exv10w2






Exhibit 10.2




OMNEON, INC.




2008 Equity Incentive Plan



(approved by the Board of Directors on August 29, 2008)



     1. PURPOSE. The purpose of this Plan is to provide incentives to attract,
retain and motivate eligible persons whose present and potential contributions are important to the
success of the Company, and any Parents and Subsidiaries that exist now or in the future, by
offering them an opportunity to participate in the Company’s future performance through the grant
of Awards. Although this Plan is intended to be a written compensatory benefit plan within the
meaning of Rule 701 promulgated under the Securities Act, grants may be made pursuant to this Plan
which do not qualify for exemption under Rule 701 or Section 25102(o) of the California
Corporations Code (“Section 25102(o)”). Any requirement of this Plan which is required in law only
because of Section 25102(o) need not apply if the Company so provides. Capitalized terms not
defined elsewhere in the text are defined in Section 26.



     2. SHARES SUBJECT TO THE PLAN.



          2.1 Number of Shares Available. Subject to Sections 2.2 and 21, the total
number of Shares reserved and available for grant and issuance pursuant to this Plan as of the date
of adoption of the Plan by the Board of Directors, is the number of authorized shares not issued or
subject to outstanding grants under the Company’s 1998 Stock Option Plan (the “Prior Plan”) on the
date the Prior Plan terminated (this number is three hundred thirteen thousand six hundred nineteen
(313,619) Shares). Subject to Sections 2.2 and 21 hereof, Shares subject to Awards, and Shares
issued upon exercise of Awards, will again be available for grant and issuance in connection with
subsequent Awards under this Plan to the extent such Shares: (i) are subject to issuance upon
exercise of an Option or SAR granted under this Plan but which cease to be subject to the Option or
SAR for any reason other than exercise of the Option or SAR; (ii) are subject to Awards granted
under this Plan that are forfeited or are repurchased by the Company at the original issue price;
or (iii) are subject to Awards granted under this Plan that otherwise terminate without such Shares
being issued. If shares that are subject to stock options granted under the Prior Plan cease to be
subject to such stock options, or if shares issued pursuant to the exercise of stock options
granted under the Prior Plan are forfeited or repurchased by the Company at the original issue
price, then an equal number of shares of the Company’s Common Stock shall become available under
the Plan. SARs to be settled in shares of the Company’s Common Stock shall be counted in full
against the number of Shares available for award under the Plan, regardless of the number of Shares
issued upon settlement of the SAR. At all times the Company shall reserve and keep available a
sufficient number of Shares as shall be required to satisfy the requirements of all outstanding
Options granted under this Plan and all other outstanding but unvested Options granted under this
Plan. No more than fifty million (50,000,000) Shares shall be issued pursuant to the exercise of
ISOs (as defined in Section 5 below). No more than twenty percent (20%) of the Shares reserved
under the Plan may be issuable pursuant to an Award (other than Stock Bonuses) at a price per share
that is at a discount from the Fair Market Value on the date of grant of such Award (excluding
Awards granted in substitution for other awards as part of an acquisition by the Company).



          2.2 Adjustment of Shares. In the event that the number or type of
outstanding shares of the Company’s Common Stock is changed by a stock dividend, recapitalization,
stock split, reverse stock split, subdivision, combination, reclassification or



1









 




similar change in the capital structure of the Company without consideration, then (a) the
number and class of Shares reserved for issuance under this Plan, (b) the Exercise Prices of
outstanding Options and SARs, (c) the number of Shares subject to outstanding Options and SARs and
(d) if any such occurrence is after the IPO Effective Date, the maximum number of Shares that may
be granted pursuant to any limitation imposed by the Plan shall be proportionately adjusted in
compliance with applicable securities laws; provided, however, that fractions of a
Share will not be issued.




     3. ELIGIBILITY. ISOs (as defined in Section 5 below) may be granted only to
employees (including officers and directors who are also employees) of the Company or of a Parent
or Subsidiary of the Company. All other Awards may be granted to employees, officers, directors,
consultants, independent contractors and advisors of the Company or any Parent or Subsidiary of the
Company; provided such consultants, independent contractors and advisors render bona fide
services not in connection with the offer and sale of securities in a capital-raising transaction.
A person may be granted more than one Award under this Plan.



     4. ADMINISTRATION.



          4.1 Committee Authority. This Plan will be administered by the Board.
Subject to the general purposes, terms and conditions of this Plan, and to the direction of the
Board, the Committee will have full power to implement and carry out this Plan except however, the
Board shall establish the terms for the grant of Awards to Outside Directors. All authority and
power of the Committee under this Plan (including all determinations specified herein to be made by
the Committee) may also be exercised by the Board. The Board and the Committee will have the
authority to:



               (a) construe and interpret this Plan, any Award Agreement and any other agreement or
document executed pursuant to this Plan;



               (b) prescribe, amend and rescind rules and regulations relating to this Plan or any
Award;



               (c) select persons to receive Awards;



               (d) determine the form and terms of Awards;



               (e) determine the number of Shares or other consideration subject to Awards;



               (f) determine whether Awards will be granted singly, in combination with, in tandem
with, in replacement of, or as alternatives to, other Awards under this Plan or any other incentive
or compensation plan of the Company or any Parent or Subsidiary of the Company;



               (g) grant waivers of Plan or Award conditions;



               (h) determine the vesting, exercisability and payment of Awards;



               (i) correct any defect, supply any omission or reconcile any inconsistency in this
Plan, any Award or any Award Agreement;



2









 





               (j) determine whether an award has been earned; and



               (k) make all other determinations necessary or advisable for the administration of
this Plan.



          4.2 Committee Interpretation and Discretion. Any determination made by the
Committee with respect to any Award shall be made in its sole discretion at the time of grant of
the Award or, unless in contravention of any express term of the Plan or Award, at any later time,
and such determination shall be final and binding on the Company and all persons having an interest
in any Award under the Plan. Any dispute regarding the interpretation of the Plan or any Award
Agreement shall be submitted by the Participant or Company to the Committee for review. The
resolution of such a dispute by the Committee shall be final and binding on the Company and the
Participant. The Committee may delegate to one or more Executive Officers the authority to review
and resolve disputes with respect to Awards held by Participants who are not Section 16 Insiders,
and such resolution shall be final and binding on the Company and the Participant.



          4.3 Section 162(m) of the Code and Section 16 of the Exchange Act. After
the IPO Effective Date, and then only when necessary or desirable for an Award to qualify as
“performance-based compensation” under Section 162(m) of the Code the Committee shall include at
least two persons who are “outside directors” (as defined under Section 162(m) of the Code) and at
least two (or a majority if more than two then serve on the Committee) such “outside directors”
shall approve the grant of such Award and timely determine the Performance Period and any
Performance Factors upon which vesting of any portion of such Award is to be subject. When required
by Section 162(m) of the Code, then prior to settlement of any such Award at least two (or a
majority if more than two then serve on the Committee) such “outside directors” then serving on the
Committee shall determine and certify in writing the extent to which such Performance Factors have
been timely achieved and the extent to which the Shares subject to such Award have thereby been
earned. After the IPO Effective Date the grant of Awards to Section 16 Insiders must be approved by
two or more “non-employee directors” (as defined in the regulations promulgated under Section 16 of
the Exchange Act).



     5. OPTIONS. The Board may grant Options to eligible persons and will
determine whether such Options will be Incentive Stock Options within the meaning of the Code
(“ISOs”) or Nonqualified Stock Options (“NQSOs”), the number of Shares subject to the Option, the
Exercise Price of the Option, the period during which the Option may be exercised, and all other
terms and conditions of the Option, subject to the following:



          5.1 Form of Option Grant. Each Option granted under this Plan will be
evidenced by an Option Agreement which will expressly identify the Option as an ISO or an NQSO
(“Stock Option Agreement”), and will be in such form and contain such provisions (which need not be
the same for each Participant) as the Board may from time to time approve, and which will comply
with and be subject to the terms and conditions of this Plan.



          5.2 Date of Grant. The date of grant of an Option will be the date on which
the Board makes the determination to grant such Option, or a specified future date. The Stock
Option Agreement and a copy of this Plan will be delivered to the Participant within a reasonable
time after the granting of the Option.



          5.3 Exercise Period. Options may be exercisable within the times or upon
the conditions as set forth in the Stock Option Agreement governing such Option; provided,



3









 




however, that no Option will be exercisable after the expiration of ten (10) years from the
date the Option is granted; and provided further that no ISO granted to a person who
directly or by attribution owns more than ten percent (10%) of the total combined voting power of
all classes of stock of the Company or of any Parent or Subsidiary of the Company (“Ten Percent
Shareholder”) will be exercisable after the expiration of five (5) years from the date the ISO is
granted. The Board also may provide for Options to become exercisable at one time or from time to
time, periodically or otherwise, in such number of Shares or percentage of Shares as the Board
determines.




          5.4 Exercise Price. The Exercise Price of an Option will be determined by
the Board when the Option is granted; provided that: (i) the Exercise Price of an ISO will be not
less than 100% of the Fair Market Value of the Shares on the date of grant; (ii) the Exercise Price
of any ISO granted to a Ten Percent Shareholder will not be less than 110% of the Fair Market Value
of the Shares on the date of grant; and (iii) the Exercise Price of an NQSO will not be less than
100% of the Fair Market Value of the Shares on the date of grant, unless at the time such Exercise
Price is set the Board expressly states that the Exercise Price shall be less than the then Fair
Market Value of the Shares. Payment for the Shares purchased may be made in accordance with
Section 11.



          5.5 Method of Exercise. Options may be exercised only by delivery to the
Company of a written stock option exercise agreement (the “Exercise Agreement”) in a form approved
by the Board (which need not be the same for each Participant), stating the number of Shares being
purchased, the restrictions imposed on the Shares purchased under such Exercise Agreement, if any,
and such representations and agreements regarding the Participant’s investment intent and access to
information and other matters, if any, as may be required by or desirable to the Company to comply
with applicable securities laws, together with payment in full of the Exercise Price for the number
of Shares being purchased.



          5.6 Termination. Notwithstanding the exercise periods set forth in the
Stock Option Agreement, the exercise of an Option will always be subject to the following:



               (a) If the Participant is Terminated for any reason except for Cause or the
Participant’s death or Disability, then the Participant may exercise such Participant’s Options
only to the extent that such Options would have been exercisable by the Participant on the
Termination Date no later than three (3) months after the Termination Date (or such shorter time
period not less than thirty (30) days or longer time period as may be determined by the Board, with
any exercise beyond three (3) months after the Termination Date deemed to be an NQSO), but in any
event no later than the respective Expiration Date of each of the Options.



               (b) If the Participant is Terminated because of Participant’s death (or the
Participant dies within three (3) months after a Termination other than for Cause or because of the
Participant’s Disability), then the Participant’s Options may be exercised only to the extent that
such Options would have been exercisable by the Participant on the Termination Date and must be
exercised by the Participant’s legal representative, or authorized assignee, no later than twelve
(12) months after the Termination Date (or such shorter time period not less than six (6) months or
longer time period, with any exercise beyond (a) three (3) months after the Termination Date when
the Termination is for any reason other than the Participant’s death, or (b) twelve (12) months
after the Termination Date when the Termination is for the Participant’s
death, deemed to be an NQSO), but in any event no later than the respective Expiration Date of
each of the Options.



4









 





               (c) If the Participant is Terminated because of Participant’s Disability, then the
Participant’s Options may be exercised only to the extent that such Options would have been
exercisable by the Participant on the Termination Date and must be exercised by the Participant (or
the Participant’s legal representative or authorized assignee) no later than twelve (12) months
after the Termination Date (with any exercise beyond (a) three (3) months after the Termination
Date when the Termination is for a Disability that is not deemed to have rendered the
Participant “disabled” as defined in Section 422 of the Code, or (b) twelve (12) months after the
Termination Date when the Termination is for a Disability that is deemed to have rendered
the Participant “disabled” as defined in Section 422 of the Code, deemed to be exercise of an
NQSO), but in any event no later than the respective Expiration Date of each of the Options.



               (d) If the Participant is terminated for Cause, then Participant’s Options shall
expire on such Participant’s Termination Date, or at such later time and on such conditions as are
determined by the Board (in no event later than the Expiration Date).



          5.7 Limitations on Exercise. The Board may specify a reasonable minimum
number of Shares that may be purchased on any exercise of an Option, provided that such minimum
number will not prevent any Participant from exercising the Option for the full number of Shares
for which it is then exercisable.



          5.8 Limitations on ISOs. The aggregate Fair Market Value (determined as of
the date of grant) of Shares with respect to which ISOs are exercisable for the first time by a
Participant during any calendar year (under this Plan or under any other incentive stock option
plan of the Company or any Parent or Subsidiary of the Company) will not exceed $100,000. If the
Fair Market Value of Shares on the date of grant with respect to which ISOs are exercisable for the
first time by a Participant during any calendar year exceeds $100,000, then the Options for the
first $100,000 worth of Shares to become exercisable in such calendar year will be ISOs and the
Options for the amount in excess of $100,000 that become exercisable in such calendar year will be
NQSOs. In the event that the Code or the regulations promulgated thereunder are later amended to
provide for a different limit on the Fair Market Value of Shares permitted to be subject to ISOs,
or the definition of “disabled” such different limit or different definition will be automatically
incorporated herein and will apply to any Options granted after the effective date of such
amendment.



          5.9 Modification, Extension or Renewal. The Board may modify, extend or
renew outstanding Options and authorize the grant of new Options in substitution therefor, provided
that any such action may not, without the written consent of a Participant, impair any of such
Participant’s rights under any Option previously granted. Any outstanding ISO that is modified,
extended, renewed or otherwise altered will be treated in accordance with Section 424(h) of the
Code. Subject to Section 17 of this Plan, by written notice to affected Participants the Board may
reduce the Exercise Price of outstanding Options without the consent of such Participants;
provided, however, that the Exercise Price may not be reduced below the minimum
Exercise Price that would be permitted under Section 5.4 for Options granted on the date the action
is taken to reduce the Exercise Price.



          5.10 No Disqualification. Notwithstanding any other provision in this Plan,
no term of this Plan relating to ISOs will be interpreted, amended or altered, nor will any
discretion
or authority granted under this Plan be exercised, so as to disqualify this Plan under Section
422 of the Code or, without the consent of the Participant affected, to disqualify any ISO under
Section 422 of the Code.



5









 





     6. RESTRICTED STOCK AWARDS.



          6.1 Awards of Restricted Stock. A Restricted Stock Award is an offer by the
Company to sell to a Participant Shares that are subject to restrictions (“Restricted
Stock”). The Board will determine to whom an offer will be made, the number of Shares the
person may purchase, the Purchase Price, the restrictions under which the Shares will be subject
and all other terms and conditions of the Restricted Stock Award, subject to the Plan.



          6.2 Restricted Stock Purchase Agreement. All purchases under a Restricted
Stock Award will be evidenced by a Restricted Stock Purchase Agreement, which will be in
substantially a form (which need not be the same for each Participant) that the Board has from time
to time approved, and will comply with and be subject to the terms and conditions of the Plan. A
Participant accepts a Restricted Stock Award by signing and delivering to the Company a Restricted
Stock Purchase Agreement with full payment of the Purchase Price, within thirty (30) days from the
date the Restricted Stock Purchase Agreement was delivered to the Participant. If the Participant
does not accept the Restricted Stock Award within thirty (30) days, then the offer of the
Restricted Stock Award will terminate, unless the Board determines otherwise. The Restricted Stock
Award, Plan and other documents may be delivered in any manner (including electronic distribution
or posting) that meets applicable legal requirements.



          6.3 Purchase Price. The Purchase Price for a Restricted Stock Award will be
determined by the Board and, may be less than Fair Market Value (but not less than the par value of
the Shares when required by law) on the date the Restricted Stock Award is granted. Payment of the
Purchase Price must be made in accordance with Section 11 of the Plan and the Restricted Stock
Purchase Agreement, and in accordance with any procedures established by the Company, as
communicated and made available to Participants.



          6.4 Terms of Restricted Stock Awards. Restricted Stock Awards will be
subject to such restrictions as the Board may impose or are required by law. These restrictions
may be based on completion of a specified number of years of service with the Company or upon
completion of the performance goals based on Performance Factors during any Performance Period as
set out in advance in the Participant’s Restricted Stock Purchase Agreement. Prior to the grant of
a Restricted Stock Award, the Board shall: (a) determine the nature, length and starting date of
any Performance Period for the Restricted Stock Award; (b) select from among the Performance
Factors to be used to measure performance goals, if any; and (c) determine the number of Shares
that may be awarded to the Participant. Performance Periods may overlap and a Participant may
participate simultaneously with respect to Restricted Stock Awards that are subject to different
Performance Periods and having different performance goals and other criteria. The Board may adjust
the performance goals applicable to Restricted Stock Awards to take into account changes in law and
accounting and to make such adjustments as the Board deems necessary or appropriate to reflect the
impact of extraordinary or unusual items, events or circumstances to avoid windfalls or hardships
provided that with respect to Restricted Stock Awards granted, or modified, after the IPO Effective
Date such adjustments are consistent with the regulations promulgated under Section 162(m) of the
Code with respect to persons whose compensation is subject to Section 162(m) of the Code.



          6.5 Termination of Participant. Except as may be set forth in the
Participant’s Restricted Stock Purchase Agreement, vesting ceases on such Participant’s Termination
Date.



6









 





     7. STOCK BONUS AWARDS.



          7.1 Awards of Stock Bonuses. A Stock Bonus Award is an award to an eligible
person of Shares (which may consist of Restricted Stock or Restricted Stock Units) for services to
be rendered or for past services already rendered to the Company or any Parent or Subsidiary. All
Stock Bonus Awards shall be made pursuant to a Stock Bonus Agreement, which shall be in
substantially a form (which need not be the same for each Participant) that the Board has from time
to time approved, and will comply with and be subject to the terms and conditions of the Plan. No
payment will be required for Shares awarded pursuant to a Stock Bonus Award.



          7.2 Terms of Stock Bonus Awards. The Board will determine the number of
Shares to be awarded to the Participant under a Stock Bonus Award and any restrictions thereon.
These restrictions may be based upon completion of a specified number of years of service with the
Company or upon satisfaction of performance goals based on Performance Factors during any
Performance Period as set out in advance in the Participant’s Stock Bonus Agreement. Prior to the
grant of any Stock Bonus Award the Board shall: (a) determine the nature, length and starting date
of any Performance Period for the Stock Bonus Award; (b) select from among the Performance Factors
to be used to measure performance goals; and (c) determine the number of Shares that may be awarded
to the Participant. Performance Periods may overlap and a Participant may participate
simultaneously with respect to Stock Bonus Awards that are subject to different Performance Periods
and different performance goals and other criteria. The number of Shares may be fixed or may vary
in accordance with such performance goals and criteria as may be determined by the Board. The
Board may adjust the performance goals applicable to a Stock Bonus Award to take into account
changes in law and accounting or tax rules and to make such adjustments as the Board deems
necessary or appropriate to reflect the impact of extraordinary or unusual items, events or
circumstances to avoid windfalls or hardships provided that with respect to Stock Bonus Awards
granted, or modified, after the IPO Effective Date such adjustments are consistent with the
regulations promulgated under Section 162(m) of the Code with respect to persons whose compensation
is subject to Section 162(m) of the Code.



          7.3 Form of Payment to Participant. The Stock Bonus Award will be paid to
the Participant currently. Payment may be made in the form of cash, whole Shares, or a combination
thereof, based on the Fair Market Value of the Shares earned under a Stock Bonus Award on the date
of payment.



          7.4 Termination of Participant. Except as may be set forth in the
Participant’s Stock Bonus Award Agreement, vesting ceases on such Participant’s Termination Date.



     8. STOCK APPRECIATION RIGHTS.



          8.1 Awards of SARs. A Stock Appreciation Right (“SAR”) is an award
to an eligible person that may be settled in cash, or Shares (which may consist of Restricted
Stock), having a value equal to the value determined by multiplying the difference between the Fair
Market Value on the date of exercise over the Exercise Price and the number of Shares with respect
to which the SAR is being settled (subject to any maximum number of Shares that may be issuable as
specified in a SAR Agreement). The SAR may be granted for services to be rendered or for past
services already rendered to the Company, or any Parent or Subsidiary. All SARs shall be made
pursuant to a SAR Agreement, which shall be in substantially a form



7









 




(which need not be the same for each Participant) that the Board has from time to time
approved, and will comply with and be subject to the terms and conditions of this Plan.




          8.2 Terms of SARs. The Board will determine the terms of each SAR
including, without limitation: (a) the number of Shares deemed subject to the SAR; (b) the Exercise
Price and the time or times during which the SAR may be settled; (c) the consideration to be
distributed on settlement of the SAR; and (d) the effect on each SAR of the Participant’s
Termination. The Exercise Price of the SAR will be determined by the Board when the SAR is granted
and, may be less than Fair Market Value (but not less than the par value of the Shares). A SAR may
be awarded upon satisfaction of such performance goals based on Performance Factors during any
Performance Period as are set out in advance in the Participant’s individual SAR Agreement. If the
SAR is being earned upon the satisfaction of performance goals, then the Board will: (x) determine
the nature, length and starting date of any Performance Period for each SAR; and (y) select from
among the Performance Factors to be used to measure the performance, if any. Performance Periods
may overlap and Participants may participate simultaneously with respect to SARs that are subject
to different performance goals and other criteria.



          8.3 Exercise Period and Expiration Date. A SAR will be exercisable within
the times or upon the occurrence of events determined by the Board and set forth in the SAR
Agreement governing such SAR. The SAR Agreement shall set forth the Expiration Date; provided that
no SAR will be exercisable after the expiration of ten (10) years from the date the SAR is granted.
The Board may also provide for SARs to become exercisable at one time or from time to time,
periodically or otherwise (including, without limitation, upon the attainment during a Performance
Period of performance goals based on Performance Factors), in such number of Shares or percentage
of the Shares subject to the SAR as the Board determines.



          8.4 Form and Timing of Settlement. The portion of a SAR being settled may
be paid currently or on a deferred basis with such interest or dividend equivalent, if any, as the
Board determines, provided that the terms of the SAR and any deferral satisfy the requirements of
Section 409A of the Code.



          8.5 Termination of Participant. Except as may be set forth in the
Participant’s SAR Agreement, vesting ceases on such Participant’s Termination Date.



     9. RESTRICTED STOCK UNITS.



          9.1 Awards of Restricted Stock Units. A Restricted Stock Unit
(“RSU”) is an award to an eligible person covering a number of Shares that may be settled
in cash, or by issuance of those Shares (which may consist of Restricted Stock) for services to be
rendered or for past services already rendered to the Company or any Parent or Subsidiary. All
RSUs shall be made pursuant to a RSU Agreement, which shall be in substantially a form (which need
not be the same for each Participant) that the Board) has from time to time approved, and will
comply with and be subject to the terms and conditions of the Plan.



          9.2 Terms of RSUs. The Board will determine the terms of a RSU including,
without limitation: (a) the number of Shares deemed subject to the RSU; (b) the time or times
during which the RSU may be exercised; (c) the consideration to be distributed on settlement, and
the effect on each RSU of the Participant’s Termination. A RSU may be awarded upon satisfaction of
such performance goals based on Performance Factors during any Performance
Period as are set out in advance in the Participant’s individual RSU Agreement. If the RSU is



8









 




being earned upon satisfaction of performance goals, then the Board will: (x) determine the nature,
length and starting date of any Performance Period for the RSU; (y) select from among the
Performance Factors to be used to measure the performance, if any; and (z) determine the number of
Shares deemed subject to the RSU. Performance Periods may overlap and participants may participate
simultaneously with respect to RSUs that are subject to different Performance Periods and different
performance goals and other criteria. The number of Shares may be fixed or may vary in accordance
with such performance goals and criteria as may be determined by the Board. The Board may adjust
the performance goals applicable to the RSUs to take into account changes in law and accounting and
to make such adjustments as the Board deems necessary or appropriate to reflect the impact of
extraordinary or unusual items, events or circumstances to avoid windfalls or hardships provided
that with respect to RSUs granted, or modified, after the IPO Effective Date such adjustments are
consistent with the regulations promulgated under Section 162(m) of the Code with respect to
persons whose compensation is subject to Section 162(m) of the Code.




          9.3 Form and Timing of Settlement. The portion of a RSU being settled shall
be paid currently. To the extent permissible under law, the Board may also permit a Participant to
defer payment under a RSU to a date or dates after the RSU is earned provided that the terms of the
RSU and any deferral satisfy the requirements of Section 409A of the Code.



          9.4 Termination of Participant. Except as may be set forth in the
Participant’s RSU Agreement, vesting ceases on such Participant’s Termination Date.



     10. PERFORMANCE SHARES.



          10.1 Awards of Performance Shares. A Performance Share Award is an award to
an eligible person denominated in Shares that may be settled in cash, or by issuance of those
Shares (which may consist of Restricted Stock). Grants of Performance Shares shall be made
pursuant to a Performance Share Agreement, which shall be in substantially a form (which need not
be the same for each Participant) that the Board) has from time to time approved, and will comply
with and be subject to the terms and conditions of the Plan.



          10.2 Terms of Performance Shares. The Board will determine, and each
Performance Share Agreement shall set forth, the terms of each award of Performance Shares
including, without limitation: (a) the number of Shares deemed subject to such Award; (b) the
Performance Factors and Performance Period that shall determine the time and extent to which each
award of Performance Shares shall be settled; (c) the consideration to be distributed on
settlement, and the effect on each award of Performance Shares of the Participant’s Termination.
In establishing Performance Factors and the Performance Period the Board will: (x) determine the
nature, length and starting date of any Performance Period; (y) select from among the Performance
Factors to be used; and (z) determine the number of Shares deemed subject to the award of
Performance Shares. Prior to settlement the Board shall determine the extent to which Performance
Shares have been earned. Performance Periods may overlap and Participants may participate
simultaneously with respect to Performance Shares that are subject to different Performance Periods
and different performance goals and other criteria. The number of Shares may be fixed or may vary
in accordance with such performance goals and criteria as may be determined by the Board. The
Board may adjust the applicable performance goals to take into account changes in law and
accounting and to make such adjustments as the Board deems necessary or appropriate to reflect the
impact of extraordinary or unusual items, events or circumstances to avoid windfalls or hardships
provided that with respect to
Performance Shares granted, or modified, after the IPO Effective Date such adjustments are



9









 




consistent with the regulations promulgated under Section 162(m) of the Code with respect to
persons whose compensation is subject to Section 162(m) of the Code




          10.3 Form and Timing of Settlement. The portion of an award of Performance
Shares being settled shall be paid currently.



          10.4 Termination of Participant. Except as may be set forth in the
Participant’s Award Agreement, vesting ceases on such Participant’s Termination Date.



     11. PAYMENT FOR SHARE PURCHASES.



          11.1 Payment. Payment for Shares purchased pursuant to this Plan may be
made in cash (by check) or, where expressly approved for the Participant by the Board and where
permitted by law:



               (a) by cancellation of indebtedness of the Company to the Participant;



               (b) by surrender of shares of the Company held by the Participant;



               (c) by waiver of compensation due or accrued to the Participant for services
rendered to the Company or a Parent or Subsidiary of the Company;



               (d) with respect only to purchases upon exercise of an Option, and provided that a
public market for the Company’s Common Stock exists:



                    (i) through a “same day sale” commitment from the Participant and a broker-dealer
designated by the Company whereby the Participant irrevocably elects to exercise the Option and to
sell a portion of the Shares so purchased to pay for the Exercise Price, and whereby the
broker-dealer irrevocably commits upon receipt of such Shares to forward the Exercise Price
directly to the Company; or



                    (ii) through a “margin” commitment from the Participant and a broker-dealer whereby
the Participant irrevocably elects to exercise the Option and to pledge the Shares so purchased to
the broker-dealer in a margin account as security for a loan from the broker-dealer in the amount
of the Exercise Price, and whereby the broker-dealer irrevocably commits upon receipt of such
Shares to forward the Exercise Price directly to the Company;



               (e) by any combination of the foregoing; or



               (f) by any other method approved by the Board.



     12. WITHHOLDING TAXES.



          12.1 Withholding Generally. Whenever Shares are to be issued in
satisfaction of Awards granted under this Plan, the Company may require the Participant to remit to
the Company an amount sufficient to satisfy federal, state and local withholding tax requirements
prior to the delivery of any certificate or certificates for such Shares. Whenever, under this
Plan, payments in satisfaction of Awards are to be made in cash, such payment will be net of an



10









 




amount sufficient to satisfy federal, state, and local withholding tax requirements, if any,
imposed on the Company.




          12.2 Stock Withholding. When, under applicable tax laws, a Participant
incurs tax liability in connection with the exercise or vesting of any Award that is subject to tax
withholding and the Participant is obligated to pay the Company the amount required to be withheld,
the Board may in its sole discretion allow the Participant to satisfy the minimum withholding tax
obligation by electing to have the Company withhold from the Shares to be issued that number of
Shares having a Fair Market Value equal to the minimum amount required to be withheld, determined
on the date that the amount of tax to be withheld is to be determined. All elections by a
Participant to have Shares withheld for this purpose will be made in accordance with the
requirements established by the Board and be in writing in a form acceptable to the Board.



     13. TRANSFERABILITY.



          13.1 General Rule. Except as otherwise provided in this Section 13, no
Award and no interest therein, shall be sold, pledged, assigned, hypothecated, transferred or
disposed of in any manner other than by will or by the laws of descent and distribution, and no
Award may be made subject to execution, attachment or similar process.



          13.2 All Awards other than NQSOs. All Awards other than NQSOs shall be
exercisable: (i) during the Participant’s lifetime only by (A) the Participant, or (B) the
Participant’s guardian or legal representative; and (ii) after the Participant’s death, by the
legal representative of the Participant’s heirs or legatees.



          13.3 NQSOs. Unless otherwise restricted by the Board, an NQSO shall be
exercisable: (i) during the Participant’s lifetime only by (A) the Participant, (B) the
Participant’s guardian or legal representative, (C) a Family Member of the Participant who has
acquired the NQSO by “permitted transfer;” and (ii) after the Participant’s death, by the legal
representative of the Participant’s heirs or legatees. “Permitted transfer” means, as authorized
by this Plan and the Board in an NQSO, any transfer effected by the Participant during the
Participant’s lifetime of an interest in such NQSO but only such transfers which are by gift or
domestic relations order. A permitted transfer does not include any transfer for value and neither
of the following are transfers for value: (a) a transfer under a domestic relations order in
settlement of marital property rights or (b) a transfer to an entity in which more than fifty
percent (50%) of the voting interests are owned by Family Members or the Participant in exchange
for an interest in that entity.



     14. PRIVILEGES OF STOCK OWNERSHIP; RESTRICTIONS ON SHARES.



          14.1 Voting and Dividends. No Participant will have any of the rights of a
stockholder with respect to any Shares until the Shares are issued to the Participant. After
Shares are issued to the Participant, the Participant will be a stockholder and have all the rights
of a stockholder with respect to such Shares, including the right to vote and receive all dividends
or other distributions made or paid with respect to such Shares; provided, that if such
Shares are restricted stock, then any new, additional or different securities the Participant may
become entitled to receive with respect to such Shares by virtue of a stock dividend, stock split
or any other change in the corporate or capital structure of the Company will be subject to the
same restrictions as the restricted stock; provided, further, that the Participant
will have no right to



11









 




retain such stock dividends or stock distributions with respect to Shares that are repurchased
at the Participant’s Exercise Price pursuant to Section 14.2.




          14.2 Restrictions on Shares. At the discretion of the Board, the Company
may reserve to itself and/or its assignee(s) a right to repurchase (a “Right of Repurchase”) any
number of Unvested Shares held by a Participant following such Participant’s Termination at any
time within ninety (90) days after the later of the Participant’s Termination Date and the date the
Participant purchases Shares under this Plan, for cash and/or cancellation of purchase money
indebtedness, at the Participant’s Exercise Price, or Purchase Price, as the case may be.



     15. CERTIFICATES. All certificates for Shares or other securities delivered
under this Plan will be subject to such stock transfer orders, legends and other restrictions as
the Board may deem necessary or advisable, including restrictions under any applicable federal,
state or foreign securities law, or any rules, regulations and other requirements of the SEC or any
stock exchange or automated quotation system upon which the Shares may be listed or quoted.



     16. ESCROW; PLEDGE OF SHARES. To enforce any restrictions on a
Participant’s Shares, the Board may require the Participant to deposit all certificates
representing Shares, together with stock powers or other instruments of transfer approved by the
Board, appropriately endorsed in blank, with the Company or an agent designated by the Company to
hold in escrow until such restrictions have lapsed or terminated, and the Board may cause a legend
or legends referencing such restrictions to be placed on the certificates. Any Participant who is
permitted to execute a promissory note as partial or full consideration for the purchase of Shares
under this Plan will be required to pledge and deposit with the Company all or part of the Shares
so purchased as collateral to secure the payment of the Participant’s obligation to the Company
under the promissory note; provided, however, that the Board may require or accept
other or additional forms of collateral to secure the payment of such obligation and, in any event,
the Company will have full recourse against the Participant under the promissory note
notwithstanding any pledge of the Participant’s Shares or other collateral. In connection with any
pledge of the Shares, the Participant will be required to execute and deliver a written pledge
agreement in such form as the Board will from time to time approve. The Shares purchased with the
promissory note may, but shall not be required to, be released from the pledge as the promissory
note is paid in such number as the Board may determine in its discretion.



     17. EXCHANGE AND BUYOUT OF AWARDS. The repricing of Options or SARs is
permitted without prior stockholder approval. The Board may, at any time or from time to time
authorize the Company, in the case of an Option or SAR exchange, and with the consent of the
respective Participants (unless not required pursuant to Section 5.9 of the Plan), to pay cash or
issue new Awards in exchange for the surrender and cancellation of any, or all, outstanding Awards.
The Board may reduce the Exercise Price of outstanding Options or SARs without the consent of
affected Participants by a written notice to them; provided, however, that the Exercise Price may
not be reduced below the minimum Exercise Price necessary to avoid treatment as a “deferral of
compensation” under Section 409A of the Code.



     18. SECURITIES LAW AND OTHER REGULATORY COMPLIANCE. Although this Plan is
intended to be a written compensatory benefit plan within the meaning of Rule 701 promulgated under
the Securities Act, grants may be made pursuant to this Plan that do not qualify for exemption
under Rule 701 or Section 25102(o). Any requirement of this Plan which is required in law only
because of Section 25102(o) need not apply with respect to a particular



12









 




Award if the Board so provides. An Award will not be effective unless such Award is in
compliance with all applicable federal and state securities laws, rules and regulations of any
governmental body, and the requirements of any stock exchange or automated quotation system upon
which the Shares may then be listed or quoted, as they are in effect on the date of grant of the
Award and also on the date of exercise or other issuance. Notwithstanding any other provision in
this Plan, the Company will have no obligation to issue or deliver certificates for Shares under
this Plan prior to: (a) obtaining any approvals from governmental agencies that the Company
determines are necessary or advisable; and/or (b) completion of any registration or other
qualification of such Shares under any state or federal law or ruling of any governmental body that
the Company determines to be necessary or advisable. The Company will be under no obligation to
register the Shares with the SEC or to effect compliance with the registration, qualification or
listing requirements of any state securities laws, stock exchange or automated quotation system,
and the Company will have no liability for any inability or failure to do so.




     19. NO OBLIGATION TO EMPLOY. Nothing in this Plan or any Award granted
under this Plan will confer or be deemed to confer on any Participant any right to continue in the
employ of, or to continue any other relationship with, the Company or any Parent or Subsidiary of
the Company or limit in any way the right of the Company or any Parent or Subsidiary of the Company
to terminate Participant’s employment or other relationship at any time, with or without cause.



     20. CORPORATE TRANSACTIONS.



          20.1 Assumption or Replacement of Awards by Successor. In the event of a
Corporate Transaction any or all outstanding Awards may be assumed or replaced by the successor
corporation, which assumption or replacement shall be binding on all Participants. In the
alternative, the successor corporation may substitute equivalent Awards or provide substantially
similar consideration to Participants as was provided to stockholders (after taking into account
the existing provisions of the Awards). The successor corporation may also issue, in place of
outstanding Shares of the Company held by the Participant, substantially similar shares or other
property subject to repurchase restrictions no less favorable to the Participant. In the event
such successor or acquiring corporation (if any) refuses to assume, convert, replace or substitute
Awards, as provided above, pursuant to a Corporate Transaction, then notwithstanding any other
provision in this Plan to the contrary, such Awards will expire on such transaction at such time
and on such conditions as the Board will determine unless the Board determines otherwise.



          20.2 Assumption of Awards by the Company. The Company, from time to time,
also may substitute or assume outstanding awards granted by another company, whether in connection
with an acquisition of such other company or otherwise, by either; (a) granting an Award under this
Plan in substitution of such other company’s award; or (b) assuming such award as if it had been
granted under this Plan if the terms of such assumed award could be applied to an Award granted
under this Plan. Such substitution or assumption will be permissible if the holder of the
substituted or assumed award would have been eligible to be granted an Award under this Plan if the
other company had applied the rules of this Plan to such grant. In the event the Company assumes
an award granted by another company, the terms and conditions of such award will remain unchanged
(except that the exercise price and the number and nature of Shares issuable upon exercise
of any such award will be adjusted appropriately pursuant to Section 424(a) of the Code). In the
event the Company elects to grant



13









 




a new Award rather than assuming an award, such new Award may be granted with a similarly
adjusted Exercise Price.




          20.3 Outside Directors’ Awards. Notwithstanding any provision to the
contrary, in the event of a Corporate Transaction, the vesting of all Awards granted to Outside
Directors will accelerate and such Awards will become exercisable in full prior to the consummation
of such event at such times and on such conditions as the Board determines.



     21. ADOPTION AND STOCKHOLDER APPROVAL. This Plan shall be submitted for the
approval of the Company’s stockholders, consistent with applicable laws, within twelve (12) months
before or after the date this Plan is adopted by the Board.



     22. TERM OF PLAN/GOVERNING LAW. Unless earlier terminated as provided
herein, this Plan will become effective on the date this Plan is adopted by the Board and will
terminate on the tenth anniversary of the earlier of the date of adoption by the Board and the date
of approval by the Company’s stockholders. This Plan and all agreements thereunder shall be
governed by and construed in accordance with the laws of the State of California. Upon adoption of
the Plan the Board may grant Awards; provided, however, that: (i) no Option may be exercised prior
to initial stockholder approval of this Plan; and (ii) no Option granted pursuant to an increase in
the number of Shares approved by the Board shall be exercised prior to the time such increase has
been approved by the stockholders of the Company. Provided further, that any Award (as well as the
issuance of any Shares under such Award) shall automatically be rescinded if the exemption from
qualification under Section 25102(o) is being claimed for such Award and the stockholder approval
of this Plan that is required for such exemption is not timely obtained.



     23. AMENDMENT OR TERMINATION OF PLAN. The Board may at any time terminate
or amend this Plan in any respect, including, without limitation, amendment of any form of Award
Agreement or instrument to be executed pursuant to this Plan; provided, however,
that the Board will not, without the approval of the stockholders of the Company, amend this Plan
in any manner that requires such stockholder approval; provided further, that a
Participant’s Award shall be governed by the version of this Plan then in effect at the time such
Award was granted.



     24. NONEXCLUSIVITY OF THE PLAN. Neither the adoption of this Plan by the
Board, the submission of this Plan to the stockholders of the Company for approval, nor any
provision of this Plan will be construed as creating any limitations on the power of the Board to
adopt such additional compensation arrangements as it may deem desirable, including, without
limitation, the granting of stock awards and bonuses otherwise than under this Plan, and such
arrangements may be either generally applicable or applicable only in specific cases.



     25. INSIDER TRADING POLICY. Each Participant who receives an Award shall
comply with any policy adopted by the Company from time to time covering transactions in the
Company’s securities by employees, officers and/or directors of the Company.



     26. DEFINITIONS. As used in this Plan, the following terms will have the
following meanings:



     “Award” means any award under the Plan, including any Option, Restricted Stock, Stock Bonus,
Stock Appreciation Right, Restricted Stock Unit or award of Performance Shares.



14









 





     “Award Agreement” means, with respect to each Award, the signed written agreement between the
Company and the Participant setting forth the terms and conditions of the Award.



     “Board” means the Board of Directors of the Company.



     “Cause” means (a) the commission of an act of theft, embezzlement, fraud, dishonesty, (b) a
breach of fiduciary duty to the Company or a Parent or Subsidiary, (c) a failure to materially
perform the customary duties of employee’s employment, or (d) such additional criteria determined
by the Board and included in an Award Agreement or other agreement with a Participant.



     “Code” means the Internal Revenue Code of 1986, as amended.



     “Committee” means the Compensation Committee of the Board or those persons to whom
administration of the Plan, or part of the Plan, has been delegated as permitted by law.



     “Company” means Omneon, Inc. or any successor corporation.



     “Corporate Transaction” means (a) a merger or consolidation in which the Company is not the
surviving corporation (other than a merger or consolidation with a wholly-owned subsidiary, a
reincorporation of the Company in a different jurisdiction, or other transaction in which there is
no substantial change in the stockholders of the Company and the Awards granted under the Plan are
assumed or replaced by the successor corporation, which assumption shall be binding on all
Participants), (b) a dissolution or liquidation of the Company, (c) the sale of substantially all
of the assets of the Company, (d) a merger in which the Company is the surviving corporation but
after which the stockholders of the Company immediately prior to such merger (other than any
stockholder that merges, or which owns or controls another corporation that merges, with the
Company in such merger) cease to own their shares or other equity interest in the Company; or (e)
any other transaction which qualifies as a “corporate transaction” under Section 424(a) of the Code
wherein the stockholders of the Company give up all of their equity interest in the Company (except
for the acquisition, sale or transfer of all or substantially all of the outstanding shares of the
Company).



     “Disability” means a disability, whether temporary or permanent, partial or total, as
determined by the Committee.



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



     “Exercise Price” means the price at which a holder of an Option may purchase the Shares
issuable upon exercise of the Option.



     “Expiration Date” means the latest outside date set by the Committee under the terms of the
Plan (Section 5.3 in the case of an Option and Section 8.3 in the case of a SAR) on which an Award
ceases to exist.



     “Fair Market Value” means, as of any date, the value of a share of the Company’s Common Stock
determined as follows:



               (a) if such Common Stock is publicly traded and is then listed on a national
securities exchange, its closing price on the date of determination on the principal



15









 




national securities exchange on which the Common Stock is listed or admitted to trading as
reported in The Wall Street Journal;




               (b) if such Common Stock is publicly traded but is not listed or admitted to trading
on a national securities exchange, the average of the closing bid and asked prices on the date of
determination as reported in The Wall Street Journal;



               (c) in the case of an Award granted on the IPO Effective Date, the price per share
at which shares of the Company’s Common Stock are initially offered for sale to the public by the
Company’s underwriters in the initial public offering of the Company’s Common Stock pursuant to a
registration statement filed with the SEC under the Securities Act; or



               (d) if none of the foregoing is applicable, by the Committee in good faith.



     “Family Member” includes any of the following:



               (a) child, stepchild, grandchild, parent, stepparent, grandparent, spouse, former
spouse, sibling, niece, nephew, mother-in-law, father-in-law, son-in-law, daughter-in-law,
brother-in-law, or sister-in-law of the Participant, including any such person with such
relationship to the Participant by adoption;



               (b) any person (other than a tenant or employee) sharing the Participant’s
household;



               (c) a trust in which the persons in (a) and (b) have more than fifty percent of the
beneficial interest;



               (d) a foundation in which the persons in (a) and (b) or the Participant control the
management of assets; or



               (e) any other entity in which the persons in (a) and (b) or the Participant own more
than fifty percent of the voting interest.



     “IPO Effective Date” means the date the underwritten initial public offering of the Company’s
Common Stock pursuant to a registration statement is declared effective by the SEC.



     “Option” means an award of an option to purchase Shares pursuant to Section 5.



     “Option Agreement” means, with respect to each Option, the signed written agreement between
the Company and the Participant setting forth the terms and conditions of the Option.



     “Outside Director” means a member of the Board who is not an employee of the Company or any
Parent or Subsidiary.



     “Parent” means any corporation (other than the Company) in an unbroken chain of corporations
ending with the Company if each of such corporations other than the Company owns stock possessing
50% or more of the total combined voting power of all classes of stock in one of the other
corporations in such chain.



16









 





     “Participant” means a person who receives an Award under this Plan.



     “Performance Factors” means the factors selected by the Committee from among the following
measures (whether or not in comparison to other peer companies) to determine whether the
performance goals, each with respect to the Company and/or one or more of its affiliates or
operating units, established by the Committee and applicable to Awards have been satisfied: (i)
operating income; (ii) earnings before interest, taxes, depreciation and amortization; (iii)
earnings; (iv) cash flow; (v) market share; (vi) sales; (vii) revenue; (viii) profits before
interest and taxes; (ix) expenses; (x) cost of goods sold; (xi) profit/loss or profit margin; (xii)
working capital; (xiii) return on capital, equity or assets; (xiv) earnings per share; (xv)
economic value added; (xvi) stock price; (xvii) price/earnings ratio; (xviii) debt or
debt-to-equity; (xix) accounts receivable; (xx) writeoffs; (xxi) cash; (xxii) assets; (xxiii)
liquidity; (xxiv) operations; (xxv) intellectual property (e.g., patents); (xxvi) product
development; (xxvii) regulatory activity; (xxviii) manufacturing, production or inventory; (xxix)
mergers and acquisitions or divestitures; (xxx) financings; and/or (xxxi) customer satisfaction;
and any other factor the Committee so designates.



     “Performance Period” means the period of time during which years of service or performance is
to be measured for the Award.



     “Performance Share” means an Award granted pursuant to Section 10 of the Plan.



     “Performance Share Agreement” means an agreement evidencing a Performance Share Award granted
pursuant to Section 10 of the Plan.



     “Plan” means this Omneon, Inc. 2008 Equity Incentive Plan.



     “Purchase Price” means the price to be paid for Shares acquired under the Plan, other than
Shares acquired upon exercise of an Option.



     “Restricted Stock Award” means an award of Shares pursuant to Section 6 of the Plan.



     “Restricted Stock Purchase Agreement” means an agreement evidencing a Restricted Stock Award
granted pursuant to Section 6 of the Plan.



     “Restricted Stock Unit” means an Award granted pursuant to Section 9 of the Plan.



     “RSU Agreement” means an agreement evidencing a Restricted Stock Unit Award granted pursuant
to Section 9 of the Plan.



     “SAR Agreement” means an agreement evidencing a Stock Appreciation Right granted pursuant to
Section 8 of the Plan.



     “SEC” means the Securities and Exchange Commission.



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



     “Section 16 Insider” means an officer or director of the Company or any other person whose
transactions in the Company’s Common Stock are subject to Section 16 of the Exchange Act.



17









 





     “Shares” means shares of the Company’s Common Stock reserved for issuance under this Plan, as
adjusted pursuant to Sections 2 and 21, and any successor security.



     “Stock Appreciation Right” means an Award granted pursuant to Section 8 of the Plan.



     “Stock Bonus” means an Award granted pursuant to Section 7 of the Plan.



     “Stock Bonus Agreement” means an agreement evidencing a Stock Bonus Award granted pursuant to
Section 7 of the Plan.



     “Subsidiary” means any corporation (other than the Company) in an unbroken chain of
corporations beginning with the Company if each of the corporations other than the last corporation
in the unbroken chain owns stock possessing 50% or more of the total combined voting power of all
classes of stock in one of the other corporations in such chain.



     “Termination” or “Terminated” means, for purposes of this Plan with respect to a Participant,
that the Participant has for any reason ceased to provide services as an employee, officer,
director, consultant, independent contractor or advisor to the Company or a Parent or Subsidiary of
the Company. An employee will not be deemed to have ceased to provide services in the case of (i)
sick leave, (ii) military leave, or (iii) any other leave of absence approved by the Committee;
provided, that such leave is for a period of not more than 90 days except as may be
approved by the Committee on a case-by-case basis, or unless reemployment upon the expiration of
such leave is guaranteed by contract or statute or unless provided otherwise pursuant to formal
policy adopted from time to time by the Company and issued and promulgated to employees in writing.
In the case of any employee on an approved leave of absence, the Committee may make such
provisions respecting suspension of vesting of the Award while on leave from the employ of the
Company or a Parent or Subsidiary of the Company as it may deem appropriate, except that in no
event may an Award continue beyond such Award’s Expiration Date. The Committee will have sole
discretion to determine whether a Participant has ceased to provide services and the effective date
on which the Participant ceased to provide services (the “Termination Date”).



     “Unvested Shares” means those Shares that as of the date of determination have not vested
under the vesting schedule set forth in the applicable Award Agreement.




18











 





OMNEON, INC.




2008 EQUITY INCENTIVE PLAN



OPTION AGREEMENT



     This Option Agreement (the “Agreement”) is made and entered into as of the date of grant (the
“Date of Grant”) set forth on the attached Notice of Grant of Stock Options and Option Agreement
(the “Grant Notice”) by and between Omneon, Inc., a Delaware corporation (the “Company”), and the
individual named on the Grant Notice (the “Participant”) as the recipient of the stock option.
Capitalized terms not defined herein shall have the meaning ascribed to them in the Company’s 2008
Equity Incentive Plan (the “Plan”). For the sake of clarity, the Company’s Stock Option Plan
referenced in the Grant Notice is the Plan.



     1. GRANT OF OPTION. The Company hereby grants to Participant an option
(this “Option”) to purchase the total number of shares of Common Stock of the Company set forth in
the Grant Notice (the “Shares”) at the purchase or exercise price per share set forth in the Grant
Notice (the “Exercise Price”), subject to all of the terms and conditions of this Agreement and the
Plan. If designated as an Incentive Stock Option on the Grant Notice, the Option is intended to
qualify as an “incentive stock option” (the “ISO”) within the meaning of Section 422 of the
Internal Revenue Code of 1986, as amended (the “Code”), except that if on the date of grant the
Participant is not subject to U.S. income tax, then this Option shall be a Non-Qualified Stock
Option (“NQSO”).



     2. EXERCISE PERIOD.



          2.1 Exercise Period of Option. Provided Participant continues to provide
services to the Company or any Subsidiary or Parent of the Company, the Option will become vested
and exercisable as to portions of the Shares as follows: (i) this Option shall not vest nor be
exercisable with respect to any of the Shares until twelve (12) months following the effective date
of grant of the Option as set forth on the Grant Notice (the “First Vesting Date” or the “Vest
Date”); (ii) on the First Vesting Date the Option will become vested and exercisable as to
twenty-five percent (25%) of the Shares; and (iii) thereafter at the end of each full succeeding
calendar month the Option will become vested and exercisable as to 1/48th of the Shares
until the Shares are vested with respect to all of the Shares. For example, if the First Vesting
Date falls on the 16th day of a month, then on the 16th day of each month
following the First Vesting Date the Option will become vested and exercisable as to
1/48th of the Shares until all of the Shares are vested. If application of the vesting
percentage causes a fractional share, such share shall be rounded down to the nearest whole share
for each month except for the last month in such vesting period, at the end of which last month
this Option shall become exercisable for the full remainder of the Shares.



          2.2 Vesting of Option. Shares that are vested pursuant to the schedule set
forth in Section 2.1 are “Vested Shares.” Shares that are not vested pursuant to the schedule set
forth in Section 2.1 are “Unvested Shares.”



          2.3 Expiration. The Option shall expire on the date of expiration set
forth in the Grant Notice (the “Expiration Date”) or earlier as provided in Section 3 below or
pursuant to Section 5.6 of the Plan.



Effective 8/29/08




 









 








     3. TERMINATION.



          3.1 Termination for Any Reason Except Death, Disability or Cause. If
Participant is Terminated for any reason, except death, Disability or for Cause, the Option, to the
extent (and only to the extent) that it would have been exercisable by Participant on the
Termination Date, may be exercised by Participant no later than three (3) months after the
Termination Date, but in any event no later than the Expiration Date.



          3.2 Termination Because of Death or Disability. If Participant is
Terminated because of death or Disability of Participant (or Participant dies within three (3)
months of Termination when Termination is for any reason other than Participant’s Disability or for
Cause), the Option, to the extent that it is exercisable by Participant on the Termination Date,
may be exercised by Participant (or Participant’s legal representative) no later than twelve (12)
months after the Termination Date, but in any event no later than the Expiration Date. Any
exercise beyond (i) three (3) months after the Termination Date when the Termination is for any
reason other than the Participant’s death or disability, within the meaning of Section 22(e)(3) of
the Code; or (ii) twelve (12) months after the Termination Date when the termination is for
Participant’s disability, within the meaning of Section 22(e)(3) of the Code, is deemed to be an
NQSO.



          3.3 Termination for Cause. If the Participant is terminated for Cause, the
Participant may exercise such Participant’s Options, but not to an extent greater than such Options
are exercisable as to Vested Shares upon the Termination Date and Participant’s Options shall
expire on such Participant’s Termination Date, or at such later time and on such conditions as are
determined by the Company.



          3.4 No Obligation to Employ. Nothing in the Plan or this Agreement shall
confer on Participant any right to continue in the employ of, or other relationship with, the
Company or any Parent or Subsidiary of the Company, or limit in any way the right of the Company or
any Parent or Subsidiary of the Company to terminate Participant’s employment or other relationship
at any time, with or without Cause.



     4. MANNER OF EXERCISE.



          4.1 Stock Option Exercise Agreement. To exercise this Option, Participant
(or in the case of exercise after Participant’s death or incapacity, Participant’s executor,
administrator, heir or legatee, as the case may be) must deliver to the Company an executed stock
option exercise agreement in the form attached hereto as Exhibit A, or in such other form
as may be approved by the Company from time to time (the “Exercise Agreement”), which shall set
forth, inter alia, (i) Participant’s election to exercise the Option, (ii) the
number of Shares being purchased, (iii) any restrictions imposed on the Shares and (iv) any
representations, warranties and agreements regarding Participant’s investment intent and access to
information as may be required by the Company to comply with applicable securities laws. If
someone other than Participant exercises the Option, then such person must submit documentation
reasonably acceptable to the Company verifying that such person has the legal right to exercise the
Option and such person shall be subject to all of the restrictions contained herein as if such
person were the Participant.



          4.2 Limitations on Exercise. The Option may not be exercised unless such
exercise is in compliance with all applicable federal and state securities laws, as they are in
effect on the date of exercise.



Effective 8/29/08




2









 








          4.3 Payment. The Exercise Agreement shall be accompanied by full payment of
the Exercise Price for the shares being purchased in cash (by check), or where permitted by law:



          (a) by cancellation of indebtedness of the Company to the Participant;



          (b) by surrender of shares of the Company’s Common Stock that (i) either (A) the
Company has received “full payment of the purchase price” within the meaning of SEC Rule 144 (and,
if such shares were purchased from the Company by use of a promissory note, such note has been
fully paid with respect to such shares); or (B) were obtained by Participant in the open public
market; and (ii) are clear of all liens, claims, encumbrances or security interests;



          (c) by waiver of compensation due or accrued to Participant for services rendered;



          (d) provided that a public market for the Company’s stock exists: (i) through a
“same day sale” commitment from Participant and a broker-dealer designated by the Company whereby
Participant irrevocably elects to exercise the Option and to sell a portion of the Shares so
purchased sufficient to pay for the total Exercise Price and whereby the broker-dealer irrevocably
commits upon receipt of such Shares to forward the total Exercise Price directly to the Company, or
(ii) through a “margin” commitment from Participant and a broker-dealer designated by the Company
whereby Participant irrevocably elects to exercise the Option and to pledge the Shares so purchased
to the broker-dealer in a margin account as security for a loan from the broker-dealer in the
amount of the total Exercise Price, and whereby the broker-dealer irrevocably commits upon receipt
of such Shares to forward the total Exercise Price directly to the Company; or



          (e) any other form of consideration approved by the Company; or



          (f) by any combination of the foregoing.



          4.4 Tax Withholding. Prior to the issuance of the Shares upon exercise of
the Option, Participant must pay or provide for any applicable federal, state and local withholding
obligations of the Company. If the Company permits, Participant may provide for payment of
withholding taxes upon exercise of the Option by requesting that the Company retain the minimum
number of Shares with a Fair Market Value equal to the minimum amount of taxes required to be
withheld; but in no event will the Company withhold Shares if such withholding would result in
adverse accounting consequences to the Company. In such case, the Company shall issue the net
number of Shares to the Participant by deducting the Shares retained from the Shares issuable upon
exercise.



          4.5 Issuance of Shares. Provided that the Exercise Agreement and payment
are in form and substance satisfactory to counsel for the Company, the Company shall issue the
Shares registered in the name of Participant, Participant’s authorized assignee, or Participant’s
legal representative, and shall deliver certificates representing the Shares with the appropriate
legends affixed thereto.



     5. NOTICE OF DISQUALIFYING DISPOSITION OF ISO SHARES. If the Option is an
ISO, and if Participant sells or otherwise disposes of any of the Shares acquired pursuant to



Effective 8/29/08




3









 







the
ISO on or before the later of (i) the date two (2) years after the Date of Grant, and (ii) the date
one (1) year after transfer of such Shares to Participant upon exercise of the Option, Participant
shall immediately notify the Company in writing of such disposition. Participant agrees that
Participant may be subject to income tax withholding by the Company on the compensation income
recognized by Participant from the early disposition by payment in cash or out of the current wages
or other compensation payable to Participant.




     6. COMPLIANCE WITH LAWS AND REGULATIONS. The Plan and this Agreement are
intended to comply with Section 25102(o) of the California Corporations Code and any regulations
relating thereto. Any provision of this Agreement that is inconsistent with Section 25102(o) or
any regulations relating thereto shall, without further act or amendment by the Company or the
Board, be reformed to comply with the requirements of Section 25102(o) and any regulations relating
thereto. The exercise of the Option and the issuance and transfer of Shares shall be subject to
compliance by the Company and Participant with all applicable requirements of federal and state
securities laws and with all applicable requirements of any stock exchange on which the Company’s
Common Stock may be listed at the time of such issuance or transfer. Participant understands that
the Company is under no obligation to register or qualify the Shares with the SEC, any state
securities commission or any stock exchange to effect such compliance.



     7. NONTRANSFERABILITY OF OPTION. The Option may not be transferred in any
manner other than by will or by the laws of descent and distribution, and, with respect to NQSOs,
by instrument to an inter vivos or testamentary trust in which the options are to be passed to
beneficiaries upon the death of the trustor (settlor), or by gift to “immediate family” as that
term is defined in 17 C.F.R. 240.16a-1(e), and may be exercised during the lifetime of Participant
only by Participant or in the event of Participant’s incapacity, by Participant’s legal
representative. The terms of the Option shall be binding upon the executors, administrators,
successors and assigns of Participant.



     8. MARKET STANDOFF. Participant hereby agrees that if so requested by the
Company or any representative of the underwriters (the “Managing Underwriter”) in connection with
any registration of the offering of any securities of the Company under the Securities Act,
Participant shall not sell or otherwise transfer any Shares or other securities of the Company
during the 180-day period (or such longer period as may be requested in writing by the Managing
Underwriter and agreed to in writing by the Company) (the “Market Standoff Period”) following the
effective date of a registration statement of the Company filed under the Securities Act; provided,
however, that such restriction shall apply only to the first registration statement of the Company
to become effective under the Securities Act that includes securities to be sold on behalf of the
Company to the public in an underwritten public offering under the Securities Act. The Company may
impose stop-transfer instructions with respect to securities subject to the foregoing restrictions
until the end of such Market Standoff Period. Participant further agrees to enter into any
agreement reasonably required by the Managing Underwriter to implement the foregoing.



     9. TAX CONSEQUENCES. Set forth below is a brief summary as of the date the
Plan was adopted of some of the federal tax consequences of exercise of the Option and disposition
of the Shares. THIS SUMMARY IS NECESSARILY INCOMPLETE, AND THE TAX LAWS AND REGULATIONS ARE
SUBJECT TO CHANGE. PARTICIPANT SHOULD
CONSULT A TAX ADVISER BEFORE EXERCISING THE OPTION OR DISPOSING OF THE SHARES.



Effective 8/29/08




4









 








          9.1 Exercise of ISO. If the Option qualifies as an ISO, there will be no
regular federal income tax liability upon the exercise of the Option, although the excess, if any,
of the Fair Market Value of the Shares on the date of exercise over the Exercise Price will be
treated as a tax preference item for federal alternative minimum tax purposes and may subject the
Participant to the alternative minimum tax in the year of exercise.



          9.2 Exercise of Nonqualified Stock Option. If the Option does not qualify
as an ISO, there may be a regular federal income tax liability upon the exercise of the Option.
Participant will be treated as having received compensation income (taxable at ordinary income tax
rates) equal to the excess, if any, of the Fair Market Value of the Shares on the date of exercise
over the Exercise Price. If Participant is a current or former employee of the Company, the
Company may be required to withhold from Participant’s compensation or collect from Participant and
pay to the applicable taxing authorities an amount equal to a percentage of this compensation
income at the time of exercise.



          9.3 Disposition of Shares. The following tax consequences may apply upon
disposition of the Shares.



               (a) Incentive Stock Options. If the Shares are held for more than twelve
(12) months after the date of purchase of the Shares pursuant to the exercise of an ISO and are
disposed of more than two (2) years after the Date of Grant, any gain realized on disposition of
the Shares will be treated as long term capital gain for federal and California income tax
purposes. If Vested Shares purchased under an ISO are disposed of within the applicable one (1)
year or two (2) year period, any gain realized on such disposition will be treated as compensation
income (taxable at ordinary income rates in the year of the disposition) to the extent of the
excess, if any, of the Fair Market Value of the Shares on the date of exercise over the Exercise
Price. To the extent the Shares were exercised prior to vesting coincident with the filing of an
83(b) Election, the amount taxed because of a disqualifying disposition will be based upon the
excess, if any, of the fair market value on the date of vesting over the exercise price.



               (b) Nonqualified Stock Options. If the Shares are held for more than twelve
(12) months after the date of purchase of the Shares pursuant to the exercise of an NQSO, any gain
realized on disposition of the Shares will be treated as long term capital gain.



     10. PRIVILEGES OF STOCK OWNERSHIP. Participant shall not have any of the
rights of a stockholder with respect to any Shares until the Shares are issued to Participant.



     11. GENERAL PROVISIONS



          11.1 Interpretation. Any dispute regarding the interpretation of this
Agreement shall be submitted by Participant or the Company to the Compensation Committee of the
Board of Directors (the “Committee”) for review. The resolution of such a dispute by the Committee
shall be final and binding on the Company and Participant.



          11.2 Entire Agreement. The Plan is incorporated herein by reference. This
Agreement, the Grant Notice and the Plan constitute the entire agreement of the parties and
supersede all prior undertakings and agreements with respect to the subject matter hereof.
This Agreement may not be modified except in a writing signed by both parties hereto.



Effective 8/29/08




5









 








          11.3 Notices. Any notice required to be given or delivered to the Company
under the terms of this Agreement shall be in writing and addressed to the Corporate Secretary of
the Company at its principal corporate offices specified below. Any notice required to be given or
delivered to Participant shall be in writing and addressed to Participant at the address indicated
below or to such other address as such party may designate in writing from time to time to the
Company. All notices shall be deemed to have been given or delivered upon: (i) personal delivery;
(ii) three (3) days after deposit in the United States mail by certified or registered mail (return
receipt requested); or (iii) one (1) business day after deposit with any return receipt express
courier (prepaid).



          11.4 Successors and Assigns. The Company may assign any of its rights under
this Agreement and the Grant Notice. This Agreement and the Grant Notice shall be binding upon and
inure to the benefit of the successors and assigns of the Company. Subject to the restrictions on
transfer set forth herein, this Agreement and the Grant Notice shall be binding upon Participant
and Participant’s heirs, executors, administrators, legal representatives, successors and assigns.



          11.5 Governing Law. This Agreement and the Grant Notice shall be governed
by and construed in accordance with the laws of the State of California as such laws are applied to
agreements between California residents entered into and to be performed entirely within
California. If any provision of this Agreement or the Grant Notice is determined by a court of law
to be illegal or unenforceable, then such provision will be enforced to the maximum extent possible
and the other provisions will remain fully effective and enforceable.



          11.6 Acceptance. Participant hereby acknowledges receipt of a copy of the
Plan, the Grant Notice and this Agreement. Participant has read and understands the terms and
provisions thereof, and accepts the Option subject to all the terms and conditions of the Plan, the
Grant Notice and this Agreement. Participant acknowledges that there may be adverse tax
consequences upon exercise of the Option or disposition of the Shares and that Participant should
consult a tax adviser prior to such exercise or disposition.



Effective 8/29/08




6









 








EXHIBIT A




FORM OF STOCK OPTION EXERCISE AGREEMENT



Effective 8/29/08





 









 








No.           




OMNEON, INC.




2008 EQUITY INCENTIVE PLAN



OPTION EXERCISE AGREEMENT



     This Option Exercise Agreement (the “Exercise Agreement”) is made and entered into as of
____________________, 20___ (the “Effective Date”) by and between Omneon, Inc., a Delaware
corporation (the “Company”), and the purchaser named below (the “Purchaser”). Capitalized terms
not defined herein shall have the meanings ascribed to them in the Company’s 2008 Equity Incentive
Plan (the “Plan”).



	 	 	 

	Purchaser:
	 	 
	 
	 	 
	 

	 	 
	 
	 	 
	 
	 	 
	 

	 	 
	 
	 	 
	Social Security Number:
	 	 
	 

	 	 
	 
	 	 
	Address:
	 	 
	 

	 	 
	 
	 	 
	 
	 	 
	 

	 	 
	 
	 	 
	Total Number of Shares:
	 	 
	 

	 	 
	 
	 	 
	Exercise Price Per Share:
	 	 
	 

	 	 
	 
	 	 
	Date of Grant:
	 	 
	 

	 	 
	 
	 	 
	First Vesting Date:
	 	 
	 

	 	 
	 
	 	 
	Expiration Date:
	 	 
	 

	 	 
	 

	 	(Unless earlier terminated under Section 5.6 of the Plan)
	 
	 	 
	Type of Stock Option
	 	 
	 
	 	 
	(Check one):

	 	o Incentive Stock Option

o Nonqualified Stock Option






     1. Exercise of Option.



          1.1 Exercise. Pursuant to exercise of that certain option (the “Option”) granted to
Purchaser under the Plan and subject to the terms and conditions of this Exercise Agreement,
Purchaser hereby purchases from the Company, and the Company hereby sells to Purchaser, the Total
Number of Shares set forth above (the “Shares”) of the Company’s Common Stock at the Exercise Price
Per Share set forth above (the “Exercise Price”). As used in this Exercise Agreement, the term
“Shares” refers to the Shares purchased under this Exercise Agreement and includes all securities
received (i) in replacement of the Shares, (ii) as a result of stock dividends or stock splits with
respect to the Shares, and (iii) all securities received in replacement of the Shares in a merger,
recapitalization, reorganization or similar corporate transaction.



          1.2 Title to Shares. The exact spelling of the name(s) under which Purchaser will
take title to the Shares is:



Effective 8/29/08




 









 








      




      




          1.3 Payment. Purchaser hereby delivers payment of the Exercise Price, along with an
amount equal to any applicable tax obligations, in the manner permitted in the Option Agreement as
follows (check and complete as appropriate):




	o  	 	in cash (by check) in the amount of $____________, receipt of which is
acknowledged by the Company;
	 
	o  	 	by cancellation of indebtedness of the Company owed to Purchaser in
the amount of $_______________;
	 
	o  	 	by delivery of _________ fully-paid, nonassessable and vested shares
of the Common Stock of the Company owned by Purchaser for which the
Company has received “full payment of the purchase price” within the
meaning of SEC Rule 144, (if purchased by use of a promissory note,
such note has been fully paid with respect to such vested shares), or
obtained by Purchaser in the open public market, and owned free and
clear of all liens, claims, encumbrances or security interests, valued
at the current Fair Market Value of $___________ per share; or
	 
	o  	 	by the waiver hereby of compensation due or accrued for services
rendered in the amount of $________.





     2. Delivery.



          2.1 Deliveries by Purchaser. Purchaser hereby delivers to the Company (i) this
Exercise Agreement, and (ii) the Exercise Price and payment or other provision for any applicable
tax obligations in the form(s) indicated above (if in the form of a check, then a copy of the check
is attached hereto).



          2.2 Deliveries by the Company. Upon its receipt of the Exercise Price, payment or
other provision for any applicable tax obligations and all the documents to be executed and
delivered by Purchaser to the Company under Section 2.1, the Company will issue a duly executed
stock certificate evidencing the Shares in the name of Purchaser.



     3. Representations and Warranties of Purchaser. Purchaser represents and warrants to
the Company that:



          3.1 Agrees to Terms of the Plan. Purchaser has received a copy of the Plan



          and the Option Agreement, has read and understands the terms of the Plan, the Option
Agreement and this Exercise Agreement, and agrees to be bound by their terms and conditions.
Purchaser acknowledges that there may be adverse tax consequences upon exercise of the Option or
disposition of the Shares, and that Purchaser should consult a tax adviser prior to such exercise
or disposition.



          3.2 Purchase for Own Account for Investment. Purchaser is purchasing the Shares for
Purchaser’s own account for investment purposes only and not with a view to, or for sale in
connection with, a distribution of the Shares within the meaning of the Securities Act. Purchaser
has no present intention of selling or otherwise disposing of all or any portion of the Shares and
no one other than Purchaser has any beneficial ownership of any of the Shares.



          3.3 Access to Information. Purchaser has had access to all information regarding the
Company and its present and prospective business, assets, liabilities and financial



Effective 8/29/08




 









 







condition that Purchaser reasonably considers important in making the decision to purchase the
Shares, and Purchaser has had ample opportunity to ask questions of the Company’s representatives
concerning such matters and this investment.




          3.4 Understanding of Risks. Purchaser is fully aware of: (i) the highly speculative
nature of the investment in the Shares; (ii) the financial hazards involved; (iii) the lack of
liquidity of the Shares and the restrictions on transferability of the Shares (e.g., that
Purchaser may not be able to sell or dispose of the Shares or use them as collateral for loans);
(iv) the qualifications and backgrounds of the management of the Company; and (v) the tax
consequences of investment in the Shares. Purchaser is capable of evaluating the merits and risks
of this investment, has the ability to protect Purchaser’s own interests in this transaction and is
financially capable of bearing a total loss of this investment.



          3.5 No General Solicitation. At no time was Purchaser presented with or solicited by
any publicly issued or circulated newspaper, mail, radio, television or other form of general
advertising or solicitation in connection with the offer, sale and purchase of the Shares.



     4. Compliance with Securities Laws.



          4.1 Compliance with U.S. Federal Securities Laws. Purchaser understands and
acknowledges that the Shares have not been registered with the SEC under the Securities Act and
that, notwithstanding any other provision of the Option Agreement to the contrary, the exercise of
any rights to purchase any Shares is expressly conditioned upon compliance with the Securities Act
and all applicable state securities laws. Purchaser agrees to cooperate with the Company to ensure
compliance with such laws.



          4.2 Compliance with California Securities Laws. THE PLAN, THE OPTION AGREEMENT, AND
THIS EXERCISE AGREEMENT ARE INTENDED TO COMPLY WITH SECTION 25102(o) OF THE CALIFORNIA CORPORATIONS
CODE AND ANY RULES (INCLUDING COMMISSIONER RULES, IF APPLICABLE) OR REGULATIONS PROMULGATED
THEREUNDER BY THE CALIFORNIA DEPARTMENT OF CORPORATIONS (THE “REGULATIONS”). ANY PROVISION OF THIS
EXERCISE AGREEMENT THAT IS INCONSISTENT WITH SECTION 25102(o) SHALL, WITHOUT FURTHER ACT OR
AMENDMENT BY THE COMPANY OR THE BOARD, BE REFORMED TO COMPLY WITH THE REQUIREMENTS OF SECTION
25102(o). THE SALE OF THE SECURITIES THAT ARE THE SUBJECT OF THIS EXERCISE AGREEMENT, IF NOT YET
QUALIFIED WITH THE CALIFORNIA COMMISSIONER OF CORPORATIONS AND NOT EXEMPT FROM SUCH QUALIFICATION,
IS SUBJECT TO SUCH QUALIFICATION, AND THE ISSUANCE OF SUCH SECURITIES, AND THE RECEIPT OF ANY PART
OF THE CONSIDERATION THEREFOR PRIOR TO SUCH QUALIFICATION IS UNLAWFUL UNLESS THE SALE IS EXEMPT.
THE RIGHTS OF THE PARTIES TO THIS EXERCISE AGREEMENT ARE EXPRESSLY CONDITIONED UPON SUCH
QUALIFICATION BEING OBTAINED OR AN EXEMPTION BEING AVAILABLE.



     5. Restricted Securities.



          5.1 No Transfer Unless Registered or Exempt. Purchaser understands that Purchaser may
not transfer any Shares unless such Shares are registered under the Securities Act or qualified
under applicable state securities laws or unless, in the opinion of counsel to the Company,
exemptions from such registration and qualification requirements are available. Purchaser
understands that only the Company may file a registration statement with the SEC and that the
Company is under no obligation to do so with respect to the Shares. Purchaser has also been
advised that exemptions from registration and qualification may not be available or may not permit
Purchaser to transfer all or any of the Shares in the amounts or at the times proposed by
Purchaser.



Effective 8/29/08




 









 








          5.2 SEC Rule 144. In addition, Purchaser has been advised that SEC Rule 144
promulgated under the Securities Act, which permits certain limited sales of unregistered
securities, is not presently available with respect to the Shares and, in any event, requires that
the Shares be held for a minimum of one (1) year, and in certain cases two (2) years, after they
have been purchased and paid for (within the meaning of Rule 144). Purchaser understands
that Rule 144 may indefinitely restrict transfer of the Shares so long as Purchaser remains an
“affiliate” of the Company or if “current public information” about the Company (as defined in Rule
144) is not publicly available.



          5.3 SEC Rule 701. The Shares are issued pursuant to SEC Rule 701 promulgated under
the Securities Act and may become freely tradeable by non-affiliates (under limited conditions
regarding the method of sale) ninety (90) days after the first sale of Common Stock of the Company
to the general public pursuant to a registration statement filed with and declared effective by the
SEC, subject to the lengthier market standoff agreement contained in Section 7 of this Exercise
Agreement or any other agreement entered into by Purchaser. Affiliates must comply with the
provisions (other than the holding period requirements) of Rule 144.



     6. Restrictions on Transfers.



          6.1 Disposition of Shares. Purchaser hereby agrees that Purchaser shall make no
disposition of the Shares (other than as permitted by this Exercise Agreement) unless and until:



               (a) Purchaser shall have notified the Company of the proposed disposition and provided a
written summary of the terms and conditions of the proposed disposition;



               (b) Purchaser shall have complied with all requirements of this Exercise Agreement applicable
to the disposition of the Shares;



               (c) Purchaser shall have provided the Company with written assurances, in form and substance
satisfactory to counsel for the Company, that (i) the proposed disposition does not require
registration of the Shares under the Securities Act or (ii) all appropriate actions necessary for
compliance with the registration requirements of the Securities Act or of any exemption from
registration available under the Securities Act (including Rule 144) have been taken; and



               (d) Purchaser shall have provided the Company with written assurances, in form and substance
satisfactory to the Company, that the proposed disposition will not result in the contravention of
any transfer restrictions applicable to the Shares pursuant to the provisions of the Regulations
referred to in Section 4.2 hereof.



          6.2 Transferee Obligations. Each person (other than the Company) to whom the Shares
are transferred by means of one of the permitted transfers specified in this Exercise Agreement
must, as a condition precedent to the validity of such transfer, acknowledge in writing to the
Company that such person is bound by the provisions of this Exercise Agreement and that the
transferred Shares are subject to the market stand-off provisions of Section 7, to the same extent
such Shares would be so subject if retained by the Purchaser.



     7. Market Standoff Agreement. Purchaser hereby agrees that if so requested by the
Company or any representative of the underwriters (the “Managing Underwriter”) in connection with
any registration of the offering of any securities of the Company under the Securities Act,
Purchaser shall not sell or otherwise transfer any Shares or other securities of the Company during
the 180-day period (or such longer period as may be requested in writing



Effective 8/29/08



 









 







by the Managing Underwriter and agreed to in writing by the Company) (the “Market Standoff
Period”) following the effective date of a registration statement of the Company filed under the
Securities Act; provided, however, that such restriction shall apply only to the first registration
statement of the Company to become effective under the Securities Act that includes securities to
be sold on behalf of the Company to the public in an underwritten public offering under the
Securities Act. The Company may impose stop-transfer instructions with respect to securities
subject to the foregoing restrictions until the end of such Market Standoff Period. Purchaser
further agrees to enter into any agreement reasonably required by the Managing Underwriter to
implement the foregoing.




     8. Rights as a Stockholder. Subject to the terms and conditions of this Exercise
Agreement, Purchaser will have all of the rights of a stockholder of the Company with respect to
the Shares from and after the date that Shares are issued to Purchaser until such time as Purchaser
disposes of the Shares.



     9. Restrictive Legends and Stop-Transfer Orders.



          9.1 Legends. Purchaser understands and agrees that the Company will place the legends
set forth below or similar legends on any stock certificate(s) evidencing the Shares, together with
any other legends that may be required by state or U.S. Federal securities laws, the Company’s
Certificate of Incorporation or Bylaws, any other agreement between Purchaser and the Company or
any agreement between Purchaser and any third party:




THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT
OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR UNDER THE SECURITIES LAWS OF CERTAIN
STATES. THESE SECURITIES ARE SUBJECT TO RESTRICTIONS ON TRANSFERABILITY AND RESALE
AND MAY NOT BE TRANSFERRED OR RESOLD EXCEPT AS PERMITTED UNDER THE SECURITIES ACT
AND APPLICABLE STATE SECURITIES LAWS, PURSUANT TO REGISTRATION OR EXEMPTION
THEREFROM. INVESTORS SHOULD BE AWARE THAT THEY MAY BE REQUIRED TO BEAR THE
FINANCIAL RISKS OF THIS INVESTMENT FOR AN INDEFINITE PERIOD OF TIME. THE ISSUER OF
THESE SECURITIES MAY REQUIRE AN OPINION OF COUNSEL IN FORM AND SUBSTANCE
SATISFACTORY TO THE ISSUER TO THE EFFECT THAT ANY PROPOSED TRANSFER OR RESALE IS IN
COMPLIANCE WITH THE SECURITIES ACT AND ANY APPLICABLE STATE SECURITIES LAWS.




THE SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO CERTAIN RESTRICTIONS ON
PUBLIC RESALE AND TRANSFER, AS SET FORTH IN A STOCK OPTION EXERCISE AGREEMENT
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 PUBLIC SALE AND TRANSFER
RESTRICTIONS ARE BINDING ON TRANSFEREES OF THESE SHARES.




THE SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO A 180 DAY MARKET STANDOFF
RESTRICTION AS SET FORTH IN A CERTAIN AGREEMENT BETWEEN THE ISSUER AND THE ORIGINAL
HOLDER OF THESE SHARES, A COPY OF WHICH MAY BE OBTAINED AT THE PRINCIPAL OFFICE OF
THE ISSUER. AS A RESULT OF SUCH AGREEMENT, THESE SHARES MAY NOT BE TRADED PRIOR TO
180 DAYS AFTER THE EFFECTIVE DATE OF ANY PUBLIC OFFERING OF THE COMMON STOCK OF THE
ISSUER HEREOF. SUCH RESTRICTION IS BINDING ON TRANSFEREES OF THESE SHARES.



Effective 8/29/08




 









 








          9.2 Stop-Transfer Instructions. Purchaser agrees that, to ensure compliance with the
restrictions imposed by this Exercise Agreement, the Company may issue appropriate “stop-transfer”
instructions to its transfer agent, if any, and if the Company transfers its own securities, it may
make appropriate notations to the same effect in its own records.



          9.3 Refusal to Transfer. The Company will 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 Agreement 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 have been so transferred.



     10. Tax Consequences. PURCHASER UNDERSTANDS THAT PURCHASER MAY SUFFER ADVERSE TAX
CONSEQUENCES AS A RESULT OF PURCHASER’S PURCHASE OR DISPOSITION OF THE SHARES. PURCHASER
REPRESENTS THAT: (i) PURCHASER HAS CONSULTED WITH ANY TAX ADVISER THAT PURCHASER DEEMS ADVISABLE
IN CONNECTION WITH THE PURCHASE OR DISPOSITION OF THE SHARES AND (ii) PURCHASER IS NOT RELYING ON
THE COMPANY FOR ANY TAX ADVICE. Set forth below is a brief summary as of the date the Plan was
adopted by the Compensation Committee of the Board of some of the U.S. Federal tax consequences of
exercise of the Option and disposition of the Shares. THIS SUMMARY IS NECESSARILY INCOMPLETE, AND
THE TAX LAWS AND REGULATIONS ARE SUBJECT TO CHANGE. PURCHASER SHOULD CONSULT HIS OR HER OWN TAX
ADVISER BEFORE EXERCISING THIS OPTION OR DISPOSING OF THE SHARES.



          10.1 Exercise of Incentive Stock Option. If the Option qualifies as an ISO, there
will be no regular U.S. Federal income tax liability upon the exercise of the Option, although the
excess, if any, of the Fair Market Value of the Shares on the date of exercise over the Exercise
Price will be treated as a tax preference item for U.S. Federal alternative minimum tax purposes
and may subject Purchaser to the alternative minimum tax in the year of exercise.



          10.2 Exercise of Nonqualified Stock Option. If the Option does not qualify as an ISO,
there may be a regular U.S. Federal income tax liability upon the exercise of the Option.
Purchaser will be treated as having received compensation income (taxable at ordinary income tax
rates) equal to the excess, if any, of the Fair Market Value of the Shares on the date of exercise
over the Exercise Price. If Purchaser is or was an employee of the Company, the Company may be
required to withhold from Purchaser’s compensation or collect from Purchaser and pay to the
applicable taxing authorities an amount equal to a percentage of this compensation income at the
time of exercise.



          10.3 Disposition of Shares. The following tax consequences may apply upon disposition
of the Shares.



               (a) Incentive Stock Options. If the Shares are held for more than twelve (12) months
after the date of the transfer of the Shares pursuant to the exercise of an ISO and are disposed of
more than two (2) years after the Date of Grant, any gain realized on disposition of the Shares
will be treated as long term capital gain for federal and California income tax purposes. If
Shares purchased under an ISO are disposed of within the applicable one (1) year or two (2) year
period, any gain realized on such disposition will be treated as compensation income (taxable at
ordinary income rates) to the extent of the excess, if any, of the Fair Market Value of the Shares
on the date of exercise over the Exercise Price.



               (b) Nonqualified Stock Options. If the Shares are held for more than twelve (12)
months after the date of the transfer of the Shares pursuant to the exercise of an NQSO, any gain
realized on disposition of the Shares will be treated as long term capital gain.



Effective 8/29/08




 









 








          (c) Withholding. The Company may be required to withhold from the Purchaser’s
compensation or collect from the Purchaser and pay to the applicable taxing authorities an amount
equal to a percentage of this compensation income.



     11. Compliance with Laws and Regulations. The issuance and transfer of the Shares
will be subject to and conditioned upon compliance by the Company and Purchaser with all applicable
state and U.S. Federal laws and regulations and with all applicable requirements of any stock
exchange or automated quotation system on which the Company’s Common Stock may be listed or quoted
at the time of such issuance or transfer.



     12. Successors and Assigns. The Company may assign any of its rights under this
Exercise Agreement. No other party to this Exercise Agreement may assign, whether voluntarily or
by operation of law, any of its rights and obligations under this Exercise Agreement, except with
the prior written consent of the Company. This Exercise Agreement shall be binding upon and inure
to the benefit of the successors and assigns of the Company. Subject to the restrictions on
transfer herein set forth, this Exercise Agreement will be binding upon Purchaser and Purchaser’s
heirs, executors, administrators, legal representatives, successors and assigns.



     13. Governing Law. This Exercise Agreement shall be governed by and construed in
accordance with the laws of the State of California, without giving effect to that body of laws
pertaining to conflict of laws.



     14. Notices. Any and all notices required or permitted to be given to a party
pursuant to the provisions of this Exercise Agreement will be in writing and will be effective and
deemed to provide such party sufficient notice under this Exercise Agreement on the earliest of the
following: (i) at the time of personal delivery, if delivery is in person; (ii) one (1) business
day after deposit with an express overnight courier for United States deliveries, or two (2)
business days after such deposit for deliveries outside of the United States, with proof of
delivery from the courier requested; or (iv) three (3) business days after deposit in the United
States mail by certified mail (return receipt requested) for United States deliveries.



          All notices for delivery outside the United States will be sent by express courier. All
notices not delivered personally will be sent with postage and/or other charges prepaid and
properly addressed to the party to be notified at the address set forth below the signature lines
of this Exercise Agreement, or at such other address as such other party may designate by one of
the indicated means of notice herein to the other parties hereto. Notices to the Company will be
marked “Attention: Stock Plans”.



     15. Further Assurances. The parties agree to execute such further documents and
instruments and to take such further actions as may be reasonably necessary to carry out the
purposes and intent of this Exercise Agreement.



     16. Titles and Headings. The titles, captions and headings of this Exercise Agreement
are included for ease of reference only and will be disregarded in interpreting or construing this
Exercise Agreement. Unless otherwise specifically stated, all references herein to “sections” and
“exhibits” will mean “sections” and “exhibits” to this Exercise Agreement.



     17. Entire Agreement. The Plan, the Option Agreement and this Exercise Agreement,
together with all Exhibits thereto, constitute the entire agreement and understanding of the
parties with respect to the subject matter of this Exercise Agreement, and supersede all prior
understandings and agreements, whether oral or written, between or among the parties hereto with
respect to the specific subject matter hereof.



Effective 8/29/08




 









 








     18. Counterparts. This Exercise Agreement may be executed in any number of
counterparts, each of which when so executed and delivered will be deemed an original, and all of
which together shall constitute one and the same agreement.



     19. Severability. If any provision of this Exercise Agreement is determined by any
court or arbitrator of competent jurisdiction to be invalid, illegal or unenforceable in any
respect, such provision will be enforced to the maximum extent possible given the intent of the
parties hereto. If such clause or provision cannot be so enforced, such provision shall be
stricken from this Exercise Agreement and the remainder of this Exercise Agreement shall be
enforced as if such invalid, illegal or unenforceable clause or provision had (to the extent not
enforceable) never been contained in this Exercise Agreement. Notwithstanding the forgoing, if the
value of this Exercise Agreement based upon the substantial benefit of the bargain for any party is
materially impaired, which determination as made by the presiding court or arbitrator of competent
jurisdiction shall be binding, then both parties agree to substitute such provision(s) through good
faith negotiations.



     IN WITNESS WHEREOF, the Company has caused this Exercise Agreement to be executed in
triplicate by its duly authorized representative and Purchaser has executed this Exercise Agreement
in triplicate as of the Effective Date, indicated above.



	 	 	 	 	 	 	 

	OMNEON, INC.	 	PURCHASER
	 
	 	 	 	 	 	 
	By:	 	 	 	
	 	 	 	 	 
	 	 	 	 	(Signature)
	 
	 	 	 	 	 	 








	 	 	 	 	 	 	 

	 	 	 
	(Please print name)	 	(Please print name)
	 
	 	 	 	 	 	 
	 	 	 	 	 
	(Please print title)	 	 	 	 
	 
	 	 	 	 	 	 
	Address:	 	Address:
	 
	 	 	 	 	 	 
	 	 	 
	 
	 	 	 	 	 	 
	 	 	 
	 
	 	 	 	 	 	 
	 	 	 
	 
	 	 	 	 	 	 
	Phone No.:

	 	 	 	Phone No.:	 	 
	 

	 	 
	 	 	 	 





List of Exhibits





	Exhibit 1:  	 	Copy of Purchaser’s Check





[Signature page to Omneon, Inc. Stock Option Exercise Agreement]




Effective 8/29/08




 









 








EXHIBIT 1




COPY OF PURCHASER’S CHECK



Effective 8/29/08





 











 





OMNEON, INC.

2008 EQUITY INCENTIVE PLAN

NOTICE OF RESTRICTED STOCK UNIT AWARD




GRANT NUMBER:



     Terms defined in the Company’s 2008 Equity Incentive Plan (the “Plan”) shall have the same
meanings in this Notice of Restricted Stock Unit Award (“Notice of Grant”).




Name:




Address:




You (“Participant”) have been granted an award of Restricted Stock Units
(“RSUs”), subject to the terms and conditions of the Plan and the attached Restricted
Stock Unit Agreement (hereinafter “RSU Agreement”) under the Plan , as follows:




Total Number of RSUs:




Start Date:




Date of Grant:




	 	Expiration Date:  	 	The earlier to occur of: (a) the date on which settlement of all
vested RSUs granted hereunder occurs and (b) the tenth anniversary of the Date of
Grant.






Vesting: If application of a vesting percentage would cause vesting of a fractional
share, then such vesting shall be rounded down to the nearest whole share and shall
cumulate with any other fractional shares and such fractions shall vest as they
aggregate into a whole Share.




          (a) No RSUs will vest until the earlier to occur of: (i) the date that is the
earlier of (x) six (6) months after the effective date of an initial public offering
of the Company’s securities (“IPO”) or (y) March 15 of the calendar year following
the year in which the IPO was declared effective; and (ii) the earlier to occur of:
(x) the later date on which (A) holders of Company Common Stock receive cash or
publicly traded acquiring company stock in a Corporate Transaction or (B) the date on
which any resale restrictions applicable to that publicly traded company stock
issuable hereunder have lapsed, (y) March 15 of the calendar year following the year
in which the Corporate Transaction was consummated (any of the foregoing (i) and (ii)
being an “Initial Vesting Event”). For purposes of clarity, if the Company
experiences a Corporate Transaction in which the Company is acquired for stock by an
acquirer that does not have a class of publicly traded stock, and the acquirer
assumes, converts, replaces or substitutes a comparable award for the outstanding
RSUs, such an acquisition shall not be an Initial Vesting Event and the acquiring
company shall be a successor to the Company for purposes of vesting pursuant to an
IPO or subsequent Corporate Transaction of the acquiring company.




The number of RSUs that vest on an Initial Vesting Event shall be calculated as
follows:



RSU Award Notice






1









 









Termination of Service of Participant Prior to IPO or Corporate Transaction.
If Participant’s service with the Company Terminates for any reason prior to the date
which is the earlier of (A) the date on which an IPO is declared effective or (B) the
date of consummation of a Corporate Transaction in which holders of Company Common
Stock receive cash or publicly traded acquiring company stock, then zero percent (0%)
of the RSUs shall vest on the Initial Vesting Event and on the date of Termination of
such service, all RSUs shall return to the Plan.




Termination of Service of Participant After IPO or Corporate Transaction, but
Before Initial Vesting Event. If Participant’s service with the Company has
Terminated for any reason prior to the Initial Vesting Event but has not Terminated
for any reason prior to the date which is the earlier of (A) the date on which an IPO
is declared effective or (B) the date of consummation of a Corporate Transaction in
which holders of Company Common Stock receive cash or publicly traded acquiring
company stock, then vesting shall be determined as follows: (i) if Participant
provided services without Termination for twelve months or more from the Start Date
to the date of his or her Termination, the number of RSUs that shall vest on the
Initial Vesting Event shall be equal to the product obtained by multiplying the
“Total Number of RSUs” identified above by a fraction, the numerator of which is the
total number of monthly anniversaries from the Start Date until the date of
Termination of Participant and the denominator of which is 48; and (ii) if
Participant provided services for less than twelve months from the Start Date to the
date of his or her Termination, then the number of RSUs that shall vest on the
Initial Vesting Event shall be zero.




Continuous Service of Participant To and Through Initial Vesting Event. If
Participant is providing services without Termination until the date of the Initial
Vesting Event, then vesting shall be determined as follows (each vesting date under
either of the following (i) or (ii) being a “Subsequent Vesting Event”): (i) if the
period between the Start Date and the Initial Vesting Event is less than twelve
months, then on the first anniversary of the Start Date, 25% of the RSUs will vest
provided that Participant has been providing services continuously on such first
anniversary, and thereafter on each subsequent monthly anniversary, 1/48th of the
RSUs will vest provided that Participant has been providing services continuously on
each such subsequent monthly anniversary thereafter; and (ii) if the period between
the Start Date and the Initial Vesting Event is greater than or equal to twelve
months, then 25% of the RSUs shall be vested as of the twelve month anniversary of
the Start Date and 1/48th of the RSUs shall have vested and continue to vest on each
subsequent monthly anniversary of the Start Date provided that Participant has been
providing services continuously on each such subsequent monthly anniversary
thereafter.




          (b) Notwithstanding the foregoing, if Participant is providing services without
Termination until the consummation of a Corporate Transaction that occurs prior to
the Initial Vesting Event and in which the entity acquiring the Company (the
“Acquiror”) does not assume, convert, replace or substitute a comparable award for
the outstanding RSUs to the extent then vested, then the consummation of that
Corporate Transaction shall be deemed an Initial Vesting Event and the portion of the
outstanding RSUs then vested shall be settled in whole in cash, based on the then
Fair Market Value of a Share of the Company’s Common Stock.




If Participant is Terminated at or prior to the Initial Vesting Event, then RSUs that
have not vested as provided for in (a) and (b) above shall on the Initial Vesting
Event be forfeited and returned to the Plan.



RSU Award Notice




2









 









     Settlement: Notwithstanding anything contained herein, settlement of vested RSUs
shall occur on the Initial Vesting Event or no later than thirty (30) days following
a Subsequent Vesting Event. Settlement means the delivery of Shares upon the vesting
of RSUs hereunder. One Share shall be delivered for each RSU that vests; provided,
however, in the event that the number or type of outstanding shares of the Company’s
Common Stock is changed by a stock dividend, recapitalization, stock split, reverse
stock split, subdivision, combination, reclassification or similar change in the
capital structure of the Company without consideration, then the number of Shares
issuable upon the vesting of RSUs hereunder shall be proportionately adjusted in
compliance with applicable securities laws. Settlement of RSUs on the Initial
Vesting Event or any Subsequent Vesting Event shall be in Shares unless at the time
of settlement the Committee, in its sole discretion, determines that settlement
shall, in whole or in part, be in the form of cash, based on the then Fair Market
Value of a Share of the Company’s Common Stock. Notwithstanding the immediately
preceding sentence, settlement of RSUs pursuant to a Corporate Transaction will be
made in Shares, unless otherwise specified in the definitive agreement for such
Corporate Transaction or unless as provided in paragraph (b) above. Settlement of
vested RSUs shall occur whether or not Participant is currently providing services to
the Company, or any Parent or Subsidiary of the Company at the time of settlement.


Participant understands that his or her employment or consulting relationship with the
Company is for an unspecified duration, can be Terminated at any time (i.e., is “at-will”),
and that nothing in this Notice of Grant, the RSU Agreement or the Plan changes the at-will
nature of that relationship. Participant acknowledges that the vesting of the RSUs pursuant
to this Notice of Grant is conditioned on the occurrence of an Initial Vesting Event or a
Subsequent Vesting Event. Participant also understands that this Notice of Grant is subject
to the terms and conditions of both the RSU Agreement and the Plan, both of which are
incorporated herein by reference. Participant has read both the RSU Agreement and the Plan.




	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 

	PARTICIPANT	 	 	 	OMNEON, INC.	 	 
	 

	 	 	 	 	 	 
	 	 	 	 	 	 	 	 
	Signature:

	 	 	 	 	 	 	 	Signature:	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 
	 

	 	Print Name:
	 	 	 	 	 	 	 	Print Name:
	 	Suresh Vasudevan	 	 
	 

	 	 	 	 
	 	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	 	 	Title:
	 	President and Chief Executive Officer	 	 
	 

	 	 	 	 	 	 	 	 	 	 	 	 	 	 





RSU Award Notice





3









 








OMNEON, INC.

RESTRICTED STOCK UNIT AGREEMENT UNDER THE

2008 EQUITY INCENTIVE PLAN



Unless otherwise defined herein, the terms defined in the Company’s 2008 Equity Incentive Plan (the
“Plan”) shall have the same defined meanings in this Restricted Stock Unit Agreement (the
“Agreement”).



You have been granted Restricted Stock Units (“RSUs”) subject to the terms, restrictions and
conditions of the Plan, the Notice of Restricted Stock Unit Grant (“Notice of Grant”) and this
Agreement.



1. No Stockholder Rights. Unless and until such time as Shares are issued in
settlement of vested RSUs, Participant shall have no ownership of the Shares allocated to the RSUs
and shall have no right to dividends or to vote such Shares.



2. Dividend Equivalents. Unless and until such time as Shares are issued in
settlement of vested RSUs, dividends, if any (whether in cash or Shares), shall not be credited to
Participant.



3. No Transfer. The RSUs and any interest therein shall not be sold, assigned,
transferred, pledged, hypothecated, or otherwise disposed of other than by will or by the laws of
descent and distribution, by instrument to an inter vivos or testamentary trust in which the
options are to be passed to beneficiaries upon the death of the trustor (settlor), or by gift to
“immediate family” as that term is defined in 17 C.F.R. 240.16a-1(e). The terms of the RSU shall
be binding upon the executors, administrators, successors and assigns of Participant.



4. Termination. If Participant’s service is Terminated for any reason, all RSUs
for which vesting is no longer possible under the terms of the Notice of Grant and this Agreement
shall be forfeited to the Company forthwith, and all rights of Participant to such RSUs shall
immediately terminate. In case of any dispute as to whether such Termination has occurred, the
Committee shall have sole discretion to determine whether such Termination has occurred and the
effective date of such Termination.



5. Interpretation. Any dispute regarding the interpretation of this Agreement
shall be submitted by Participant or the Company to the Compensation Committee of the Board of
Directors (the “Committee”) for review. The resolution of such a dispute by the Committee shall be
final and binding on the Company and Participant.



6. Acknowledgement. The Company and Participant agree that the RSUs are granted
under and governed by the Notice of Grant, this Agreement and by the provisions of the Plan
(incorporated herein by reference). Participant: (i) acknowledges receipt of a copy of each of the
foregoing documents, (ii) represents that Participant has carefully read and is familiar with their
provisions, and (iii) hereby accepts the RSUs subject to all of the terms and conditions set forth
herein and those set forth in the Plan and the Notice of Grant.



7. Withholding of Tax. When the RSUs are vested and/or settled the fair market
value of the Shares is treated as income subject to withholding by the Company for income and
employment taxes. The Company shall withhold an amount equal to the tax due at vesting and/or
settlement from the Participant’s other compensation or require Participant to remit to the Company
an amount equal to the tax then due. In its sole discretion, the Company may instead withhold a
number of Shares with a fair market value (determined on the date the Shares are issued) equal to
the minimum amount the Company is then required to withhold for taxes. Further, a RSU is
considered a deferral of compensation that is subject to Section 409A of the Code. Section 409A of
the Code imposes special rules to the timing of making and effecting certain amendments of this RSU
with respect to distribution of any deferred




RSU Award Notice





4









 







compensation. You should consult your personal tax advisor for more information on the actual and
potential tax consequences of this RSU.



8. Limitations on Transfer of Shares. In addition to any other limitation on
transfer created by applicable securities laws, Participant shall not assign, encumber or dispose
of any interest in the Shares issued pursuant to this Restricted Stock Unit Agreement except in
compliance with the provisions below and applicable securities laws.




     (a) Right of First Refusal. Before any Shares held by Participant or any transferee
of Participant (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 herein
(the “Right of First Refusal”).



          (i) 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 Participant or other transferee
(“Proposed Transferee”); (iii) the number of Shares to be transferred to each Proposed Transferee;
and (iv) the terms and conditions of each proposed sale or transfer. The Holder shall offer the
Shares at the same price (the “Offered Price”) and upon the same terms (or terms as similar as
reasonably possible) to the Company or its assignee(s).



          (ii) 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 (iii) below.



          (iii) Purchase Price. The purchase price (“Purchase Price”) for the Shares purchased
by the Company or its assignee(s) 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 Committee in good faith.



          (iv) 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, 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.



          (v) 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 herein, 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 sixty (60) days after the date of the Notice and provided further that any such
sale or other transfer is effected in accordance with any applicable securities laws and the
Proposed Transferee agrees in writing that the Right of First Refusal 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, or if the Holder proposes to change the
price or other terms to make them more favorable to the Proposed Transferee, 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.



     (b) Assignment. The Company’s rights under this Section 8 may be assigned in whole
or in part to any shareholder or shareholders of the Company or other persons or organizations.



RSU Award Notice





5









 








     (c) Restrictions Binding on Transferees. All transferees of Shares or any interest
therein will receive and hold such Shares or interest subject to the provisions of this agreement.
Any sale or transfer of the Company’s Shares shall be void unless the provisions of this agreement
are satisfied.



     (d) Termination of Rights. The rights provided under this Section 8 shall terminate
upon the first sale of Common Stock of the Company to the general public pursuant to a registration
statement filed with and declared effective by the Securities and Exchange Commission under the
Securities Act of 1933, as amended (the “Securities Act”) or as otherwise determined by the Company
or its successor.


9. U.S. Tax Consequences. Participant acknowledges that there will be tax
consequences upon vesting and/or settlement of the RSUs and/or disposition of the Shares, if any,
received in connection therewith, and Participant should consult a tax adviser regarding
Participant’s tax obligations prior to such settlement or disposition.



10. Compliance with Laws and Regulations. The issuance of Shares will be subject
to and conditioned upon compliance by the Company and Participant (including any written
representations, warranties and agreements as the Committee may request of Participant for
compliance with applicable laws) with all applicable state and federal laws and regulations and
with all applicable requirements of any stock exchange or automated quotation system on which the
Company’s Common Stock may be listed or quoted at the time of such issuance or transfer.



11. Restrictive Legends and Stop-Transfer Orders.




          11.1 Legends. Purchaser understands and agrees that the Company will place the
legends set forth below or similar legends on any stock certificate(s) evidencing the Shares,
together with any other legends that may be required by state or U.S. Federal securities laws, the
Company’s Certificate of Incorporation or Bylaws, any other agreement between Purchaser and the
Company or any agreement between Purchaser and any third party:




THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT
OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR UNDER THE SECURITIES LAWS OF CERTAIN
STATES. THESE SECURITIES ARE SUBJECT TO RESTRICTIONS ON TRANSFERABILITY AND RESALE
AND MAY NOT BE TRANSFERRED OR RESOLD EXCEPT AS PERMITTED UNDER THE SECURITIES ACT
AND APPLICABLE STATE SECURITIES LAWS, PURSUANT TO REGISTRATION OR EXEMPTION
THEREFROM. INVESTORS SHOULD BE AWARE THAT THEY MAY BE REQUIRED TO BEAR THE
FINANCIAL RISKS OF THIS INVESTMENT FOR AN INDEFINITE PERIOD OF TIME. THE ISSUER OF
THESE SECURITIES MAY REQUIRE AN OPINION OF COUNSEL IN FORM AND SUBSTANCE
SATISFACTORY TO THE ISSUER TO THE EFFECT THAT ANY PROPOSED TRANSFER OR RESALE IS IN
COMPLIANCE WITH THE SECURITIES ACT AND ANY APPLICABLE STATE SECURITIES LAWS.




THE SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO CERTAIN RESTRICTIONS ON
PUBLIC RESALE AND TRANSFER, AS SET FORTH IN A STOCK OPTION EXERCISE AGREEMENT
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 PUBLIC SALE AND TRANSFER
RESTRICTIONS ARE BINDING ON TRANSFEREES OF THESE SHARES.




THE SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO A 180 DAY MARKET STANDOFF
RESTRICTION AS SET FORTH IN A CERTAIN AGREEMENT BETWEEN THE ISSUER AND THE ORIGINAL
HOLDER OF THESE SHARES, A



RSU Award Notice




6









 









COPY OF WHICH MAY BE OBTAINED AT THE PRINCIPAL OFFICE OF THE ISSUER. AS A RESULT OF
SUCH AGREEMENT, THESE SHARES MAY NOT BE TRADED PRIOR TO 180 DAYS AFTER THE EFFECTIVE
DATE OF ANY PUBLIC OFFERING OF THE COMMON STOCK OF THE ISSUER HEREOF. SUCH
RESTRICTION IS BINDING ON TRANSFEREES OF THESE SHARES.



          11.2 Stop-Transfer Instructions. Purchaser agrees that, to ensure compliance with the
restrictions imposed by this Exercise Agreement, the Company may issue appropriate “stop-transfer”
instructions to its transfer agent, if any, and if the Company transfers its own securities, it may
make appropriate notations to the same effect in its own records.



          11.3 Refusal to Transfer. The Company will 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 Agreement 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 have been so transferred.


12. Successors and Assigns. The Company may assign any of its rights under this
Agreement. This Agreement shall be binding upon and inure to the benefit of the successors and
assigns of the Company. Subject to the restrictions on transfer set forth herein, this Agreement
will be binding upon Participant and Participant’s heirs, executors, administrators, legal
representatives, successors and assigns.



13. Entire Agreement; Severability. The Plan and Notice of Grant are
incorporated herein by reference. The Plan, the Notice of Grant and this 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 Participant with respect to the
subject matter hereof (including, without limitation, any other form of equity award (such as stock
options) that may have been set forth in any employment offer letter or other agreement between the
parties), and no modification of these agreements can be made other than in a writing signed by
both parties hereto. If any provision of this Agreement is determined by a court of law to be
illegal or unenforceable, then such provision will be enforced to the maximum extent possible and
the other provisions will remain fully effective and enforceable.



14. Market Standoff Agreement. Participant hereby agrees that if so requested by
the Company or any representative of the underwriters (the “Managing Underwriter”) in connection
with any registration of the offering of any securities of the Company under the Securities Act,
Participant shall not sell or otherwise transfer any Shares or other securities of the Company
during the 180-day period (or such longer period as may be requested in writing by the Managing
Underwriter and agreed to in writing by the Company) (the “Market Standoff Period”) following the
effective date of a registration statement of the Company filed under the Securities Act; provided,
however, that such restriction shall apply only to the first registration statement of the Company
to become effective under the Securities Act that includes securities to be sold on behalf of the
Company to the public in an underwritten public offering under the Securities Act. The Company may
impose stop-transfer instructions with respect to securities subject to the foregoing restrictions
until the end of such Market Standoff Period. Participant further agrees to enter into any
agreement reasonably required by the Managing Underwriter to implement the foregoing.



15. No Rights as Employee, Director or Consultant. Nothing in this Agreement
shall affect in any manner whatsoever the right or power of the Company, or a Parent or Subsidiary
of the Company, to terminate Participant‘s service, for any reason, with or without
cause.



16. Notices. Any notice required to be given or delivered to the Company under
the terms of this Agreement shall be in writing and addressed to the Corporate Secretary of the
Company at its principal corporate offices specified below. Any notice required to be given or
delivered to Participant shall be in writing and addressed to Participant at the address indicated
below or to such other address as such party may designate in writing from time to time to the
Company. All notices shall be deemed to have been




RSU Award Notice





7









 







given or delivered upon: (i) personal delivery; (ii) three (3) days after deposit in the United
States mail by certified or registered mail (return receipt requested); or (iii) one (1) business
day after deposit with any return receipt express courier (prepaid).



17. Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of California as such laws are applied to agreements between
California residents entered into and to be performed entirely within California. If any provision
of this Agreement is determined by a court of law to be illegal or unenforceable, then such
provision will be enforced to the maximum extent possible and the other provisions will remain
fully effective and enforceable.



18. Acceptance. By your signature and the signature of the Company’s
representative on the Notice of Grant, Participant and the Company agree that this RSU is granted
under and governed by the terms and conditions of the Plan, the Notice of Grant and this Agreement.
Participant has reviewed the Plan, the Notice of Grant and this Agreement in their entirety, has
had an opportunity to obtain the advice of counsel prior to executing this Agreement, and fully
understands all provisions of the Plan, the Notice of Grant and this Agreement. Participant hereby
agrees to accept as binding, conclusive and final all decisions or interpretations of the Committee
upon any questions relating to the Plan, the Notice of Grant and this Agreement. Participant
further agrees to notify the Company upon any change in Participant’s residence address.




RSU Award Notice





8











 





OMNEON, INC.




2008 EQUITY INCENTIVE PLAN



OPTION AGREEMENT (OUTSIDE DIRECTORS ONLY)



     This Option Agreement (the “Agreement”) is made and entered into as of the date of grant (the
“Date of Grant”) set forth on the attached Notice(s) of Grant of Stock Options and Option Agreement
(the “Grant Notice”) by and between Omneon, Inc., a Delaware corporation (the “Company”), and the
individual named below (the “Participant”) as the recipient of the stock option. Capitalized terms
not defined herein shall have the meaning ascribed to them in the Company’s 2008 Equity Incentive
Plan (the “Plan”). For the sake of clarity, the Company’s Stock Option Plan referenced in the Grant
Notice is the Plan.



     1. GRANT OF OPTION. The Company hereby grants to Participant an option
(this “Option”) to purchase the total number of shares of Common Stock of the Company set forth in
the Grant Notice (the “Shares”) at the purchase or exercise price per share set forth in the Grant
Notice (the “Exercise Price”), subject to all of the terms and conditions of this Agreement and the
Plan.



     2. EXERCISE PERIOD.



          2.1 Exercise Period of Option. Provided Participant continues to provide
services to the Company or any Subsidiary or Parent of the Company, and subject to the vesting
acceleration provided under Section 20.3 of the Plan, at the end of each full succeeding calendar
month following the Date of Grant the Option will become vested and exercisable as to
1/36th of the Shares until the Shares are vested with respect to all of the Shares. If
application of the vesting percentage causes a fractional share, such share shall be rounded down
to the nearest whole share for each month except for the last month in such vesting period, at the
end of which last month this Option shall become exercisable for the full remainder of the Shares.



          2.2 Vesting of Options. Shares that are vested pursuant to the schedule set
forth in Section 2.1 are “Vested Shares.” Shares that are not vested pursuant to the schedule set
forth in Section 2.1 are “Unvested Shares.”



          2.3 Expiration. The Option shall expire on the date of expiration set forth
in the Grant Notice (the “Expiration Date”) or earlier as provided in Section 3 below or pursuant
to Section 5.6 of the Plan.



     3. TERMINATION.



          3.1 Termination for Any Reason Except Death, Disability or Cause. If
Participant is Terminated for any reason, except death, Disability or for Cause, the Option, to the
extent (and only to the extent) that it would have been exercisable by Participant on the
Termination Date, may be exercised by Participant no later than six (6) months after the
Termination Date, but in any event no later than the Expiration Date.



          3.2 Termination Because of Death or Disability. If Participant is
Terminated because of death or Disability of Participant (or Participant dies within six (6) months
of Termination when Termination is for any reason other than Participant’s Disability or



Effective 8/29/08




 









 







for Cause), the Option, to the extent that it is exercisable by Participant on the Termination
Date, may be exercised by Participant (or Participant’s legal representative) no later than twelve
(12) months after the Termination Date, but in any event no later than the Expiration Date.




          3.3 Termination for Cause. If the Participant is terminated for Cause, the
Participant may exercise such Participant’s Options, but not to an extent greater than such Options
are exercisable as to Vested Shares upon the Termination Date and Participant’s Options shall
expire on such Participant’s Termination Date, or at such later time and on such conditions as are
determined by the Company.



          3.4 No Obligation to Employ. Nothing in the Plan or this Agreement shall
confer on Participant any right to continue in the employ of, or other relationship with, the
Company or any Parent or Subsidiary of the Company, or limit in any way the right of the Company or
any Parent or Subsidiary of the Company to terminate Participant’s employment or other relationship
at any time, with or without Cause.



     4. MANNER OF EXERCISE.



          4.1 Stock Option Exercise Agreement. To exercise this Option, Participant
(or in the case of exercise after Participant’s death or incapacity, Participant’s executor,
administrator, heir or legatee, as the case may be) must deliver to the Company an executed stock
option exercise agreement in the form attached hereto as Exhibit A, or in such other form
as may be approved by the Company from time to time (the “Exercise Agreement”), which shall set
forth, inter alia, (i) Participant’s election to exercise the Option, (ii) the
number of Shares being purchased, (iii) any restrictions imposed on the Shares and (iv) any
representations, warranties and agreements regarding Participant’s investment intent and access to
information as may be required by the Company to comply with applicable securities laws. If
someone other than Participant exercises the Option, then such person must submit documentation
reasonably acceptable to the Company verifying that such person has the legal right to exercise the
Option and such person shall be subject to all of the restrictions contained herein as if such
person were the Participant.



          4.2 Limitations on Exercise. The Option may not be exercised unless such
exercise is in compliance with all applicable federal and state securities laws, as they are in
effect on the date of exercise. The Option may not be exercised as to fewer than one hundred (100)
Shares unless it is exercised as to all Shares as to which the Option is then exercisable.



          4.3 Payment. The Exercise Agreement shall be accompanied by full payment of
the Exercise Price for the shares being purchased in cash (by check), or where permitted by law:



          (a) by cancellation of indebtedness of the Company to the Participant;



          (b) by surrender of shares of the Company’s Common Stock that (i) either (A) the
Company has received “full payment of the purchase price” within the meaning of SEC Rule 144 (and,
if such shares were purchased from the Company by use of a promissory note, such note has been
fully paid with respect to such shares); or (B) were obtained by Participant in the open public
market; and (ii) are clear of all liens, claims, encumbrances or security interests;



Effective 8/29/08



 









 





          (c) by waiver of compensation due or accrued to Participant for services rendered;



          (d) provided that a public market for the Company’s stock exists: (i) through a
“same day sale” commitment from Participant and a broker-dealer designated by the Company whereby
Participant irrevocably elects to exercise the Option and to sell a portion of the Shares so
purchased sufficient to pay for the total Exercise Price and whereby the broker-dealer irrevocably
commits upon receipt of such Shares to forward the total Exercise Price directly to the Company, or
(ii) through a “margin” commitment from Participant and a broker-dealer designated by the Company
whereby Participant irrevocably elects to exercise the Option and to pledge the Shares so purchased
to the broker-dealer in a margin account as security for a loan from the broker-dealer in the
amount of the total Exercise Price, and whereby the broker-dealer irrevocably commits upon receipt
of such Shares to forward the total Exercise Price directly to the Company; or



          (e) any other form of consideration approved by the Company; or



          (f) by any combination of the foregoing.



          4.4 Tax Withholding. Prior to the issuance of the Shares upon exercise of
the Option, Participant must pay or provide for any applicable federal, state and local withholding
obligations of the Company. If the Company permits, Participant may provide for payment of
withholding taxes upon exercise of the Option by requesting that the Company retain the minimum
number of Shares with a Fair Market Value equal to the minimum amount of taxes required to be
withheld; but in no event will the Company withhold Shares if such withholding would result in
adverse accounting consequences to the Company. In such case, the Company shall issue the net
number of Shares to the Participant by deducting the Shares retained from the Shares issuable upon
exercise.



          4.5 Issuance of Shares. Provided that the Exercise Agreement and payment
are in form and substance satisfactory to counsel for the Company, the Company shall issue the
Shares registered in the name of Participant, Participant’s authorized assignee, or Participant’s
legal representative, and shall deliver certificates representing the Shares with the appropriate
legends affixed thereto.



     5. COMPLIANCE WITH LAWS AND REGULATIONS. The Plan and this Agreement are
intended to comply with Section 25102(o) of the California Corporations Code and any regulations
relating thereto. Any provision of this Agreement that is inconsistent with Section 25102(o) or
any regulations relating thereto shall, without further act or amendment by the Company or the
Board, be reformed to comply with the requirements of Section 25102(o) and any regulations relating
thereto. The exercise of the Option and the issuance and transfer of Shares shall be subject to
compliance by the Company and Participant with all applicable requirements of federal and state
securities laws and with all applicable requirements of any stock exchange on which the Company’s
Common Stock may be listed at the time of such issuance or transfer. Participant understands that
the Company is under no obligation to register or qualify the Shares with the SEC, any state
securities commission or any stock exchange to effect such compliance.



     6. NONTRANSFERABILITY OF OPTION. The Option may not be transferred in any
manner other than by will or by the laws of descent and distribution, and, with respect to
NQSOs, by instrument to an inter vivos or testamentary trust in which the options are to be


 Effective 8/29/08



 









 




passed to beneficiaries upon the death of the trustor (settlor), or by gift to “immediate family”
as that term is defined in 17 C.F.R. 240.16a-1(e), and may be exercised during the lifetime of
Participant only by Participant or in the event of Participant’s incapacity, by Participant’s legal
representative. The terms of the Option shall be binding upon the executors, administrators,
successors and assigns of Participant.




     7. MARKET STANDOFF. Participant hereby agrees that if so requested by the
Company or any representative of the underwriters (the “Managing Underwriter”) in connection with
any registration of the offering of any securities of the Company under the Securities Act,
Participant shall not sell or otherwise transfer any Shares or other securities of the Company
during the 180-day period (or such longer period as may be requested in writing by the Managing
Underwriter and agreed to in writing by the Company) (the “Market Standoff Period”) following the
effective date of a registration statement of the Company filed under the Securities Act; provided,
however, that such restriction shall apply only to the first registration statement of the Company
to become effective under the Securities Act that includes securities to be sold on behalf of the
Company to the public in an underwritten public offering under the Securities Act. The Company may
impose stop-transfer instructions with respect to securities subject to the foregoing restrictions
until the end of such Market Standoff Period. Participant further agrees to enter into any
agreement reasonably required by the Managing Underwriter to implement the foregoing.



     8. TAX CONSEQUENCES. Set forth below is a brief summary as of the date the
Plan was adopted of some of the federal tax consequences of exercise of the Option and disposition
of the Shares. THIS SUMMARY IS NECESSARILY INCOMPLETE, AND THE TAX LAWS AND REGULATIONS ARE
SUBJECT TO CHANGE. PARTICIPANT SHOULD CONSULT A TAX ADVISER BEFORE EXERCISING THE OPTION OR
DISPOSING OF THE SHARES.



          8.1 Exercise of Nonqualified Stock Option. There may be a regular federal
income tax liability upon the exercise of the Option. Participant will be treated as having
received compensation income (taxable at ordinary income tax rates) equal to the excess, if any, of
the Fair Market Value of the Shares on the date of exercise over the Exercise Price. If
Participant is a current or former employee of the Company, the Company may be required to withhold
from Participant’s compensation or collect from Participant and pay to the applicable taxing
authorities an amount equal to a percentage of this compensation income at the time of exercise.



          8.2 Disposition of Shares. If the Shares are held for more than twelve (12)
months after the date of purchase of the Shares pursuant to the exercise of an NQSO, any gain
realized on disposition of the Shares will be treated as long term capital gain.



     9. PRIVILEGES OF STOCK OWNERSHIP. Participant shall not have any of the
rights of a stockholder with respect to any Shares until the Shares are issued to Participant.



     10. GENERAL PROVISIONS



          10.1 Interpretation. Any dispute regarding the interpretation of this
Agreement shall be submitted by Participant or the Company to the Compensation Committee
of the Board of Directors (the “Committee”) for review. The resolution of such a dispute by
the Committee shall be final and binding on the Company and Participant.


 Effective 8/29/08



 









 





          10.2 Entire Agreement. The Plan is incorporated herein by reference. This
Agreement, the Grant Notice and the Plan constitute the entire agreement of the parties and
supersede all prior undertakings and agreements with respect to the subject matter hereof. This
Agreement may not be modified except in a writing signed by both parties hereto.



          10.3 Notices. Any notice required to be given or delivered to the Company
under the terms of this Agreement shall be in writing and addressed to the Corporate Secretary of
the Company at its principal corporate offices specified below. Any notice required to be given or
delivered to Participant shall be in writing and addressed to Participant at the address indicated
below or to such other address as such party may designate in writing from time to time to the
Company. All notices shall be deemed to have been given or delivered upon: (i) personal delivery;
(ii) three (3) days after deposit in the United States mail by certified or registered mail (return
receipt requested); or (iii) one (1) business day after deposit with any return receipt express
courier (prepaid).



          10.4 Successors and Assigns. The Company may assign any of its rights under
this Agreement and the Grant Notice. This Agreement and the Grant Notice shall be binding upon and
inure to the benefit of the successors and assigns of the Company. Subject to the restrictions on
transfer set forth herein, this Agreement shall be binding upon Participant and Participant’s
heirs, executors, administrators, legal representatives, successors and assigns.



          10.5 Governing Law. This Agreement and the Grant Notice shall be governed
by and construed in accordance with the laws of the State of California as such laws are applied to
agreements between California residents entered into and to be performed entirely within
California. If any provision of this Agreement or the Grant Notice is determined by a court of law
to be illegal or unenforceable, then such provision will be enforced to the maximum extent possible
and the other provisions will remain fully effective and enforceable.



          10.6 Acceptance. Participant hereby acknowledges receipt of a copy of the
Plan, the Grant Notice and this Agreement. Participant has read and understands the terms and
provisions thereof, and accepts the Option subject to all the terms and conditions of the Plan, the
Grant Notice and this Agreement. Participant acknowledges that there may be adverse tax
consequences upon exercise of the Option or disposition of the Shares and that Participant should
consult a tax adviser prior to such exercise or disposition.


Effective 8/29/08



 




 






 







EXHIBIT A




FORM OF STOCK OPTION EXERCISE AGREEMENT


 Effective 8/29/08



 









 





No.                     




OMNEON, INC.




2008 EQUITY INCENTIVE PLAN



OPTION EXERCISE AGREEMENT



     This Option Exercise Agreement (the “Exercise Agreement”) is made and entered into as of
____________________, 20___ (the “Effective Date”) by and between Omneon, Inc., a Delaware
corporation (the “Company”), and the purchaser named below (the “Purchaser”). Capitalized terms
not defined herein shall have the meanings ascribed to them in the Company’s 2008 Equity Incentive
Plan (the “Plan”).



	 	 	 

	Purchaser:

	 	_____________________________________________________________________

	 
	 	 
	 
	 	 
	 

	 	 
	 
	 	 
	Social Security Number:

	 	_____________________________________________________________________

	 
	 	 
	Address:

	 	_____________________________________________________________________

	 
	 	 
	 
	 	 
	 

	 	 
	 
	 	 
	Total Number of Shares:

	 	_____________________________________________________________________

	 
	 	 
	Exercise Price Per Share:

	 	_____________________________________________________________________

	 
	 	 
	Date of Grant:

	 	_____________________________________________________________________

	 
	 	 
	First Vesting Date:

	 	_____________________________________________________________________

	 
	 	 
	Expiration Date:

	 	_____________________________________________________________________

	 

	 	(Unless earlier terminated under Section 5.6 of the Plan)
	 
	 	 
	Type of Stock Option:

	 	Nonqualified Stock Option






     1. Exercise of Option.



          1.1 Exercise. Pursuant to exercise of that certain option (the “Option”) granted to
Purchaser under the Plan and subject to the terms and conditions of this Exercise Agreement,
Purchaser hereby purchases from the Company, and the Company hereby sells to Purchaser, the Total
Number of Shares set forth above (the “Shares”) of the Company’s Common Stock at the Exercise Price
Per Share set forth above (the “Exercise Price”). As used in this Exercise Agreement, the term
“Shares” refers to the Shares purchased under this Exercise Agreement and includes all securities
received (i) in replacement of the Shares, (ii) as a result of stock dividends or stock splits with
respect to the Shares, and (iii) all securities received in replacement of the Shares in a merger,
recapitalization, reorganization or similar corporate transaction.



          1.2 Title to Shares. The exact spelling of the name(s) under which Purchaser will
take title to the Shares is:


 




Effective 8/29/08




 









 







 





          1.3 Payment. Purchaser hereby delivers payment of the Exercise Price, along with an
amount equal to any applicable tax obligations, in the manner permitted in the Option Agreement as
follows (check and complete as appropriate):




	o	 	in cash (by check) in the amount of $____________, receipt of which is
acknowledged by the Company;
	 
	o	 	by cancellation of indebtedness of the Company owed to Purchaser in
the amount of $_______________;
	 
	o	 	by delivery of _________ fully-paid, nonassessable and vested shares
of the Common Stock of the Company owned by Purchaser for which the
Company has received “full payment of the purchase price” within the
meaning of SEC Rule 144, (if purchased by use of a promissory note,
such note has been fully paid with respect to such vested shares), or
obtained by Purchaser in the open public market, and owned free and
clear of all liens, claims, encumbrances or security interests, valued
at the current Fair Market Value of $___________ per share; or
	 
	o	 	by the waiver hereby of compensation due or accrued for services
rendered in the amount of $________.





     2. Delivery.



          2.1 Deliveries by Purchaser. Purchaser hereby delivers to the Company (i) this
Exercise Agreement, and (ii) the Exercise Price and payment or other provision for any applicable
tax obligations in the form(s) indicated above (if in the form of a check, then a copy of the check
is attached hereto).



          2.2 Deliveries by the Company. Upon its receipt of the Exercise Price, payment or
other provision for any applicable tax obligations and all the documents to be executed and
delivered by Purchaser to the Company under Section 2.1, the Company will issue a duly executed
stock certificate evidencing the Shares in the name of Purchaser.



     3. Representations and Warranties of Purchaser. Purchaser represents and warrants to
the Company that:



          3.1 Agrees to Terms of the Plan. Purchaser has received a copy of the Plan and the
Option Agreement, has read and understands the terms of the Plan, the Option Agreement and this
Exercise Agreement, and agrees to be bound by their terms and conditions. Purchaser acknowledges
that there may be adverse tax consequences upon exercise of the Option or disposition of the
Shares, and that Purchaser should consult a tax adviser prior to such exercise or disposition.



          3.2 Purchase for Own Account for Investment. Purchaser is purchasing the Shares for
Purchaser’s own account for investment purposes only and not with a view to, or for sale in
connection with, a distribution of the Shares within the meaning of the Securities Act. Purchaser
has no present intention of selling or otherwise disposing of all or any portion of the Shares and
no one other than Purchaser has any beneficial ownership of any of the Shares.



          3.3 Access to Information. Purchaser has had access to all information regarding the
Company and its present and prospective business, assets, liabilities and financial condition that
Purchaser reasonably considers important in making the decision to purchase the


 Effective 8/29/08



2









 




Shares, and Purchaser has had ample opportunity to ask questions of the Company’s
representatives concerning such matters and this investment.




          3.4 Understanding of Risks. Purchaser is fully aware of: (i) the highly speculative
nature of the investment in the Shares; (ii) the financial hazards involved; (iii) the lack of
liquidity of the Shares and the restrictions on transferability of the Shares (e.g., that
Purchaser may not be able to sell or dispose of the Shares or use them as collateral for loans);
(iv) the qualifications and backgrounds of the management of the Company; and (v) the tax
consequences of investment in the Shares. Purchaser is capable of evaluating the merits and risks
of this investment, has the ability to protect Purchaser’s own interests in this transaction and is
financially capable of bearing a total loss of this investment.



          3.5 No General Solicitation. At no time was Purchaser presented with or solicited by
any publicly issued or circulated newspaper, mail, radio, television or other form of general
advertising or solicitation in connection with the offer, sale and purchase of the Shares.



     4. Compliance with Securities Laws.



          4.1 Compliance with U.S. Federal Securities Laws. Purchaser understands and
acknowledges that the Shares have not been registered with the SEC under the Securities Act and
that, notwithstanding any other provision of the Option Agreement to the contrary, the exercise of
any rights to purchase any Shares is expressly conditioned upon compliance with the Securities Act
and all applicable state securities laws. Purchaser agrees to cooperate with the Company to ensure
compliance with such laws.



          4.2 Compliance with California Securities Laws. THE PLAN, THE OPTION AGREEMENT, AND
THIS EXERCISE AGREEMENT ARE INTENDED TO COMPLY WITH SECTION 25102(o) OF THE CALIFORNIA CORPORATIONS
CODE AND ANY RULES (INCLUDING COMMISSIONER RULES, IF APPLICABLE) OR REGULATIONS PROMULGATED
THEREUNDER BY THE CALIFORNIA DEPARTMENT OF CORPORATIONS (THE “REGULATIONS”). ANY PROVISION OF THIS
EXERCISE AGREEMENT THAT IS INCONSISTENT WITH SECTION 25102(o) SHALL, WITHOUT FURTHER ACT OR
AMENDMENT BY THE COMPANY OR THE BOARD, BE REFORMED TO COMPLY WITH THE REQUIREMENTS OF SECTION
25102(o). THE SALE OF THE SECURITIES THAT ARE THE SUBJECT OF THIS EXERCISE AGREEMENT, IF NOT YET
QUALIFIED WITH THE CALIFORNIA COMMISSIONER OF CORPORATIONS AND NOT EXEMPT FROM SUCH QUALIFICATION,
IS SUBJECT TO SUCH QUALIFICATION, AND THE ISSUANCE OF SUCH SECURITIES, AND THE RECEIPT OF ANY PART
OF THE CONSIDERATION THEREFOR PRIOR TO SUCH QUALIFICATION IS UNLAWFUL UNLESS THE SALE IS EXEMPT.
THE RIGHTS OF THE PARTIES TO THIS EXERCISE AGREEMENT ARE EXPRESSLY CONDITIONED UPON SUCH
QUALIFICATION BEING OBTAINED OR AN EXEMPTION BEING AVAILABLE.



     5. Restricted Securities.



          5.1 No Transfer Unless Registered or Exempt. Purchaser understands that Purchaser may
not transfer any Shares unless such Shares are registered under the Securities Act or qualified
under applicable state securities laws or unless, in the opinion of counsel to the Company,
exemptions from such registration and qualification requirements are available. Purchaser
understands that only the Company may file a registration statement with the SEC and that the
Company is under no obligation to do so with respect to the Shares. Purchaser has also been
advised that exemptions from registration and qualification may not be available or may not permit
Purchaser to transfer all or any of the Shares in the amounts or at the times proposed by
Purchaser.


 Effective 8/29/08



3









 





          5.2 SEC Rule 144. In addition, Purchaser has been advised that SEC Rule 144
promulgated under the Securities Act, which permits certain limited sales of unregistered
securities, is not presently available with respect to the Shares and, in any event, requires that
the Shares be held for a minimum of one (1) year, and in certain cases two (2) years, after they
have been purchased and paid for (within the meaning of Rule 144). Purchaser understands
that Rule 144 may indefinitely restrict transfer of the Shares so long as Purchaser remains an
“affiliate” of the Company or if “current public information” about the Company (as defined in Rule
144) is not publicly available.



          5.3 SEC Rule 701. The Shares are issued pursuant to SEC Rule 701 promulgated under
the Securities Act and may become freely tradeable by non-affiliates (under limited conditions
regarding the method of sale) ninety (90) days after the first sale of Common Stock of the Company
to the general public pursuant to a registration statement filed with and declared effective by the
SEC, subject to the lengthier market standoff agreement contained in Section 7 of this Exercise
Agreement or any other agreement entered into by Purchaser. Affiliates must comply with the
provisions (other than the holding period requirements) of Rule 144.]



     6. Restrictions on Transfers.



          6.1 Disposition of Shares. Purchaser hereby agrees that Purchaser shall make no
disposition of the Shares (other than as permitted by this Exercise Agreement) unless and until:



               (a) Purchaser shall have notified the Company of the proposed disposition and provided a
written summary of the terms and conditions of the proposed disposition;



               (b) Purchaser shall have complied with all requirements of this Exercise Agreement applicable
to the disposition of the Shares;



               (c) Purchaser shall have provided the Company with written assurances, in form and substance
satisfactory to counsel for the Company, that (i) the proposed disposition does not require
registration of the Shares under the Securities Act or (ii) all appropriate actions necessary for
compliance with the registration requirements of the Securities Act or of any exemption from
registration available under the Securities Act (including Rule 144) have been taken; and



               (d) Purchaser shall have provided the Company with written assurances, in form and substance
satisfactory to the Company, that the proposed disposition will not result in the contravention of
any transfer restrictions applicable to the Shares pursuant to the provisions of the Regulations
referred to in Section 4.2 hereof.



          6.2 Transferee Obligations. Each person (other than the Company) to whom the Shares
are transferred by means of one of the permitted transfers specified in this Exercise Agreement
must, as a condition precedent to the validity of such transfer, acknowledge in writing to the
Company that such person is bound by the provisions of this Exercise Agreement and that the
transferred Shares are subject to the market stand-off provisions of Section 7, to the same extent
such Shares would be so subject if retained by the Purchaser.



     7. Market Standoff Agreement. Purchaser hereby agrees that if so requested by the
Company or any representative of the underwriters (the “Managing Underwriter”) in connection with
any registration of the offering of any securities of the Company under the Securities Act,
Purchaser shall not sell or otherwise transfer any Shares or other securities of the Company during
the 180-day period (or such longer period as may be requested in writing


 Effective 8/29/08



4









 




by the Managing Underwriter and agreed to in writing by the Company) (the “Market Standoff
Period”) following the effective date of a registration statement of the Company filed under the
Securities Act; provided, however, that such restriction shall apply only to the first registration
statement of the Company to become effective under the Securities Act that includes securities to
be sold on behalf of the Company to the public in an underwritten public offering under the
Securities Act. The Company may impose stop-transfer instructions with respect to securities
subject to the foregoing restrictions until the end of such Market Standoff Period. Purchaser
further agrees to enter into any agreement reasonably required by the Managing Underwriter to
implement the foregoing.




     8. Rights as a Stockholder. Subject to the terms and conditions of this Exercise
Agreement, Purchaser will have all of the rights of a stockholder of the Company with respect to
the Shares from and after the date that Shares are issued to Purchaser until such time as Purchaser
disposes of the Shares.



     9. Restrictive Legends and Stop-Transfer Orders.



          9.1 Legends. Purchaser understands and agrees that the Company will place the legends
set forth below or similar legends on any stock certificate(s) evidencing the Shares, together with
any other legends that may be required by state or U.S. Federal securities laws, the Company’s
Certificate of Incorporation or Bylaws, any other agreement between Purchaser and the Company or
any agreement between Purchaser and any third party:




THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT
OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR UNDER THE SECURITIES LAWS OF CERTAIN
STATES. THESE SECURITIES ARE SUBJECT TO RESTRICTIONS ON TRANSFERABILITY AND RESALE
AND MAY NOT BE TRANSFERRED OR RESOLD EXCEPT AS PERMITTED UNDER THE SECURITIES ACT
AND APPLICABLE STATE SECURITIES LAWS, PURSUANT TO REGISTRATION OR EXEMPTION
THEREFROM. INVESTORS SHOULD BE AWARE THAT THEY MAY BE REQUIRED TO BEAR THE
FINANCIAL RISKS OF THIS INVESTMENT FOR AN INDEFINITE PERIOD OF TIME. THE ISSUER OF
THESE SECURITIES MAY REQUIRE AN OPINION OF COUNSEL IN FORM AND SUBSTANCE
SATISFACTORY TO THE ISSUER TO THE EFFECT THAT ANY PROPOSED TRANSFER OR RESALE IS IN
COMPLIANCE WITH THE SECURITIES ACT AND ANY APPLICABLE STATE SECURITIES LAWS.




THE SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO CERTAIN RESTRICTIONS ON
PUBLIC RESALE AND TRANSFER, AS SET FORTH IN A STOCK OPTION EXERCISE AGREEMENT
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 PUBLIC SALE AND TRANSFER
RESTRICTIONS ARE BINDING ON TRANSFEREES OF THESE SHARES.




THE SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO A 180 DAY MARKET STANDOFF
RESTRICTION AS SET FORTH IN A CERTAIN AGREEMENT BETWEEN THE ISSUER AND THE ORIGINAL
HOLDER OF THESE SHARES, A COPY OF WHICH MAY BE OBTAINED AT THE PRINCIPAL OFFICE OF
THE ISSUER. AS A RESULT OF SUCH AGREEMENT, THESE SHARES MAY NOT BE TRADED PRIOR TO
180 DAYS AFTER THE EFFECTIVE DATE OF ANY PUBLIC OFFERING OF THE


 Effective 8/29/08



5









 






COMMON STOCK OF THE ISSUER HEREOF. SUCH RESTRICTION IS BINDING ON TRANSFEREES OF
THESE SHARES.



          9.2 Stop-Transfer Instructions. Purchaser agrees that, to ensure compliance with the
restrictions imposed by this Exercise Agreement, the Company may issue appropriate “stop-transfer”
instructions to its transfer agent, if any, and if the Company transfers its own securities, it may
make appropriate notations to the same effect in its own records.



          9.3 Refusal to Transfer. The Company will 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 Agreement 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 have been so transferred.



     10. Tax Consequences. PURCHASER UNDERSTANDS THAT PURCHASER MAY SUFFER ADVERSE TAX
CONSEQUENCES AS A RESULT OF PURCHASER’S PURCHASE OR DISPOSITION OF THE SHARES. PURCHASER
REPRESENTS THAT: (i) PURCHASER HAS CONSULTED WITH ANY TAX ADVISER THAT PURCHASER DEEMS ADVISABLE
IN CONNECTION WITH THE PURCHASE OR DISPOSITION OF THE SHARES AND (ii) PURCHASER IS NOT RELYING ON
THE COMPANY FOR ANY TAX ADVICE. Set forth below is a brief summary as of the date the Plan was
adopted by the Compensation Committee of the Board of some of the U.S. Federal tax consequences of
exercise of the Option and disposition of the Shares. THIS SUMMARY IS NECESSARILY INCOMPLETE, AND
THE TAX LAWS AND REGULATIONS ARE SUBJECT TO CHANGE. PURCHASER SHOULD CONSULT HIS OR HER OWN TAX
ADVISER BEFORE EXERCISING THIS OPTION OR DISPOSING OF THE SHARES.



          10.1 Exercise of Nonqualified Stock Option. If the Option does not qualify as an ISO,
there may be a regular U.S. Federal income tax liability upon the exercise of the Option.
Purchaser will be treated as having received compensation income (taxable at ordinary income tax
rates) equal to the excess, if any, of the Fair Market Value of the Shares on the date of exercise
over the Exercise Price. If Purchaser is or was an employee of the Company, the Company may be
required to withhold from Purchaser’s compensation or collect from Purchaser and pay to the
applicable taxing authorities an amount equal to a percentage of this compensation income at the
time of exercise.



          10.2 Disposition of Shares. If the Shares are held for more than twelve (12) months
after the date of the transfer of the Shares pursuant to the exercise of an NQSO, any gain realized
on disposition of the Shares will be treated as long term capital gain.



     11. Compliance with Laws and Regulations. The issuance and transfer of the Shares
will be subject to and conditioned upon compliance by the Company and Purchaser with all applicable
state and U.S. Federal laws and regulations and with all applicable requirements of any stock
exchange or automated quotation system on which the Company’s Common Stock may be listed or quoted
at the time of such issuance or transfer.



     12. Successors and Assigns. The Company may assign any of its rights under this
Exercise Agreement. No other party to this Exercise Agreement may assign, whether voluntarily or
by operation of law, any of its rights and obligations under this Exercise Agreement, except with
the prior written consent of the Company. This Exercise Agreement shall be binding upon and inure
to the benefit of the successors and assigns of the Company. Subject to the restrictions on
transfer herein set forth, this Exercise Agreement will be binding upon Purchaser and Purchaser’s
heirs, executors, administrators, legal representatives, successors and assigns.


 Effective 8/29/08



6









 





     13. Governing Law. This Exercise Agreement shall be governed by and construed in
accordance with the laws of the State of California, without giving effect to that body of laws
pertaining to conflict of laws.



     14. Notices. Any and all notices required or permitted to be given to a party
pursuant to the provisions of this Exercise Agreement will be in writing and will be effective and
deemed to provide such party sufficient notice under this Exercise Agreement on the earliest of the
following: (i) at the time of personal delivery, if delivery is in person; (ii) one (1) business
day after deposit with an express overnight courier for United States deliveries, or two (2)
business days after such deposit for deliveries outside of the United States, with proof of
delivery from the courier requested; or (iv) three (3) business days after deposit in the United
States mail by certified mail (return receipt requested) for United States deliveries.



          All notices for delivery outside the United States will be sent by express courier. All
notices not delivered personally will be sent with postage and/or other charges prepaid and
properly addressed to the party to be notified at the address set forth below the signature lines
of this Exercise Agreement, or at such other address as such other party may designate by one of
the indicated means of notice herein to the other parties hereto. Notices to the Company will be
marked “Attention: Stock Plans”.



     15. Further Assurances. The parties agree to execute such further documents and
instruments and to take such further actions as may be reasonably necessary to carry out the
purposes and intent of this Exercise Agreement.



     16. Titles and Headings. The titles, captions and headings of this Exercise Agreement
are included for ease of reference only and will be disregarded in interpreting or construing this
Exercise Agreement. Unless otherwise specifically stated, all references herein to “sections” and
“exhibits” will mean “sections” and “exhibits” to this Exercise Agreement.



     17. Entire Agreement. The Plan, the Option Agreement and this Exercise Agreement,
together with all Exhibits thereto, constitute the entire agreement and understanding of the
parties with respect to the subject matter of this Exercise Agreement, and supersede all prior
understandings and agreements, whether oral or written, between or among the parties hereto with
respect to the specific subject matter hereof.



     18. Counterparts. This Exercise Agreement may be executed in any number of
counterparts, each of which when so executed and delivered will be deemed an original, and all of
which together shall constitute one and the same agreement.



     19. Severability. If any provision of this Exercise Agreement is determined by any
court or arbitrator of competent jurisdiction to be invalid, illegal or unenforceable in any
respect, such provision will be enforced to the maximum extent possible given the intent of the
parties hereto. If such clause or provision cannot be so enforced, such provision shall be
stricken from this Exercise Agreement and the remainder of this Exercise Agreement shall be
enforced as if such invalid, illegal or unenforceable clause or provision had (to the extent not
enforceable) never been contained in this Exercise Agreement. Notwithstanding the forgoing, if the
value of this Exercise Agreement based upon the substantial benefit of the bargain for any party is
materially impaired, which determination as made by the presiding court or arbitrator of competent
jurisdiction shall be binding, then both parties agree to substitute such provision(s) through good
faith negotiations.



[Remainder of Page Intentionally Blank, Signature Page Follows]




Effective 8/29/08




7









 








     IN WITNESS WHEREOF, the Company has caused this Exercise Agreement to be executed in
triplicate by its duly authorized representative and Purchaser has executed this Exercise Agreement
in triplicate as of the Effective Date, indicated above.




	 	 	 	 	 	 	 

	OMNEON, INC.	 	PURCHASER
	 
	 	 	 	 	 	 
	By:	 	 	 	
	 	 	 	 	 
	 	 	 	 	(Signature)
	 
	 	 	 	 	 	 








	 	 	 	 	 	 	 

	 	 	 
	(Please print name)	 	(Please print name)
	 
	 	 	 	 	 	 
	 	 	 	 	 
	(Please print title)	 	 	 	 
	 
	 	 	 	 	 	 
	Address:	 	Address:
	 
	 	 	 	 	 	 
	 	 	 
	 
	 	 	 	 	 	 
	 	 	 
	 
	 	 	 	 	 	 
	 	 	 
	 
	 	 	 	 	 	 
	Phone No.:

	 	 	 	Phone No.:	 	 
	 

	 	 
	 	 	 	 





List of Exhibits





	Exhibit 1:	 	Copy of Purchaser’s Check





[Signature page to Omneon, Inc. Stock Option Exercise Agreement]





Effective 8/29/08





8









 








EXHIBIT 1




COPY OF PURCHASER’S CHECK



Effective 8/29/08