Document:

Amended and Restated 2003 Equity Incentive Plan of Sorrento Networks Corporation

 EXHIBIT 10.2 
  
 AMENDED AND RESTATED 
  
 2003 EQUITY INCENTIVE PLAN 
  
 OF 
  
 SORRENTO NETWORKS CORPORATION 
  
 Effective February 15, 2005 
  

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 TABLE OF CONTENTS 
  

					
	 1.
	 	PURPOSE	  	4
	 2.
	 	DEFINITIONS AND RULES OF INTERPRETATION	  	4
	 2.1
	 	 Definitions
	  	4
	 2.2
	 	 Rules of Interpretation
	  	8
	 3.
	 	SHARES SUBJECT TO THIS PLAN; TERM OF THIS PLAN	  	8
	 3.1
	 	 Number of Award Shares
	  	8
	 3.2
	 	 Source of Shares
	  	8
	 3.3
	 	 Term of this Plan
	  	8
	 4.
	 	ADMINISTRATION	  	8
	 4.1
	 	 General
	  	8
	 4.2
	 	 Authority of Administrator
	  	9
	 4.3
	 	 Scope of Discretion
	  	10
	 5.
	 	PERSONS ELIGIBLE TO RECEIVE AWARDS	  	10
	 5.1
	 	 Eligible Individuals
	  	10
	 5.2
	 	 Section 162(m) Limitation
	  	10
	 6.
	 	TERMS AND CONDITIONS OF OPTIONS	  	10
	 6.1
	 	 Price
	  	10
	 6.2
	 	 Term
	  	11
	 6.3
	 	 Vesting
	  	11
	 6.4
	 	 Form of Payment
	  	11
	 6.5
	 	 Nonassignability of Options
	  	12
	 6.6
	 	 Substitute Options
	  	12
	 6.7
	 	 Cancellation and Regrant of Options
	  	12
	 7.
	 	INCENTIVE STOCK OPTIONS	  	12
	 8.
	 	STOCK APPRECIATION RIGHTS, STOCK AWARDS AND CASH AWARDS	  	13
	 8.1
	 	 Stock Appreciation Rights
	  	13
	 8.2
	 	 Stock Awards
	  	14
	 8.3
	 	 Cash Awards
	  	15
	 9.
	 	EXERCISE OF AWARDS	  	15
	 9.1
	 	 In General
	  	15
	 9.2
	 	 Time of Exercise
	  	15
	 9.3
	 	 Issuance of Award Shares
	  	15
	 9.4
	 	 Termination
	  	16
	 10.
	 	CERTAIN TRANSACTIONS AND EVENTS	  	18
	 10.1
	 	 In General
	  	18
	 10.2
	 	 Changes in Capital Structure
	  	18
	 10.3
	 	 Fundamental Transactions
	  	18
	 10.4
	 	 Divestiture
	  	18
	 10.5
	 	 Dissolution
	  	18
	 10.6
	 	 Cut-Back to Preserve Benefits
	  	18
	 11.
	 	[Reserved]	  	19
	 12.
	 	WITHHOLDING AND TAX REPORTING	  	19
	 12.1
	 	 Tax Withholding Alternatives
	  	19
	 12.2
	 	 Reporting of Dispositions
	  	19
	 13.
	 	COMPLIANCE WITH LAW	  	19
	 14.
	 	AMENDMENT OR TERMINATION OF THIS PLAN OR OUTSTANDING AWARDS	  	19
	 14.1
	 	 Amendment and Termination
	  	19
	 14.2
	 	 Shareholder Approval
	  	19
	 14.3
	 	 Effect
	  	20
	 15.
	 	RESERVED RIGHTS	  	20
	 15.1
	 	 Nonexclusivity of this Plan
	  	20
	 15.2
	 	 Unfunded Plan
	  	20
	 16.
	 	SPECIAL ARRANGEMENTS REGARDING AWARD SHARES	  	20
	 16.1
	 	 Escrows and Pledges
	  	20

  

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	 16.2
	  	 Repurchase Rights
	  	20
	 17.
	  	BENEFICIARIES	  	21
	 18.
	  	MISCELLANEOUS	  	21
	 18.1
	  	 Governing Law
	  	21
	 18.2
	  	 Determination of Value
	  	21
	 18.3
	  	 Reservation of Shares
	  	22
	 18.4
	  	 Contractual Arrangements
	  	22
	 18.5
	  	 Prior Plans
	  	22
	 18.6
	  	 Electronic Communications
	  	22
	 18.7
	  	 Notices
	  	22

  
  

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 1. PURPOSE 
  
 The purpose of the Amended and Restated 2003 Equity Incentive Plan of Sorrento Networks Corporation (the “Plan”) is to enhance the long-term
shareholder value of Zhone Technologies, Inc. (the “Company”) by offering opportunities to eligible individuals to participate in the growth in value of the equity of the Company. 
  
 2. DEFINITIONS AND RULES OF INTERPRETATION 
  
 2.1 Definitions. This Plan uses the following defined terms:

  
 (a) “Administrator” means the Board, the Committee,
or any officer or employee of the Company to whom the Board or the Committee delegates authority to administer this Plan. 
  
 (b) “Affiliate” means a “parent” or “subsidiary” (as each is defined in Section 424 of the Code) of the Company and any
other entity that the Board or Committee designates as an ‘Affiliate’ for purposes of this Plan. 
  
 (c) “Applicable Law” means any and all laws, rules and regulations of whatever jurisdiction, within or without the United States, and the rules
of, any stock exchange or quotation system on which Shares are listed or quoted, applicable to the taking or refraining from taking of any action under this Plan, including the administration of this Plan and the issuance or transfer of Awards or
Award Shares. 
  
 (d) “Award” means a Stock Award, SAR,
Cash Award, or Option granted in accordance with the terms of the Plan. 
  
 (e) “Award Agreement” means the document evidencing the grant of an Award. 
  
 (f) “Award Shares” means Shares covered by an outstanding Award or purchased under an Award. 
  
 (g) “Awardee” means: (i) a person to whom an Award has been granted, including a holder of a Substitute Award, (ii) a person to whom an Award
has been transferred in accordance with all applicable requirements of Sections 6.5, 7(h) and 17, and (iii) a person who holds Option Shares subject to any right of repurchase under Section 16.2. 
  
 (h) “Board” means the board of directors of the Company.

  
 (i) “Cash Award” means the right to receive cash as
described in Section 8.3. 
  
 (j) “Change of Control”
means a change in ownership or control of the Company effected through either of the following transactions: 
  
 (i) The acquisition, directly or indirectly by any person or related group of persons (other than the Company or an Affiliate), of beneficial ownership
(within the meaning of Rule 13d]-3 of the Exchange Act) of securities possessing more than fifty percent (50%) of the total combined voting power of the Company’s outstanding securities pursuant to a tender or exchange offer made directly to
the Company’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 consist of individuals who either (A) have
been Board 

  

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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. 
  
 (k) “Code” means the Internal Revenue Code of 1986. 
  
 (l) “Committee” means a committee composed of Company Directors appointed in accordance with the Company’s charter documents and Section 4.

  
 (m) “Company” means Zhone Technologies, Inc., a
Delaware corporation. 
  
 (n) “Company Director” means a
member of the Board. 
  
 (o) “Consultant” means an
individual who, or an employee of any entity that, provides bona fide services to the Company or an Affiliate not in connection with the offer or sale of securities in a capital-raising transaction, but who is not an Employee. 
  
 (p) “Director” means a member of the board of directors of the
Company or an Affiliate. 
  
 (q) “Divestiture” means any
transaction or event that the Board specifies as a Divestiture under Section 10.4. 
  
 (r) “Domestic Relations Order” means a ‘domestic relations order’ as defined in, and otherwise meeting the requirements of, Section 414(p) of the Code, except that reference to a “plan”
in that definition shall be to this Plan. 
  
 (s)
“Employee” means a regular employee of the Company or an Affiliate, including an officer or Director, who is treated as an employee in the personnel records of the Company or an Affiliate, but not individuals who are classified by the
Company or an Affiliate as: (i) leased from or otherwise employed by a third party, (ii) independent contractors, or (iii) intermittent or temporary workers. The Company’s or an Affiliate’s classification of an individual as an
“Employee” (or as not an ‘Employee’) for purposes of this Plan shall not be altered retroactively even if that classification is changed retroactively for another purpose as a result of an audit, litigation or otherwise. An
Awardee shall not cease to be an Employee due to transfers between locations of the Company, or between the Company and an Affiliate, or to any successor to the Company or an Affiliate that assumes the Awardee’s Options under Section 10.
Neither service as a Director nor receipt of a director’s fee shall be sufficient to make a Director an “Employee”. 
  
 (t) “Exchange Act” means the Securities Exchange Act of 1934. 
  
 (u) “Executive” means, if the Company has any class of any equity security registered under Section 12 of the
Exchange Act, an individual who is subject to Section 16 of the Exchange Act or who is a “covered employee” under Section 162(m) of the Code, in either case because of the individual’s relationship with the Company or an Affiliate. If
the Company does not have any class of any equity security registered under Section 12 of the Exchange Act, “Executive” means any (i) Director, (ii) officer elected or appointed by the Board, or (iii) beneficial owner of more than 10% of
any class of the Company’s equity securities. 
  
 (v)
“Expiration Date” means, with respect to an Award, the date stated in the Award Agreement as the expiration date of the Award or, if no such date is stated in the Award Agreement, then the last day of the maximum exercise period for the
Award, disregarding the effect of an Awardee’s Termination or any other event that would shorten that period. 
  

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 (w) “Fair Market Value” means the value of Shares as determined under Section 18.2. 

 
 (x) “Fundamental Transaction” means either of the following
shareholder-approved transactions: 
  
 (i) the Company or an
Affiliate is a party to a merger, consolidation, amalgamation, or other transaction in which the beneficial shareholders of the Company, immediately before the transaction, beneficially own securities representing 50% or less of the total combined
voting power or value of the Company immediately after the transaction, or 
  
 (ii) The sale, transfer or other disposition of all or substantially all of the Company’s assets in complete liquidation or dissolution of the Company. 
  
 (y) “Grant Date” means the date the Administrator approves the
grant of an Award. However, if the Administrator specifies that an Award’s Grant Date is a future date or the date on which a condition is satisfied, the Grant Date for such Award is that future date or the date that the condition is satisfied.

  
 (z) “Hostile Take-Over” shall mean the acquisition,
directly or indirectly, by any person or related group of persons (other than the Company or an Affiliate) of beneficial ownership (within the meaning of Rule 13d-3 of the Exchange Act) of securities possessing more than fifty percent (50%) of the
total combined voting power of the Company’s outstanding securities pursuant to a tender or exchange offer made directly to the Company’s shareholders which the Board does not recommend such shareholders to accept. 
  
 (aa) “Incentive Stock Option” means an Option intended to qualify
as an incentive stock option under Section 422 of the Code and designated as an Incentive Stock Option in the Award Agreement for that Option. 
  
 (bb) [Reserved] 
  
 (cc) “Nonstatutory Option” means any Option other than an Incentive Stock Option. 
  
 (dd) “Objectively Determinable Performance Condition” shall mean a performance condition (i) that is established
(A) at the time an Award is granted or (B) no later than the earlier of (1) 90 days after the beginning of the period of service to which it relates, or (2) before the elapse of 25% of the period of service to which it relates, (ii) that is
uncertain of achievement at the time it is established, and (iii) the achievement of which is determinable by a third party with knowledge of the relevant facts Examples of measures that may be used in Objectively Determinable Performance Conditions
include, without limitation, net order dollars, net profit dollars, net profit growth, net revenue dollars, revenue growth, individual performance, earnings per share, return on assets, return on equity, and other financial objectives, objective
customer satisfaction indicators and efficiency measures, each with respect to the Company and/or an individual business unit. 
  
 (ee) “Officer” means an officer of the Company as defined in Rule 16a-1 adopted under the Exchange Act. 
  
 (ff) “Option” means a right to purchase Shares of the Company
granted under this Plan. 
  
 (gg) “Option Price” means
the price payable under an Option for Shares, not including any amount payable in respect of withholding or other taxes. 
  

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 (hh) “Option Shares” means Shares covered by an outstanding Option or purchased under an
Option. 
  
 (ii) “Plan” means the Amended and Restated
2003 Equity Incentive Plan of Sorrento Networks Corporation. 
  
 (jj) “Prior Plans” means the Company’s 1997 Incentive and Non-Qualified Stock Option Plan, the 1997 Directors Stock Option Plan, and the 2000 Stock Option/Stock Issuance Plan in effect. 
  
 (kk) “Purchase Price” means the price payable under a Stock Award
for Shares, not including any amount payable in respect of withholding or other taxes. 
  
 (ll) “Reverse Vesting” means that an Option is or was fully exercisable but that, subject to a “reverse” vesting schedule, the Company has a right to repurchase the Option Shares as specified in
Section 15.2(a), with the Company’s right of repurchase expiring in accordance with a “forward” vesting schedule that would otherwise have applied to the Option under which the Option Shares were purchased or in accordance with some
other vesting schedule described in the Award Agreement. With respect to a Stock Award, Reverse Vesting means that the Company has a right to repurchase the Award Shares purchased pursuant to the Stock Award, as specified in Section 16.2(a), with
the Company’s right of repurchase expiring in accordance with the vesting schedule in the Award Agreement. 
  
 (mm) “Rule 16b-3” means Rule 16b-3 adopted under Section 16(b) of the Exchange Act. 
  
 (nn) “SAR” or “Stock Appreciation Right” means a right to
receive cash based on a change in the Fair Market Value of a specific number of Shares pursuant to an Award Agreement, as described in Section 8.1. 
  
 (oo) “Securities Act” means the Securities Act of 1933. 
  

(pp) “Share” means a share of the common stock of the Company or other securities substituted for the common stock under Section 10.

  
 (qq) “Stock Award” means an offer by the Company to
sell shares subject to certain restrictions pursuant to the Award Agreement as described in Section 8.2. 
  
 (rr) “Substitute Award” means a Substitute Option, Substitute SAR or Substitute Stock Award granted in accordance with the terms of the Plan.

  
 (ss) “Substitute Option” means an Option granted in
substitution for, or upon the conversion of, an option granted by another entity to purchase equity securities in the granting entity. 
  
 (tt) “Substitute SAR” means a SAR granted in substitution for, or upon the conversion of, a stock appreciation right granted by another entity
with respect to equity securities in the granting entity. 
  
 (uu)
“Substitute Stock Award” means a Stock Award granted in substitution for, or upon the conversion of, a stock award granted by another entity to purchase equity securities in the granting entity. 
  
 (vv) “Take-Over Price” shall mean the greater of (i) the Fair
Market Value per share of Company’s Common Stock on the date the option is surrendered to the Company in connection with a Hostile Take-Over or (ii) the highest reported price per share of the Company’s Common Stock paid by the tender
offeror in effecting such Hostile Take-Over. 
  

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 (ww) “Termination” means that the Awardee has ceased to be, with or without any cause or
reason, an Employee, Director or Consultant. However, unless so determined by the Administrator, “Termination” shall not include a change in status from an Employee, Consultant or Director to another such status. An event that causes an
Affiliate to cease being an Affiliate shall be treated as the ‘Termination’ of that Affiliate’s Employees, Directors, and Consultants. 
  
 2.2 Rules of Interpretation. Any reference to a ‘Section,’ without more, is to a Section of this Plan Captions and titles are used for
convenience in this Plan and shall not, by themselves, determine the meaning of this Plan Except, when otherwise indicated by the context, the singular includes the plural and vice versa. Any reference to a statute is also a reference to the
applicable rules and regulations adopted under that statute Any reference to a statute, rule or regulation, or to a section of a statute, rule or regulation, is a reference to that statute, rule, regulation, or section as amended from time to time,
both before and after the effective date of this Plan and including any successor provisions. 
  
 3. SHARES SUBJECT TO THIS PLAN; TERM OF THIS PLAN 
  
 3.1 Number of Award Shares. Subject to adjustment under Section 10, the maximum number of Shares that may be issued under this Plan is [        ]. When an Award is
granted, the maximum number of Shares that may be issued under this Plan shall be reduced by the number of Shares covered by that Award. However, if an Award later terminates or expires without having been exercised in full, the maximum number of
shares that may be issued under this Plan shall be increased by the number of Shares that were covered by, but not purchased under, that Award. By contrast, the repurchase of Shares by the Company shall not increase the maximum number of Shares that
may be issued under this Plan. 
  
 3.2 Source of Shares.
Award Shares may be: (a) Shares that have never been issued, (b) Shares that have been issued but are no longer outstanding, or (c) Shares that are outstanding and are acquired, including shares repurchased by the Company on the open market, to
discharge the Company’s obligation to deliver Award Shares. 
  
 3.3 Term of this Plan. 
  
 (a) This Plan shall be
effective on, and Awards may be granted under this Plan after, the date it has been both adopted by the Board and approved by the Company’s shareholders. 
  

(b) Subject to Section 13, Awards may be granted under this Plan for a period of ten years from the earlier of the date on which the Board approves
this Plan and the date the Company’s shareholders approve this Plan. Accordingly, Awards may not be granted under the Plan after the earlier of those dates. 
  
 (c) One or more provisions of the Plan, including (without limitation) the provisions of Section 10, may, in the
Administrator’s discretion, be extended to one or more options granted under Prior Plans which do not otherwise contain such provisions, provided, however, that no modification of any option shall impair any existing contractual rights of any
awardee unless the affected awardee consents to such modification. When contemplating a modification of awards granted under Prior Plans pursuant to this Section 3.3(d), the Administrator shall give due consideration to the effect of such
modification under Applicable Law, tax laws and any adverse accounting treatment that may be incurred. 
  
 4. ADMINISTRATION 
  
 4.1
General. 
  
 (a) The Board shall have ultimate
responsibility for administering this Plan. The Board may delegate certain of its responsibilities to a Committee, which shall consist of at least two members of the Board. The Board or the Committee may further delegate its responsibilities to any
Employee of the Company or any Affiliate. Where this Plan specifies that an action is to be taken or a determination made by the Board, only the Board may take that action or make that determination. Where this Plan specifies that an action is to be
taken or a determination made by the Committee, only the Committee may take that 
  

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 action or make that determination. Where this Plan references the “Administrator,” the action may be taken or
determination made by the Board, the Committee, or other Administrator. However, only the Board or the Committee may approve grants of Awards to Executives, and an Administrator other than the Board or the Committee may grant Awards only within
guidelines established by the Board or Committee. Moreover, all actions and determinations by any Administrator are subject to the provisions of this Plan. 
  
 (b) So long as the Company has registered and outstanding a class of equity securities under Section 12 of the Exchange Act, the Committee shall consist
of Company Directors who are “Non-Employee Directors” as defined in Rule 16b-3 and, after the expiration of any transition period permitted by Treasury Regulations Section 1.162-27(h)(3), who are “outside directors” as defined in
Section 162(m) of the Code. 
  
 4.2 Authority of
Administrator. Subject to the other provisions of this Plan, the Administrator shall have the authority to: 
  
 (a) grant Awards, including Substitute Awards; 
  
 (b) determine the Fair Market Value of Shares; 
  
 (c) determine the Option Price and the Purchase Price of Awards; 
  

(d) select the Awardees; 
  
 (e) determine the times at which Awards are granted; 
  
 (f) determine the number of Shares subject to each Award; 
  
 (g) determine the types of payment that may be used to purchase Award Shares; 
  
 (h) determine the types of payment that may be used to satisfy withholding tax obligations; 
  
 (i) determine the other terms of each Award, including but not limited to the
time or times at which Awards may be exercised, whether and under what conditions an Award is assignable, and whether an Option is a Nonstatutory Option or an Incentive Stock Option; 
  
 (j) modify or amend any Award; 
  
 (k) authorize any person to sign any Award Agreement or other document related to this Plan on behalf of the Company; 
  
 (l) determine the form of any Award Agreement or other document related to
this Plan, and whether that document, including signatures, may be in electronic form; 
  
 (m) interpret this Plan and any Award Agreement or document related to this Plan; 
  
 (n) correct any defect, remedy any omission, or reconcile any inconsistency in this Plan, any Award Agreement or any other document related to this Plan;

  
 (o) adopt, amend, and revoke rules and regulations under this
Plan, including rules and regulations relating to sub-plans and Plan addenda; 
  
 (p) adopt, amend, and revoke special rules and procedures which may be inconsistent with the terms of this Plan, set forth (if the Administrator so chooses) in sub-plans regarding (for example) the 
  

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 operation and administration of this Plan and the terms of Awards, if and to the extent necessary or useful to
accommodate non-U.S. Applicable Laws and practices as they apply to Awards and Award Shares held by, or granted or issued to, persons working or resident outside of the United States or employed by Affiliates incorporated outside the United States;

  
 (q) determine whether a transaction or event should be treated
as a Change of Control, a Divestiture or neither; 
  
 (r)
determine the effect of a Fundamental Transaction and, if the Board determines that a transaction or event should be treated as a Change of Control or a Divestiture, then the effect of that Change of Control or Divestiture; and 
  
 (s) make all other determinations the Administrator deems necessary or
advisable for the administration of this Plan. 
  
 4.3 Scope of
Discretion. Subject to the last sentence of this Section 4.3, on all matters for which this Plan confers the authority, right or power on the Board, the Committee, or other Administrator to make decisions, that body may make those decisions in
its sole and absolute discretion. Those decisions will be final, binding and conclusive. Moreover, but again subject to the last sentence of this Section 4.3, in making those decisions the Board, Committee or other Administrator need not treat all
persons eligible to receive Awards, all Awardees, all Awards or all Award Shares the same way. However, except as provided in Section 13.3, the discretion of the Board, Committee or other Administrator is subject to the specific provisions and
specific limitations of this Plan, as well as all rights conferred on specific Awardees by Award Agreements and other agreements. 
  
 5. PERSONS ELIGIBLE TO RECEIVE AWARDS 
  
 5.1 Eligible Individuals. Awards (including Substitute Awards) may be granted to, and only to, Employees, Directors and Consultants, including to
prospective Employees, Directors and Consultants conditioned on the beginning of their service for the Company or an Affiliate. However, Incentive Stock Options may only be granted to Employees, as provided in Section 7(g). 
  
 5.2 Section 162(m) Limitation. 
  
 (a) Options and SARs. So long as the Company is a “publicly held
corporation” within the meaning of Section 162(m) of the Code: (i) no Employee or prospective Employee may be granted one or more SARs and Options within any fiscal year of the Company under this Plan to purchase more than 1,300,000 Shares
under Options or to receive compensation calculated with reference to more than that number of Shares under SARs, subject to adjustment under Section 10, and (ii) Options and SARs may be granted to an Executive only by the Committee (and,
notwithstanding Section 4.1(a), not by the Board). If an Option or SAR is cancelled without being exercised or if the Option Price of an Option is reduced, that cancelled or repriced Option or SAR shall continue to be counted against the limit on
Awards that may be granted to any individual under this Section 5.2. 
  
 (b) Cash Awards and Stock Awards. Any Cash Award or Stock Award intended as “qualified performance-based compensation” within the meaning of Section 162(m) of the Code must vest or become exercisable contingent on the achievement
of one or more Objectively Determinable Performance Conditions. The Committee shall have the discretion to determine the time and manner of compliance with Section 162(m) of the Code. 
  
 6. TERMS AND CONDITIONS OF OPTIONS 
  
 The following rules apply to all Options: 
  
 6.1 Price. No Option intended as “qualified incentive-based compensation” within the meaning of Section 162(m) of the Code may have an
Option Price less than 100% of the Fair Market Value of the Shares on the Grant Date. In no event will the Option Price of any Option be less than the par value of the Shares issuable under the Option if that is required by Applicable Law. The
Option Price of an Incentive Stock Option shall be subject to Section 7(f). 
  

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 6.2 Term. No Option shall be exercisable after its Expiration Date. No Option may have an
Expiration Date that is more than ten years after its Grant Date. Additional provisions regarding the term of Incentive Stock Options are provided in Sections 7(a) and 7(e). 
  
 6.3 Vesting. Options shall be exercisable: (a) on the Grant Date, or (b) in accordance with a schedule related to the
Grant Date, the date the Optionee’s directorship, employment or consultancy begins, or a different date specified in the Option Agreement. If so provided in the Option Agreement, an Option may be exercisable subject to the application of
Reverse Vesting to the Option Shares. Additional provisions regarding the vesting of Incentive Stock Options are provided in Section 7(c). No Option granted to an individual who is subject to the overtime pay provisions of the Fair Labor Standards
Act may be exercised before the expiration of six months after the Grant Date. 
  
 6.4 Form of Payment. 
  
 (a) The Administrator shall determine the acceptable form and method of payment for exercising an Option. 
  
 (b) Acceptable forms of payment for all Option Shares are cash, check or wire transfer, denominated in U.S. dollars except as specified by the
Administrator for non-U.S. Employees or non-U.S. sub-plans. 
  
 (c) In addition, the Administrator may permit payment to be made by any of the following methods: 
  
 (i) other Shares, or the designation of other Shares, which (A) are “mature” shares for purposes of avoiding variable accounting treatment under
generally accepted accounting principles (generally mature shares are those that have been owned by the Optionee for more than six months on the date of surrender), and (B) have a Fair Market Value on the date of surrender equal to the Option Price
of the Shares as to which the Option is being exercised; 
  
 (ii)
provided that a public market exists for the Shares, consideration received by the Company under a procedure under which a broker-dealer that is a member of the National Association of Securities Dealers advances funds on behalf of an Optionee or
sells Option Shares on behalf of an Optionee (a “Cashless Exercise Procedure”), provided that if the Company extends or arranges for the extension of credit to an Optionee under any Cashless Exercise Procedure, no Officer or Director may
participate in that Cashless Exercise Procedure; 
  
 (iii) with
respect only to Optionees who are neither Officers nor Directors as of the date of exercise, one or more promissory notes meeting the requirements of Section 6.4(e), provided, however, that promissory notes may not be used for any portion of an
Award which is not vested at the time of exercise; 
  
 (iv)
cancellation of any debt owed by the Company or any Affiliate to the Optionee by the Company including without limitation waiver of compensation due or accrued for services previously rendered to the Company; and 
  
 (v) any combination of the methods of payment permitted by any paragraph of
this Section 6.4. 
  

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 (d) The Administrator may also permit any other form or method of payment for Option Shares permitted by
Applicable Law. 
  
 (e) The promissory notes referred to in
Section 6.4(c)(iii) must be full recourse. Unless the Committee specifies otherwise after taking into account any relevant accounting issues, the notes shall bear interest at a fair market value rate when the Option is exercised. Interest on the
notes shall also be at least sufficient to avoid imputation of interest under Sections 483, 1274, and 7872 of the Code. The notes and their administration shall at all times comply with any applicable margin rules of the Federal Reserve. The notes
may also include such other terms as the Administrator specifies Payment may not be made by promissory note by Officers or Directors if Shares are registered under Section 12 of the Exchange Act. 
  
 6.5 Nonassignability of Options. Except as determined by the
Administrator, no Option shall be assignable or otherwise transferable by the Optionee except by will or by the laws of descent and distribution. However, Options may be transferred and exercised in accordance with a Domestic Relations Order and may
be exercised by a guardian or conservator appointed to act for the Optionee. Incentive Stock Options may only be assigned in compliance with Section 7(h). 
  
 6.6 Substitute Options. The Board may cause the Company to grant Substitute Options in connection with the acquisition by the Company or an
Affiliate of equity securities of any entity (including by merger, tender offer, or other similar transaction) or of all or a portion of the assets of any entity. Any such substitution shall be effective when the acquisition closes. Substitute
Options may be Nonstatutory Options or Incentive Stock Options. Unless and to the extent specified otherwise by the Board, Substitute Options shall have the same terms and conditions as the options they replace, except that (subject to Section 10)
Substitute Options shall be Options to purchase Shares rather than equity securities of the granting entity and shall have an Option Price determined by the Board. 
  
 6.7 Cancellation and Regrant of Options. The 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 granted under this Plan and to grant in substitution new Options covering the same or a different number of shares of the
Company’s common stock but with an Option Price based on the Fair Market Value per share of the Company’s common stock on the new Grant Date. 
  
 7. INCENTIVE STOCK OPTIONS 
  
 The following rules apply only to Incentive Stock Options and only to the extent these rules are more restrictive than the rules that would otherwise
apply under this Plan. With the consent of the Optionee, or where this Plan provides that an action may be taken notwithstanding any other provision of this Plan, the Administrator may deviate from the requirements of this Section, notwithstanding
that any Incentive Stock Option modified by the Administrator will thereafter be treated as a Nonstatutory Option. 
  
 (a) The Expiration Date of an Incentive Stock Option shall not be later than ten years from its Grant Date, with the result that no Incentive Stock Option
may be exercised after the expiration of ten years from its Grant Date. 
  
 (b) No Incentive Stock Option may be granted more than ten years from the date this Plan was approved by the Board. 
  
 (c) Options intended to be incentive stock options under Section 422 of the Code that are granted to any single Optionee under all incentive stock option
plans of the Company and its Affiliates, including incentive stock options granted under this Plan, may not vest at a rate of more than $100,000 in Fair Market Value of stock (measured on the grant dates of the options) during any calendar year. For
this purpose, an option vests with respect to a given share of stock the first time its holder may purchase that share, notwithstanding any right of the Company to repurchase that share. Unless the administrator of that option plan specifies
otherwise in the related agreement governing the option, this vesting limitation shall be applied by, to the extent necessary to satisfy this $100,000 rule, treating certain stock options that were 
  

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 intended to be incentive stock options under Section 422 of the Code as Nonstatutory Options. The stock options or
portions of stock options to be reclassified as Nonstatutory Options are those with the highest option prices, whether granted under this Plan or any other equity compensation plan of the Company or any Affiliate that permits that treatment. This
Section 7(c) shall not cause an Incentive Stock Option to vest before its original vesting date or cause an Incentive Stock Option that has already vested to cease to be vested. 
  
 (d) In order for an Incentive Stock Option to be exercised for any form of payment other than those described in Section
6.4(b), that right must be stated at the time of grant in the Option Agreement relating to that Incentive Stock Option. 
  
 (e) Any Incentive Stock Option granted to a Ten Percent Shareholder, must have an Expiration Date that is not later than five years from its Grant Date,
with the result that no such Option may be exercised after the expiration of five years from the Grant Date. A “Ten Percent Shareholder” is any person who, directly or by attribution under Section 424(d) of the Code, owns stock possessing
more than ten percent of the total combined voting power of all classes of stock of the Company or of any Affiliate on the Grant Date. 
  
 (f) The Option Price of an Incentive Stock Option shall never be less than the Fair Market Value of the Shares at the Grant Date. The Option Price for the
Shares covered by an Incentive Stock Option granted to a Ten Percent Shareholder shall never be less than 110% of the Fair Market Value of the Shares at the Grant Date. 
  
 (g) Incentive Stock Options may be granted only to Employees. If an Optionee changes status from an Employee to a
Consultant, that Optionee’s Incentive Stock Options become Nonstatutory Options if not exercised within the time period described in Section 7(i). 
  
 (h) No rights under an Incentive Stock Option may be transferred by the Optionee, other than by will or the laws of descent and distribution. During the
life of the Optionee, an Incentive Stock Option may be exercised only by the Optionee. The Company’s compliance with a Domestic Relations Order, or the exercise of an Incentive Stock Option by a guardian or conservator appointed to act for the
Optionee, shall not violate this Section 7(h). 
  
 (i) An
Incentive Stock Option shall be treated as a Nonstatutory Option if it remains exercisable after, and is not exercised within, the three-month period beginning with the Optionee’s Termination for any reason other than the Optionee’s death
or disability (as defined in Section 22(c) of the Code). In the case of Termination due to death, an Incentive Stock Option shall continue to be treated as an Incentive Stock Option if it remains exercisable after, and is not exercised within, the
three-month period after the Optionee’s Termination provided it is exercised before the Expiration Date. In the case of Termination due to disability, an Incentive Stock Option shall be treated as a Nonstatutory Option if it remains exercisable
after, and is not exercised within, one year after the Optionee’s Termination. 
  
 (j) An Incentive Stock Option may only be modified by the Board. 
  
 8. STOCK APPRECIATION RIGHTS, STOCK AWARDS AND CASH AWARDS 
  
 8.1 Stock Appreciation Rights. SARs may be granted either alone, in addition to, or in tandem with other Awards granted under the Plan. The
Administrator may grant SARs subject to terms and conditions not inconsistent with the Plan and determined by the Administrator. The specific terms and conditions applicable to the Awardee shall be provided for in the Award Agreement. The following
rules apply to SARs: 
  
 (a) Term. No SAR shall be exercisable
after its Expiration Date. No SAR may have an Expiration Date that is more than ten years after its Grant Date. 
  

 - 13 - 

 (b) Vesting. SARs shall be exercisable: (i) on the Grant Date, (ii) in accordance with a schedule related
to the Grant Date, the date the Awardee’s directorship, employment or consultancy begins, or a different date specified in the Award Agreement, or (iii) or upon the achievement of Objectively Determinable Performance Conditions. 
  
 (c) Exercise of SARs. Upon the exercise of an SAR, in whole or in part, an
Awardee shall be entitled to a payment in an amount equal to the excess of the Fair Market Value of a fixed number of Shares covered by the exercised portion of the SAR on the date of exercise, over the Fair Market Value of the Shares covered by the
exercised portion of the SAR on the Grant Date. The amount due to the Awardee the exercise of a SAR will be paid in cash or Shares over the period or periods specified in the Award Agreement. An Award Agreement may place limits on the amount that
may be paid over any specified period or periods upon the exercise of a SAR, on an aggregate basis or as to any Awardee. A SAR shall be considered exercised when the Company receives written notice of exercise in accordance with the terms of the
Award Agreement from the person entitled to exercise the SAR. 
  
 (d) Nonassignability of SARs. Except as determined by the Administrator, no SAR shall be assignable or otherwise transferable by the Awardee except by will or by the laws of descent and distribution. However, SARs may be transferred and
exercised in accordance with a Domestic Relations Order. 
  
 (e)
Substitute SARs. The Board may cause the Company to grant Substitute SARs in connection with the acquisition by the Company or an Affiliate of equity securities of any entity (including by merger) or all or a portion of the assets of any entity. Any
such substitution shall be effective when the acquisition closes. Unless and to the extent specified otherwise by the Board, Substitute SARs shall have the same terms and conditions as the options they replace, except that (subject to Section 10)
Substitute SARs shall be exercisable with respect to the Fair Market Value of Shares rather than equity securities of the granting entity and shall be on terms that, as determined by the Board in its sole and absolute discretion, properly reflects
the substitution. 
  
 (f) Cancellation and Regrant of SARs. The
Administrator shall have the authority to effect, at any time and from time to time, with the consent of the affected Awardee, the replacement or re-grant, through cancellation or modification, of Stock Awards granted under the Plan. 
  
 8.2 Stock Awards. Stock Awards may be granted either alone, in
addition to, or in tandem with other Awards granted under the Plan. The specific terms and conditions applicable to the Awardee shall be provided for in the Award Agreement. The Award Agreement shall state the number of Shares that the Awardee shall
be entitled to receive or purchase, the terms and conditions on which the Shares shall vest, the price to be paid, if any, and, if applicable, the time within which the Awardee must accept such offer. The following rules apply to all Stock Awards:

  
 (a) Term. No Stock Award shall be exercisable after its
Expiration Date. No Stock Award may have an Expiration Date that is more than ten years after its Grant Date. 
  
 (b) Vesting. Stock Awards shall be exercisable: (i) on the Grant Date, or (ii) in accordance with a schedule related to the Grant Date, the date the
Awardee’s directorship, employment or consultancy begins, or a different date specified in the Award Agreement. 
  
 (c) Right of Repurchase If so provided in the Award Agreement, Award Shares acquired pursuant to a Stock Award may be subject to Reverse Vesting.

  
 (d) Form of Payment. The Administrator shall determine the
acceptable form and method of payment for exercising a Stock Award. 
  

 - 14 - 

 (i) Acceptable forms of payment for all Award Shares are cash, check. or wire transfer, denominated in
U.S. dollars except as specified by the Administrator for non-U.S. Employees or non-U.S. sub-plans. 
  
 (ii) In addition, the Administrator may permit payment to be made by any of the methods permitted with respect to the exercise of Options pursuant to
Section 6.4. 
  
 (e) Nonassignability of Stock Awards. Except as
determined by the Administrator, no Stock Award shall be assignable or otherwise transferable by the Awardee except by will or by the laws of descent and distribution. However, Options may be transferred and exercised in accordance with a Domestic
Relations Order. 
  
 (f) Substitute Stock Award. The Board may
cause the Company to grant Substitute Stock Awards in connection with the acquisition by the Company or an Affiliate of equity securities of any entity (including by merger) or all or a portion of the assets of any entity. Unless and to the extent
specified otherwise by the Board, Substitute Stock Awards shall have the same terms and conditions as the options they replace, except that (subject to Section 10) Substitute Stock Awards shall be Stock Awards to purchase Shares rather than equity
securities of the granting entity and shall have a Purchase Price that, as determined by the Board in its sole and absolute discretion, properly reflects the substitution. 
  
 (g) Cancellation or Regrant of Stock Awards. The Administrator shall have the authority to effect, at any time and from time
to time, with the consent of the affected Awardee, the replacement or re-grant, through cancellation or modification, of Stock Awards granted under the Plan. 
  
 8.3 Cash Awards. Cash Awards may be granted either alone, in addition to, or in tandem with other Awards granted under the Plan. Once the
Administrator determines that it will grant a Cash Award, it shall advise the Awardee, by means of an Award Agreement, of the terms, conditions and restrictions related to the Cash Award. The following rules apply to all Cash Awards: 
  
 (a) Term. No Cash Award shall be payable after its Expiration Date. No Cash
Award may have an Expiration Date that is more than ten years after its Grant Date. 
  
 (b) Vesting. Cash Awards shall be payable: (i) on the Grant Date, (ii) in accordance with a schedule related to the Grant Date, the date the Awardee’s directorship, employment or consultancy begins, or a
different date specified in the Award Agreement, or (iii) or upon the achievement of Objectively Determinable Performance Conditions. 
  
 9. EXERCISE OF AWARDS 
  
 9.1 In General. An Award shall be exercisable in accordance with this Plan and the Award Agreement under which it is granted. 
  
 9.2 Time of Exercise. Options and Stock Awards shall be considered
exercised when the Company receives: (a) written notice of exercise from the person entitled to exercise the Option or Stock Award, (b) full payment, or provision for payment, in a form and method approved by the Administrator, for the Shares for
which the Option or Stock Award is being exercised, and (c) with respect to Nonstatutory Options, payment, or provision for payment, in a form approved by the Administrator, of all applicable withholding taxes due upon exercise. An Award may not be
exercised for a fraction of a Share SARs and Cash Awards shall be considered exercised when the Company receives written notice of the exercise from the person entitled to exercise the SAR or Cash Award. 
  
 9.3 Issuance of Award Shares. The Company shall issue Award Shares in
the name of the person properly exercising the Award. If the Awardee is that person and so requests, the Award Shares shall be issued in the name of the Awardee and the Awardee’s spouse. The Company shall endeavor to issue Award Shares promptly
after an Award is exercised. However, until Award Shares are actually 
  

 - 15 - 

 issued, as evidenced by the appropriate entry on the stock books of the Company or its transfer agent, the Awardee will
not have the rights of a shareholder with respect to those Award Shares, even though the Awardee has completed all the steps necessary to exercise the Award. No adjustment shall be made for any dividend, distribution, or other right for which the
record date precedes the date the Award Shares are issued, except as provided in Section 10. 
  
 9.4 Termination. 
  
 (a)
In General. Except as provided in an Award Agreement or in writing by the Administrator, including in an Award Agreement, and as otherwise provided in Sections 9.4(b), (c), (d), (e), (f), (g) and (h), after an Awardee’s Termination, the
Awardee’s Awards shall be exercisable to the extent (but only to the extent) they are vested on the date of that Termination and only during the three months after the Termination, but in no event after the Expiration Date. To the extent the
Awardee does not exercise an Award within the time specified for exercise, the Award shall automatically terminate. 
  
 (b) Leaves of Absence. Unless otherwise provided in the Award Agreement, no Award may be exercised more than three months after the beginning of a leave
of absence, other than a personal or medical leave approved by an authorized representative of the Company with employment guaranteed upon return Awards shall not continue to vest during a leave of absence, unless otherwise determined by the
Administrator with respect to an approved personal or medical leave with employment guaranteed upon return. 
  
 (c) Death or Disability. Unless otherwise provided by the Administrator, if an Awardee’s Termination is due to death or disability (as determined by
the Administrator with respect to all Awards other than Incentive Stock Options and as defined by Section 22(e) of the Code with respect to Incentive Stock Options), all Awards of that Awardee to the extent exercisable at the date of that
Termination may be exercised for one year after that Termination, but in no event after the Expiration Date. In the case of Termination due to death, an Award may be exercised as provided in Section 16. In the case of Termination due to disability,
if a guardian or conservator has been appointed to act for the Awardee and been granted this authority as part of that appointment, that guardian or conservator may exercise the Award on behalf of the Awardee. In the case of an Awardee who dies or
become disabled within three months after Termination, if the Termination was not due to Cause, the Awardee’s Awards may be exercised for one year after that Termination. To the extent an Award is not so exercised within the time specified for
its exercise, the Award shall automatically terminate. 
  
 (d)
Divestiture. If an Awardee’s Termination is due to a Divestiture, the Board may take any one or more of the actions described in Section 10.3 with respect to the Awardee’s Awards. 
  
 (e) Retirement. Unless otherwise provided by the Administrator, if an
Awardee’s Termination is due to the Awardee’s retirement in accordance with the Company’s or an Affiliate’s retirement policy, all Awards of that Awardee to the extent exercisable at the Awardee’s date of retirement may be
exercised for one year after the Awardee’s date of retirement, but in no event after the Expiration Date. To the extent the Awardee does not exercise an Option within the time specified for exercise, the Award shall automatically terminate.

  
 (f) Severance Programs. Unless otherwise provided by the
Administrator, if an Awardee’s Termination results from participation in a voluntary severance incentive program of the Company or an Affiliate approved by the Board, all Awards of that Employee to the extent exercisable at the time of that
Termination shall be exercisable for one year after the Awardee’s Termination, but in no event after the Expiration Date. If the Awardee does not exercise an Award within the time specified for exercise, the Award shall automatically terminate.

  
 (g) Termination for Cause. If an Awardee’s Termination is
due to Cause, all of the Awardee’s Awards shall automatically terminate and cease to be exercisable at the time of Termination and the Administrator may rescind any and all exercises of Awards by the Awardee that occurred after the first

  

 - 16 - 

 event constituting Cause. ‘Cause’ means employment-related dishonesty, fraud, misconduct or disclosure or
misuse of confidential information, or other employment-related conduct that is likely to cause significant injury to the Company, an Affiliate, or any of their respective employees, officers or directors (including, without limitation, commission
of a felony or similar offense), in each case as determined by the Administrator. ‘Cause’ shall not require that a civil judgment or criminal conviction have been entered against or guilty plea shall have been made by the Awardee regarding
any of the matters referred to in the previous sentence. 
  
 (h)
Administrator Discretion. Notwithstanding the provisions of Section 9.4 (a)-(g), the Plan Administrator shall have complete discretion, exercisable either at the time an Award is granted or at any time while the Award remains outstanding, to:

  
 (i) Extend the period of time for which the Award is to
remain exercisable, following the Awardee’s Termination, from the limited exercise period otherwise in effect for that Award to such greater period of time as the Administrator shall deem appropriate, but in no event beyond the expiration of
the option term; and/or 
  
 (ii) Permit the Award to be exercised,
during the applicable post-Termination exercise period, not only with respect to the number of vested shares of the Company’s common stock for which such Award may be exercisable at the time of the Awardee’s Termination but also with
respect to one or more additional installments in which the Awardee would have vested had the Awardee not been subject to Termination; and/or 
  
 (iii) Permit the lapse of some or all of the Company’s repurchase rights, as to any given Award, that is subject to Reverse Vesting. 
  
 (i) Consulting or Employment Relationship. Nothing in this Plan or in any
Award Agreement, and no Award or the fact that Award Shares remain subject to repurchase rights, shall: (A) interfere with or limit the right of the Company or any Affiliate to terminate the employment or consultancy of any Awardee at any time,
whether with or without cause or reason, and with or without the payment of severance or any other compensation or payment, or (B) interfere with the application of any provision in any of the Company’s or any Affiliate’s charter documents
or Applicable Law relating to the election, appointment, term of office, or removal of a Director. 
  

 - 17 - 

 10. CERTAIN TRANSACTIONS AND EVENTS 
  
 10.1 In General. Except as provided in this Section 10, no change in the capital structure of the Company, merger,
sale or other disposition of assets or a subsidiary, change of control, issuance by the Company of shares of any class of securities convertible into shares of any class, conversion of securities, or other transaction or event shall require or be
the occasion for any adjustments of the type described in this Section 10. Additional provisions with respect to the foregoing transactions are set forth in Section 13.3. 
  
 10.2 Changes in Capital Structure. In the event of any stock split, reverse stock split, recapitalization,
combination or reclassification of stock, stock dividend, spin-off, or similar change to the capital structure of the Company (not including a Fundamental Transaction or Change of Control), the Board shall make whatever adjustments it concludes are
appropriate to: (a) the number and type of Awards that may be granted under this Plan, (b) the number and type of Options that may be granted to any individual under this Plan, (c) the Terms of any SAR, (d) the Purchase Price of any Stock Award, (e)
the Option Price and number and class of securities issuable under each outstanding Option, and (f) the repurchase price of any securities substituted for Option Shares that are subject to repurchase rights. The specific adjustments shall be
determined by the Board Unless the Board specifies otherwise, any securities issuable as a result of any such adjustment shall be rounded to the next lower whole security. The Board need not adopt the same rules for each Award or each Awardee.

  
 10.3 Fundamental Transactions. If the Company engages
in a Fundamental Transaction, then, subject to Section 18.4 of this Plan, but notwithstanding any other provision of this Plan, the Board shall do one or more of the following contingent on the closing or completion of the Fundamental Transaction:
(a) arrange for the substitution, in exchange for Awards, of options to purchase equity securities other than Shares (including, if appropriate, equity securities of an entity other than the Company) (an ‘assumption’ of Awards) on such
terms and conditions as the Board determines are appropriate, (b) accelerate the vesting and termination of outstanding Awards, in whole or in part, so that Awards can be exercised before or otherwise in connection with the closing or completion of
the Fundamental Transaction or event but then terminate, (c) cancel or arrange for the cancellation of Awards in exchange for cash payments to Awardees, or (d) either arrange for any repurchase rights of the Company with respect to Award Shares to
apply to the securities issued in substitution for Shares or terminate repurchase rights on Award Shares. 
  
 10.4 Divestiture. If the Company or an Affiliate sells or otherwise transfers equity securities of an Affiliate to a person or entity other than
the Company or an Affiliate, or leases, exchanges or transfers all or any portion of its assets to such a person or entity, then the Board may specify that such transaction or event constitutes a ‘Divestiture’. In connection with a
Divestiture, notwithstanding any other provision of this Plan, the Board may take one or more of the actions described in Section 10.3 with respect to Awards or Award Shares held by, for example, Employees, Directors or Consultants for whom that
transaction or event results in a Termination. The Board need not adopt the same rules for each Award or each Awardee. 
  
 10.5 Dissolution. If the Company adopts a plan of dissolution, the Board may cause Awards to be fully vested and exercisable (but not after their
Expiration Date) before the dissolution is completed but contingent on its completion and may cause the Company’s repurchase rights on Award Shares to lapse upon completion of the dissolution. The Board need not adopt the same rules for each
Award or each Awardee. However, to the extent not exercised before the earlier of the completion of the dissolution or their Expiration Date, Awards shall terminate just before the dissolution is completed. 
  
 10.6 Cut-Back to Preserve Benefits. If the Administrator determines
that the net after-tax amount to be realized by any Awardee, taking into account any accelerated vesting, termination of repurchase rights, or cash payments to that Awardee in connection with any transaction or event addressed in this Section 10
would be greater if one or more of those steps were not taken or payments were not made with respect to that Awardee’s Awards or Award Shares, then and to that extent one or more of those steps shall not be taken and payments shall not be made.

  

 - 18 - 

 11. [RESERVED 
  
 However, all Options granted under this Article before this amendment and restatement came into effect, shall be governed by the terms of the 2003 Stock
Incentive Plan of Sorrento Networks Corporation prior to this amendment and restatement.] 
  
 12. WITHHOLDING AND TAX REPORTING 
  
 12.1 Tax Withholding Alternatives. 
  
 (a) General. Whenever Award Shares are issued or become free of restrictions, the Company may require the Awardee to remit to the Company an amount sufficient to satisfy any applicable tax withholding requirement,
whether the related tax is imposed on the Awardee or the Company. The Company shall have no obligation to deliver Award Shares or release Award Shares from an escrow or permit a transfer of Award Shares until the Awardee has satisfied those tax
withholding obligations. Whenever payment in satisfaction of Awards is made in cash, the payment will be reduced by an amount sufficient to satisfy all tax withholding requirements. 
  
 (b) Method of Payment. The Awardee shall pay any required withholding using the forms of consideration described in Section
6.4(b), except that, in the discretion of the Administrator, the Company may also permit the Awardee to use any of the forms of payment described in Section 6.4(c). The Administrator may also permit Award Shares to be withheld to pay required
withholding. If the Administrator permits Award Shares to be withheld, the Fair Market Value of the Award Shares withheld, as determined as of the date of withholding, shall not exceed the amount determined by the applicable minimum statutory
withholding rates. 
  
 12.2 Reporting of Dispositions. Any
holder of Option Shares acquired under an Incentive Stock Option shall promptly notify the Administrator, following such procedures as the Administrator may require, of the sale or other disposition of any of those Option Shares if the disposition
occurs during: (a) the longer of two years after the Grant Date of the Incentive Stock Option and one year after the date the Incentive Stock Option was exercised, or (b) such other period as the Administrator has established. 
  
 13. COMPLIANCE WITH LAW 
  
 The grant of Awards and the issuance and subsequent transfer of Award Shares shall be subject to compliance with all
Applicable Law, including all applicable securities laws. Awards may not be exercised, and Award Shares may not be transferred, in violation of Applicable Law. Thus, for example, Awards may not be exercised unless: (a) a registration statement under
the Securities Act is then in effect with respect to the related Award Shares, or (b) in the opinion of legal counsel to the Company, those Award Shares may be issued in accordance with an applicable exemption from the registration requirements of
the Securities Act and any other applicable securities laws. The failure or inability of the Company to obtain from any regulatory body the authority considered by the Company’s legal counsel to be necessary or useful for the lawful issuance of
any Award Shares or their subsequent transfer shall relieve the Company of any liability for failing to issue those Award Shares or permitting their transfer. As a condition to the exercise of any Award or the transfer of any Award Shares, the
Company may require the Awardee to satisfy any requirements or qualifications that may be necessary or appropriate to comply with or evidence compliance with any Applicable Law. 
  
 14. AMENDMENT OR TERMINATION OF THIS PLAN OR OUTSTANDING AWARDS 
  
 14.1 Amendment and Termination. The Board may at any time amend, suspend, or terminate this Plan. 
  
 14.2 Shareholder Approval. The Board shall have complete and exclusive
power and authority to amend or modify the Plan in any or all respects. However, the Company shall obtain the approval of the Company’s shareholders for any amendment to this Plan if shareholder approval is 
  

 - 19 - 

 necessary or desirable to comply with any Applicable Law or with the requirements applicable to the grant of Awards
intended to be Incentive Stock Options. The Board may also, but need not, require that the Company’s shareholders approve any other amendments to this Plan. 
  
 14.3 Effect. No such amendment or modification as contemplated in Section 14.2 of this Plan shall adversely affect
the rights and obligations with respect to Awards at the time outstanding under the Plan unless the Awardee consents to such amendment or modification. 
  
 15. RESERVED RIGHTS 
  
 15.1 Nonexclusivity of this Plan. 
  
 This Plan shall not limit the power of the Company or any Affiliate to adopt other incentive arrangements including, for example, the grant or issuance of
stock options, stock, or other equity-based rights under other plans or independently of any plan. 
  
 15.2 Unfunded Plan. This Plan shall be unfunded. Although bookkeeping accounts may be established with respect to Awardees, any such accounts will
be used merely as a convenience. The Company shall not be required to segregate any assets on account of this Plan, the grant of Awards, or the issuance of Award Shares. The Company and the Administrator shall not be deemed to be a trustee of stock
or cash to be awarded under this Plan. Any obligations of the Company to any Awardee shall be based solely upon contracts entered into under this Plan, such as Award Agreements. No such obligations shall be deemed to be secured by any pledge or
other encumbrance on any assets of the Company. Neither the Company nor the Administrator shall be required to give any security or bond for the performance of any such obligations. 
  
 16. SPECIAL ARRANGEMENTS REGARDING AWARD SHARES 
  
 16.1 Escrows and Pledges. To enforce any restrictions on Award Shares including restrictions related to Reverse
Vesting, the Administrator may require their holder to deposit the certificates representing Award Shares, with stock powers or other transfer instruments approved by the Administrator endorsed in blank, with the Company or an agent of the Company
to hold in escrow until the restrictions have lapsed or terminated. The Administrator may also cause a legend or legends referencing the restrictions to be placed on the certificates. Any Awardee who delivers a promissory note as partial or full
consideration for the purchase of Award Shares will be required to pledge and deposit with the Company some or all of the Award Shares as collateral to secure the payment of the note. However, the Administrator may require or accept other or
additional forms of collateral to secure the note and, in any event, the Company will have full recourse against the maker of the note, notwithstanding any pledge or other collateral. 
  
 16.2 Repurchase Rights. 
  
 (a) Reverse Vesting. If an Option or Stock Award is subject to Reverse Vesting, the Company shall have the right, during the seven months after the
Awardee’s Termination, to repurchase any or all of the Award Shares that were unvested as of the date of that Termination. If the Award Shares were purchased with a promissory note, the repurchase price shall be the lower of: the Option Price
or Purchase Price for such Shares, (minus the amount of any cash dividends paid or payable with respect to the Award Shares for which the record date precedes the repurchase) and the Fair Market Value at the date of Termination. In all other cases,
the repurchase price shall be determined by the Administrator in accordance with this Section 16.2. The repurchase determined by the Administrator shall be either (i) the Option Price or Purchase Price for the Award Shares (minus the amount of any
cash dividends paid or payable with respect to the Award Shares for which the record date precedes the repurchase) or (ii) the lower of (A) the Option Price or Purchase Price for the Shares or (B) the Fair Market Value of those Option Shares as of
the date of the Termination. The repurchase price shall be paid in cash or, if the Option Shares were purchased in whole or in part with a promissory note, cancellation of indebtedness under that note, or a combination of those means. The Company
may assign this right of repurchase. 
  

 - 20 - 

 (b) Procedure. The Company or its assignee may choose to give the Awardee a written notice of exercise of
its repurchase rights under this Section 16.2. However, the Company’s failure to give such a notice shall not affect its rights to repurchase Award Shares. The Company must, however, tender the repurchase price during the period specified in
this Section 16.2 for exercising its repurchase rights in order to exercise such rights. 
  
 17. BENEFICIARIES 
  
 An
Awardee may file a written designation of one or more beneficiaries who are to receive the Awardee’s rights under the Awardee’s Awards after the Awardee’s death. An Awardee may change such a designation at any time by written notice.
If an Awardee designates a beneficiary, the beneficiary may exercise the Awardee’s Awards after the Awardee’s death. If an Awardee dies when the Awardee has no living beneficiary designated under this Plan, the Company shall allow the
executor or administrator of the Awardee’s estate to exercise the Award or, if there is none, the person entitled to exercise the Option under the Awardee’s will or the laws of descent and distribution. In any case, no Award may be
exercised after its Expiration Date. 
  
 18. MISCELLANEOUS 
  
 18.1 Governing Law. This Plan, the Award Agreements and all other
agreements entered into under this Plan, and all actions taken under this Plan or in connection with Awards or Award Shares, shall be governed by the substantive laws, but not the choice of law rules, of the state of incorporation of the Company.

  
 18.2 Determination of Value. Fair Market Value shall be
determined as follows: 
  
 (a) Listed Stock. If the Shares are
traded on any established stock exchange or quoted on a national market system, Fair Market Value shall be the closing sales price for the Shares as quoted on that stock exchange or system for the date the value is to be determined (the ‘Value
Date’) as reported in The Wall Street Journal or a similar publication. If no sales are reported as having occurred on the Value Date, Fair Market Value shall be that closing sales price for the last preceding trading day on which sales of
Shares are reported as having occurred. If no sales are reported as having occurred during the five trading days before the Value Date, Fair Market Value shall be the closing bid for Shares on the Value Date. If Shares are listed on multiple
exchanges or systems, Fair Market Value shall be based on sales or bids on the primary exchange or system on which Shares are traded or quoted. 
  
 (b) Stock Quoted by Securities Dealer. If Shares are regularly quoted by a recognized securities dealer but selling prices are not reported on any
established stock exchange or quoted on a national market system, Fair Market Value shall be the mean between the high bid and low asked prices on the Value Date. If no prices are quoted for the Value Date, Fair Market Value shall be the mean
between the high bid and low asked prices on the last preceding trading day on which any bid and asked prices were quoted. 
  
 (c) No Established Market. If Shares are not traded on any established stock exchange or quoted on a national market system and are not quoted by a
recognized securities dealer, the Administrator (following guidelines established by the Board or Committee) will determine Fair Market Value in good faith. The Administrator will consider the following factors, and any others it considers
significant, in determining Fair Market Value: (i) the price at which other securities of the Company have been issued to purchasers other than Employees, Directors, or Consultants, (ii) the Company’s net worth, prospective earning power,
dividend-paying capacity, and non-operating assets, if any, and (iii) any other relevant factors, including the economic outlook for the Company and the Company’s industry, the Company’s position in that industry, the Company’s
goodwill and other intellectual property, and the values of securities of other businesses in the same industry. 
  

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 18.3 Reservation of Shares. During the term of this Plan, the Company will at all times reserve
and keep available such number of Shares as are still issuable under this Plan. 
  
 18.4 Contractual Arrangements. Notwithstanding anything to the contrary set forth within this Plan, the terms and conditions of all existing and future employment and consulting agreements with the Company,
including without limitation, any definitions contained in those agreements, shall be unaffected by and shall supersede the terms of this Plan. 
  
 18.5 Prior Plans. All options outstanding under the Prior Plans shall continue to be governed solely by the terms of the documents evidencing such
options, 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 the Company’s Common Stock. 
  
 18.6 Electronic Communications. Any Award Agreement, notice of
exercise of an Award, or other document required or permitted by this Plan may be delivered in writing or, to the extent determined by the Administrator, electronically. Signatures may also be electronic if permitted by the Administrator.

  
 18.7 Notices. Unless the Administrator specifies
otherwise, any notice to the Company under any Option Agreement or with respect to any Awards or Award Shares shall be in writing (or, if so authorized by Section 18.4, communicated electronically), shall be addressed to the Secretary of the
Company, and shall only be effective when received by the Secretary of the Company. 
  

 - 22 -Zhone Technologies, Inc. Amended and Restated 2001 Stock Incentive Plan

 EXHIBIT 10.3 
  
 ZHONE TECHNOLOGIES, INC. 
  
 AMENDED AND RESTATED 
  
 2001 STOCK INCENTIVE PLAN 
  
 Effective May 12, 2005 

 ZHONE TECHNOLOGIES, INC. 
 AMENDED AND RESTATED 
 2001 STOCK INCENTIVE PLAN 
  
 1. Purpose. 
  
 The purpose of the Zhone Technologies, Inc. Amended and Restated 2001 Stock
Incentive Plan (the “Plan”), formerly known as the Tellium, Inc. 2001 Stock Incentive Plan) is to strengthen Zhone Technologies, Inc., a Delaware corporation (the “Company”), by providing an incentive to its employees, officers,
directors and consultants and thereby encouraging them to devote their abilities and industry to the success of the Company’s business enterprise. It is intended that this purpose be achieved by extending to employees (including future
employees who have received a formal written offer of employment), officers, directors, and consultants of the Company and its Subsidiaries an added long-term incentive for high levels of performance and unusual efforts through the grant of
Incentive Stock Options, Nonqualified Stock Options, Stock Appreciation Rights, Dividend Equivalent Rights, Performance Units and Performance Shares, Share Awards, Phantom Stock and Restricted Stock (as each term is herein defined). After the
Effective Date of this Plan, no further awards shall be made under the Amended and Restated 1997 Employee Stock Incentive Plan of Tellium, Inc. (as amended and currently in effect, the “Former Plan”). Each award outstanding under the
Former Plan as of the Effective Date of this Plan shall remain outstanding and continue to be subject to the terms of the Former Plan and the award agreement under which such award was granted. Each Share that is available for the granting of new
awards under the Former Plan as of the Effective Date of this Plan and each Share that is the subject of an award under the Former Plan but is not issued prior to the time that such award expires or otherwise terminates (collectively, the
“Former Plan Shares”) shall, after the Effective Date of this Plan, not be available for the granting of awards under the Former Plan, but shall instead be available for the granting of Options or Awards under this Plan. 
  
 2. Definitions. 
  
 For purposes of the Plan: 
  
 2.1 “Adjusted Fair Market Value” means, in the event of a
Change in Control, the greater of (a) the highest price per Share paid to holders of the Shares in any transaction (or series of related transactions) constituting or resulting in a Change in Control other than pursuant to Section 2.10(b) or (b) the
highest Fair Market Value of a Share during the ninety (90) day period ending on the date of the Change in Control. 
  
 2.2 “Affiliate” means, with respect to any Person, any other Person that, directly or indirectly through one or more intermediaries,
controls, or is controlled by, or under common control with, such Person. Any Relative (for this purpose, “Relative” means a spouse, child, stepchild, parent, parent of spouse, sibling or grandchild) of an individual shall be deemed to be
an Affiliate of such individual for purposes hereof. Neither the Company nor any Person controlled by the Company shall be deemed to be an Affiliate of any holder of Company stock. 
  
 2.3 “Agreement” means the written agreement between the Company and an Optionee or Grantee evidencing the
grant of an Option or Award and setting forth the terms and conditions thereof. 
  
 2.4 “Award” means a grant of Restricted Stock, Phantom Stock, a Stock Appreciation Right, a Performance Award, a Dividend Equivalent Right, a Share Award, or any or all of them. 
  
 2.5 “Beneficial Ownership” means ownership within the
meaning of Rule 13d-3 promulgated under the Exchange Act. 
  
 2.6
“Beneficiary” means an individual, trust or estate who or which, by a written designation of the Optionee or Grantee filed with the Company or by operation of law succeeds to the rights and obligations of the Optionee or Grantee
under the Plan and an Agreement upon the Optionee’s or Grantee’s death. 
  
 2.7 “Board” means the Board of Directors of the Company. 
  

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 2.8 “Cause” means: 
  
 (a) with respect to directors, the commission of an act of fraud or intentional misrepresentation or an act of
embezzlement, misappropriation or conversion of assets or opportunities of the Company or any of its Subsidiaries, and 
  
 (b) in the case of an Optionee or Grantee whose employment with the Company or a Subsidiary is, as the date of the applicable Agreement, subject to the
terms of an employment agreement between such Optionee or Grantee and the Company or a Subsidiary, which employment agreement includes a definition of “Cause,” the term “Cause” as used in this Plan or any Agreement shall have the
meaning set forth in such employment agreement during the period that such employment agreement remains in effect; or 
  
 (c) in all other cases, the term “Cause” as used in this Plan or any Agreement shall mean (i) willfully failing to perform reasonably assigned
duties within thirty (30) days after having received written notice from the Company to do so, (ii) dishonesty or willful misconduct in the performance of duties, (iii) involvement in a transaction in connection with the performance of duties to the
Company or any of its Subsidiaries which transaction is adverse to the interests of the Company or any of its Subsidiaries and which is engaged in for personal profit or (iv) willful violation of any law, rule or regulation (other than traffic
violations or similar offenses) in connection with the performance of duties. 
  
 2.9 “Change in Capitalization” means any increase or reduction in the number of Shares, or any change (including, without limitation, in the case of a spin-off, dividend or other distribution in
respect of Shares, a change in value) in the Shares or exchange of Shares for a different number or kind of shares or other securities of the Company or another corporation, by reason of a reclassification, recapitalization, merger, consolidation,
reorganization, spin-off, split-up, issuance of warrants or rights or debentures, stock dividend, stock split or reverse stock split, cash dividend, property dividend, combination or exchange of shares, repurchase of shares, change in corporate
structure or a substantially similar transaction. 
  
 2.10 A
“Change in Control” shall mean the occurrence of any of the following: 
  
 (a) An acquisition (other than directly from the Company) of any Voting Securities of the Company by any Person, immediately after which such Person has Beneficial Ownership of fifty percent (50%) or more of the then
outstanding Shares or the combined voting power of the Company’s then outstanding Voting Securities, provided, however, in determining whether a Change in Control has occurred pursuant to this Section 2.10(a), Shares or Voting Securities
which are acquired in a “Non-Control Acquisition” (as hereinafter defined) shall not constitute an acquisition which would cause a Change in Control. A “Non-Control Acquisition” shall mean an acquisition by (i) an employee
benefit plan (or a trust forming a part thereof) maintained by (A) the Company or (B) any corporation or other Person of which a majority of its voting power or its voting equity securities or equity interest is owned, directly or indirectly, by the
Company (for purposes of this definition, a “Related Entity”), (ii) the Company or any Related Entity, or (iii) any Person in connection with a “Non-Control Transaction” (as hereinafter defined); 
  
 (b) The individuals who, as of the date hereof, are members of the Board
(the “Incumbent Board”), cease for any reason to constitute at least a majority of the members of the Board, or following a Merger (as defined in paragraph (c)(i) below) which results in a Parent corporation, the board of directors of the
ultimate Parent Corporation (as defined in paragraph (c)(i)(A) below); provided, however, that if the election, or nomination for election by the Company’s common stockholders, of any new director was approved by a vote of at least
two-thirds of the Incumbent Board, such new director shall, for purposes of this Plan, be considered as a member of the Incumbent Board; provided further, however, that no individual shall be considered a member of the Incumbent Board if such
individual initially assumed office as a result of either an actual or threatened “Election Contest” (as described in Rule 14a-11 promulgated under the Exchange Act) or other actual or threatened solicitation of proxies or consents by or
on behalf of a Person other than the Board (a “Proxy Contest”) including by reason of any agreement intended to avoid or settle any Election Contest or Proxy Contest; or 
  

 - 2 - 

 (c) The consummation of: 
  
 (i) A merger, consolidation or reorganization with or into the Company or in which securities of the Company are issued (a
“Merger”), unless such Merger is a “Non-Control Transaction.” A “Non-Control Transaction” shall mean a Merger where: 
  
 (A) the stockholders of the Company, immediately before such Merger own directly or indirectly immediately following such Merger at least fifty percent
(50%) of the combined voting power of the outstanding voting securities of (x) the corporation resulting from such Merger (the “Surviving Corporation”) if fifty percent (50%) or more of the combined voting power of the then outstanding
voting securities of the Surviving Corporation is not Beneficially Owned, directly or indirectly by another Person (a “Parent Corporation”), or (y) if there are one or more Parent Corporations, the ultimate Parent Corporation; and

  
 (B) the individuals who were members of the Incumbent Board
immediately prior to the execution of the agreement providing for such Merger constitute at least a majority of the members of the board of directors of (x) the Surviving Corporation, if there is no Parent Corporation, or (y) if there are one or
more Parent Corporations, the ultimate Parent Corporation; and 
  
 (C) no Person other than (1) the Company, (2) any Related Entity, (3) any employee benefit plan (or any trust forming a part thereof) that, immediately prior to such Merger was maintained by the Company or any Related Entity, or (4) any
Person who, together with its Affiliates, immediately prior to such Merger, had Beneficial Ownership of fifty percent (50%) or more of the then outstanding Voting Securities or Shares, owns, together with its Affiliates, Beneficial Ownership of (i)
fifty percent (50%) or more of the combined voting power of the outstanding voting securities or common stock of (x) the Surviving Corporation if there is no Parent Corporation, or (y) if there are one or more Parent Corporations, the ultimate
Parent Corporation. 
  
 (ii) A complete liquidation or
dissolution of the Company; or 
  
 (iii) The sale or other
disposition of all or substantially all of the assets of the Company to any Person (other than a transfer to a Related Entity or under conditions that would constitute a Non-Control Transaction with the disposition of the assets being regarded as a
Merger for this purpose or the distribution to the Company’s stockholders of the stock of a Related Entity or any other assets). 
  
 Notwithstanding the foregoing, a Change in Control shall not be deemed to occur solely because any Person (the “Subject Person”) acquired
Beneficial Ownership of more than the permitted amount of the then outstanding Shares or Voting Securities as a result of the acquisition of Shares or Voting Securities by the Company which, by reducing the number of Shares or Voting Securities then
outstanding, increases the proportional number of shares Beneficially Owned by the Subject Persons, provided that if a Change in Control would occur (but for the operation of this sentence) as a result of the acquisition of Shares or Voting
Securities by the Company, and (1) before such share acquisition by the Company the Subject Person becomes the Beneficial Owner of any new or additional Shares or Voting Securities in contemplation of such share acquisition by the Company or (2)
after such share acquisition by the Company the Subject Person becomes the Beneficial Owner of any new or additional Shares or Voting Securities which in either case increases the percentage of the then outstanding Shares or Voting Securities
Beneficially Owned by the Subject Person, then a Change in Control shall occur. 
  
 2.11 “Code” means the Internal Revenue Code of 1986, as amended. 
  
 2.12 “Committee” means a committee, as described in Section 3.1, appointed by the Board from time to time to administer the Plan and to
perform the functions set forth herein. 
  
 2.13
“Company” means Zhone Technologies, Inc., a Delaware corporation. 
  
 2.14 “Director” means a director of the Company. 
  

 - 3 - 

 2.15 “Disability” means: 
  
 (a) in the case of an Optionee or Grantee whose employment with the Company or a Subsidiary is, as of the date of the
applicable Agreement, subject to the terms of an employment agreement between such Optionee or Grantee and the Company or a Subsidiary, which employment agreement includes a definition of “Disability,” the term “Disability” as
used in this Plan or any Agreement shall have the meaning set forth in such employment agreement during the period that such employment agreement remains in effect; or 
  
 (b) in all other cases, the term “Disability” as used in this Plan or any Agreement shall mean a physical or
mental infirmity which impairs the Optionee’s or Grantee’s ability to perform substantially his or her duties for a period of one hundred eighty (180) consecutive days. 
  
 2.16 “Disability Date” means the date which is one hundred eighty (180) consecutive days after the date on
which an Optionee or Grantee is first absent from active employment with the Company or ceases to perform his or her duties as a director, by reason of a Disability. 
  
 2.17 “Dividend Equivalent Right” means a right to receive all or some portion of the cash dividends that
are or would be payable with respect to Shares. 
  
 2.18
“Division” means any of the operating units or divisions of the Company designated as a Division by the Committee. 
  
 2.19 “Eligible Individual” means any of the following individuals who is designated by the Committee as eligible to receive Options or
Awards subject to the conditions set forth herein: (a) any director, officer or employee of the Company or a Subsidiary, (b) any individual to whom the Company or a Subsidiary has extended a formal, written offer of employment, or (c) any consultant
or advisor of the Company or a Subsidiary. 
  
 2.20
“Exchange Act” means the Securities Exchange Act of 1934, as amended. 
  
 2.21 “Fair Market Value” on any date means the closing sales prices of the Shares on such date on the principal national securities exchange on which such Shares are listed or admitted to trading, or,
if such Shares are not so listed or admitted to trading, the average of the per Share closing bid price and per Share closing asked price on such date as quoted on the National Association of Securities Dealers Automated Quotation System or such
other market in which such prices are regularly quoted, or, if there have been no published bid or asked quotations with respect to Shares on such date, the Fair Market Value shall be the value established by the Board in good faith and, in the case
of an Incentive Stock Option, in accordance with Section 422 of the Code. 
  
 2.22 “Former Plan” means the Amended and Restated 1997 Employee Stock Incentive Plan of Tellium, Inc. 
  
 2.23 [Reserved] 
  
 2.24 “Grantee” means a person to whom an Award has been granted under the Plan. 
  
 2.25 “Incentive Stock Option” means an Option satisfying the
requirements of Section 422 of the Code and designated by the Committee as an Incentive Stock Option. 
  
 2.26 “Initial Public Offering” means the consummation of the first public offering of Shares pursuant to a registration statement (other
than a Form S-8 or successor forms) filed with, and declared effective by, the Securities and Exchange Commission. 
  
 2.27 “Nonemployee Director” means a director of the Company who is a “nonemployee director” within the meaning of Rule 16b-3
promulgated under the Exchange Act. 
  

 - 4 - 

 2.28 “Nonqualified Stock Option” means an Option which is not an Incentive Stock Option.

  
 2.29 “Normal Retirement Date” means the date
on which an Optionee or Grantee terminates active employment with the Company or ceases to perform his or her duties as a director on or after attainment of age 65, but does not include termination by the Company for Cause. 
  
 2.30 “Option” means a Nonqualified Stock Option, an
Incentive Stock Option, or any or all of them. 
  
 2.31
“Optionee” means a person to whom an Option has been granted under the Plan. 
  
 2.32 “Outside Director” means a director of the Company who is an “outside director” within the meaning of Section 162(m) of the Code and the regulations promulgated thereunder. 

 
 2.33 “Parent” means any corporation which is a parent
corporation (within the meaning of Section 424(e) of the Code) with respect to the Company. 
  
 2.34 “Performance Awards” means Performance Units, Performance Shares or either or both of them. 
  
 2.35 “Performance-Based Compensation” means any Option or Award that is intended to constitute “performance based compensation”
within the meaning of Section 162(m)(4)(C) of the Code and the regulations promulgated thereunder. 
  
 2.36 “Performance Cycle” means the time period specified by the Committee at the time Performance Awards are granted during which the
performance of the Company, a Subsidiary or a Division will be measured. 
  
 2.37 “Performance Objectives” has the meaning set forth in Section 11. 
  
 2.38 “Performance Shares” means Shares issued or transferred to an Eligible Individual under Section 11. 
  
 2.39 “Performance Units” means Performance Units granted to
an Eligible Individual under Section 11. 
  
 2.40
“Person” means ‘person’ as such term is used for purposes of Section 13(d) or 14(d) of the Exchange Act, including without limitation, any individual, corporation, limited liability company, partnership, trust,
unincorporated organization, government or any agency or political subdivision thereof, or any other entity or any group of Persons. 
  
 2.41 “Phantom Stock” means a right granted to an Eligible Individual under Section 12 representing a number of hypothetical Shares.

  
 2.42 “Plan” means the Zhone Technologies,
Inc. Amended and Restated 2001 Stock Incentive Plan, as amended and restated from time to time. 
  
 2.43 “Pooling Transaction” means an acquisition of the Company in a transaction which is intended to be treated as a “pooling of
interests” under generally accepted accounting principles. 
  
 2.44 “Restricted Stock” means Shares issued or transferred to an Eligible Individual pursuant to Section 10. 
  
 2.45 “Share Award” means a grant of Shares pursuant to Section 12. 
  

 - 5 - 

 2.46 “Shares” means the common stock, par value $0.001 per share, of the Company and any
other securities into which such shares are changed or for which such shares are exchanged. 
  
 2.47 “Stock Appreciation Right” means a right to receive all or some portion of the increase in the value of the Shares as provided in Section 8 hereof. 
  
 2.48 “Subsidiary” means (i) except as provided in subsection
(ii) below, any corporation which is or becomes a subsidiary corporation (within the meaning of Section 424(f) of the Code) with respect to the Company, and (ii) with respect to provisions relating to the eligibility to receive Options or Awards
other than Incentive Stock Options and to continued employment for purposes of Options and Awards (unless the Committee determines otherwise), any entity, whether or not incorporated, in which the Company directly or indirectly owns fifty percent
(50%) or more of the outstanding equity or other ownership interests. 
  
 2.49 “Successor Corporation” means a corporation, or a parent or subsidiary thereof, which issues or assumes an Option or Award in a transaction described in Section 424(a) of the Code without regard to Sections 424(a)(1)
and (2) thereof. 
  
 2.50 “Tax Benefit” means an
actual decrease in the Company’s liability for taxes in any period. 
  
 2.51 “Ten-Percent Stockholder” means an Eligible Individual, who, at the time an Incentive Stock Option is to be granted to him or her, owns (within the meaning of Section 422(b)(6) of the Code) stock
possessing more than ten percent (10%) of the total combined voting power of all classes of stock of the Company, or of a Parent or a Subsidiary. 
  
 2.52 “Termination of Employment” means the later of (i) severance of the employer-employee relationship with the Company, a Parent or a
Subsidiary or (ii) the resignation, removal or termination of an officer or Director of the Company, a Parent or a Subsidiary. 
  
 2.53 “Transition Period” means the period beginning with an Initial Public Offering and ending as of the earlier of (i) the date of the
first annual meeting of stockholders of the Company at which Directors are to be elected that occurs after the close of the third (3rd) calendar year following the calendar year in which the Initial Public Offering occurs or (ii) the expiration of
the “reliance period” under Treasury Regulation § 1.162-27(f)(2). 
  
 2.54 “Voting Securities” means all outstanding voting securities of the Company entitled to vote generally in the election of the Board of Directors. 
  
 3. Administration. 
  
 3.1 The Plan shall be administered by the Committee, which shall hold
meetings at such times as may be necessary for the proper administration of the Plan. The Committee shall keep minutes of its meetings. If the Committee consists of more than one (1) member, a quorum shall consist of not fewer than two (2) members
of the Committee and a majority of a quorum may authorize any action. Any decision or determination reduced to writing and signed by all of the members of the Committee shall be as fully effective as if made by a majority vote at a meeting duly
called and held. The Committee shall consist of at least one (1) Director and may consist of the entire Board; provided, however, that from and after the date of an Initial Public Offering, (A) if the Committee consists of less than
the entire Board, then with respect to any Option or Award to an Eligible Individual who is subject to Section 16 of the Exchange Act, the Committee shall consist of at least two (2) Directors each of whom shall be a Nonemployee Director and (B) to
the extent necessary for any Option or Award intended to qualify as Performance-Based Compensation to so qualify, the Committee shall consist of at least two (2) Directors each of whom shall be an Outside Director. For purposes of the preceding
sentence, if one or more members of the Committee is not a Nonemployee Director and, if necessary for any Option or Award intended to qualify as Performance-Based Compensation to so qualify, an Outside Director, but recuses himself or herself or
abstains from 

  

 - 6 - 

 
voting with respect to a particular action taken by the Committee, then the Committee, with respect to that action, shall be deemed to consist only of the
members of the Committee who have not recused themselves or abstained from voting. Subject to applicable law, the Committee may delegate its authority under the Plan to any other person or persons. Notwithstanding the foregoing, with respect
to any Option or Award granted to an Eligible Individual who is a Nonemployee Director, the Committee should consist of the entire Board. 
  
 3.2 No member of the Committee shall be liable for any action, failure to act, determination or interpretation made in good faith with respect to this
Plan or any transaction hereunder. The Company hereby agrees to indemnify each member of the Committee for all costs and expenses and, to the extent permitted by applicable law, any liability incurred in connection with defending against, responding
to, negotiating for the settlement of or otherwise dealing with any claim, cause of action or dispute of any kind arising in connection with any actions in administering this Plan or in authorizing or denying authorization to any transaction
hereunder. 
  
 3.3 Subject to the express terms and conditions set
forth herein, the Committee shall have the power from time to time to: 
  
 (a) determine those Eligible Individuals to whom Options shall be granted under the Plan and the number of such Options to be granted and to prescribe the terms and conditions (which need not be identical) of each
such Option, including the purchase price per Share, the vesting schedule and the duration of each Option, and make any amendment or modification to any Option Agreement consistent with the terms of the Plan; 
  
 (b) select those Eligible Individuals to whom Awards shall be granted under
the Plan and to determine the number of Shares in respect of which each Award is granted, the terms and conditions (which need not be identical) of each such Award, including the restrictions or Performance Objectives relating to Awards and the
maximum value of any Award, and make any amendment or modification to any Award Agreement consistent with the terms of the Plan; 
  
 (c) construe and interpret the Plan and the Options and Awards granted hereunder and to establish, amend and revoke rules and regulations for the
administration of the Plan, including, without limitation, correcting any defect or supplying any omission, or reconciling any inconsistency in the Plan or in any Agreement, in the manner and to the extent it shall deem necessary or advisable,
including so that the Plan and the operation of the Plan complies with Rule 16b-3 under the Exchange Act, the Code to the extent applicable and other applicable law, and otherwise to make the Plan fully effective. All decisions and determinations by
the Committee in the exercise of this power shall be final, binding and conclusive upon the Company, its Subsidiaries, the Optionees and Grantees, and all other persons having any interest therein; 
  
 (d) determine the duration and purposes for leaves of absence which may be
granted to an Optionee or Grantee on an individual basis without constituting a Termination of Employment or service for purposes of the Plan; 
  
 (e) exercise its sole discretion with respect to the powers and rights granted to it as set forth in the Plan; and 
  
 (f) exercise, generally, such powers and to perform such acts as are deemed
necessary or advisable to promote the best interests of the Company with respect to the Plan. 
  
 4. Stock Subject to the Plan; Grant Limitations. 
  
 4.1 The maximum number of Shares that may be made the subject of Options and Awards granted under this Plan shall not exceed 14,000,000, plus the Shares that are subject to outstanding options or awards granted under
the Former Plan which Shares are not issued prior to the expiration or termination of such options or awards (including Shares subject to options or awards that expire or terminate after the expiration of the term of the Former Plan), plus, if on
January 1 of any year in which this Plan is in effect the aggregate number of Shares with respect to which Options or Awards may be granted under the Plan (not including Shares that are 

  

 - 7 - 

 
subject to outstanding Options or Awards granted under the Plan) is less than five percent (5%) of the total number of outstanding Shares on such date, an
annual increase (determined as of January 1 of each year) in an amount such that the aggregate number of Shares with respect to which Options or Awards may be granted under the Plan (not including Shares that are subject to outstanding Options or
Awards granted under the Plan) is equal to the lesser of (a) five percent (5%) of the total number of outstanding Shares on such date or (b) such other number of Shares as determined by the Board; provided, however, that in the aggregate, not
more than one-quarter of the number of allotted Shares may be made the subject of Restricted Stock Awards under Section 10 of the Plan (other than shares of Restricted Stock made in settlement of Performance Units pursuant to Section 11.2(b)). The
Company shall reserve for the purposes of the Plan, out of its authorized but unissued Shares or out of Shares held in the Company’s treasury, or partly out of each, such number of Shares as shall be determined by the Board. 
  
 4.2 Upon the granting of an Option or an Award, the number of Shares
available under Section 4.1 for the granting of further Options and Awards shall be reduced as follows: 
  
 (a) In connection with the granting of an Option or an Award (other than the granting of a Performance Unit denominated in dollars), the number of Shares
shall be reduced by the number of Shares in respect of which the Option or Award is granted or denominated; provided, however, that if any Option is exercised by tendering Shares, either actually or by attestation, to the Company as
full or partial payment of the purchase price, the maximum number of Shares available under Section 4.1 shall be increased by the number of Shares so tendered. 
  

(b) In connection with the granting of a Performance Unit denominated in dollars, the number of Shares shall be reduced by an amount equal to the
quotient of (i) the dollar amount in which the Performance Unit is denominated, divided by (ii) the Fair Market Value of a Share on the date the Performance Unit is granted. 
  
 4.3 Whenever any outstanding Option or Award or portion thereof under this Plan or the Former Plan expires, is canceled, is
settled in cash (including the settlement of tax withholding obligations using Shares), or is otherwise terminated for any reason without having been exercised or payment having been made in respect of the entire Option or Award, the Shares
allocable to the expired, canceled, settled or otherwise terminated portion of the Option or Award may again be the subject of Options or Awards granted hereunder. 
  
 4.4 In no event may more than 24,500,000 Shares be issued upon the exercise of Incentive Stock Options granted under the
Plan. 
  
 5. Option Grants for Eligible Individuals.

  
 5.1 Authority of Committee. Subject to the provisions
of the Plan, the Committee shall have full and final authority to select those Eligible Individuals who will receive Options, the terms and conditions of which shall be set forth in an Agreement. Without limiting the generality of the preceding
sentence, unless the Committee determines otherwise in its sole discretion, in consideration of granting an Option, the Optionee shall agree, in the Agreement, to remain in the employ of the Company or any Subsidiary for a period of at least one (1)
year (or such shorter period as may be fixed in the Agreement or by action of the Committee following grant of the Option) after the Option is granted. Incentive Stock Options may be granted only to Eligible Individuals who are employees of the
Company or any Subsidiary. 
  
 5.2 Purchase Price. The
purchase price (which may be greater than, less than or equal to the Fair Market Value on the date of grant) or the manner in which the purchase price is to be determined for Shares under each Option shall be determined by the Committee and set
forth in the Agreement pursuant to which each Option is granted; provided, however, that the purchase price per Share under each Option intended to qualify as Performance-Based Compensation shall not be less than 100% of the Fair Market Value
of a Share on the Date the Option is granted and provided, further, however, that the purchase price per Share under each Incentive Stock Option shall not be less than 100% of the Fair Market Value of a Share on the date the
Option is granted (110% in the case of an Incentive Stock Option granted to a Ten-Percent Stockholder). 
  

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 5.3 Maximum Duration. Options granted hereunder shall be for such term as the Committee shall
determine; provided, however, that an Option shall not be exercisable after the expiration of ten (10) years from the date it is granted (five (5) years in the case of an Incentive Stock Option granted to a Ten-Percent Stockholder);
and provided, further, however, that the Committee may provide that an Option (other than an Incentive Stock Option) may, upon the death of the Optionee prior to the expiration of the Option, be exercised for up to one (1) year
following the date of the Optionee’s death even if such period extends beyond ten (10) years from the date the Option is granted. The Committee may, subsequent to the granting of any Option, extend the term thereof, but in no event shall the
term as so extended exceed the maximum term provided for in the preceding sentence. 
  
 5.4 Vesting and Exercisability. Subject to Sections 5.5 and 7.5, each Option shall become vested and exercisable in such installments (which need not be equal) and at such times as may be designated by the
Committee and set forth in the Agreement. To the extent not exercised, installments shall accumulate and be exercisable, in whole or in part, at any time after becoming exercisable, but not later than the date the Option expires. The Committee may
accelerate the exercisability of any Option or portion thereof at any time. 
  
 5.5 Termination. Subject to Sections 5.3, 7.5 and 13 and unless otherwise provided by the Committee, in its sole discretion, at the time of grant (and set forth in the applicable Agreement) or at a later date,
the following provisions shall apply to Options upon a Termination of Employment: 
  
 (a) Except in the case of termination for Cause, Disability, retirement on or after the Optionee’s Normal Retirement Date, or death as provided in Sections 5.5(b), (c) and (d) below, upon an Optionee’s
Termination of Employment with the Company, a Parent or a Subsidiary for any reason, any unexercised Option (or portion thereof) held by such Optionee shall expire three (3) months after the Optionee has a Termination of Employment and such Option
(or portion thereof) may only be exercised by the Optionee or his or her Beneficiary to the extent that the Option (or a portion thereof) was exercisable on the date of Termination of Employment. 
  
 (b) If the Optionee’s Termination of Employment arises as a result of a
termination for Cause, then, unless the Committee determines otherwise at the time of the Termination of Employment, any unexercised Options (whether or not vested and exercisable) held by such Optionee shall terminate and expire concurrently with
the Optionee’s Termination of Employment and no rights thereunder may be exercised. 
  
 (c) If an Optionee suffers a Disability or retires on or after the Optionee’s Normal Retirement Date, any unexercised Option (or portion thereof) held by such disabled or retired Optionee shall expire one (1)
year after the Disability Date or date of Termination of Employment by reason of retirement, as the case may be, and such Option (or portion thereof) may only be exercised by the Optionee or his or her guardian or legal representative to the extent
that the Option (or a portion thereof) was exercisable on the Disability Date or the date of Termination of Employment by reason of retirement, as the case may be. 
  
 (d) If an Optionee dies while still employed by the Company, each Option (or portion thereof) held by such Optionee shall
immediately become vested and exercisable with respect to those Shares that otherwise would have vested during the one-year period following the Optionee’s death and will be deemed to have become vested and exercisable on the day preceding the
date of the Optionee’s death. The Options (or portions thereof) which the Optionee was entitled to exercise on the date of the Optionee’s death (which shall include those Options (or portions thereof) that become vested and exercisable
pursuant to the preceding sentence by reason of the Optionee’s death) may be exercised at any time after the Optionee’s death by the Optionee’s Beneficiary; provided, however, that no Option (or portion thereof) may be
exercised after the earlier of: (i) one (1) year after the Optionee’s death or (ii) the expiration date specified for the particular Option in the Agreement. If an Optionee dies after his or her Termination of Employment, then the Option (or
portions thereof) which the Optionee was entitled to exercise on the date of the Optionee’s death may be exercised by his or her Beneficiary within the remaining portion of the period specified in Sections 5.5(a) or 5.5(c), as the case may be.

  

 - 9 - 

 (e) The Option (or portion thereof), to the extent not yet vested and exercisable as of the date of the
Optionee’s Termination of Employment, shall terminate immediately upon such date. 
  
 5.6 Deferred Delivery of Option Shares. The Committee may, in its sole discretion, permit Optionees to elect to defer the issuance of Shares upon the exercise of one or more Nonqualified Stock Options granted
pursuant to the Plan. The terms and conditions of such deferral shall be determined at the time of the grant of the Option or thereafter and shall be set forth in the Agreement evidencing the Option. 
  
 5.7 Modification. No modification of an Option shall adversely alter
or impair any rights or obligations under the Option without the Optionee’s consent. 
  
 5.8 Limitations on Incentive Stock Options. To the extent that the aggregate Fair Market Value (determined as of the date of the grant) of Shares with respect to which Incentive Stock Options granted under the
Plan and “incentive stock options” (within the meaning of Section 422 of the Code) granted under all other plans of the Company or its Subsidiaries (in either case determined without regard to this Section 5.8) are exercisable by an
Optionee for the first time during any calendar year exceeds $100,000, such Incentive Stock Options shall be treated as Nonqualified Stock Options. In applying the limitation in the preceding sentence in the case of multiple Option grants, Options
which were intended to be Incentive Stock Options shall be treated as Nonqualified Stock Options according to the order in which they were granted such that the most recently granted Options are first treated as Nonqualified Stock Options.

  
 6. [Reserved. All options granted under this Article prior to
the effective date of this amendment and restatement of the Plan, shall be governed by the terms of the Plan as in effect prior to its amendment and restatement.] 
  
 7. Terms and Conditions Applicable to All Options. 
  
 7.1 Additional Terms. The provisions of this Section 7 shall apply to all Options, unless otherwise provided by the
Committee, in its sole discretion, in the applicable Agreement. 
  
 7.2 Non-Transferability. No Option granted hereunder shall be transferable by the Optionee to whom it is granted otherwise than by will or by the laws of descent and distribution or, in the case of an Option other than an Incentive
Stock Option, in the Committee’s sole discretion, pursuant to a domestic relations order (within the meaning of Rule 16a-12 promulgated under the Exchange Act) (a “Domestic Relations Transfer”), and, except with respect to an Option
transferred pursuant to a Domestic Relations Transfer, an Option shall be exercisable during the lifetime of such Optionee only by the Optionee or his or her guardian or legal representative. Notwithstanding the foregoing, the Committee may set
forth in the Agreement evidencing an Option (other than an Incentive Stock Option) at the time of grant or thereafter, that the Option may be transferred to members of the Optionee’s immediate family, to trusts solely for the benefit of such
immediate family members and to partnerships in which such family members and/or trusts are the only partners. Following transfer, for purposes of this Plan, a transferee of an Option shall be deemed to be the Optionee; provided that the Option
shall be exercisable by the transferee only to the extent and for such periods that the Option would have been exercisable if held by the original Optionee. For this purpose, immediate family means the Optionee’s spouse, parents, children,
stepchildren and grandchildren and the spouses of such parents, children, stepchildren and grandchildren. The terms of an Option shall be final, binding and conclusive upon the beneficiaries, executors, administrators, heirs and successors of the
Optionee. 
  
 7.3 Method of Exercise. 
  
 (a) The exercise of an Option shall be made only by a written notice
delivered in person or by mail to the Secretary of the Company at the Company’s principal executive office, specifying the number of Shares to be purchased and, to the extent applicable, accompanied by payment therefor and otherwise in
accordance with such procedures which may be approved by the Committee from time to time, and in accordance with the Agreement pursuant to which the Option was granted; provided, however, that Options may not be 

  

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exercised by an Optionee for twelve months following a hardship distribution to the Optionee, to the extent such exercise is prohibited under Treasury
Regulation § 1.401(k)-1(d)(2)(iv)(B)(4). The purchase price for any Shares purchased pursuant to the exercise of an Option shall be paid, in any of the following forms: (a) cash or (b) the transfer, either actually or by attestation, to the
Company of Shares that have been held by the Optionee for at least six (6) months (or such lesser period as may be permitted by the Committee) prior to the exercise of the Option and that have a Fair Market Value equal in amount to the purchase
price, such transfer to be upon such terms and conditions as determined by the Committee or (c) a combination of cash and the transfer of Shares, provided, however, that the Committee, in its sole discretion, may determine in the case
of Options that the purchase price shall be paid only in cash. In addition, Options may be exercised through a registered broker-dealer pursuant to such cashless exercise procedures which are, from time to time, deemed acceptable by the Committee.
Any Shares transferred to the Company as payment of the purchase price under an Option shall be valued at their Fair Market Value on the day preceding the date of exercise of such Option. If requested by the Committee, the Optionee shall deliver the
Agreement evidencing the Option to the Secretary of the Company who shall endorse thereon a notation of such exercise and return such Agreement to the Optionee. No fractional Shares (or cash in lieu thereof) shall be issued upon exercise of an
Option and the number of Shares that may be purchased upon exercise shall be rounded to the nearest number of whole Shares. 
  
 (b) If the Fair Market Value of the Shares with respect to which the Option is being exercised exceeds the purchase price of such Option, an Optionee
may, instead of exercising an Option as provided in Section 7.3(a), request that the Committee authorize payment to the Optionee of the difference between the Fair Market Value of part or all of the Shares which are the subject of the Option and the
purchase price of the Option, such difference to be determined as of the date the Committee receives the request from the Optionee. The Committee, in its sole discretion, may grant or deny such a request from an Optionee with respect to part or all
of the Shares as to which the Option is then exercisable and, to the extent granted, shall direct the Company to make the payment to the Optionee either in cash or in Shares or in any combination thereof; provided, however, that the
payment in Shares shall be based upon the Fair Market Value of Shares as of the date the Committee received the request from the Optionee. An Option shall be deemed to have been exercised and shall be canceled to the extent that the Committee grants
a request pursuant to this Section 7.3(b). 
  
 7.4 Rights of
Optionees. No Optionee shall be deemed for any purpose to be the owner of any Shares subject to any Option unless and until (a) the Option shall have been exercised pursuant to the terms thereof, (b) the Company shall have issued and delivered
Shares to the Optionee, and (c) the Optionee’s name shall have been entered as a stockholder of record on the books of the Company. Thereupon, the Optionee shall have full voting, dividend and other ownership rights with respect to such Shares,
subject to such terms and conditions as may be set forth in the applicable Agreement. 
  
 7.5 Effect of Change in Control. 
  
 (a) Notwithstanding anything to the contrary in Section 5, in the event of a Change in Control, the Plan and the Options shall continue; provided, however, that the Committee, in its sole discretion and
on such terms and conditions as it deems appropriate, may provide, either by the terms of the applicable Agreement or by action taken prior to the occurrence of any such Change in Control, for any or all of the following alternatives (separately or
in any combination): 
  
 (i) for the payment in cash upon the
surrender to the Company for cancellation of any Option or portion of an Option to the extent vested and not yet exercised in an amount equal to the excess, if any, of (a) (i) in the case of a Nonqualified Stock Option, the greater of (A) the Fair
Market Value, on the date preceding the date of surrender, of the Shares subject to the Option or portion thereof surrendered or (B) the Adjusted Fair Market Value of the Shares subject to the Option or portion thereof surrendered or (ii) in the
case of an Incentive Stock Option, the Fair Market Value, on the date preceding the date of surrender, of the Shares subject to the Option or portion thereof surrendered, over (b) the aggregate purchase price for such Shares under the Option or
portion thereof surrendered. 
  
 (ii) for the replacement of the
Options with other rights or property selected by the Committee in its sole discretion; 
  

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 (iii) for the accelerated vesting of all or a portion of the Options; 
  
 (iv) for the assumption of the Options by the successor or survivor
corporation, or a parent or subsidiary thereof, or the substitution by such corporation for such Options of new options covering the stock of the successor or survivor corporation, or a parent or subsidiary thereof, with appropriate adjustments as
to the number and kind of shares and prices; or 
  
 (v) for
adjustments in the terms and conditions of outstanding Options and/or the number and type of Shares or other securities or property subject to such outstanding Options. 
  
 Any action pursuant to this Section 7.5(a) shall be conditioned upon the consummation of the Change in Control and shall be effective only
immediately before the consummation of the Change in Control. 
  
 (b) Subject to Section 7.5(d) and to the extent set forth in the applicable Agreement or provided by the Committee, in its sole discretion, subsequent to the granting of an Option, if, as a result of a Change in Control transaction, an
Option intended to qualify as an Incentive Stock Option fails to so qualify solely because of the failure to meet the holding requirements of Code Section 422(a)(1) (a “Disqualifying Disposition”), the Company shall make a cash
payment to the Optionee equal to the amount which will, after taking into account all taxes imposed on the Disqualifying Disposition and the receipt of such payment, leave the Optionee in the same after-tax position the Optionee would have been in
had the Code Section 422(a)(1) holding requirements been met at the time of the Disqualifying Disposition (which after-tax position will reflect the total taxes, if any, that would have been incurred by the Optionee had the Disqualifying Disposition
been subject to federal income tax at capital gains rates) provided, however, that no payment described in this Section shall exceed the Tax Benefit to the Company resulting from deductions relating to ordinary income recognized by the
Optionee as a result of the Disqualifying Disposition. The payment described in this Section shall be made by the Company within thirty (30) days of the filing by the Company of the federal tax return which includes the tax items associated with the
income recognized by the Optionee as a result of the Disqualifying Disposition (or, if the Tax Benefit described in the preceding sentence is not realized until a later year, within thirty (30) days of the filing by the Company of the federal tax
return with respect to which such Tax Benefit is realized). 
  
 (c) Subject to Section 7.5(d) and to the extent set forth in the applicable Agreement or provided by the Committee, in its sole discretion, subsequent to the granting of an Option, and provided that an Optionee is not entitled to payment
under Section 7.5(b) hereof, if, as a result of a Change in Control transaction, an Option intended to qualify as an Incentive Stock Option fails to so qualify solely because the vesting of the Option is accelerated pursuant to Section 7.5(a)
and such acceleration causes the aggregate fair market value (determined at the time the Option is granted) of the Shares with respect to which Options are exercisable for the first time by an Optionee during the calendar year in which such vesting
occurs to exceed $100,000, within the meaning of Code Section 422(d) (a “Disqualified Option”), then, upon exercise of such Disqualified Option, the Company shall make a cash payment to the Optionee equal to the amount which will, after
taking into account all taxes imposed on the exercise of such Disqualified Option and the receipt of such payment, leave the Optionee in the same after-tax position the Optionee would have been in had the Disqualified Option continued to qualify as
an Incentive Stock Option on the date of exercise and the Optionee sold the Shares received upon exercise of the Option at their Fair Market Value on the date of exercise, provided, however, that no payment described in this Section
shall exceed the Tax Benefit to the Company resulting from deductions relating to ordinary income recognized by the Optionee as a result of exercising the Disqualified Option and the receipt of such payment. The payment described in this Section
shall be made by the Company within thirty (30) days of the filing by the Company of the federal tax return which includes the tax items associated with the income recognized by the Optionee as a result of exercising the Disqualified Option (or, if
the Tax Benefit described in the preceding sentence is not realized until a later year, within thirty (30) days of the filing by the Company of the federal tax return with respect to which such Tax Benefit is realized). 
  

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 (d) If more than one Optionee is entitled to a cash payment pursuant to Section 7.5(b) or Section 7.5(c)
in any single tax year and the Tax Benefit realized by the Company in such year with respect to all such Optionees is less than the aggregate amount of the payments due to such Optionees hereunder, then (i) each such Optionee shall receive a portion
of such cash payment equal to an amount determined by multiplying the amount of the Tax Benefit realized by the Company in such year by a fraction the numerator of which is equal to the amount of payment due to such Optionee and the denominator of
which is equal to the aggregate amount due to all such Optionees entitled to a payment hereunder, and (ii) subject to further application of this Section 7.5(d), shall be entitled to receive the remaining portion within thirty (30) days of the
filing by the Company of the federal tax return with respect to which such Tax Benefit is realized. 
  
 8. Stock Appreciation Rights. 
  
 The Committee may in its sole discretion, either alone or in connection with the grant of an Option, grant Stock Appreciation Rights in accordance with
the Plan, the terms and conditions of which shall be set forth in an Agreement. If granted in connection with an Option, a Stock Appreciation Right shall cover the same Shares covered by the Option (or such lesser number of Shares as the Committee
may determine) and shall, except as provided in this Section 8, be subject to the same terms and conditions as the related Option. 
  
 8.1 Time of Grant. A Stock Appreciation Right may be granted (a) at any time if unrelated to an Option, or (b) if related to an Option, either at
the time of grant, or (except in the case of an Incentive Stock Option) at any time thereafter during the term of the Option. 
  
 8.2 Stock Appreciation Right Related to an Option. 
  
 (a) Exercise. Subject to Section 8.9, a Stock Appreciation Right granted in connection with an Option shall be exercisable at such time or times
and only to the extent that the related Options are exercisable (including, without limitation, exercisability upon Termination of Employment or a Change in Control), and will not be transferable except to the extent the related Option may be
transferable. A Stock Appreciation Right granted in connection with an Incentive Stock Option shall expire no later than the expiration of the related Incentive Stock Option and shall be exercisable only if the Fair Market Value of a Share on the
date of exercise exceeds the purchase price of the Option specified in the related Incentive Stock Option Agreement. 
  
 (b) Treatment of Related Options and Stock Appreciation Rights Upon Exercise. Upon the exercise of a Stock Appreciation Right granted in
connection with an Option, the Option shall be canceled to the extent of the number of Shares as to which the Stock Appreciation Right is exercised, and upon the exercise of an Option granted in connection with a Stock Appreciation Right, the Stock
Appreciation Right shall be canceled to the extent of the number of Shares as to which the Option is exercised or surrendered. 
  
 8.3 Stock Appreciation Right Unrelated to an Option. 
  
 (a) Terms. Subject to Section 8.9, stock Appreciation Rights unrelated to Options shall contain such terms and conditions as to exercisability,
vesting and duration as the Committee shall determine, but in no event shall they have a term of greater than ten (10) years; provided, however, that the Committee may provide that Stock Appreciation Rights may, upon the death of the
Grantee, be exercised for up to one (1) year following the date of the Grantee’s death even if such period extends beyond ten (10) years from the date the Stock Appreciation Right was granted. 
  
 (b) Termination. Subject to Section 13 and except as provided in
Section 8.9, and unless otherwise provided by the Committee, in its sole discretion, in the applicable Agreement, upon a Grantee’s Termination of Employment, a Stock Appreciation Right shall be exercisable by the Grantee to the same extent that
an Option would be exercisable by an Optionee upon the Optionee’s Termination of Employment under the provisions of Section 5.5; provided, however, no Stock Appreciation Right may be exercised after the expiration date specified
for the particular Stock Appreciation Right in the applicable Agreement. 
  

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 8.4 Amount Payable. Subject to Section 8.7, upon the exercise of a Stock Appreciation Right, the
Grantee shall be entitled to receive an amount determined by multiplying (x) the excess of the Fair Market Value of a Share on the date preceding the date of exercise of such Stock Appreciation Right over (A) in the case of a Stock Appreciation
Right granted in connection with an Option, the per Share purchase price under the related Option, or (B) in the case of a Stock Appreciation Right unrelated to an Option, the Fair Market Value of a Share on the date the Stock Appreciation Right was
granted, by (y) the number of Shares as to which such Stock Appreciation Right is being exercised. Notwithstanding the foregoing, the Committee may limit in any manner the amount payable with respect to any Stock Appreciation Right by including such
a limit in the Agreement evidencing the Stock Appreciation Right at the time it is granted. 
  
 8.5 Non-Transferability. No Stock Appreciation Right shall be transferable by the Grantee to whom it was granted otherwise than by will or by the laws of descent and distribution or, in the Committee’s
sole discretion, (except in the case of a Stock Appreciation Right granted in connection with an Incentive Stock Option), pursuant to domestic relations order (within the meaning of Rule 16a-12 promulgated under the Exchange Act (a “Domestic
Relations Transfer”) and, except with respect to a Stock Appreciation Right transferred pursuant to a Domestic Relations Transfer, such Stock Appreciation Right shall be exercisable during the lifetime of such Grantee only by the Grantee or his
or her guardian or legal representative. The terms of such Stock Appreciation Right shall be final, binding and conclusive upon the beneficiaries, executors, administrators, heirs and successors of the Grantee. 
  
 8.6 Method of Exercise. Stock Appreciation Rights shall be exercised
by a Grantee only by a written notice delivered in person or by mail to the Secretary of the Company at the Company’s principal executive office, specifying the number of Shares with respect to which the Stock Appreciation Right is being
exercised. If requested by the Committee, the Grantee shall deliver the Agreement evidencing the Stock Appreciation Right being exercised and the Agreement evidencing any related Option to the Secretary of the Company who shall endorse thereon a
notation of such exercise and return such Agreement to the Grantee. 
  
 8.7 Form of Payment. Payment of the amount determined under Section 8.4 may be made in the sole discretion of the Committee solely in whole Shares in a number determined at their Fair Market Value on the date preceding the date of
exercise of the Stock Appreciation Right, or solely in cash, or in a combination of cash and Shares. If the Committee decides to make full payment in Shares and the amount payable results in a fractional Share, no fractional Shares (or cash in lieu
thereof) shall be issued upon the exercise of the Stock Appreciation Right and the number of Shares that will be delivered shall be rounded to the nearest number of whole Shares. 
  
 8.8 Modification. No modification of an Award shall adversely alter or impair any rights or obligations under the
Agreement without the Grantee’s consent. 
  
 8.9 Effect of
Change in Control. Notwithstanding anything contained in this Section 8 to the contrary, in the event of a Change in Control, the Plan and the Stock Appreciation Rights shall continue; provided, however, that the Committee, in its
sole discretion and on such terms and conditions as it deems appropriate, may provide, either by the terms of the applicable Agreement or by action taken prior to the occurrence of any such Change in Control, for any or all of the following
alternatives (separately or in any combination): 
  
 (i) with
respect to a Stock Appreciation Right unrelated to an Option, for the payment in cash upon the surrender to the Company for cancellation of any such Stock Appreciation Right or portion of a Stock Appreciation Right to the extent vested and not yet
exercised in an amount equal to the excess, if any, of (A) the greater of (i) the Fair Market Value, on the date preceding the date of surrender, of the Shares subject to the Stock Appreciation Right or portion thereof surrendered or (ii) the
Adjusted Fair Market Value, on the date preceding the date of surrender, of the Shares over (B) the aggregate Fair Market Value, on the date the Stock Appreciation Right was granted, of the Shares subject to the Stock Appreciation Right or portion
thereof surrendered. 
  
 (ii) for the replacement of the Stock
Appreciation Rights with other rights or property selected by the Committee in its sole discretion; 
  

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 (iii) for the accelerated vesting of all or a portion of the Stock Appreciation Rights; 
  
 (iv) for the assumption of the Stock Appreciation Rights by the successor or
survivor corporation, or a parent or subsidiary thereof, or the substitution by such corporation for such Stock Appreciation Rights of new stock appreciation rights covering the stock of the successor or survivor corporation, or a parent or
subsidiary thereof, with appropriate adjustments as to the number and kind of shares and prices; or 
  
 (v) for adjustments in the terms and conditions of outstanding Stock Appreciation Rights and/or the number and type of Shares or other securities or
property subject to such outstanding Stock Appreciation Rights. 
  
 Any action
pursuant to this Section 8.9 shall be conditioned upon the consummation of the Change in Control and shall be effective only immediately before the consummation of the Change in Control. 
  
 9. Dividend Equivalent Rights. 
  
 The Committee may in its sole discretion grant Dividend Equivalent Rights to Eligible Individuals in tandem with an Option
or Award or as a separate Award. The terms and conditions (including, without limitation, terms and conditions relating to a Change in Control) applicable to each Dividend Equivalent Right shall be specified in the Agreement under which the Dividend
Equivalent Right is granted. In the sole discretion of the Committee, amounts payable in respect of Dividend Equivalent Rights may be payable currently or deferred until the lapsing of restrictions on such Dividend Equivalent Rights or until the
vesting, exercise, payment, settlement or other lapse of restrictions on the Option or Award to which the Dividend Equivalent Rights relate. In the event that the amount payable in respect of Dividend Equivalent Rights are to be deferred, the
Committee shall determine whether such amounts are to be held in cash or reinvested in Shares or deemed (notionally) to be reinvested in Shares. If amounts payable in respect of Dividend Equivalent Rights are to be held in cash, there may be
credited at the end of each year (or portion thereof) interest on the amount of the account at the beginning of the year at a rate per annum as the Committee, in its sole discretion, may determine. In the sole discretion of the Committee, Dividend
Equivalent Rights may be settled in cash or Shares or a combination thereof, in a single installment or multiple installments. To the extent necessary for any Dividend Equivalent Right intended to qualify as Performance-Based Compensation to so
qualify, the terms and conditions of the Dividend Equivalent Right shall be such that payment of the Dividend Equivalent Right is contingent upon attainment of specified Performance Objectives within the Performance Cycle, as provided for in Section
11, and such Dividend Equivalent Right shall be treated as a Performance Award for purposes of Sections 11 and 16. 
  
 10. Restricted Stock. 
  
 10.1 Grant. The Committee may in its sole discretion grant Awards to Eligible Individuals of Restricted Stock, which shall be evidenced by an
Agreement between the Company and the Grantee. Each Agreement shall contain such restrictions, terms and conditions as the Committee may, in its sole discretion, determine and (without limiting the generality of the foregoing) such Agreements may
require that an appropriate legend be placed on Share certificates. Awards of Restricted Stock shall be subject to the terms and provisions set forth below in this Section 10. 
  
 10.2 Rights of Grantee. Shares of Restricted Stock granted pursuant to an Award hereunder shall be issued in the name
of the Grantee as soon as reasonably practicable after the Award is granted provided that the Grantee has executed an Agreement evidencing the Award, the appropriate blank stock powers and, in the sole discretion of the Committee, an escrow
agreement and any other documents which the Committee may require as a condition to the issuance of such Shares. If a Grantee shall fail to execute the Agreement evidencing a Restricted Stock Award, the appropriate blank stock powers, an escrow
agreement or any other documents which the Committee may require within the time period prescribed by the Committee at the time the Award is granted, the Award shall be null and void. At the sole discretion of the Committee, Shares issued in
connection with a Restricted 

  

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Stock Award shall be deposited together with the stock powers with an escrow agent (which may be the Company) designated by the Committee. Unless the
Committee determines otherwise and as set forth in the Agreement, upon delivery of the Shares to the escrow agent, the Grantee shall have all of the rights of a stockholder with respect to such Shares, including the right to vote the Shares and to
receive all dividends or other distributions paid or made with respect to the Shares. 
  
 10.3 Non-transferability. Until all restrictions upon the Shares of Restricted Stock awarded to a Grantee shall have lapsed in the manner set forth in Section 10.4, such Shares shall not be sold, transferred or
otherwise disposed of and shall not be pledged or otherwise hypothecated, nor shall they be delivered to the Grantee. 
  
 10.4 Lapse of Restrictions. 
  
 (a) Generally. Subject to Section 10.4(b), restrictions upon Shares of Restricted Stock awarded hereunder shall lapse at such time or times and on
such terms and conditions as the Committee may determine; provided, however, that except in the case of Shares of Restricted Stock issued in full or partial settlement of another Award or other earned compensation, such restrictions
shall not fully lapse prior to the third anniversary of the date on which such Shares of Restricted Stock were granted. The Agreement evidencing the Award shall set forth any such restrictions. 
  
 (b) Effect of Change in Control. Notwithstanding anything contained
in this Section 10 to the contrary, in the event of a Change in Control, the Plan and the Awards of Restricted Stock shall continue; provided, however, that the Committee, in its sole discretion and on such terms and conditions as it
deems appropriate, may provide, either by the terms of the applicable Agreement or by action taken prior to the occurrence of any such Change in Control, for any or all of the following alternatives (separately or in any combination): (i) for the
assumption of the shares of Restricted Stock by the successor or survivor corporation, or a parent or subsidiary thereof, or the substitution by such corporation for such shares of Restricted Stock of new shares of restricted stock of the successor
or survivor corporation, or a parent or subsidiary thereof, with appropriate adjustments as to the number and kind of shares, (ii) for the lapse of all restrictions upon all or a portion of the shares of Restricted Stock, or (iii) for adjustments in
the terms and conditions of outstanding Awards of Restricted Stock. Any action pursuant to this Section 10.5(b) shall be conditioned upon the consummation of the Change in Control and shall be effective only immediately before the consummation of
the Change in Control. 
  
 10.5 Terms of Restricted Stock.

  
 (a) Forfeiture of Restricted Stock. Subject to
Sections 10.4(b), 10.5(b) and 13, all Restricted Stock shall be forfeited and returned to the Company and all rights of the Grantee with respect to such Restricted Stock shall terminate unless the Grantee continues in the service of the Company as
an employee or director until the expiration of the forfeiture period for such Restricted Stock and satisfies any and all other conditions set forth in the Agreement. The Committee, in its sole discretion, shall determine the forfeiture period
(which may, but need not, lapse in installments) and any other terms and conditions applicable with respect to any Restricted Stock Award. 
  
 (b) Waiver of Forfeiture Period. Notwithstanding anything contained in this Section 10 to the contrary, the Committee may, in its sole discretion,
waive the forfeiture period and any other conditions set forth in any Agreement under appropriate circumstances (including, without limitation, the death, Disability or retirement of the Grantee or a material change in circumstances arising after
the date of grant) and subject to such terms and conditions (including, without limitation, forfeiture of a proportionate number of the Restricted Stock) as the Committee shall deem appropriate, provided that the Grantee shall at that time have
completed at least one (1) year of employment or service after the date of grant. 
  
 10.6 Modification or Substitution. Subject to the terms of the Plan, including, without limitation, Section 16, the Committee may modify outstanding Awards of Restricted Stock or accept the surrender of
outstanding shares of Restricted Stock (to the extent the restrictions on such Shares have not yet lapsed) and grant new Awards in substitution for them. Notwithstanding the foregoing, no modification of an Award shall adversely alter or impair any
rights or obligations under the Agreement without the Grantee’s consent. 
  

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 10.7 Treatment of Dividends. At the time an Award of Shares of Restricted Stock is granted, the
Committee may, in its sole discretion, determine that the payment to the Grantee of dividends, or a specified portion thereof, declared or paid on such Shares by the Company shall be (a) deferred until the lapsing of the restrictions imposed upon
such Shares and (b) held by the Company for the account of the Grantee until such time. In the event that dividends are to be deferred, the Committee shall determine whether such dividends are to be reinvested in Shares (which shall be held as
additional Shares of Restricted Stock) or held in cash. If deferred dividends are to be held in cash, there may be credited at the end of each year (or portion thereof) interest on the amount of the account at the beginning of the year at a rate per
annum as the Committee, in its sole discretion, may determine. Payment of deferred dividends in respect of Shares of Restricted Stock (whether held in cash or as additional Shares of Restricted Stock), together with interest accrued thereon, if any,
shall be made upon the lapsing of restrictions imposed on the Shares in respect of which the deferred dividends were paid, and any dividends deferred (together with any interest accrued thereon) in respect of any Shares of Restricted Stock shall be
forfeited upon the forfeiture of such Shares. 
  
 10.8 Delivery
of Shares. Upon the lapse of the restrictions on Shares of Restricted Stock, the Committee shall cause a stock certificate to be delivered to the Grantee with respect to such Shares, free of all restrictions hereunder. 
  
 11. Performance Awards. 
  
 11.1 Performance Objectives 
  
 (a) Establishment. Performance Objectives for Performance Awards may
be expressed in terms of (i) earnings per Share, (ii) Share price, (iii) pre-tax profits, (iv) after-tax profits, (v) operating profits, (vi) sales or expenses, (vii) net earnings, (viii) return on equity or assets, (ix) revenues, (x) EBITDA
(earnings before interest, taxes, depreciation and amortization), (xi) market share, or market penetration, (xii) any combination of the foregoing, (xiii) confidential business objectives or (xiv)prior to the end of the Transition Period, such other
criteria as the Committee may determine. Performance Objectives may be in respect of the performance of the Company, any of its Subsidiaries, any of its Divisions or any combination thereof. Performance Objectives may be absolute or relative (to
prior performance of the Company or to the performance of one or more other entities or external indices) and may be expressed in terms of a progression within a specified range. The Performance Objectives with respect to a Performance Cycle shall
be established in writing by the Committee by the earlier of (x) the date on which a quarter of the Performance Cycle has elapsed or (y) the date which is ninety (90) days after the commencement of the Performance Cycle, and in any event while the
performance relating to the Performance Objectives remains substantially uncertain. 
  
 (b) Effect of Certain Events. At the time of the granting of a Performance Award, or at any time thereafter, in either case to the extent permitted under Section 162(m) of the Code and the regulations
thereunder without adversely affecting the treatment of the Performance Award as Performance-Based Compensation, the Committee may provide for the manner in which performance will be measured against the Performance Objectives (or may adjust the
Performance Objectives) to reflect the impact of specified corporate transactions, accounting or tax law changes and other extraordinary or nonrecurring events. 
  

(c) Determination of Performance. Prior to the vesting, payment, settlement or lapsing of any restrictions with respect to any Performance
Award that is intended to constitute Performance-Based Compensation made to a Grantee who is subject to Section 162(m) of the Code, the Committee shall certify in writing that the applicable Performance Objectives have been satisfied to the extent
necessary for such Award to qualify as Performance-Based Compensation. 
  
 11.2 Performance Units. The Committee, in its sole discretion, may grant Awards of Performance Units to Eligible Individuals, the terms and conditions of which shall be set forth in an Agreement 

  

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between the Company and the Grantee. Performance Units may be denominated in Shares or a specified dollar amount and, contingent upon the attainment of
specified Performance Objectives within the Performance Cycle, represent the right to receive payment as provided in Section 11.2(b) of (i) in the case of Share-denominated Performance Units, the Fair Market Value of a Share on the date the
Performance Unit was granted, the date the Performance Unit became vested or any other date specified by the Committee, (ii) in the case of dollar-denominated Performance Units, the specified dollar amount or (iii) a percentage (which may be more
than 100%) of the amount described in clause (i) or (ii) depending on the level of Performance Objective attainment; provided, however, that, the Committee may at the time a Performance Unit is granted specify a maximum amount payable in
respect of a vested Performance Unit. Each Agreement shall specify the number of Performance Units to which it relates, the Performance Objectives which must be satisfied in order for the Performance Units to vest and the Performance Cycle within
which such Performance Objectives must be satisfied. 
  
 (a)
Vesting and Forfeiture. Subject to Sections 11.1(c) and 11.4, Performance Units shall become vested in such installments (which need not be equal) and at such time or times and on such terms, conditions and satisfaction of Performance
Objectives as the Committee may, in its sole discretion, determine at the time an Award is granted. 
  
 (b) Payment of Awards. Subject to Sections 11.1(c) and 11.4, payment to Grantees in respect of vested Performance Units shall be made as soon as
practicable after the last day of the Performance Cycle to which such Award relates unless the Agreement evidencing the Award provides for the deferral of payment, in which event the terms and conditions of the deferral shall be set forth in the
Agreement. Subject to Section 11.4, such payments may be made entirely in Shares valued at their Fair Market Value as of the day preceding the date of payment or such other date specified by the Committee, entirely in cash, or in such combination of
Shares and cash as the Committee in its sole discretion shall determine at any time prior to such payment; provided, however, that if the Committee in its sole discretion determines to make such payment entirely or partially in Shares of
Restricted Stock, the Committee must determine the extent to which such payment will be in Shares of Restricted Stock and the terms of such Restricted Stock at the time the Award is granted. 
  
 (c) Non-transferability. Until the vesting of Performance Units, such
Performance Units shall not be sold, transferred or otherwise disposed of and shall not be pledged or otherwise hypothecated. 
  
 11.3 Performance Shares. The Committee, in its sole discretion, may grant Awards of Performance Shares to Eligible Individuals, the terms and
conditions of which shall be set forth in an Agreement between the Company and the Grantee. Each Agreement may require that an appropriate legend be placed on Share certificates. Awards of Performance Shares shall be subject to the following terms
and provisions: 
  
 (a) Rights of Grantee. The Committee
shall provide at the time an Award of Performance Shares is made the time or times at which the actual Shares represented by such Award shall be issued in the name of the Grantee; provided, however, that no Performance Shares shall be issued
until the Grantee has executed an Agreement evidencing the Award, the appropriate blank stock powers and, in the sole discretion of the Committee, an escrow agreement and any other documents which the Committee may require as a condition to the
issuance of such Performance Shares. If a Grantee shall fail to execute the Agreement evidencing an Award of Performance Shares, the appropriate blank stock powers, an escrow agreement and any other documents which the Committee may require within
the time period prescribed by the Committee at the time the Award is granted, the Award shall be null and void. At the sole discretion of the Committee, Shares issued in connection with an Award of Performance Shares shall be deposited together with
the stock powers with an escrow agent (which may be the Company) designated by the Committee. Except as restricted by the terms of the Agreement, upon delivery of the Shares to the escrow agent, the Grantee shall have, in the sole discretion of the
Committee, all of the rights of a stockholder with respect to such Shares, including the right to vote the Shares and to receive all dividends or other distributions paid or made with respect to the Shares. 
  
 (b) Non-transferability. Until any restrictions upon the Performance
Shares awarded to a Grantee shall have lapsed in the manner set forth in Sections 11.3(c) or 11.4, such Performance Shares shall not be sold, transferred or otherwise disposed of and shall not be pledged or otherwise hypothecated, nor shall they be
delivered to the Grantee. The Committee also may impose such other restrictions and conditions on the Performance Shares, if any, as it deems appropriate. 
  

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 (c) Lapse of Restrictions. Subject to Sections 11.1(c) and 11.4, restrictions upon Performance
Shares awarded hereunder shall lapse and such Performance Shares shall become vested at such time or times and on such terms, conditions and satisfaction of Performance Objectives as the Committee may, in its sole discretion, determine at the time
an Award is granted. 
  
 (d) Treatment of Dividends. At
the time the Award of Performance Shares is granted, the Committee may, in its sole discretion, determine that the payment to the Grantee of dividends, or a specified portion thereof, declared or paid on Shares represented by such Award which have
been issued by the Company to the Grantee shall be (i) deferred until the lapsing of the restrictions imposed upon such Performance Shares and (ii) held by the Company for the account of the Grantee until such time. In the event that dividends are
to be deferred, the Committee shall determine whether such dividends are to be reinvested in Shares (which shall be held as additional Performance Shares) or held in cash. If deferred dividends are to be held in cash, there may be credited at the
end of each year (or portion thereof) interest on the amount of the account at the beginning of the year at a rate per annum as the Committee, in its sole discretion, may determine. Payment of deferred dividends in respect of Performance Shares
(whether held in cash or in additional Performance Shares), together with interest accrued thereon, if any, shall be made upon the lapsing of restrictions imposed on the Performance Shares in respect of which the deferred dividends were paid, and
any dividends deferred (together with any interest accrued thereon) in respect of any Performance Shares shall be forfeited upon the forfeiture of such Performance Shares. 
  
 (e) Delivery of Shares. Upon the lapse of the restrictions on Performance Shares awarded hereunder, the Committee
shall cause a stock certificate to be delivered to the Grantee with respect to such Shares, free of all restrictions hereunder. 
  
 11.4 Effect of Change in Control. Notwithstanding anything in this Section 11 to the contrary, in the event of a Change in Control, the Plan and
the Performance Awards shall continue; provided, however, that the Committee, in its sole discretion and on such terms and conditions as it deems appropriate, may provide, either by the terms of the applicable Agreement or by action
taken prior to the occurrence of any such Change in Control, for any or all of the following alternatives (separately or in any combination): (i) for the assumption of the Performance Awards by the successor or survivor corporation, or a parent or
subsidiary thereof, or the substitution by such corporation for such Performance Awards of new performance awards of the successor or survivor corporation, or a parent or subsidiary thereof, with appropriate adjustments as to the applicable
performance objectives and, if necessary, the number and kind of shares, (ii) for the vesting of all or a portion of the Performance Awards as if all Performance Objectives had been satisfied at the level specified by the Committee in its sole
discretion and, in the case of Performance Units which become vested as a result of a Change in Control, for a payment which may be made entirely in cash, entirely in Shares valued at their Fair Market Value as of the day preceding the payment, or
in such combination of cash and Shares as the Committee shall determine in its sole discretion at any time prior to such payment; provided that such payment shall be made within ten (10) business days after such Change in Control, or (iii) for
adjustments in the terms and conditions of outstanding Performance Awards. Any action pursuant to this Section 11.4 shall be conditioned upon the consummation of the Change in Control and shall be effective only immediately before the consummation
of the Change in Control. 
  
 11.5 Termination. Subject to
Sections 11.4 and 13, and unless otherwise provided by the Committee, in its sole discretion, in the applicable Agreement, the following provisions shall apply to Performance Awards upon a Termination of Employment: 
  
 (a) Termination of Employment Prior to End of Performance Cycle.
Except as provided in Sections 11.5(b) and (d), in the case of a Grantee’s Termination of Employment, prior to the end of a Performance Cycle, the Grantee will not be entitled to any Performance Awards, and any Performance Shares shall be
forfeited. 
  
 (b) Disability, Retirement or Death Prior to
End of Performance Cycle. Unless 

  

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otherwise provided by the Committee, in its sole discretion, in the Agreement, if a Grantee’s Disability Date or Termination of Employment by reason of
retirement on or after the Grantee’s Normal Retirement Date or death occurs following participation in at least one-half (1/2) of the Performance Cycle, but prior to the end of a Performance Cycle, the Grantee or such Grantee’s
Beneficiary, as the case may be, shall be entitled to receive a pro-rata share of his or her Performance Award as determined under Subsection (c). 
  
 (c) Pro-Rata Payment. 
  
 (i) Performance Units. With respect to Performance Units, the amount of any payment made to a Grantee (or Beneficiary) under
circumstances described in Section 11.5(b) shall be the amount determined by multiplying the amount of the Performance Units payable in Shares or dollars which would have been earned, determined at the end of the Performance Cycle, had such
employment not been terminated, by a fraction, the numerator of which is the number of whole months such Grantee was employed during the Performance Cycle, and the denominator of which is the total number of months of the Performance Cycle. Any such
payment shall be made as soon as practicable after the end of the respective Performance Cycle, and shall relate to attainment of Performance Objectives over the entire Performance Cycle. 
  
 (ii) Performance Shares. With respect to Performance Shares, the amount of Performance Shares held by
a Grantee (or Beneficiary) with respect to which restrictions shall lapse under circumstances described in Section 11.5(b) shall be the amount determined by multiplying the amount of the Performance Shares with respect to which restrictions would
have lapsed, determined at the end of the Performance Cycle, had such employment not been terminated, by a fraction, the numerator of which is the number of whole months such Grantee was employed during the Performance Cycle, and the denominator of
which is the total number of months of the Performance Cycle. The Committee shall determine the amount of Performance Shares with respect to which restrictions shall lapse under this Section 11.5(c)(ii) as soon as practicable after the end of
the respective Performance Cycle, and such determination shall relate to attainment of Performance Objectives over the entire Performance Cycle. At that time, all Performance Shares relating to that Performance Cycle with respect to which
restrictions shall not lapse shall be forfeited. 
  
 (d) Other
Events. Except to the extent a Performance Award is intended to qualify as Performance-Based Compensation, the Committee may, in its sole discretion, determine to pay all or any portion of a Performance Award to a Grantee who has a Termination
of Employment prior to the end of a Performance Cycle under certain circumstances (including, without limitation, a material change in circumstances arising after the date of grant) and subject to such terms and conditions as the Committee shall
deem appropriate, provided that the Grantee shall have completed at his or her date of Termination of Employment at least one (1) year of employment after the date of grant. 
  
 (e) Termination of Employment After End of Performance Cycle. Subject to Sections 11.4 and 11.5(f), in the case of a
Grantee’s Termination of Employment after the end of a Performance Cycle in which the applicable Performance Objectives have been satisfied, the Grantee shall not be entitled to any Performance Awards that have not yet vested as of the date of
the Grantee’s Termination of Employment. 
  
 (f) Waiver
of Forfeiture. Notwithstanding anything to the contrary in Section 11(e), in the case of a Grantee’s Termination of Employment after the end of a Performance Cycle in which the applicable Performance Objectives have been satisfied, the
Committee may, in its sole discretion, waive the forfeiture of Performance Awards and any other conditions set forth in any Agreement under appropriate circumstances (including, without limitation, the death, Disability, or retirement of the Grantee
or a material change in circumstances arising after the date of grant) and subject to such terms and conditions as the Committee shall deem appropriate. 
  
 11.6 Modification or Substitution. Subject to the terms of the Plan, including, without limitation, Section 16, the Committee may modify
outstanding Performance Awards or accept the surrender of outstanding Performance Awards and grant new Performance Awards in substitution for them. Notwithstanding the foregoing, no modification of a Performance Award shall adversely alter or impair
any rights or obligations under the Agreement without the Grantee’s consent. 
  

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 12. Other Share Based Awards. 
  
 12.1 Share Awards. The Committee, in its sole discretion, may grant a Share Award to any Eligible Individual on such
terms and conditions as the Committee may determine. Share Awards may be made as additional compensation for services rendered by the Eligible Individual or may be in lieu of cash or other compensation to which the Eligible Individual is entitled
from the Company. 
  
 12.2 Phantom Stock Awards.

  
 (a) Grant. The Committee, in its sole discretion, may
grant shares of Phantom Stock to any Eligible Individual. Such Phantom Stock shall be subject to the terms and conditions established by the Committee and set forth in the applicable Agreement. 
  
 (b) Payment of Awards. Upon the vesting of a Phantom Stock Award, the
Grantee shall be entitled to receive a cash payment in respect of each share of Phantom Stock which shall be equal to the Fair Market Value of a Share as of the date the Phantom Stock Award was granted, or such other date as determined by the
Committee at the time the Phantom Stock Award was granted. The Committee may, at the time a Phantom Stock Award is granted, provide a limitation on the amount payable in respect of each share of Phantom Stock. In lieu of a cash payment, the
Committee, in its sole discretion, may settle Phantom Stock Awards with Shares having a Fair Market Value on the date of vesting equal to the cash payment to which the Grantee has become entitled. 
  
 13. Employment Agreement Governs Termination of Employment.

  
 An employment agreement, if applicable, between an Optionee
or Grantee and the Company shall govern with respect to the terms and conditions applicable to such Option or Award upon a termination or change in the status of the employment of the Optionee or Grantee, to the extent that such employment agreement
provides for terms and conditions that differ from the terms and conditions provided for in the applicable Agreement or the Plan; provided, however, that to the extent necessary for an Option or Award intended to qualify as
Performance-Based Compensation to so qualify, the terms of the applicable Agreement or the Plan shall govern the Option or Award; and, provided further, that the Committee shall have reviewed and, in its sole discretion, approved the
employment agreement. 
  
 14. Adjustment Upon Changes in
Capitalization. 
  
 (a) In the event of a Change in
Capitalization, the Committee shall conclusively determine the appropriate adjustments, if any, to (i) the maximum number and class of Shares or other stock or securities with respect to which Options or Awards may be granted under the Plan, (ii)
the maximum number and class of Shares or other stock or securities that may be issued upon exercise of Incentive Stock Options; (iii) the number and class of Shares or other stock or securities which are subject to outstanding Options or Awards
granted under the Plan and the purchase price therefor, if applicable, (iv) the Performance Objectives. 
  
 (b) Any such adjustment in the Shares or other stock or securities (i) subject to outstanding Incentive Stock Options (including any adjustments in the
purchase price) shall be made in such manner as not to constitute a modification as defined by Section 424(h)(3) of the Code and only to the extent otherwise permitted by Sections 422 and 424 of the Code or (ii) subject to outstanding Options or
Awards that are intended to qualify as Performance-Based Compensation shall be made in such a manner as not to adversely affect the treatment of the Options or Awards as Performance-Based Compensation. 
  
 (c) If, by reason of a Change in Capitalization, a Grantee of an Award shall
be entitled to, or an Optionee shall be entitled to exercise an Option with respect to, new, additional or different shares of stock or 

  

 - 21 - 

 
securities of the Company or any other corporation, such new, additional or different shares shall thereupon be subject to all of the conditions,
restrictions and performance criteria which were applicable to the Shares subject to the Award or Option, as the case may be, prior to such Change in Capitalization. 
  
 15. Effect of Certain Transactions. 
  
 Subject to Sections 7.5, 8.9, 10.4(b) and 11.4 or as otherwise provided in an Agreement, in the event of (a) the liquidation
or dissolution of the Company or (b) a merger or consolidation of the Company (a “Transaction”), the Plan and the Options and Awards issued hereunder shall continue in effect in accordance with their respective terms, except that following
a Transaction either (i) each outstanding Option or Award shall be treated as provided for in the agreement entered into in connection with the Transaction or (ii) if not so provided in such agreement, each Optionee and Grantee shall be entitled to
receive in respect of each Share subject to any outstanding Options or Awards, as the case may be, upon exercise of any Option or payment or transfer in respect of any Award, the same number and kind of stock, securities, cash, property or other
consideration that each holder of a Share was entitled to receive in the Transaction in respect of a Share; provided, however, that such stock, securities, cash, property, or other consideration shall remain subject to all of the conditions,
restrictions and performance criteria which were applicable to the Options and Awards prior to such Transaction. The treatment of any Option or Award as provided in this Section 15 shall be conclusively presumed to be appropriate for purposes of
Section 11. 
  
 16. Interpretation. 
  
 Following the required registration of any equity security of the Company
pursuant to Section 12 of the Exchange Act: 
  
 (a) The Plan is
intended to comply with Rule 16b-3 promulgated under the Exchange Act and the Committee shall interpret and administer the provisions of the Plan or any Agreement in a manner consistent therewith. Any provisions inconsistent with such Rule shall be
inoperative and shall not affect the validity of the Plan. 
  
 (b)
Unless otherwise expressly stated in the relevant Agreement, each Option, Stock Appreciation Right and Performance Award granted under the Plan is intended to be Performance-Based Compensation. The Committee shall not be entitled to exercise any
discretion otherwise authorized hereunder with respect to such Options or Awards if the ability to exercise such discretion or the exercise of such discretion itself would cause the compensation attributable to such Options or Awards to fail to
qualify as Performance-Based Compensation. Notwithstanding anything to the contrary in the Plan, the provisions of the Plan may at any time be bifurcated by the Board or the Committee in any manner so that certain provisions of the Plan or any
Performance Award intended (or required in order) to satisfy the applicable requirements of Section 162(m) of the Code are only applicable to persons whose compensation is subject to Section 162(m). 
  
 17. Pooling Transactions. 
  
 Notwithstanding anything contained in the Plan or any Agreement to the
contrary, in the event of a Change in Control which is also intended to constitute a Pooling Transaction, the Committee shall take such actions, if any, as are specifically recommended by an independent accounting firm retained by the Company to the
extent reasonably necessary in order to assure that the Pooling Transaction will qualify as such, including, without limitation, (a) deferring the vesting, exercise, payment, settlement or lapsing of restrictions with respect to any Option or Award,
(b) providing that the payment or settlement in respect of any Option or Award be made in the form of cash, Shares or securities of a successor or acquirer of the Company, or a combination of the foregoing, and (c) providing for the extension of the
term of any Option or Award to the extent necessary to accommodate the foregoing, but not beyond the maximum term permitted for any Option or Award. 
  
 18. Effective Date, Termination and Amendment of the Plan. 
  
 18.1 Effective Date. The original effective date of this Plan was March 12, 2001. The effective date of this amended
and restated Plan shall be May 12, 2005, subject only to the approval of the stock holders of the Company. 
  

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 18.2 Plan Amendment or Termination. The Plan shall terminate on the day preceding the tenth
anniversary of the date of its adoption by the Board and no Option or Award may be granted thereafter. The Board may sooner terminate the Plan and the Board may at any time and from time to time amend, modify or suspend the Plan; provided,
however, that: 
  
 (a) no such amendment, modification,
suspension or termination shall impair or adversely alter any Options or Awards theretofore granted under the Plan, except with the consent of the Optionee or Grantee, nor shall any amendment, modification, suspension or termination deprive any
Optionee or Grantee of any Shares which he or she may have acquired through or as a result of the Plan; and 
  
 (b) to the extent necessary under any applicable law, regulation or exchange requirement, no amendment shall be effective unless approved by the
stockholders of the Company in accordance with applicable law, regulation or exchange requirement. 
  
 19. Non-Exclusivity of the Plan. 
  
 The adoption of the Plan by the Board shall not be construed as amending, modifying or rescinding any previously approved incentive arrangement or as
creating any limitations on the power of the Board to adopt such other incentive arrangements as it may deem desirable, including, without limitation, the granting of stock options otherwise than under the Plan, and such arrangements may be either
applicable generally or only in specific cases. 
  
 20.
Limitation of Liability. 
  
 As illustrative of the
limitations of liability of the Company, but not intended to be exhaustive thereof, nothing in the Plan shall be construed to: 
  
 (a) give any person any right to be granted an Option or Award other than at the sole discretion of the Committee; 
  
 (b) give any person any rights whatsoever with respect to Shares except as
specifically provided in the Plan; 
  
 (c) interfere with or limit
in any way the right of the Company or any Subsidiary to terminate the employment of any person at any time for any reason whatsoever, with or without good cause; or 
  
 (d) be evidence of any agreement or understanding, expressed or implied, that the Company will employ any person at any
particular rate of compensation or for any particular period of time. 
  
 21. Regulations and Other Approvals; Governing Law. 
  
 21.1 Except as to matters of federal law, the Plan and the rights of all persons claiming hereunder shall be construed and determined in accordance with the laws of the State of Delaware without giving effect to conflicts of laws principles
thereof. 
  
 21.2 The obligation of the Company to sell or deliver
Shares with respect to Options and Awards granted under the Plan shall be subject to all applicable laws, rules and regulations, including all applicable federal and state securities laws, and the obtaining of all such approvals by governmental
agencies as may be deemed necessary or appropriate by the Committee. 
  

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 21.3 The Board may make such changes as may be necessary or appropriate to comply with the rules and
regulations of any government authority, or to obtain for Eligible Individuals granted Incentive Stock Options the tax benefits under the applicable provisions of the Code and regulations promulgated thereunder. 
  
 21.4 Each Option and Award is subject to the requirement that, if at any time
the Committee determines, in its sole discretion, that the listing, registration or qualification of Shares issuable pursuant to the Plan is required by any securities exchange or under any state or federal law, or the consent or approval of any
governmental regulatory body is necessary or desirable as a condition of, or in connection with, the grant of an Option or Award or the issuance of Shares, no Options or Awards shall be granted or payment made or Shares issued, in whole or in part,
unless listing, registration, qualification, consent or approval has been effected or obtained free of any conditions as acceptable to the Committee. 
  
 21.5 Notwithstanding anything contained in the Plan or any Agreement to the contrary, in the event that the disposition of Shares acquired pursuant to the
Plan is not covered by a then current registration statement under the Securities Act of 1933, as amended (the “Securities Act”), and is not otherwise exempt from such registration, such Shares shall be restricted against transfer to the
extent required by the Securities Act and Rule 144 or other regulations thereunder. The Company may place on any certificate representing any such Shares any legend deemed desirable by the Company’s counsel to comply with federal or state
securities laws and the Committee may require any individual receiving Shares pursuant to an Option or Award granted under the Plan, as a condition precedent to receipt of such Shares, to represent and warrant to the Company in writing that the
Shares acquired by such individual are acquired without a view to any distribution thereof and will not be sold or transferred other than pursuant to an effective registration thereof under said Act or pursuant to an exemption applicable under the
Securities Act or the rules and regulations promulgated thereunder. 
  
 22. Miscellaneous. 
  
 22.1 Multiple
Agreements. The terms of each Option or Award may differ from other Options or Awards granted under the Plan at the same time, or at some other time. The Committee may also grant more than one Option or Award to a given Eligible Individual
during the term of the Plan, either in addition to, or in substitution for, one or more Options or Awards previously granted to that Eligible Individual. 
  
 22.2 Captions. The use of captions in this Plan or any Agreement is for the convenience of reference only and shall not affect the meaning of any
provision of the Plan or such Agreement. 
  
 22.3
Severability. Whenever possible, each provision of the Plan or an Agreement shall be interpreted in such manner as to be effective and valid under applicable law, but if any provision of the Plan or an Agreement shall be held by a court of
competent jurisdiction to be prohibited by or invalid or unenforceable under applicable law, then (a) such provision shall be deemed to be amended to accomplish the objectives of the provision as originally written to the fullest extent permitted by
law and (b) all other provisions of the Plan or an Agreement shall remain in full force and effect. 
  
 22.4 Withholding of Taxes. 
  
 (a) At such times as an Optionee or Grantee recognizes taxable income in connection with the receipt of Shares or cash hereunder (a “Taxable
Event”), the Optionee or Grantee shall pay to the Company an amount equal to the federal, state and local income taxes and other amounts as may be required by law to be withheld by the Company in connection with the Taxable Event (the
“Withholding Taxes”) prior to the issuance, or release from escrow, of such Shares or the payment of such cash. The Company shall have the right to deduct from any payment of cash to an Optionee or Grantee an amount equal to the
Withholding Taxes in satisfaction of the obligation to pay Withholding Taxes. In satisfaction of the obligation to pay Withholding Taxes to the Company, the Optionee or Grantee may make a written election (the “Tax Election”), which may be
accepted or rejected in the sole discretion of the Committee, to have withheld a portion of the Shares then issuable to him or her having an aggregate Fair Market Value equal to the Withholding Taxes. 
  

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 (b) If an Optionee makes a disposition, within the meaning of Section 424(c) of the Code and regulations
promulgated thereunder, of any Share or Shares issued to such Optionee pursuant to the exercise of an Incentive Stock Option within the two-year period commencing on the day after the date of the grant or within the one-year period commencing on the
day after the date of transfer of such Share or Shares to the Optionee pursuant to such exercise, the Optionee shall, within ten (10) days of such disposition, notify the Company thereof, by delivery of written notice to the Company at its principal
executive office. 
  
 22.5 Post-Transition Period. Any
Option or Award granted under the Plan after the expiration of the Transition Period which is intended to be Performance-Based Compensation shall be subject to the approval of the material terms of the Plan by a majority of the stockholders of the
Company in accordance with Section 162(m) of the Code and the regulations promulgated thereunder. 
  

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