Document:

Form of Restricted Stock Agreement

 Exhibit 10.1 
  
 RESTRICTED STOCK AGREEMENT 
  
 THIS RESTRICTED STOCK AGREEMENT (this “Agreement”) is made as of
                         ,              between
Symmetry Medical Inc., a Delaware corporation (the “Company”), and                         
(“Grantee”). 
  
 WHEREAS, the Grantee is a
director of the Company; and 
  
 WHEREAS, the grant of the shares
of restricted stock (as governed by the Company’s 2004 Equity Incentive Plan (the “Plan”)) to the Grantee described herein has been authorized by the Company’s Compensation Committee and Board of Directors (the
“Board”). 
  
 NOW, THEREFORE, pursuant to the
Plan, the Company, upon the terms and conditions set forth herein, hereby grants to you 1,667 restricted shares of Common Stock, par value $.0001, (“Common Stock”) of the Company (the “Restricted Shares”) effective
as of the date hereof (the “Date of Grant”), and subject to the terms and conditions of the Plan and the terms and conditions of this Agreement. 
  
 1. Definitions. All capitalized terms used herein and not otherwise defined herein shall have the meanings assigned
to them in the Plan. 
  
 2. Issuance of Shares. In
consideration of the Grantee’s service as a director of the Company, the Restricted Shares shall be issued to the Grantee, and, upon payment to the Company by the Grantee of the aggregate par value thereof, which payment shall be made within 10
days of the date hereof, shall be fully paid and nonassessable and shall be represented by a certificate or certificates issued in the name of the Grantee and endorsed with an appropriate legend referring to the restrictions hereinafter set forth.

  
 3. Restrictions on Transfer of Shares. The Restricted
Shares may not be sold, assigned, transferred, conveyed, pledged, exchanged or otherwise encumbered or disposed of (each, a “Transfer”) by the Grantee, except to the Company, until they have become nonforfeitable as provided in
Section 3 hereof. Any purported encumbrance or disposition in violation of the provisions of this Section 2 shall be void AB INITIO, and the other party to any such purported transaction shall not obtain any rights to or interest in the
Restricted Shares. As and when permitted by the Plan, the Committee may in its sole discretion waive the restrictions on transferability with respect to all or a portion of the Restricted Shares. Notwithstanding the foregoing, Grantee may not
Transfer Restricted Shares which have become nonforfeitable as provided in Section 3 hereof unless such Restricted Shares are registered pursuant to the Securities Act of 1933 (the “Securities Act”) or under Rule 144 promulgated
under the Securities Act or unless the Company and its counsel agree with Grantee that such Transfer is not required to be registered under the Securities Act. 

 4. Vesting of Shares. 
  
 (a) Subject to Section 5 hereof, the Restricted Shares shall vest and become nonforfeitable if the Grantee remains a
director of the Company through the vesting dates set forth below with respect to the number of Restricted Shares set forth next to such date: 
  

			
	 Vesting Date

	  	Number (or Percentage) of Restricted
Shares Vesting on such Vesting Date

	 December 31, 2005
	  	555
	 December 31, 2006
	  	556
	 December 31, 2007
	  	556

  
 (b) Notwithstanding
the provisions of Section 4(a) above, in connection with a Change in Control, the provisions set forth in Section 13 of the Plan shall govern with respect to the acceleration of the vesting of the Restricted Shares. 
  
 (c) Notwithstanding the provisions of Section 3(a) above, the Board may, in
its sole discretion, accelerate the vesting of shares of the Restricted Shares at any time. 
  
 5. Forfeiture of Shares. If the Grantee ceases to be a director of the Company due to death, Disability or Retirement during any period of restriction, any non-vested Restricted Shares shall immediately vest
and all restrictions on the Restricted Shares shall lapse. If the Grantee ceases to be a director of the Company for any other reason, any non-vested Restricted Shares shall be forfeited by the Grantee and the certificate(s) representing the
non-vested portion of the Restricted Shares so forfeited shall be canceled. 
  
 6. Dividend, Voting and Other Rights. Except as otherwise provided in this Agreement, from and after the Date of Grant, the Grantee shall have all of the rights of a stockholder with respect to the Restricted
Shares, including the right to vote the Restricted Shares and receive any dividends that may be paid thereto, provided, however, that any additional Common Stock or other securities that the Grantee may become entitled to receive pursuant to a stock
dividend, stock split, recapitalization, combination of shares, merger, consolidation, separation or reorganization or any other change in the capital structure of the Company shall be subject to the same risk of forfeiture and restrictions on
transfer as the forfeitable Restricted Shares in respect of which they are issued or transferred and shall become Restricted Shares for the purposes of this Agreement. 
  
 7. Retention of Stock Certificate(s) by the Company. The certificate(s) representing the Restricted Shares shall be
held in custody by the Company, together with a stock power in the form of Exhibit A hereto which shall be endorsed in blank by the Grantee and delivered to the Company within 10 days of the date hereof, until such shares have become nonforfeitable
in accordance with Section 3. 
  
 8. Investment
Representation. Grantee hereby represents and warrants to the Company that: (i) the Grantee has had an opportunity to ask questions and receive answers concerning the terms and conditions of the offering of the Restricted Shares and has had full
access to such other information concerning the Company as it has requested; (ii) Grantee is 
  

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acquiring the Restricted Shares to be acquired by it hereunder for its own account with the present intention of holding such securities for purposes of
investment; (iii) Grantee is an “accredited investor” within the meaning of Rule 501 Regulation D promulgated under the Securities Act; (iv) Grantee understands that the Restricted Shares constitute “restricted securities” within
the meaning of Rule 144 promulgated under the Securities Act and the certificates representing such Restricted Shares will bear a legend stating, and Grantee hereby agrees, that such securities may not be transferred without the consent of the
issuer or its legal counsel as to compliance with the Securities Act; (v) Grantee does not intend to sell such securities in a public distribution in violation of any applicable foreign, federal or state securities laws. 
  
 10. Compliance with Law. The Company shall make reasonable efforts to
comply with all applicable federal and state securities laws, provided, however, notwithstanding any other provision of this Agreement, the Company shall not be obligated to issue or release from restrictions on transfer any Restricted Shares
pursuant to this Agreement if such issuance or release would result in a violation of any such law. 
  
 11. Withholding Taxes. If the Company shall be required to withhold any federal, state, local or foreign tax in connection with any issuance or
vesting of Restricted Shares or other securities pursuant to this Agreement, and the amounts available to the Company for such withholding are insufficient, the Grantee shall pay the tax or make provisions that are satisfactory to the Company for
the payment thereof. The Grantee may elect to satisfy all or any part of any such withholding obligation by surrendering to the Company a portion of the Restricted Shares that become nonforfeitable hereunder, and the Restricted Shares so surrendered
by the Grantee shall be credited against any such withholding obligation at the market value (determined with reference to the then current price of the Company’s Common Stock as quoted on the New York Stock Exchange) per Share of such
Restricted Shares on the date of such surrender. 
  
 12.
Conformity with Plan. The Agreement and the Restricted Shares granted pursuant hereto are intended to conform in all respects with, and are subject to all applicable provisions of, the Plan (which is incorporated herein by reference).
Inconsistencies between this letter agreement and the Plan shall be resolved in accordance with the terms of the Plan. By executing this Agreement, you acknowledge and agree to be bound by all of the terms of this Agreement and the Plan. 

 
 13. Amendments. The provisions of this Agreement may be amended and
waived only with the prior written consent of the Company and the Grantee. 
  
 14. Severability. In the event that one or more of the provisions of this Agreement shall be invalidated for any reason by a court of competent jurisdiction, any provision so invalidated shall be deemed to be
separable from the other provisions hereof, and the remaining provisions hereof shall continue to be valid and fully enforceable. 
  
 15. Successors and Assigns. The provisions of this Agreement shall inure to the benefit of, and be binding upon, the successors, administrators,
heirs, legal representatives and assigns of the Grantee and the successors and assigns of the Company. 
  

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 16. Notices. Any notice to the Company provided for herein shall be in writing to the attention of
the Secretary of the Company at Symmetry Medical Inc., 220 W. Market Street, Warsaw, Indiana 46580, and any notice to the Grantee shall be addressed to the Grantee at his address currently on file with the Company. Except as otherwise provided
herein, any written notice shall be deemed to be duly given if and when hand delivered, or five business days after having been mailed by United States registered or certified mail, return receipt requested, postage prepaid, or three business days
after having been sent by a nationally recognized overnight courier service, addressed as aforesaid. Any party may change the address to which notices are to be given hereunder by written notice to the other party as herein specified, except that
notices of changes of address shall be effective only upon receipt. 
  
 17. Governing Law. The laws of the State of New York, without giving effect to the principles of conflict of laws thereof, shall govern the interpretation, performance and enforcement of this Agreement. 
  
 * * * * * 
  

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 IN WITNESS WHEREOF, the undersigned have executed this Agreement as of the date first set forth above.

  

			
	SYMMETRY MEDICAL INC.
		
	By:	 	  

	Name:	 	  

	Title:	 	  

  
 ACKNOWLEDGED AND AGREED:

	
	
	

	(Signature of Grantee)

  
  

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 EXHIBIT A 
  

FORM OF ASSIGNMENT SEPARATE FROM CERTIFICATE 
  
 FOR VALUE RECEIVED,
                                 hereby sells, assigns and transfers unto
                                        ,
             shares of the Common Stock, par value $0.001 per share, of Symmetry Medical Inc., a Delaware corporation (the “Company”) standing in its name on the
books of said Company represented by Certificate Number             , and does hereby irrevocably constitute and appoint
                     as attorney to transfer the said stock on the books of the Company with full power of substitution in the premises.

  

			
	Date:                         	 	  

	 	 	Holder

  

 6Sorrento Networks Corporation Amended and Restated 2000 Stock Incentive Plan

 EXHIBIT 10.1 
  
 SORRENTO NETWORKS CORPORATION 
  

AMENDED AND RESTATED 
  
 2000 STOCK INCENTIVE PLAN 
  
 Effective February 15, 2005 
  

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 SORRENTO NETWORKS CORPORATION 
 AMENDED AND RESTATED 
 2000 STOCK INCENTIVE PLAN 
  
 ARTICLE I. 
 GENERAL PROVISIONS 
  
 I. Purpose of the Plan 
  
 The Sorrento Networks
Corporation Amended and Restated 2000 Stock Incentive Plan (the “Plan”), is intended to promote the interests of Zhone Technologies, Inc. a Delaware corporation, by providing eligible persons in the Corporation’s service with the
opportunity to acquire a proprietary interest, or otherwise increase their proprietary interest, in the Corporation as an incentive for them to remain in such service. Capitalized terms shall have the meanings assigned to such terms in the attached
Appendix. 
  
 II. Structure of the Plan 
  
 (A) The Plan shall be divided into three separate equity incentive programs:

  
 1) The Discretionary Option Grant Program
under which eligible persons may, at the discretion of the Plan Administrator, be granted options to purchase shares of Common Stock, 
  
 2) The Stock Issuance Program under which eligible persons may, at the discretion of the Plan Administrator, be issued shares of Common
Stock directly, either through the immediate purchase of such shares or as a bonus for services rendered the Corporation (or any Parent or Subsidiary) and; 
  
 (B) The provisions of Articles One and Five shall apply to all equity programs under the Plan and shall govern the interests of all persons under the
Plan. 
  
 III. Administration of the Plan 
  
 (A) The Primary Committee shall have sole and exclusive authority to
administer the Discretionary Option Grant and Stock Issuance Programs with respect to Section 16 Insiders. Administration of the Discretionary Option Grant and Stock Issuance Programs with respect to all other persons eligible to participate in
those programs may, at the Board’s discretion, be vested in the Primary Committee or a Secondary Committee, or the Board may retain the power to administer those programs with respect to all such persons. However, any discretionary option
grants or stock issuances for members of the Primary Committee must be authorized by a disinterested majority of the Board. 
  
 (B) Members of the Primary Committee or any Secondary Committee shall serve for such period of time as the Board may determine and may be removed by the
Board at any time. The Board may also at any time terminate the functions of any Secondary Committee and reassume all powers and authority previously delegated to such committee. 
  
 (C) Each Plan Administrator shall, within the scope of its administrative functions under the Plan, have full power and
authority (subject to the provisions of the Plan) to establish such rules and regulations as it may deem appropriate for proper administration of the Discretionary Option Grant and Stock Issuance Programs and to make such determinations under, and
issue such interpretations of, the provisions of those programs and any outstanding options or stock issuances thereunder as it may deem necessary or advisable. Decisions of the Plan Administrator within the scope of its administrative functions
under the Plan shall be final and binding on all parties who have an interest in the Discretionary Option Grant and Stock Issuance Programs under its jurisdiction or any stock option or stock issuance thereunder. 
  

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 (D) Service on the Primary Committee or the Secondary Committee shall constitute service as a Board
member, and members of each such committee shall accordingly be entitled to full indemnification and reimbursement as Board members for their service on such committee. No member of the Primary Committee or the Secondary Committee shall be liable
for any act or omission made in good faith with respect to the Plan or any option grants or stock issuances under the Plan. 
  
 IV. Eligibility 
  
 (A) The persons eligible to participate in the Discretionary Option Grant and Stock Issuance Programs are as follows: 
  
 (i) Employees, 
  
 (ii) non-employee members of the Board or the board of
directors of any Parent or Subsidiary, and 
  
 (iii) consultants and other independent advisors who provide services to the Corporation (or any Parent or Subsidiary). 
  
 (B) Each Plan Administrator shall, within the scope of its administrative jurisdiction under the Plan, have full authority to determine, (i) with respect
to the option grants under the Discretionary Option Grant Program, which eligible persons are to receive such grants, the time or times when those grants are to be made, the number of shares to be covered by each such grant, the status of the
granted option as either an Incentive Option or a Non-Statutory Option, the time or times when each option is to become exercisable, the vesting schedule (if any) applicable to the option shares and the maximum term for which the option is to remain
outstanding and (ii) with respect to stock issuances under the Stock Issuance Program, which eligible persons are to receive such issuances, the time or times when the issuances are to be made, the number of shares to be issued to each Participant,
the vesting schedule (if any) applicable to the issued shares and the consideration for such shares. 
  
 (C) The Plan Administrator shall have the absolute discretion either to grant options in accordance with the Discretionary Option Grant Program or to
effect stock issuances in accordance with the Stock Issuance Program. 
  
 V.
Stock Subject to the Plan 
  
 (A) The stock issuable under
the Plan shall be shares of authorized but unissued or reacquired Common Stock, including shares repurchased by the Corporation on the open market. The number of shares of Common Stock initially reserved for issuance over the term of the Plan shall
not exceed 8,300,000 shares. 
  
 (B) No one person participating
in the Plan may receive stock options, separately exercisable stock appreciation rights and direct stock issuances for more than 600,000 shares of Common Stock in the aggregate per calendar year beginning after December 31, 2000 except such
limitation will be 2,000,000 for persons who have not been previously employed the Corporation as an inducement to accept employment. 
  
 (C) Shares of Common Stock subject to outstanding options (including options transferred to this Plan from the Predecessor Plans) shall be available for
subsequent issuance under the Plan to the extent (i) those options expire or terminate for any reason prior to exercise in full or (ii) the options are canceled in accordance with the cancellation-regrant provisions of Article Two. Unvested shares
issued under the Plan and subsequently canceled or repurchased by the Corporation, at the original issue price paid per share, pursuant to the Corporation’s repurchase rights under the Plan shall be added back to the number of shares of Common
Stock reserved for issuance under the Plan and shall accordingly be available for reissuance through one or more subsequent option grants or direct stock issuances under the Plan. However, should the exercise price of an option under the Plan be
paid with shares of 

  

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Common Stock or should shares of Common Stock otherwise issuable under the Plan be withheld by the Corporation in satisfaction of the withholding taxes
incurred in connection with the exercise of an option or the vesting of a stock issuance under the Plan, then the number of shares of Common Stock available for issuance under the Plan shall be reduced by the gross number of shares for which the
option is exercised or which vest under the stock issuance, and not by the net number of shares of Common Stock issued to the holder of such option or stock issuance. Shares of Common Stock underlying one or more stock appreciation rights exercised
under Section V of Article Two of the Plan shall not be available for subsequent issuance under the Plan. 
  
 (D) If any change is made to the Common Stock by reason of any stock split, stock dividend, recapitalization, combination of shares, exchange of shares or
other change affecting the outstanding Common Stock as a class without the Corporation’s receipt of consideration, appropriate adjustments shall be made by the Plan Administrator to (i) the maximum number and/or class of securities issuable
under the Plan, (ii) the maximum number and/or class of securities for which any one person may be granted stock options, separately exercisable stock appreciation rights and direct stock issuances under the Plan per calendar year, (iii) [Reserved],
(iv) the number and/or class of securities and the exercise price per share in effect under each outstanding option under the Plan, and (v) the number and/or class of securities and exercise price per share in effect under each outstanding option
transferred to this Plan from the Predecessor Plans. Such adjustments to the outstanding options are to be effected in a manner which shall preclude the enlargement or dilution of rights and benefits under such options. The adjustments determined by
the Plan Administrator shall be final, binding and conclusive. 
  
 ARTICLE II. 
 DISCRETIONARY OPTION GRANT PROGRAM 
  
 I. Option Terms 
  
 Each option shall be evidenced by one or more documents in the form approved by the Plan Administrator; provided, however, that each such document shall
comply with the terms specified below. Each document evidencing an Incentive Option shall, in addition, be subject to the provisions of the Plan applicable to such options. 
  
 (A) Exercise Price 
  

1) The exercise price per share shall be fixed by the Plan Administrator but shall not be less than one hundred percent (100%) of the
Fair Market Value per share of Common Stock on the option grant date. 
  
 2) The exercise price shall become immediately due upon exercise of the option and shall, subject to the provisions of Section I of Article Five and the documents evidencing the option, be payable in one or more of
the forms specified below: 
  
 (i) cash or check
made payable to the Corporation, 
  
 (ii) shares
of Common Stock held for the requisite period necessary to avoid a charge to the Corporation’s earnings for financial reporting purposes and valued at Fair Market Value on the Exercise Date, or 
  
 (iii) to the extent the option is exercised for vested
shares, through a special sale and remittance procedure pursuant to which the Optionee shall concurrently provide irrevocable instructions to (a) a Corporation-designated brokerage firm to effect the immediate sale of the purchased shares and remit
to the Corporation, out of the sale proceeds available on the settlement date, sufficient funds to cover the aggregate exercise price payable for the purchased shares plus all applicable Federal, state and local income and employment taxes required
to be withheld by the Corporation by reason of such exercise and (b) the Corporation to deliver the certificates for the purchased shares directly to such brokerage firm in order to complete the sale. Except to the extent such sale and remittance
procedure is utilized, payment of the exercise price for the purchased shares must be made on the Exercise Date. 
  

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 (B) Exercise and Term of Options. Each option shall be exercisable at such time or times,
during such period and for such number of shares as shall be determined by the Plan Administrator and set forth in the documents evidencing the option. However, no option shall have a term in excess of ten (10) years measured from the option grant
date. 
  
 (C) Effect of Termination of Service

  
 1) The following provisions shall govern the
exercise of any options held by the Optionee at the time of cessation of Service or death: 
  
 (i) Expect as provided in (iii) below, any option outstanding at the time of the Optionee’s cessation of Service for any reason shall
remain exercisable for such period of time thereafter as shall be determined by the Plan Administrator and set forth in the documents evidencing the option, but no such option shall be exercisable after the expiration of the option term. 

 
 (ii) Any option held by the Optionee at the time of death
and exercisable in whole or in part at that time may be subsequently exercised by the personal representative of the Optionee’s estate or by the person or persons to whom the option is transferred pursuant to the Optionee’s will or the
laws of inheritance or by the Optionee’s designated beneficiary or beneficiaries of that option. 
  
 (iii) Should the Optionee’s Service be terminated for Misconduct or should the Optionee otherwise engage in Misconduct while holding
one or more outstanding options under this Article Two, then all those options shall terminate immediately and cease to be outstanding. 
  
 (iv) During the applicable post-Service exercise period, the option may not be exercised in the aggregate for more than the number of
vested shares for which the option is exercisable on the date of the Optionee’s cessation of Service. Upon the expiration of the applicable exercise period or (if earlier) upon the expiration of the option term, the option shall terminate and
cease to be outstanding for any vested shares for which the option has not been exercised. However, the option shall, immediately upon the Optionee’s cessation of Service, terminate and cease to be outstanding to the extent the option is not
otherwise at that time exercisable for vested shares. 
  
 2) The Plan Administrator shall have complete discretion, exercisable either at the time an option is granted or at any time while the option remains outstanding, to: 
  
 (i) extend the period of time for which the option is to remain exercisable following the Optionee’s
cessation of Service from the limited exercise period otherwise in effect for that option to such greater period of time as the Plan Administrator shall deem appropriate, but in no event beyond the expiration of the option term, and/or 

 
 (ii) permit the option to be exercised, during the
applicable post-Service exercise period, not only with respect to the number of vested shares of Common Stock for which such option is exercisable at the time of the Optionee’s cessation of Service but also with respect to one or more
additional installments in which the Optionee would have vested had the Optionee continued in Service. 
  
 (D) Shareholder Rights. The holder of an option shall have no shareholder rights with respect to the shares subject to the option until such
person shall have exercised the option, paid the exercise price and become a holder of record of the purchased shares. 
  
 (E) Repurchase Rights. The Plan Administrator shall have the discretion to grant options which are exercisable for unvested shares of Common
Stock. Should the Optionee cease Service while holding such unvested shares, the Corporation shall have the right to repurchase, at the exercise price paid per share, any or all of those unvested shares. The terms upon which such repurchase right
shall be exercisable (including the period and procedure for exercise and the appropriate vesting schedule for the purchased shares) shall be established by the Plan Administrator and set forth in the document evidencing such repurchase right.

  

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 (F) Limited Transferability of Options. During the lifetime of the Optionee, Incentive
Options shall be exercisable only by the Optionee and shall not be assignable or transferable other than by will or the laws of inheritance following the Optionee’s death. Non-Statutory Options shall be subject to the same restriction, except
that a Non-Statutory Option may be assigned in whole or in part during the Optionee’s lifetime to one or more members of the Optionee’s family or to a trust established exclusively for one or more such family members or to entity in which
the Optionee is majority owner or to Optionee’s former spouse, to the extent such assignment is in connection with the Optionee’s estate or financial plan or pursuant to a domestic relations order. The assigned portion may only be
exercised by the person or persons who acquire a proprietary interest in the option pursuant to the assignment. The terms applicable to the assigned portion shall be the same as those in effect for the option immediately prior to such assignment and
shall be set forth in such documents issued to the assignee as the Plan Administrator may deem appropriate. Notwithstanding the foregoing, the Optionee may also designate one or more persons as the beneficiary or beneficiaries of his or her
outstanding options under this Article Two, and those options shall, in accordance with such designation, automatically be transferred to such beneficiary or beneficiaries upon the Optionee’s death while holding those options. Such beneficiary
or beneficiaries shall take the transferred options subject to all the terms and conditions of the applicable agreement evidencing each such transferred option, including (without limitation) the limited time period during which the option may be
exercised following the Optionee’s death. 
  
 II. Incentive Options

  
 The terms specified below shall be applicable to all
Incentive Options. Except as modified by the provisions of this Section II, all the provisions of Articles One, Two and Five shall be applicable to Incentive Options. Options which are specifically designated as Non-Statutory Options when issued
under the Plan shall not be subject to the terms of this Section II. 
  
 (A) Eligibility. Incentive Options may only be granted to Employees. 
  
 (B) Dollar Limitation. The aggregate Fair Market Value of the shares of Common Stock (determined as of the respective date or dates of grant) for which one or more options granted to any Employee under
the Plan (or any other option plan of the Corporation or any Parent or Subsidiary) may for the first time become exercisable as Incentive Options during any one calendar year shall not exceed the sum of One Hundred Thousand Dollars ($100,000). To
the extent the Employee holds two (2) or more such options which become exercisable for the first time in the same calendar year, the foregoing limitation on the exercisability of such options as Incentive Options shall be applied on the basis of
the order in which such options are granted. 
  
 (C) 10%
Shareholder. If any Employee to whom an Incentive Option is granted is a 10% Shareholder, then the exercise price per share shall not be less than one hundred ten percent (110%) of the Fair Market Value per share of Common Stock on the
option grant date, and the option term shall not exceed five (5) years measured from the option grant date. 
  
 III. Corporate Transaction/Change in Control/Hostile Take-Over 
  
 (A) In the event of any Corporate Transaction, each outstanding option under the Discretionary Option Grant Program shall automatically accelerate so that
each such option shall, immediately prior to the effective date of the Corporate Transaction, become exercisable for all the shares of Common Stock at the time subject to such option and may be exercised for any or all of those shares as fully
vested shares of Common Stock. However, an outstanding option shall not become exercisable on such an accelerated basis if and to the extent: (i) such option is, in connection with the Corporate Transaction, to be assumed by the successor
corporation (or parent thereof) or (ii) such option is to be replaced with a cash incentive program of the successor corporation which preserves the spread existing at the time of the Corporate Transaction on any shares for which the option is not
otherwise at that time exercisable and provides for subsequent payout in accordance with the same exercise/vesting schedule applicable to those option shares or (iii) the acceleration of such option is subject to other limitations imposed by the
Plan Administrator at the time of the option grant. 
  

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 (B) All outstanding repurchase rights under the Discretionary Option Grant Program shall automatically
terminate, and the shares of Common Stock subject to those terminated rights shall immediately vest in full, in the event of any Corporate Transaction, except to the extent: (i) those repurchase rights are to be assigned to the successor corporation
(or parent thereof) in connection with such Corporate Transaction or (ii) such accelerated vesting is precluded by other limitations imposed by the Plan Administrator at the time the repurchase right is issued. 
  
 (C) Immediately following the consummation of the Corporate Transaction, all
outstanding options under the Discretionary Option Grant Program shall terminate and cease to be outstanding, except to the extent assumed by the successor corporation (or parent thereof). 
  
 (D) Each option which is assumed in connection with a Corporate Transaction
shall be appropriately adjusted, immediately after such Corporate Transaction, to apply to the number and class of securities which would have been issuable to the Optionee in consummation of such Corporate Transaction had the option been exercised
immediately prior to such Corporate Transaction. Appropriate adjustments to reflect such Corporate Transaction shall also be made to (i) the exercise price payable per share under each outstanding option, provided the aggregate exercise price
payable for such securities shall remain the same, (ii) the maximum number and/or class of securities available for issuance over the remaining term of the Plan and (iii) the maximum number and/or class of securities for which any one person may be
granted stock options, separately exercisable stock appreciation rights and direct stock issuances under the Plan per calendar year and (iv) the maximum number and/or class of securities by which the share reserve is to increase automatically each
calendar year. To the extent the actual holders of the Corporation’s outstanding Common Stock receive cash consideration for their Common Stock in consummation of the Corporate Transaction, the successor corporation may, in connection with the
assumption of the outstanding options under the Discretionary Option Grant Program, substitute one or more shares of its own common stock with a fair market value equivalent to the cash consideration paid per share of Common Stock in such Corporate
Transaction. 
  
 (E) The Plan Administrator shall have the
discretionary authority to structure one or more outstanding options under the Discretionary Option Grant Program so that those options shall, immediately prior to the effective date of such Corporate Transaction, become exercisable for all the
shares of Common Stock at the time subject to those options and may be exercised for any or all of those shares as fully vested shares of Common Stock, whether or not those options are to be assumed in the Corporate Transaction. In addition, the
Plan Administrator shall have the discretionary authority to structure one or more of the Corporation’s repurchase rights under the Discretionary Option Grant Program so that those rights shall not be assignable in connection with such
Corporate Transaction and shall accordingly terminate upon the consummation of such Corporate Transaction, and the shares subject to those terminated rights shall thereupon vest in full. 
  
 (F) The Plan Administrator shall have full power and authority to structure one or more outstanding options under the
Discretionary Option Grant Program so that those options shall become exercisable for all the shares of Common Stock at the time subject to those options in the event the Optionee’s Service is subsequently terminated by reason of an Involuntary
Termination within a designated period (not to exceed eighteen (18) months) following the effective date of any Corporate Transaction in which those options are assumed and do not otherwise accelerate. In addition, the Plan Administrator may
structure one or more of the Corporation’s repurchase rights so that those rights shall immediately terminate with respect to any shares held by the Optionee at the time of his or her Involuntary Termination, and the shares subject to those
terminated repurchase rights shall accordingly vest in full at that time. 
  
 (G) In the event of Change of Control or Hostile Take-Over, outstanding options under the Discretionary Option Grant Program shall, immediately prior to the effective date of a Change in Control or Hostile Take-Over,
become exercisable for all the shares of Common Stock at the time subject to those options and may be exercised for any or all of those shares as fully vested shares of Common Stock. Each such option shall remain exercisable for such fully vested
option shares until the expiration or sooner termination of the option term. In addition, the Corporation’s repurchase rights under the Discretionary Option Grant Program shall terminate automatically upon the consummation of such Change in
Control or Hostile Take-Over, and the shares subject to those terminated rights shall thereupon vest in full. 
  

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 (H) The portion of any Incentive Option accelerated in connection with a Corporate Transaction or Change
in Control or Hostile Take-Over shall remain exercisable as an Incentive Option only to the extent the applicable One Hundred Thousand Dollar ($100,000) limitation is not exceeded. To the extent such dollar limitation is exceeded, the accelerated
portion of such option shall be exercisable as a Nonstatutory Option under the Federal tax laws. 
  
 (I) The outstanding options shall in no way affect the right of the Corporation to adjust, reclassify, reorganize or otherwise change its capital or
business structure or to merge, consolidate, dissolve, liquidate or sell or transfer all or any part of its business or assets. 
  
 IV. Cancellation and Regrant of Options 
  
 The Plan Administrator shall have the authority to effect, at any time and from time to time, with the consent of the affected option holders, the
cancellation of any or all outstanding options under the Discretionary Option Grant Program (including outstanding options incorporated from the Predecessor Plans) and to grant in substitution new options covering the same or a different number of
shares of Common Stock but with an exercise price per share based on the Fair Market Value per share of Common Stock on the new grant date. 
  
 V. Stock Appreciation Rights 
  
 (A) The Plan Administrator shall have full power and authority to grant to selected Optionees tandem stock appreciation rights and/or limited stock
appreciation rights. 
  
 (B) The following terms shall govern the
grant and exercise of tandem stock appreciation rights: 
  
 (i) One or more Optionees may be granted the right, exercisable upon such terms as the Plan Administrator may establish, to elect between the exercise of the underlying option for shares of Common Stock and the
surrender of that option in exchange for a distribution from the Corporation in an amount equal to the excess of (a) the Fair Market Value (on the option surrender date) of the number of shares in which the Optionee is at the time vested under the
surrendered option (or surrendered portion thereof) over (b) the aggregate exercise price payable for such shares. 
  
 (ii) No such option surrender shall be effective unless it is approved by the Plan Administrator, either at the time of the actual option
surrender or at any earlier time. If the surrender is so approved, then the distribution to which the Optionee shall be entitled may be made in shares of Common Stock valued at Fair Market Value on the option surrender date, in cash, or partly in
shares and partly in cash, as the Plan Administrator shall in its sole discretion deem appropriate. 
  
 (iii) If the surrender of an option is not approved by the Plan Administrator, then the Optionee shall retain whatever rights the Optionee
had under the surrendered option (or surrendered portion thereof) on the option surrender date and may exercise such rights at any time prior to the later of (a) five (5) business days after the receipt of the rejection notice or (b) the last day on
which the option is otherwise exercisable in accordance with the terms of the documents evidencing such option, but in no event may such rights be exercised more than ten (10) years after the option grant date. 
  
 (C) The following terms shall govern the grant and exercise of limited stock
appreciation rights: 
  
 (i) One or more Section
16 Insiders may be granted limited stock appreciation rights with respect to their outstanding options. 
  
 (ii) Upon the occurrence of a Hostile Take-Over, each individual holding one or more options with such a limited stock appreciation right
shall have the unconditional right (exercisable for a thirty (30)-day period following such Hostile Take-Over) to surrender each such option to the Corporation. In return for the 
  

 8 

 surrendered option, the Optionee shall receive a cash distribution from the Corporation in an amount
equal to the excess of (A) the Take-Over Price of the shares of Common Stock at the time subject to such option (whether or not the option is otherwise at that time vested and exercisable for those shares) over (B) the aggregate exercise price
payable for those shares. Such cash distribution shall be paid within five (5) days following the option surrender date. 
  
 (iii) At the time such limited stock appreciation right is granted, the Plan Administrator shall pre-approve any subsequent exercise of
that right in accordance with the terms of this Paragraph C. Accordingly, no further approval of the Plan Administrator or the Board shall be required at the time of the actual option surrender and cash distribution. 
  
 ARTICLE III. 
 STOCK ISSUANCE PROGRAM 
  
 I. Stock Issuance Terms 
  
 Shares of Common
Stock may be issued under the Stock Issuance Program through direct and immediate issuances without any intervening option grants. Each such stock issuance shall be evidenced by a Stock Issuance Agreement which complies with the terms specified
below. Shares of Common Stock may also be issued under the Stock Issuance Program pursuant to share right awards which entitle the recipients to receive those shares upon the attainment of designated performance goals. 
  
 (A) Purchase Price 
  
 1) The purchase price per share shall be fixed by the Plan
Administrator, but shall not be less than one hundred percent (100%) of the Fair Market Value per share of Common Stock on the issuance date. 
  
 2) Subject to the provisions of Section I of Article Five, shares of Common Stock may be issued under the Stock Issuance Program for any
of the following items of consideration which the Plan Administrator may deem appropriate in each individual instance: 
  
 (i) cash or check made payable to the Corporation, or 
  
 (ii) past services rendered to the Corporation (or any Parent or Subsidiary). 
  
 (B) Vesting Provisions 
  
 1) Shares of Common Stock issued under the Stock Issuance
Program may, in the discretion of the Plan Administrator, be fully and immediately vested upon issuance or may vest in one or more installments over the Participant’s period of Service or upon attainment of specified performance objectives. The
elements of the vesting schedule applicable to any unvested shares of Common Stock issued under the Stock Issuance Program shall be determined by the Plan Administrator and incorporated into the Stock Issuance Agreement. Shares of Common Stock may
also be issued under the Stock Issuance Program pursuant to share right awards which entitle the recipients to receive those shares upon the attainment of designated performance goals. 
  
 2) Any new, substituted or additional securities or other property (including money paid other than as a
regular cash dividend) which the Participant may have the right to receive with respect to the Participant’s unvested shares of Common Stock by reason of any stock dividend, stock split, recapitalization, combination of shares, exchange of
shares or other change affecting the outstanding Common Stock as a class without the Corporation’s receipt of consideration shall be issued subject to (i) the same vesting requirements applicable to the Participant’s unvested shares of
Common Stock and (ii) such escrow arrangements as the Plan Administrator shall deem appropriate. 
  

 9 

 3) The Participant shall have full shareholder rights with respect to any shares of
Common Stock issued to the Participant under the Stock Issuance Program, whether or not the Participant’s interest in those shares is vested. Accordingly, the Participant shall have the right to vote such shares and to receive any regular cash
dividends paid on such shares. 
  
 4) Should the
Participant cease to remain in Service while holding one or more unvested shares of Common Stock issued under the Stock Issuance Program or should the performance objectives not be attained with respect to one or more such unvested shares of Common
Stock, then those shares shall be immediately surrendered to the Corporation for cancellation, and the Participant shall have no further shareholder rights with respect to those shares. To the extent the surrendered shares were previously issued to
the Participant for consideration paid in cash or cash equivalent (including the Participant’s purchase-money indebtedness), the Corporation shall repay to the Participant the cash consideration paid for the surrendered shares and shall cancel
the unpaid principal balance of any outstanding purchase-money note of the Participant attributable to the surrendered shares. 
  
 5) The Plan Administrator may in its discretion waive the surrender and cancellation of one or more unvested shares of Common Stock which
would otherwise occur upon the cessation of the Participant’s Service or the non-attainment of the performance objectives applicable to those shares. Such waiver shall result in the immediate vesting of the Participant’s interest in the
shares of Common Stock as to which the waiver applies. Such waiver may be effected at any time, whether before or after the Participant’s cessation of Service or the attainment or non-attainment of the applicable performance objectives.

  
 6) Outstanding share right awards under the
Stock Issuance Program shall automatically terminate, and no shares of Common Stock shall actually be issued in satisfaction of those awards, if the performance goals established for such awards are not attained. The Plan Administrator, however,
shall have the discretionary authority to issue shares of Common Stock under one or more outstanding share right awards as to which the designated performance goals have not been attained. 
  
 II. Corporate Transaction/Change in Control/Hostile Take-Over 
  
 (A) All of the Corporation’s outstanding repurchase rights under the
Stock Issuance Program shall terminate automatically, and all the shares of Common Stock subject to those terminated rights shall immediately vest in full, in the event of any Corporate Transaction, except to the extent (i) those repurchase rights
are to be assigned to the successor corporation (or parent thereof) in connection with such Corporate Transaction or (ii) such accelerated vesting is precluded by other limitations imposed in the Stock Issuance Agreement. 
  
 (B) The Plan Administrator shall have the discretionary authority to
structure one or more of the Corporation’s repurchase rights under the Stock Issuance Program so that those rights shall automatically terminate in whole or in part, and the shares of Common Stock subject to those terminated rights shall
immediately vest, in the event the Participant’s Service should subsequently terminate by reason of an Involuntary Termination within a designated period (not to exceed eighteen (18) months) following the effective date of any Corporate
Transaction in which those repurchase rights are assigned to the successor corporation (or parent thereof). 
  
 (C) In the event of Change of Control or Hostile Take-Over the Corporation’s repurchase rights under the Stock Issuance program shall automatically
terminate, and the shares of Common Stock subject to those terminated rights shall immediately vest in full. 
  

 10 

 III. Share Escrow/Legends 
  
 Unvested shares may, in the Plan Administrator’s discretion, be held in escrow by the Corporation until the
Participant’s interest in such shares vests or may be issued directly to the Participant with restrictive legends on the certificates evidencing those unvested shares. 
  
 ARTICLE IV. 
 AUTOMATIC OPTION GRANT PROGRAM 
  
 [Reserved. All
options granted under this Article before the effective date of this Sorrento Networks Corporation Amended and Restated 2000 Stock Incentive Plan shall be governed by the terms of the Plan prior to such amendment and restatement.] 
  
 ARTICLE V. 
 MISCELLANEOUS 
  
 I. Financing 
  
 The Plan Administrator may
permit any Optionee or Participant to pay the option exercise price under the Discretionary Option Grant Program or the purchase price of shares issued under the Stock Issuance Program by delivering a full-recourse, interest-bearing promissory note
payable in one or more installments. The terms of any such promissory note (including the interest rate and the terms of repayment) shall be established by the Plan Administrator in its sole discretion. In no event may the maximum credit available
to the Optionee or Participant exceed the sum of (i) the aggregate option exercise price or purchase price payable for the purchased shares (less the par value of such shares) plus (ii) any Federal, state and local income and employment tax
liability incurred by the Optionee or the Participant in connection with the option exercise or share purchase. 
  
 II. Tax Withholding 
  
 (A) The Corporation’s obligation to deliver shares of Common Stock upon the exercise of options or the issuance or vesting of such shares under the
Plan shall be subject to the satisfaction of all applicable Federal, state and local income and employment tax withholding requirements. 
  
 (B) The Plan Administrator may, in its discretion, provide any or all holders of Non-Statutory Options or unvested shares of Common Stock under the Plan
with the right to use shares of Common Stock in satisfaction of all or part of the Withholding Taxes to which such holders may become subject in connection with the exercise of their options or the vesting of their shares. Such right may be provided
to any such holder in either or both of the following formats: 
  
 Stock Withholding: The election to have the Corporation withhold, from the shares of Common Stock otherwise issuable upon the exercise of such Non-Statutory Option or the vesting of such shares, a portion of
those shares with an aggregate Fair Market Value equal to the percentage of the Withholding Taxes (not to exceed one hundred percent (100%)) designated by the holder. 
  
 Stock Delivery. The election to deliver to the Corporation, at the time the Non-Statutory Option is
exercised or the shares vest, one or more shares of Common Stock previously acquired by such holder (other than in connection with the option exercise or share vesting triggering the Withholding Taxes) with an aggregate Fair Market Value equal to
the percentage of the Withholding Taxes (not to exceed one hundred percent (100%)) designated by the holder. 
  

 11 

 III. Effective Date and Term of the Plan 
  
 (A) The Plan shall become effective immediately on the Plan Effective Date. However, the Salary Investment Option Grant
Program shall not be implemented until such time as the Primary Committee may deem appropriate. Options may be granted under the Discretionary Option Grant at any time on or after the Plan Effective Date. However, no options granted under the Plan
may be exercised, and no shares shall be issued under the Plan, until the Plan is approved by the Corporation’s shareholders. If such shareholder approval is not obtained within twelve (12) months after the Plan Effective Date, then all options
previously granted under this Plan shall terminate and cease to be outstanding, and no further options shall be granted and no shares shall be issued under the Plan. 
  
 (B) The Plan shall serve as the successor to the Predecessor Plans, and no further option grants or direct stock issuances
shall be made under the Predecessor Plans after the Plan Effective Date. All options outstanding under the Sorrento 2000 Stock Option/Issuance Plan on the Plan Effective Date shall be transferred to the Plan at that time and shall be treated as
outstanding options under the Plan. However, each outstanding option so transferred shall continue to be governed solely by the terms of the documents evidencing such option, and no provision of the Plan shall be deemed to affect or otherwise modify
the rights or obligations of the holders of such transferred options with respect to their acquisition of shares of Common Stock. 
  
 (C) One or more provisions of the Plan, including (without limitation) the option/vesting acceleration provisions of Article Two relating to Corporate
Transactions and Changes in Control, may, in the Plan Administrator’s discretion, be extended to one or more options transferred from the Predecessor Plans which do not otherwise contain such provisions. 
  
 (D) The Plan shall terminate upon the earliest to occur of (i) ten (10) years
from the Plan Effective Date, (ii) the date on which all shares available for issuance under the Plan shall have been issued as fully vested shares or (iii) the termination of all outstanding options in connection with a Corporate Transaction.
Should the Plan terminate as specified in (i) or (ii) previously, then all option grants and unvested stock issuances outstanding at that time shall continue to have force and effect in accordance with the provisions of the documents evidencing such
grants or issuances. 
  
 IV. Amendment of the Plan 
  
 (A) The Board shall have complete and exclusive power and authority to amend
or modify the Plan in any or all respects. However, no such amendment or modification shall adversely affect the rights and obligations with respect to stock options or unvested stock issuances at the time outstanding under the Plan unless the
Optionee or the Participant consents to such amendment or modification. In addition, certain amendments may require shareholder approval pursuant to applicable laws or regulations. 
  
 (B) Options to purchase shares of Common Stock may be granted under the Discretionary Option Grant and Salary Investment
Option Grant Programs and shares of Common Stock may be issued under the Stock Issuance Program that are in each instance in excess of the number of shares then available for issuance under the Plan, provided any excess shares actually issued under
those programs shall be held in escrow until there is obtained shareholder approval of an amendment sufficiently increasing the number of shares of Common Stock available for issuance under the Plan. If such shareholder approval is not obtained
within twelve (12) months after the date the first such excess issuances are made, then (i) any unexercised options granted on the basis of such excess shares shall terminate and cease to be outstanding and (ii) the Corporation shall promptly refund
to the Optionees and the Participants the exercise or purchase price paid for any excess shares issued under the Plan and held in escrow, together with interest (at the applicable Short Term Federal Rate) for the period the shares were held in
escrow, and such shares shall thereupon be automatically cancelled and cease to be outstanding. 
  
 V. Use of Proceeds 
  
 Any
cash proceeds received by the Corporation from the sale of shares of Common Stock under the Plan shall be used for general corporate purposes. 
  

 12 

 VI. Regulatory Approvals 
  

(A) The implementation of the Plan, the granting of any stock option under the Plan and the issuance of any shares of Common Stock (i) upon the
exercise of any granted option or (ii) under the Stock Issuance Program shall be subject to the Corporation’s procurement of all approvals and permits required by regulatory authorities having jurisdiction over the Plan, the stock options
granted under it and the shares of Common Stock issued pursuant to it. 
  
 (B) No shares of Common Stock or other assets shall be issued or delivered under the Plan unless and until there shall have been compliance with all applicable requirements of Federal and state securities laws, including the filing and
effectiveness of the Form S-8 registration statement for the shares of Common Stock issuable under the Plan, and all applicable listing requirements of any stock exchange (or the Nasdaq National Market, if applicable) on which Common Stock is then
listed for trading. 
  
 VII. No Employment/Service Rights 
  
 Nothing in the Plan shall confer upon the Optionee or the Participant any
right to continue in Service for any period of specific duration or interfere with or otherwise restrict in any way the rights of the Corporation (or any Parent or Subsidiary employing or retaining such person) or of the Optionee or the Participant,
which rights are hereby expressly reserved by each, to terminate such person’s Service at any time for any reason, with or without cause. 
  

 13 

 APPENDIX 
  

The following definitions shall be in effect under the Plan: 
  

(A) [Reserved] 
  
 (B) Board shall mean the Corporation’s Board of Directors. 
  
 (C) Change in Control shall mean a change in ownership or control of the Corporation effected through either of the
following transactions: 
  
 (i) the acquisition,
directly or indirectly by any person or related group of persons (other than the Corporation or a person that directly or indirectly controls, is controlled by, or is under common control with, the Corporation), of beneficial ownership (within the
meaning of Rule l3d-3 of the 1934 Act) of securities possessing more than fifty percent (50%) of the total combined voting power of the Corporation’s outstanding securities pursuant to a tender or exchange offer made directly to the
Corporation’s shareholders, or 
  
 (ii) a
change in the composition of the Board over a period of thirty-six (36) consecutive months or less such that a majority of the Board members ceases, by reason of one or more contested elections for Board membership, to be comprised of individuals
who either (A) have been Board members continuously since the beginning of such period or (B) have been elected or nominated for election as Board members during such period by at least a majority of the Board members described in clause (A) who
were still in office at the time the Board approved such election or nomination. 
  
 (D) Code shall mean the Internal Revenue Code of 1986, as amended. 
  
 (E) Common Stock shall mean the Corporation’s common stock. 
  
 (F) Corporate Transaction shall mean either of the following shareholder-approved transactions to which the
Corporation is a party: 
  
 (i) a merger or
consolidation in which securities possessing more than fifty percent (50%) of the total combined voting power of the Corporation’s outstanding securities are transferred to a person or persons different from the persons holding those securities
immediately prior to such transaction, or 
  
 (ii) the sale, transfer or other disposition of all or substantially all of the Corporation’s assets in complete liquidation or dissolution of the Corporation. 
  
 (G) Corporation shall mean Zhone Technologies, Inc., a Delaware corporation, and any corporate successor to all or
substantially all of the assets or voting stock of Zhone Technologies, Inc., which shall by appropriate action adopt the Plan. 
  
 (H) Discretionary Option Grant Program shall mean the discretionary option grant program in effect under Article Two of the Plan. 
  
 (I) Employee shall mean an individual who is in the employ of the
Corporation (or any Parent or Subsidiary), subject to the control and direction of the employer entity as to both the work to be performed and the manner and method of performance. 
  
 (J) Exercise Date shall mean the date on which the Corporation shall have received written notice of the option
exercise. 
  

 14 

 (K) Fair Market Value per share of Common Stock on any relevant date shall be determined in
accordance with the following provisions: 
  
 (i)
If the Common Stock is at the time traded on the Nasdaq National Market, then the Fair Market Value shall be the closing selling price per share of Common Stock on the date in question, as such price is reported by the National Association of
Securities Dealers on the Nasdaq National Market and published in The Wall Street Journal. If there is no closing selling price for the Common Stock on the date in question, then the Fair Market Value shall be the closing selling price on the last
preceding date for which such quotation exists. 
  
 (ii) If the Common Stock is at the time listed on any Stock Exchange, then the Fair Market Value shall be the closing selling price per share of Common Stock on the date in question on the Stock Exchange determined by the Plan Administrator
to be the primary market for the Common Stock, as such price is officially quoted in the composite tape of transactions on such exchange and published in The Wall Street Journal. If there is no closing selling price for the Common Stock on the date
in question, then the Fair Market Value shall be the closing selling price on the last preceding date for which such quotation exists. 
  
 (L) Hostile Take-Over shall mean the acquisition, directly or indirectly, by any person or related group of persons (other than the Corporation or
a person that directly or indirectly controls, is controlled by, or is under common control with, the Corporation) of beneficial ownership (within the meaning of Rule l3d-3 of the 1934 Act) of securities possessing more than fifty percent (50%) of
the total combined voting power of the Corporation’s outstanding securities pursuant to a tender or exchange offer made directly to the Corporation’s shareholders which the Board does not recommend such shareholders to accept. 

 
 (M) Incentive Option shall mean an option which satisfies the
requirements of Code Section 422. 
  
 (N) Involuntary
Termination shall mean the termination of the Service of any individual which occurs by reason of: 
  
 (i) such individual’s involuntary dismissal or discharge by the Corporation for reasons other than Misconduct, or 
  
 (ii) such individual’s voluntary resignation following
(A) a change in his or her position with the Corporation which materially reduces his or her duties and responsibilities or the level of management to which he or she reports, (B) a reduction in his or her level of compensation (including base
salary, fringe benefits and target bonus under any corporate-performance based bonus or incentive programs) by more than fifteen percent (15%) or (C) a relocation of such individual’s place of employment by more than fifty (50) miles, provided
and only if such change, reduction or relocation is effected by the Corporation without the individual’s consent. 
  
 (O) Misconduct shall mean the commission of any act of fraud, embezzlement or dishonesty by the Optionee or Participant, any unauthorized use or
disclosure by such person of confidential information or trade secrets of the Corporation (or any Parent or Subsidiary), or any other intentional misconduct by such person adversely affecting the business or affairs of the Corporation (or any Parent
or Subsidiary) in a material manner. The foregoing definition shall not in any way preclude or restrict the right of the Corporation (or any Parent or Subsidiary) to discharge or dismiss any Optionee, Participant or other person in the Service of
the Corporation (or any Parent or Subsidiary) for any other acts or omissions, but such other acts or omissions shall not be deemed, for purposes of the Plan, to constitute grounds for termination for Misconduct. 
  
 (P) 1934 Act shall mean the Securities Exchange Act of 1934, as
amended. 
  
 (Q) Non-Statutory Option shall mean an option
not intended to satisfy the requirements of Code Section 422. 
  

 15 

 (R) Optionee shall mean any person to whom an option is granted under the Plan. 
  
 (S) Parent shall mean any corporation (other than the Corporation) in
an unbroken chain of corporations ending with the Corporation, provided each corporation in the unbroken chain (other than the Corporation) owns, at the time of the determination, stock possessing fifty percent (50%) or more of the total combined
voting power of all classes of stock in one of the other corporations in such chain. 
  
 (T) Participant shall mean any person who is issued shares of Common Stock under the Stock Issuance Program. 
  
 (U) Permanent Disability or Permanently Disabled shall mean the inability of the Optionee or the Participant to engage in any substantial gainful
activity by reason of any medically determinable physical or mental impairment expected to result in death or to be of continuous duration of twelve (12) months or more. However, with respect to non-employee Board members, Permanent Disability or
Permanently Disabled shall mean the inability of the non-employee Board member to perform his or her usual duties as a Board member by reason of any medically determinable physical or mental impairment expected to result in death or to be of
continuous duration of twelve (12) months or more. 
  
 (V)
Plan shall mean the Sorrento Networks Corporation Amended and Restated 2000 Stock Incentive Plan, as set forth in this document. 
  
 (W) Plan Administrator shall mean the particular entity, whether the Primary Committee, the Board or the Secondary Committee, which is authorized
to administer the Discretionary Option Grant and Stock Issuance Programs with respect to one or more classes of eligible persons, to the extent such entity is carrying out its administrative functions under those programs with respect to the persons
under its jurisdiction. 
  
 (X) Plan Effective Date shall
mean the date the Plan shall become effective on February 1, 2000. The effective date of this Amended and Restated Plan is February 15, 2005. 
  
 (Y) Predecessor Plans shall mean the 1997 Incentive and Non-Qualified Stock Option Plan, the 1997 Directors Stock Option Plan, and the Sorrento
Subsidiary’s 2000 Stock Option/Stock Issuance Plan in effect immediately prior to the Plan Effective Date hereunder. 
  
 (Z) Primary Committee shall mean the committee of two (2) or more non-employee Board members appointed by the Board to administer the Discretionary
Option Grant and Stock Issuance Programs with respect to Section 16 Insiders. 
  
 (AA) Secondary Committee shall mean a committee of one or more Board members appointed by the Board to administer the Discretionary Option Grant and Stock Issuance Programs with respect to eligible persons
other than Section 16 Insiders. 
  
 (BB) Section 16 Insider
shall mean an officer or director of the Corporation subject to the short-swing profit liabilities of Section 16 of the 1934 Act. 
  
 (CC) Service shall mean the performance of services for the Corporation (or any Parent or Subsidiary) by a person in the capacity of an Employee, a
non-employee member of the board of directors or a consultant or independent advisor, except to the extent otherwise specifically provided in the documents evidencing the option grant or stock issuance. 
  
 (DD) Stock Exchange shall mean either the American Stock Exchange or
the New York Stock Exchange. 
  
 (EE) Stock Issuance
Agreement shall mean the agreement entered into by the Corporation and the Participant at the time of issuance of shares of Common Stock under the Stock Issuance Program. 
  

 16 

 (FF) Stock Issuance Program shall mean the stock issuance program in effect under Article Three of
the Plan. 
  
 (GG) Subsidiary shall mean any corporation
(other than the Corporation) in an unbroken chain of corporations beginning with the Corporation, provided each corporation (other than the last corporation) in the unbroken chain owns, at the time of the determination, stock possessing fifty
percent (50%) or more of the total combined voting power of all classes of stock in one of the other corporations in such chain. 
  
 (HH) Take-Over Price shall mean the greater of (i) the Fair Market Value per share of Common Stock on the date the option is surrendered to the
Corporation in connection with a Hostile Take-Over or (ii) the highest reported price per share of Common Stock paid by the tender offeror in effecting such Hostile Take-Over. However, if the surrendered option is an Incentive Option, the Take-Over
Price shall not exceed the clause (i) price per share. 
  
 (II)
10% Shareholder shall mean the owner of stock (as determined under Code Section 424(d)) possessing more than ten percent (10%) of the total combined voting power of all classes of stock of the Corporation (or any Parent or Subsidiary).

  
 (JJ) Withholding Taxes shall mean the Federal, state
and local income and employment withholding taxes to which the holder of Non-Statutory Options or unvested shares of Common Stock may become subject in connection with the exercise of those options or the vesting of those shares. 
  

 17

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