Document:

EXHIBIT 10.39

 

AVAYA INC. 2004 LONG TERM INCENTIVE PLAN
(“PLAN”)

STOCK OPTION AGREEMENT

 

	
  Name

  	
   

  	
  Grant Date

  
	
   

  	
   

  	
   

  
	
  Capitalized terms not otherwise defined herein shall have the same
  meanings as in the Plan.

  

 

Pursuant to the Plan, you have been granted as of the Grant Date an
option (the “Option”) to purchase from Avaya Inc. (“Avaya”) XXX shares of common stock, par value
$.01, of Avaya (“Shares”) at the price of $XXX
per Share, subject to the terms and conditions of the Plan and to this
Agreement.

 

1.              Exercisability of Option.  This Option may be
exercised at any time prior to its Expiration Date or cancellation as follows:

 

(a)          One
third of the Shares covered by this Option shall become exercisable on each of
the first, second, and third anniversary of the Grant Date (each such
anniversary a “Vesting Date”).  The
number of shares that becomes exercisable on any date will be rounded down to
the next lowest whole number, and any fraction of a share shall be added to the
portion of the Option becoming exercisable on the following Vesting Date.

 

(b)         Upon
the termination of your employment by reason of Retirement or Disability, any
portion of this Option which is then exercisable will remain exercisable until
the Expiration Date and any portion of this Option which is not then
exercisable will be forfeited and cancelled.

 

(c)          Upon
the termination of your employment by reason of death, any portion of this
Option which is not then exercisable will become exercisable and, along with
any portion of this Option which is then exercisable, will remain exercisable
until the Expiration Date.  If death
occurs after termination of employment but prior to the Expiration Date, that
portion of the Option which is outstanding at the time of death will remain
exercisable until the Expiration Date.

 

(d)         Upon
the termination of your employment for Cause, this Option will be forfeited and
cancelled.

 

(e)          Upon
the termination of your employment as a result of a Company Action, any portion
of this Option equal to the Company Action Vesting Portion shall become
immediately exercisable until the earlier of the ninetieth day after
termination of employment or the original Expiration Date; any portion of this
Option that is not so vested shall be forfeited and cancelled.  The Company Action Vesting Portion shall be
determined by multiplying the number of shares of this Option by a fraction,
the numerator of which shall be equal to the number of complete months prior to
the termination of employment since the Grant Date, and the denominator of which
shall be equal to the number of complete months from the Grant Date to the date
this Option becomes fully exercisable, and by subtracting from this product the
number of shares of this Option that are exercisable without regard to this
paragraph 1(e), if any.

 

(f)            Upon
the termination of your employment for any reason other than Retirement, death,
Disability, Cause or Company Action, any portion of this Option which is then
exercisable will remain exercisable until the earlier of the ninetieth day
after termination of employment or the original Expiration Date and any portion
of this Option which is not then exercisable will immediately be forfeited and
cancelled.

 

(g)         It
will not be considered a termination of your employment if you (i) transfer to
and from Avaya and any Subsidiary or (ii) are placed on an approved leave of
absence.  Unless otherwise determined by
the Committee, it will be considered a termination of employment if your
employer ceases to be Avaya or a Subsidiary.

 

2.  Definitions.

 

(a)          Retirement.  “Retirement” means termination of employment
with Avaya or any of its Subsidiaries under any of the following circumstances
or entitlements:

(i)             Service Pension under the Avaya Pension
Plan for Salaried Employees as defined in that Plan;

(ii)          After
attainment of age fifty (50) and fifteen (15) years of service with Avaya or
any of its Subsidiaries.

 

 

(b)         Disability. “Disability” means termination of
employment under circumstances where you qualify for and receive payments under
a long-term disability pay plan maintained by Avaya or any Subsidiary or as
required by or available under applicable local law.

 

(c)          Cause. “Cause” means:

(i)             violation of
Avaya’s code of conduct;

(ii)          conviction
of a felony (including a plea of guilty or nolo contendere) or any crime of
theft, dishonesty or moral turpitude, or

(iii)       gross
omission or gross dereliction of any statutory or common-law duty to Avaya.

 

3.              Term of Option.
The last day (“Expiration Date”) you can exercise this Option is the day
preceding the seventh anniversary of the Grant Date, except as provided in
Section 1 above.

 

4.              Exercise
Procedure.  You may
exercise this Option only by delivering to Avaya a notice in the form
prescribed for this purpose.  In order to
exercise the Option, or any portion thereof, you must also pay to Avaya the
exercise price in full, together with applicable withholding and/or other
taxes, in accordance with the operating rules of the Plan.  Exercise of the Option shall take effect on
the date the notice of exercise is actually received in accordance with
procedures specified by Avaya.  Notice of
exercise of the option must be received by the designated recordkeeper prior to
the close of trading on The New York Stock Exchange on the last day to exercise
the Option under this Agreement.  Avaya
reserves the right to restrict or suspend the exercisability of any Option in
order to comply with applicable law.

 

5.              Issuance of Avaya
Shares.  Following exercise of
the Option, Avaya will issue to you or your legal representative the number of
Shares you purchased under the Option. 
Neither you nor your legal representative shall be, or have any of the
rights and privileges of, a shareholder of Avaya in respect of any Shares
purchasable upon the exercise of this Option, in whole or in part, unless and
until such Shares shall have been issued. 
You may, in accordance with procedures established by the Committee,
designate one or more beneficiaries to receive all or part of your Option in
case of your death.

 

6.              Governing Law.  The validity, construction and effect of this
Agreement and the Plan shall be determined in accordance with the laws of the
State of Delaware without giving effect to principles of conflicts of laws.

 

7.              Value of Option.  Avaya makes no representation as to the value
of this Option or whether you will be able to realize any profit out of it.

 

8.              Transferability.  Unless otherwise provided for in the Plan,
you may not transfer, pledge, assign, sell or otherwise alienate your Option
award.

 

9.              Beneficiary.  You may, in accordance with procedures
established by the Committee, designate one or more beneficiaries to receive
all or part of this award in case of your death, and you may change or revoke
such designation at any time.  Such
designation shall not be effective unless and until the Senior Vice President-
Human Resources shall determine, on advice of counsel, that transfer of your
Option or the underlying shares does not require any registration,
qualification, consent or approval of any securities exchange or governmental
or regulatory agency or authority.  In
the event of your death, any portion of this award that is subject to such a
designation (to the extent such designation is valid, effective and enforceable
under this Agreement and applicable law) shall be distributed to such
beneficiary or beneficiaries in accordance with this Agreement.  Any other portion of this award shall be
distributed to your estate.  If there
shall be any question as to the legal right of any beneficiary to receive a
distribution hereunder, or to the extent your designation is not effective,
such portion will be delivered to your estate, in which event neither Avaya nor
any Subsidiary shall have any further liability to anyone with respect to such
award.

 

10.       Subject to Plan.  This Option is subject to all of the terms
and conditions of the Plan.

 

Please indicate your acceptance of terms 1-10 hereof, and acknowledge
that you have received a copy of the Plan, as currently in effect, by signing
at the place provided and returning the original of this Agreement.

 

	
  ACCEPTED
  AND AGREED:

  	
  Avaya
  Inc.

  
	
  SIGNATURE

  	
  By:EXHIBIT 10.40

 

AVAYA INC. 2004 LONG TERM INCENTIVE PLAN (“PLAN”)

RESTRICTED STOCK UNIT AWARD AGREEMENT

 

	
  Name

  	
  Grant Date

  
	
   

  	
   

  
	
  Capitalized terms not otherwise defined herein shall have the same
  meanings as in the Plan.

  	
   

  

 

You have been granted as of the Grant Date set forth above,             
restricted stock units (“Restricted Stock Units”). Upon termination
of the restrictions related thereto, each Restricted Stock Unit will be
converted into one share of Avaya Inc. (“Avaya”) common stock, par value $.01 (“Shares”),
subject to the terms and conditions of the Plan and this Agreement.

 

1.               Vesting of Award.  The Restricted Stock Units shall vest and
become nonforfeitable on the following schedule; 50%
on the third anniversary of the Grant Date, and 50%
on the fourth anniversary of the Grant Date (the date on which any Restricted
Stock Unit vests being the “Vesting Date” for such Restricted Stock Unit).  The period beginning on the Grant Date hereof
and ending on the day prior to the Vesting Date for a Restricted Stock Unit is
herein referred to as the “Restriction Period” with respect to such Restricted
Stock Unit.

 

2.  Termination of Employment.  Upon termination of your employment for any
reason other than death or disability as described below, including without
limitation, retirement and termination as a result of your employer ceasing to
be either Avaya or a Subsidiary, any Restricted Stock Units that are not vested
shall be forfeited and cancelled. Transfer to and from Avaya and any Subsidiary
shall not be considered a termination of employment for purposes of this
Agreement.  Nor shall it be considered a
termination of employment for purposes of this Agreement if you are placed on
an approved leave of absence, unless the Committee shall otherwise determine.  Upon termination of your employment for Cause,
any Restricted Stock Units that are not vested shall be forfeited and
cancelled.

 

(a)                                  Death
- If you die prior to the Vesting Date, the Restricted Stock Units will become
nonforfeitable, the Restriction Period will end and the award will be paid as
soon as practicable after the date of death as specified in Section 3.

 

(b)                                 Disability
- “Disability” means termination of employment under circumstances where you
qualify for and receive payments under a long-term disability pay plan
maintained by Avaya or any Subsidiary or as required by or available under
applicable local law.  Upon termination
of your employment prior to the Vesting Date as a result of your Disability the
Restricted Stock Units will become nonforfeitable, the Restriction Period will
end and the award will be paid at time of termination as specified in Section
3.

 

(c)                                  Cause. “Cause” means:

(i)             violation of
Avaya’s code of conduct;

(ii)          conviction
of a felony (including a plea of guilty or nolo contendere) or any crime of
theft, dishonesty or moral turpitude, or

(iii)       gross
omission or gross dereliction of any statutory or common law duty to Avaya.

 

3.               Payment of Shares.  As soon as practicable after termination of
the Restriction Period, the Company will deliver a certificate representing the
Shares being distributed to you or to your legal representative.

 

4.               Transferability.  Unless otherwise provided for in the Plan,
you may not transfer, pledge, assign, sell or otherwise alienate your
Restricted Stock Units.

 

5.               No Right of Employment.  Neither the Plan nor this Restricted Stock
Unit Award shall be construed as giving you the right to be retained in the
employ of Avaya or any Subsidiary.

 

6.     Taxes.  Avaya shall deduct or cause to be deducted
from, or collect or cause to be collected with respect to, your Restricted
Stock Units any federal, state, or local taxes required by law to be withheld
or paid with respect to your Restricted Stock Units, and you or your legal
representative or beneficiaries shall be required to pay any such amounts.  Avaya shall have the right to take such
action as may be necessary, in Avaya’s opinion, to satisfy such obligations.

 

 

7.               Beneficiary.  You may, in accordance with procedures
established by the Committee, designate one or more beneficiaries to receive
all or part of this award in case of your death, and you may change or revoke
such designation at any time.  Such
designation shall not be effective unless and until the Senior Vice President-
Human Resources shall determine, on advice of counsel, that resale of Shares by
your beneficiary(ies) does not require any registration, qualification, consent
or approval of any securities exchange or governmental or regulatory agency or
authority.  In the event of your death,
any portion of this Award that is subject to such a designation (to the extent
such designation is valid, effective and enforceable under this Agreement and
applicable law) shall be distributed to such beneficiary or beneficiaries in
accordance with this Agreement.  Any
other portion of this Award shall be distributed to your estate.  If there shall be any question as to the
legal right of any beneficiary to receive a distribution hereunder, or to the
extent your designation is not effective, such portion will be delivered to
your estate, in which event neither Avaya nor any Subsidiary shall have any
further liability to anyone with respect to such award.

 

8.               Governing Law.  The validity, construction and effect of this
Agreement shall be determined in accordance with the laws of the State of
Delaware without giving effect to principles of conflicts of law.

 

9.               Subject to Plan.  This Agreement and grant of Restricted Stock
Units are subject to all of the terms and conditions of the Plan.

 

	
  Please
  indicate your acceptance of terms 1-9, and acknowledge that you have received
  a copy of the Plan, as currently in effect, by signing at the place provided
  and returning the original of this Agreement.

  
	
   

  	
   

  
	
  ACCEPTED
  AND AGREED:

  	
  Avaya
  Inc.

  
	
  SIGNATURE

  	
  BY

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