Document:

Form of Notice of Stock Option Award

 Exhibit 10.2 
  
 Form of Notice of Stock Option Award and Agreement for Grants 
 Pursuant to Registrant’s 2001 Stock Incentive Plan 
 (for other than Executive Officers) 
  

			
	 	 
	 Notice of Grant of Stock Options and
 Option Agreement
	  	 Magma Design Automation, Inc.
 ID: 77-0454924
 5460 Bayfront Plaza
 Santa Clara, CA 95054-3600
  

  

					
			
	Name	  	Option Number:	  	000XXXX
	Address 1	  	Plan:	  	XXXX
	Address 2	  	 	  	 
	City, State, Zip	  	ID:	  	xxx-xx-xxxx

  
 Effective mm/dd/yyyy, you have been
granted a(n) Incentive Stock Option to buy xxx shares of Magma Design Automation, Inc. (the Company) stock at $xx.xx per share. 
  
 The total option price of the shares granted is $xx,xxx.xx. 
  
 Shares in each period will become fully vested on the date shown. 
  

							
	 Shares            

	  	 Vest Type        

	  	 Full Vest            

	  	 Expiration        

	 xxx
	  	On Vest Date	  	mm/dd/yyyy	  	mm/dd/yyyy
	 x,xxx
	  	Monthly	  	mm/dd/yyyy	  	mm/dd/yyyy

  

  
 By your signature and the Company’s signature below, you and the Company agree that these options are granted under and governed by the
terms and conditions of the Company’s Stock Option Plan as amended and the Option Agreement, all of which are attached and made a part of this document. 
  

  

					
	  

	  	 	 	  

	Magma Design Automation, Inc.	  	 	 	Date
			
	
	  	 	 	

	Optionee Name	  	 	 	Date

 STOCK OPTION AGREEMENT 
  
 TERMS AND CONDITIONS 
  
 MAGMA DESIGN AUTOMATION, INC. 
  
 2001 Stock Incentive Plan 
  
 THIS STOCK OPTION AGREEMENT TERMS AND CONDITIONS (the “Stock Option Agreement Terms and Conditions”), together with the Notice of Stock Option
Grant (the “Notice of Grant”) to which this Stock Option Agreement Terms and Conditions is attached, constitute the Stock Option Agreement referred to in the Magma Design Automation, Inc. 2001 Stock Incentive Plan (the “Plan”)
with respect to the option granted to you pursuant to the Notice of Grant (the “Option”). This Option is intended to be an Incentive Stock Option or a Nonstatutory Stock Option, as provided in the Notice of Grant. 
  
 1. Exercise. The Option evidenced by this Stock Option
Agreement Terms and Conditions becomes exercisable
                                        
                                        
                                        
        , as summarized in the Notice of Grant. Your rights to exercise the Option accrue only for the time period you render Service to the Company following your vesting commencement date. Your vesting
commencement date is the “Effective Date” set forth in the Notice of Grant. Your vesting commencement date is
                                        
                                        
    . 
  
 2. Term. The Option
expires on the date shown in the Notice of Grant, but in no event later than the tenth anniversary of the Date of Grant set forth in the Notice of Grant. The Option may expire earlier in connection with the termination of your Service, as described
below. 
  
 3. Regular Termination. If your Service
with the Company or a Subsidiary terminates for any reason excluding death, Total and Permanent Disability or Cause, this Option will expire on the date three months after your termination date. 
  
 4. Death or Disability. If your Service with the Company or a
Subsidiary terminates as a result of your Total and Permanent Disability or death, this Option will expire on the date six months after your termination date. If the Option is an Incentive Stock Option, the Stock Option will cease to be treated as
an Incentive Stock Option if not exercised within three (3) months after termination of Service. 
  
 5. Cause. If your Service with the Company or a Subsidiary terminates for Cause, this Option will expire on the date seven days following
your termination date. For purposes of this section, Cause shall mean (i) continued failure to perform substantially your duties, which standard of duties shall be referenced to the standards set by the Company at the date of this Agreement (other
than as a result of sickness, accident or similar cause beyond your reasonable control) after receipt of a written warning and your being given thirty (30) days to cure the failure; (ii) willful misconduct or gross negligence, which is demonstrably
injurious to the Company or any of its subsidiaries, including without limitation willful or grossly negligent failure to perform your material duties as an officer or employee of the Company or any of its subsidiaries or a material breach of this
Agreement, your employment agreement (if any) or your Proprietary Information and Inventions Agreement with the Company; (iii) conviction of or plea of nolo contendere to a felony; or (iv) commission of an act of fraud against, or the
misappropriation of property belonging to, the Company or any affiliated company, employee, customer or supplier of the Company. 
  
 6. Leaves of Absence. For purposes of this Option, your Service does not terminate when you go on a military leave of absence, a sick leave
of absence or another bona fide leave of absence, if the leave of absence was approved by the Company in writing and if continued crediting of Service is required by the terms of the leave or by applicable law. Your Service will terminate when the
approved leave of absence ends unless you immediately return to active work. Except as provided by applicable law, or unless expressly provided in writing pursuant to a Company-approved leave of absence, the period of the approved leave of absence
will not be credited as Service to the Company for the purposes of determining when your Option vests. In accordance with the preceding sentence, the dates on which the Option would otherwise vest will be postponed by the number of days of the
approved leave of absence. 

 7. Restrictions on Exercise. The Company will not permit you to exercise this Option if the
issuance of Shares at that time would violate any law or regulation. 
  
 8. Notice of Exercise. When you wish to exercise this Option you must notify the Company by completing the Notice of Stock Option Exercise in the form attached to this Stock Option Agreement Terms and Conditions (or such other
form approved by the Company) (the “Notice of Exercise”) and filing it with the Treasury Department of the Company. The exercise of your Option will be effective when the Notice of Exercise and payment of the Exercise Price is received by
the Company. In the case of a cashless exercise through a securities broker approved by the Company, the Notice of Exercise form must be filed in advance and approved by the Company prior to placing the order with the broker. This Notice of Exercise
form may be superseded by a Company-sponsored web-based trading program that includes security measures sufficient to ensure your identification, such that your entry of a web-based exercise or cashless exercise constitutes your request and
authorization to exercise the Option. If someone else wants to exercise this Option after your death, that person must prove to the Company’s satisfaction that he or she is entitled to do so. 
  
 9. Form of Payment. Payment may be made (i) by personal check,
a cashier’s check or a money order, (ii) in shares of Company Stock which have been owned by you or your representative for more than twelve (12) months and which are surrendered to the Company in good form for transfer, or (iii) by delivering
a Committee-approved form of irrevocable direction to a securities broker approved by the Company to sell all or part of the Shares subject to the Option and to deliver to the Company from the sale proceeds an amount sufficient to pay the Exercise
Price and any withholding taxes. In the case of a cashless exercise, the balance of the sale proceeds will be delivered to you. Notwithstanding the foregoing, a form of payment will not be available if the Committee determines, in its sole and
absolute discretion, that such form of payment could violate any law or regulation. 
  
 10. Withholding Taxes and Stock Withholding. You will not be allowed to exercise this Option unless you make arrangements acceptable to the Company to pay any withholding taxes that may be due as a
result of the Option exercise. These arrangements may include withholding Shares of Company Stock that otherwise would be issued to you when you exercise this Option. The value of these Shares, determined as of the effective date of Option exercise,
will be applied to the withholding taxes. 
  
 11.
Restrictions on Resale. By entering into this Stock Option Agreement Terms and Conditions, you agree not to sell any Shares at a time when applicable laws or Company policies prohibit a sale. This restriction will apply as long as you
are providing Service to the Company or a Subsidiary. 
  
 12.
Transfer of Option. Prior to your death, only you can exercise this Option. You cannot transfer or assign this Option. For instance, you may not sell this Option or use it as security for a loan. If you attempt to do any of these
things, this Option will immediately become invalid. You may in any event dispose of this Option in your will. Regardless of any marital property settlement agreement, the Company is not obligated to honor a notice of exercise from your former
spouse, nor is the Company obligated to recognize your former spouse’s interest in your Option in any other way. 
  
 13. Retention Rights. Neither your Option nor this Stock Option Agreement Terms and Conditions give you the right to be retained by the
Company or a Subsidiary in any capacity. The Company and its subsidiaries reserve the right to terminate your Service at any time, with or without Cause. 
  
 14. Stockholder Rights. You have no rights as a stockholder of the Company until you have exercised this Option by giving the required
Notice of Exercise to the Company and paying the Exercise Price. No adjustments are made for dividends or other rights if the applicable record date occurs before you exercise this Option, except as described in the Plan. 
  
 15. Adjustments. In the event of a stock split, a stock
dividend or a similar change in Company Stock, the number of Shares subject to this Option and the Exercise Price per share may be adjusted pursuant to the Plan. 

 16. Applicable Law. This Stock Option Agreement Terms and Conditions will be interpreted
and enforced under the laws of the State of California (without regard to choice-of-law provisions). 
  
 17. The Plan and Other Agreements. The text of the Plan is incorporated in this Stock Option Agreement Terms and Conditions by reference.
Capitalized terms used herein and not defined shall have the meanings set forth in the Plan. This Stock Option Agreement Terms and Conditions, the Notice of Grant, the Notice of Exercise and the Plan constitute the entire understanding between you
and the Company regarding this Option. Any prior agreements, commitments or negotiations concerning the Option are superseded. This Stock Option Agreement Terms and Conditions, the Notice of Grant and the Notice of Exercise may be amended only by
another written agreement, signed by both you and the Company. 
  
 BY SIGNING THE NOTICE OF GRANT, YOU AGREE TO ALL OF THE 
 TERMS AND CONDITIONS DESCRIBED IN THE NOTICE OF GRANT, THE

 STOCK OPTION AGREEMENT TERMS AND CONDITIONS, THE NOTICE OF 
 EXERCISE AND THE PLAN, AND ACKNOWLEDGE RECEIPT OF A COPY OF THE 
 PLAN.Description of Executive Cash Bonus Plan

 Exhibit 10.1 
  
 Description of Executive Cash Bonus Plan 
  
 On October 31, 2004, the Board of Directors of Avanex Corporation (the “Company”) adopted and approved an Executive Cash Bonus
Plan. Pursuant to the Executive Cash Bonus Plan, certain executive officers of the Company may receive one-time cash bonuses of between 24% to 40% of their base salaries following the satisfaction of certain financial and operating milestones
approved by the Board of Directors. The aggregate cash payments that may be paid to executive officers of the Company upon satisfaction of the financial and operating milestones pursuant to the Executive Cash Bonus Plan would be approximately $1.1
million.

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