
forthwith to the Administrator which shall review such dispute at its next regular meeting. The resolution of such a dispute by the Administrator shall be final and binding on all parties. 
 10. Governing Law; Severability. This Exercise Notice is governed by the internal substantive laws but not the choice of law rules,
of the State of California. In the event that any provision hereof becomes or is declared by a court of competent jurisdiction to be illegal, unenforceable or void, this Option Agreement will continue in full force and effect. 
 11. Entire Agreement. The Sub-Plan, the Option Agreement, the Joint Election and the Section 431 Election are incorporated
herein by reference. This Exercise Notice, the Sub-Plan, the Option Agreement, the Joint Election, the Section 431 Election and the Investment Representation Statement constitute the entire agreement of the parties with respect to the subject
matter hereof and supersede in their entirety all prior undertakings and agreements of the Company and Optionee with respect to the subject matter hereof, and may not be modified adversely to the Optionee’s interest except by means of a writing
signed by the Company and Optionee. 
  

					
	Submitted by:	 		 	Accepted by:
	OPTIONEE	 		 	Kazeon Systems, Inc.
			
	  	 		 	  
	Signature	 		 	By
			
	 Option-ee
	 		 	  
	Print name	 		 	Title
			
	Address:	 		 	Address:
	 	 		 	 
	 	 		 	 
	 	 		 	
			
	 	 		 	  
		 		 	Date Received

  

 69 








 EXHIBIT B 
 INVESTMENT REPRESENTATION STATEMENT 
  

							
	 OPTIONEE:
	  	Optionee	  		  	
				
	 COMPANY:
	  	KAZEON SYSTEMS, INC.	  		  	
				
	 SECURITY:
	  	COMMON STOCK	  		  	
				
	 GRANT NO.
	  	gtno	  		  	
				
	 AMOUNT:
	  	                                       
                            	  		  	
				
	 DATE:
	  	                                       
                            	  		  	

 In connection with the purchase of the above-listed Securities, the undersigned
Optionee represents to the Company the following: 
 (a) Optionee is aware of the Company’s business affairs and financial
condition and has acquired sufficient information about the Company to reach an informed and knowledgeable decision to acquire the Securities. Optionee is acquiring these Securities for investment for Optionee’s own account only and not with a
view to, or for resale in connection with, any “distribution” thereof within the meaning of the Securities Act of 1933, as amended (the “Securities Act”). 
 (b) Optionee acknowledges and understands that the Securities constitute “restricted securities” under the Securities Act and have
not been registered under the Securities Act in reliance upon a specific exemption therefrom, which exemption depends upon, among other things, the bona fide nature of Optionee’s investment intent as expressed herein. In this connection,
Optionee understands that, in the view of the Securities and Exchange Commission, the statutory basis for such exemption may be unavailable if Optionee’s representation was predicated solely upon a present intention to hold these Securities for
the minimum capital gains period specified under tax statutes, for a deferred sale, for or until an increase or decrease in the market price of the Securities, or for a period of one year or any other fixed period in the future. Optionee further
understands that the Securities must be held indefinitely unless they are subsequently registered under the Securities Act or an exemption from such registration is available. Optionee further acknowledges and understands that the Company is under
no obligation to register the Securities. Optionee understands that the certificate evidencing the Securities will be imprinted with any legend required under applicable state securities laws. 
 (c) Optionee is familiar with the provisions of Rule 701 and Rule 144, each promulgated under the Securities Act, which, in substance,
permit limited public resale of “restricted securities” acquired, directly or indirectly from the issuer thereof, in a non-public offering subject to the satisfaction of certain conditions. Rule 701 provides that if the issuer qualifies
under Rule 701 at the time of the grant of the Option to the Optionee, the exercise will be exempt from registration under the Securities Act. In the event the Company becomes subject to the

  

 70 








 
reporting requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, ninety (90) days thereafter (or such longer period as any market stand-off agreement may require)
the Securities exempt under Rule 701 may be resold, subject to the satisfaction of certain of the conditions specified by Rule 144, including: (1) the resale being made through a broker in an unsolicited “broker’s transaction” or
in transactions directly with a market maker (as said term is defined under the Securities Exchange Act of 1934); and, in the case of an affiliate, (2) the availability of certain public information about the Company, (3) the amount of
Securities being sold during any three month period not exceeding the limitations specified in Rule 144(e), and (4) the timely filing of a Form 144, if applicable. 
 In the event that the Company does not qualify under Rule 701 at the time of grant of the Option, then the Securities may be resold in certain limited circumstances subject to the provisions of Rule 144,
which requires the resale to occur not less than one year after the later of the date the Securities were sold by the Company or the date the Securities were sold by an affiliate of the Company, within the meaning of Rule 144; and, in the case of
acquisition of the Securities by an affiliate, or by a non-affiliate who subsequently holds the Securities less than two years, the satisfaction of the conditions set forth in sections (1), (2), (3) and (4) of the paragraph immediately
above. 
 (d) Optionee further understands that in the event all of the applicable requirements of Rule 701 or 144 are not
satisfied, registration under the Securities Act, compliance with Regulation A, or some other registration exemption will be required; and that, notwithstanding the fact that Rules 144 and 701 are not exclusive, the Staff of the Securities and
Exchange Commission has expressed its opinion that persons proposing to sell private placement securities other than in a registered offering and otherwise than pursuant to Rules 144 or 701 will have a substantial burden of proof in establishing
that an exemption from registration is available for such offers or sales, and that such persons and their respective brokers who participate in such transactions do so at their own risk. Optionee understands that no assurances can be given that any
such other registration exemption will be available in such event. 
  

	
	Signature of Optionee:
	
	                                       
                                         
                      
	Date:                                     
        ,                               
              


  

 71 








 Exhibit C 
  

	
	 
	 Joint Election under s431 ITEPA 2003 for full or partial disapplication of
 Chapter 2 Income Tax (Earnings and Pensions) Act 2003
  


 One Part Election 
 1. Between 
  

			
		
	 the Employee
	  	[insert name of employee]
		
	 whose National Insurance Number is
	  	[insert NINO]
		
	 and
	  	
		
	 the Company (who is the Employee’s employer)
	  	Kazeon Systems Europe Limited
		
	 of Company Registration Number
	  	06023883

 2. Purpose of Election 
 This joint election is made pursuant to section 431(1) or 431(2) Income Tax (Earnings and Pensions) Act 2003 (ITEPA) and applies where
employment-related securities, which are restricted securities by reason of section 423 ITEPA, are acquired. 
 The effect of an
election under section 431(1) is that, for the relevant Income Tax and NIC purposes, the employment-related securities and their market value will be treated as if they were not restricted securities and that sections 425 to 430 ITEPA do not apply.
An election under section 431(2) will ignore one or more of the restrictions in computing the charge on acquisition. Additional Income Tax will be payable (with PAYE and NIC where the securities are Readily Convertible Assets). 
  

	
	 Should the value of the securities fall following the acquisition, it is
possible that Income Tax/NIC that would have arisen because of any future chargeable event (in the absence of an election) would have been less than the Income Tax/NIC due by reason of this election. Should this be the case, there is no Income
Tax/NIC relief available under Part 7 of ITEPA 2003; nor is it available if the securities acquired are subsequently transferred, forfeited or revert to the original owner.


  

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 3. Application 
 This joint election is made not later than 14 days after the date of acquisition of the securities by the employee and applies to: 
  

			
		
	 Number of securities
	  	[insert number]
		
	 Description of securities
	  	Common Stock of Kazeon Systems, Inc.
		
	 Name of issuer of securities
	  	Kazeon Systems, Inc.
		
	 *       [insert date of option]
	  	
	
	 *       to be acquired by the Employee after [dd/mm/yyyy] under the terms
of the UK Sub-Plan of the Kazeon Systems, Inc. 2003 Stock Plan

		
		  	(* delete as appropriate)

 4. Extent of Application 
 This election disapplies: 
  

	 	*	S.431(1) ITEPA: All restrictions attaching to the securities, or 

 5. Declaration 
 This election will become irrevocable upon the later of its
signing or the acquisition (* and each subsequent acquisition) of employment-related securities to which this election applies. 
  

			
		
		  	(* delete as appropriate)

  

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 In signing this joint election, we agree to be bound by its terms as stated above.

  

							
				
	 	 	  	 		 	/            /                        
		 	Signature (Employee)	 		 	Date
				
	 	 	  	 		 	/            /                        
				
	III.	 	Signature (for and on behalf of the Company)	 		 	Date
				
	 	 	  	 		 	 
		 	Position in company	 		 	

 Note: Where the election is in respect of multiple acquisitions, prior to the date of any
subsequent acquisition of a security it may be revoked by agreement between the employee and employer in respect of that and any later acquisition. 
  

 74 









	 DATED 
	2007 

  
 KAZEON SYSTEMS, INC. 
 - and - 
 KAZEON SYSTEMS EUROPE LIMITED 
 - and - 
 [OPTIONEE] 
  
  
 JOINT ELECTION 
  
  
 TAYLOR WESSING LLP 
 Carmelite 
 50
Victoria Embankment 
 Blackfriars 
 London EC4Y ODX 
 Tel: +44 (0)20 7300 7000 
 Fax: +44 (0)20 7300 7100 
 DX 41 London 
  

 75 








 JOINT ELECTION 
 BETWEEN 
  

	(1)	KAZEON SYSTEMS, INC. whose registered office is at 1161 San Antonio Road, Mountain View, CA 94043, USA (the “Company”); and 


 

	(2)	KAZEON SYSTEMS EUROPE LIMITED whose registered office is at Standard House, Weyside Park, Catteshall Lane, Godalming, Surrey, GU7 1XE (the “Employer”);
and 

  

	(3)	[                                       
     ] of [Insert Address] (the “Optionee” which shall include his executors or administrators in the case of his death). 

 INTRODUCTION 
  

	(A)	The Optionee may be granted options (each one an “Option”) to acquire shares of common stock in the Company (the “Shares”) on terms to be set out in
stock option agreements to be issued to the Optionee and which will be subject to the UK Sub-Plan of the Kazeon Systems, Inc. 2003 Stock Plan (the “Plan”). 

  

	(B)	The grant of an Option will only take place after the Optionee has executed this joint election (the “Joint Election”). This Joint Election is in an approved
format. The exercise, cancellation, release, assignment or other disposal of an Option is subject to the Optionee entering into this Joint Election. 

  

	(C)	The Optionee is currently an employee of the Employer. 

  

	(D)	The exercise, release, cancellation, assignment or other disposal of an Option (a “Trigger Event”) (whether in whole or in part), may result in the Employer
or, if and to the extent that there is a change in law, any other company or person who becomes the secondary contributor for National Insurance contributions (“NIC”) purposes at the time of such Trigger Event having a liability to pay
employer’s (secondary) Class I NICs (or any tax or social security premiums which may be introduced in substitution or in addition thereto) in respect of such Trigger Event. 

  

	(E)	Where the context so admits, any reference in this Joint Election: 

  

	 	(i)	to the singular number shall be construed as if it referred also to the plural number and vice versa; 

  

	 	(ii)	to the masculine gender shall be construed as though it referred also to the feminine gender; 

  

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	 	(iii)	to a statute or statutory provision shall be construed as if it referred also to that statute or provision as for the time being amended or re-enacted; and


  

	 	(iv)	Shares means shares of common stock of the Company. 

 AGREED TERMS 
  

	1.	Joint Election 

  

	1.1	It is a condition of the grant, exercise, cancellation, release, assignment or other disposal of an Option that the Optionee has entered into this Joint Election with
the Employer. 

  

	1.2	The Optionee, the Company and the Employer elect to transfer the liability (the “Liability”) for all of the employer’s (Secondary) Class I NICs, referred
to in (D) above and charged on payments or other benefits arising on a Trigger Event and treated as remuneration and earnings pursuant to section 4(4)(a) of the Social Security Contributions and Benefit Act 1992 (“SSCBA”) to the
Optionee. This Joint Election is made pursuant to an arrangement authorised by paragraph 3B, Schedule 1 of the SSCBA. 

  

	1.3	This Joint Election does not apply in relation to any liability, or any part of any liability, arising as a result of regulations being given retrospective effect by
virtue of section 4B(2) of the Social Security Contributions and Benefits Act 1992 or the Social Security Contributions and Benefits (Northern Ireland) Act 1992. 

  

	2.	Restriction on registration until liability paid by Optionee 

 The Optionee hereby agrees that no Shares shall be registered in his name until he has met the Liability as a result of a Trigger Event in accordance with this Joint Election. 
  

	3.	Payment 

  

	3.1	Where, in relation to an Option, the Optionee is liable, or is in accordance with current practice at the date of the Trigger Event believed by the Employer to be
liable (where it is believed that the shares under option are readily convertible assets), to account to HM Revenue & Customs for the Liability, the Optionee and the Employer agree that, upon receipt of the funds to meet the Liability from
the Optionee, that such funds to meet the Liability shall be paid to the Collector of Taxes or other relevant taxation authority by the Employer on the Optionee’s behalf within 14 days of the end of the income tax month in which the gain on the
Option was made (the “14 day period”) and for the purposes of securing payment of the Liability the Optionee will on the occurrence of a Trigger Event: 

  

 77 









	 	(a)	pay to the Employer a cash amount equal to the Liability; and/or 

  

	 	(b)	suffer a deduction from salary or other remuneration due to the Optionee such deduction being in an amount not exceeding the Liability; and/or 


 

	 	(c)	at the request of the Company enter into such arrangement or arrangements necessary or expedient with such person or persons (including the appointment of a nominee on
behalf of the Optionee) to effect the sale of Shares acquired through the exercise of the Option to cover all or any part of the Liability and use the proceeds to pay the Employer a cash amount equal to the Liability. 

  

	3.2	The Optionee hereby irrevocably appoints the Company and the Employer as his attorney with full power in his name to execute or sign any document and do any other thing
which the Company or the Employer may consider desirable for the purpose of giving effect to the Optionee satisfying the Liability under clause 3.1 and satisfying any penalties and interest under clause 3.4. The Optionee further agrees to ratify and
confirm whatever the Company and the Employer may lawfully do as his attorney. In particular, the Employer and/or the Company will have the right to enter into such an arrangement (as envisaged by clause 3.1(c)) on the Optionee’s behalf to sell
sufficient of the Shares issued or transferred to the Optionee on the exercise of an Option to meet the Liability pursuant to clause 3.1 and any penalty or interest arising under clause 3.4. 

  

	3.3	The Employer shall pass all monies it has collected from the Optionee in respect of the Liability to the Collector of Taxes by no later than 14 days after the end of
the income tax month in which the Trigger Event occurred. The Employer shall be responsible for any penalties or interest that may arise in respect of the Liability from any failure on its part after it has collected any monies from the Optionee to
pass the Liability to the Collector of Taxes within the said 14 days period. 

  

	3.4	If the Optionee has failed to pay all or part of the Liability to the Employer within the 14 day period the Optionee hereby indemnifies the Employer against such
penalties or interest that the Employer would have to pay in respect of the late payment of all or part of the Liability to the Collector of Taxes. 

  

	4.	Termination of Joint Election 

  

	4.1	This Joint Election shall cease to have effect on the occurrence of any of the following: 

  

	 	(a)	if the terms of this Joint Election are satisfied in the reasonable opinion of the Company, the Employer and the Optionee; 

  

	 	(b)	if the Company, the Employer and the Optionee jointly agree in writing to revoke this Joint Election; 

  

 78 









	 	(c)	if HM Revenue & Customs withdraws approval of this Joint Election so far as it relates to share options covered by the Joint Election but not yet granted;


  

	 	(d)	if the Options lapse or no Option is otherwise capable of being exercised pursuant to the Plan; and/or 

  

	 	(e)	if the Company and/or the Employer serve notice on the Optionee that the Joint Election is to cease to have effect. 

  

	5.	Further assurance 

  

	5.1	The Company, Employer and the Optionee shall do all such things and execute all such documents as may be necessary or desirable to ensure that this Joint Election
complies with all relevant legislation and/or HM Revenue & Customs requirements. 

  

	5.2	The Optionee shall notify the Employer in writing of any Trigger Event which occurs in relation to an Option within three days of such Trigger Event.


  

	5.3	The Company intends, as soon as practicable, to notify the Employer of the Optionee’s intention of exercising an Option and shall provide the Employer with such
information available to the Company to enable the Employer to calculate the Liability arising on the Trigger Event. 

  

	6.	Secondary Contributor 

 The Employer enters into this Joint Election on its own behalf and on behalf of the Company, or, if and to the extent that there is a change in law, any other company or person who is or becomes a secondary contributor for NIC purposes in
respect of an Option. It is agreed that the Employer can enforce the terms of this Joint Election against the Optionee on behalf of any such company. 
  

	7.	Binding Effect 

  

	7.1	The Optionee agrees to be bound by the terms of this Joint Election and for the avoidance of doubt the Optionee shall continue to be bound by the terms of this Joint
Election regardless of which country the Optionee is working in when the Liability arises and regardless of whether the Optionee is an employee of the Employer when the Liability arises. 

  

	7.2	The Employer and the Company agree to be bound by the terms of this Joint Election and for the avoidance of doubt the Employer and Company shall continue to be bound by
the terms of this Joint Election regardless of which country the Optionee is working in when the Liability arises and regardless of whether the Optionee is an employee of the Employer when the Liability arises. 

  

 79 









	8.	Governing Law 

  

	8.1	This Joint Election shall be governed by and construed in accordance with English law and the parties irrevocably submit to the non-exclusive jurisdiction of the
English Courts to settle any claims, disputes or issues which may arise out of this deed. 

  

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 This Joint Election has been executed and delivered as a deed on the date written above. 
  

			
	 SIGNED as a DEED
 by
KAZEON SYSTEMS, INC.
 acting by the under-mentioned
 person acting on the authority
 of the Company in accordance
 with the laws of the territory of
 its
incorporation:
	  	
		
		  	Authorised signatory
		
	 SIGNED as a DEED
 by
KAZEON SYSTEMS EUROPE LIMITED
 acting by:
	  	
		
		  	Director
		
		  	Director/Secretary
		
	 SIGNED as a Deed
 by
[insert name of Optionee]
	  	
		
	 in the presence of:
	  	
		
	Witness signature:	  	
		
	Name:	  	
		
	Address:	  	
		
	Occupation:	  	

  

 81