Document:

Exhibit 10.3.1

IKANOS
COMMUNICATIONS, INC.

AMENDED AND
RESTATED

2004 EQUITY
INCENTIVE PLAN

RESTRICTED STOCK
UNIT AGREEMENT FOR EMPLOYEES IN FRANCE

NOTICE OF GRANT OF
RESTRICTED STOCK UNITS

The terms defined in the amended and restated 2004
Equity Incentive Plan (the “US Plan”) and the Rules of the Ikanos
Communications, Inc. Amended and Restated 2004 Equity Incentive Plan for
the Grant of Restricted Stock Units to Employees in France (the “French RSU
Plan”and, in conjunction with the US Plan, the “Plan”), will have the same
defined meanings in this Notice of Grant. Where no definition exists in the
Plan, new definitions will be noted in this document.

	
  Name:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Address:

  	
   

  	
   

  

 

You have been granted the right to receive Restricted
Stock Units, subject to the terms and conditions of the Plan and this
Restricted Stock Unit Agreement as follows:

	
  Grant Number

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Date of Grant

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Vesting Commencement Date

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Total Number of Restricted Stock Units

  	
   

  	
   

  

 

Vesting Schedule:

[INSERT VESTING SCHEDULE- NO VESTING TO OCCUR PRIOR TO
2 YEARS AFTER THE GRANT DATE. In the event Participant ceases to be a Service
Provider for any or no reason (with the exception of death) before Participant
vests in the right to acquire the Shares to be issued pursuant to the
Restricted Stock Unit, the Restricted Stock Unit and the Participant’s right to
acquire any Shares hereunder will immediately terminate.]

By your signature and the signature of the Company’s
representative below, you and the Company agree that this Award is granted
under and governed by the terms and conditions of the Plan and the Terms and
Conditions of International Restricted Stock Units (the “Agreement”), attached
hereto as Appendix A, both of which are made a part of this
document.

You acknowledge receipt of a copy of the 2004 Equity
Incentive Plan prospectus. The Agreement and prospectus are available on the
Company’s website at http://iweb/Finance/Forms/2004StockPlan.pdf or by request
from the Company’s Stock Administration Department. You hereby agree that these
documents are deemed to be delivered to you.

	
  PARTICIPANT:

  	
   

  	
  IKANOS COMMUNICATIONS, INC.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Signature

  	
   

  	
  By

  
	
   

  	
   

  	
   

  
	
  Print Name

  	
   

  	
  Title

  

 

 

APPENDIX A

TERMS AND
CONDITIONS OF INTERNATIONAL RESTRICTED STOCK UNITS

FOR EMPLOYEES IN FRANCE

Restricted Stock Units granted under this Agreement
are intended to be French-qualified Restricted Stock Units that qualify for the
favorable tax and social security regime in France, as set forth in the French
RSU Plan. Certain events may affect the tax and social security favored status
of the Restricted Stock Units as French-qualified Restricted Stock Units and
the Restricted Stock Units may lose their tax and social security favored
status in the future. The Company does not make any undertaking or
representation to maintain the qualified status of the Frenchqualified Restricted
Stock Units during the life of the grant of the Restricted Stock Units, and the
Participant will not be entitled to any damages if the Restricted Stock Units
no longer qualify as French-qualified Restricted Stock Units.

1.   Grant.   The Company
hereby grants to the Participant under the Plan an Award of Restricted Stock
Units, subject to all of the terms and conditions in this Agreement and the
Plan.

2.   Company’s Obligation to Pay.   Each
Restricted Stock Unit represents the right to receive a Share on the date it
becomes vested. Unless and until the Restricted Stock Units will have vested in
the manner set forth in Section 3, the Participant will have no right to
payment of any such Restricted Stock Units. Prior to actual payment of any
vested Restricted Stock Units, such Restricted Stock Unit will represent an
unsecured obligation of the Company, payable (if at all) only from the general
assets of the Company.

3.   Vesting Schedule.   Subject to Section 4,
the Restricted Stock Units awarded by this Agreement will vest in the
Participant according to the vesting schedule set forth on the attached Notice
of Grant of Restricted Stock Units, subject to the Participant continuing to be
a Service Provider through each applicable vesting date. In no event shall
vesting occur prior to two years after the grant date, or if shorter, the
period required for favorable tax and social security treatment under French
law.

In the event of the death of Participant, the Company
will transfer the Restricted Stock Units to Participant’s heirs and issue
Shares underlying Restricted Stock Units, if Participant’s heirs so request
anytime within six months following the death of Participant. Any unrequested Restricted
Stock Units will be forfeited at the end of the six-month period following
Participant’s death.

4.   Forfeiture upon Termination as Service Provider.   Notwithstanding
any contrary provision of this Agreement, if the Participant ceases to be a
Service Provider for any reason (except in the event of the Participant’s death
as provided for in Section 3), the then-unvested Restricted Stock Units
awarded by this Agreement will thereupon be forfeited at no cost to the Company
and the Participant will have no further rights thereunder.

5.   Payment after Vesting.   Any
Restricted Stock Units that vest in accordance with Section 3 will be paid
to the Participant (or in the event of the Participant’s death, to his or her estate)
in whole Shares, subject to Section 6.

 

6.   Withholding of Taxes.   Notwithstanding
any contrary provision of this Agreement, no certificate representing the
Shares will be issued to the Participant, unless and until satisfactory
arrangements (as determined by the Administrator) will have been made by the Participant
with respect to the payment of income (including federal, state, foreign and
local taxes), employment, social security contributions, payroll tax, payment
on account and other taxes which the Company determines must be withheld with
respect to such Shares so issuable (the “Withholding Taxes”). Participant
acknowledges that the ultimate liability for all Withholding Taxes legally due
by Participant is and remains Participant’s responsibility and that the Company
and/or the Participant’s actual employer (the “Employer”) (i) make no representations
or undertakings regarding the treatment of any Withholding Taxes in connection with
any aspect of the Restricted Stock Units, including the grant of the Restricted
Stock Units, the vesting of Restricted Stock Units, the settlement of the
Restricted Stock Units in Shares or the subsequent sale of any Shares acquired
at vesting and the receipt of any dividends; and (ii) do not commit to
structure the terms of the grant or any aspect of the Restricted Stock Units to
reduce or eliminate the Participant’s liability for Withholding Taxes.

To satisfy the Withholding Taxes, the Company may
withhold otherwise deliverable Shares upon vesting of Restricted Stock Units,
according to the vesting schedule, having a Fair Market Value equal to the
minimum amount required to be withheld for the payment of the Withholding Taxes
pursuant to such procedures as the Administrator may specify from time to time.
The Company will not retain fractional Shares to satisfy any portion of the
Withholding Taxes. If the Administrator determines that the withholding of
whole Shares results in an overwithholding to meet the minimum tax withholding
requirements, a reimbursement will be made to the Participant as soon as
administratively possible.

If the Company does
not withhold in Shares as described above, prior to the issuance of Shares upon
vesting of Restricted Stock Units, Participant shall pay, or make adequate arrangements
satisfactory to the Company or to the Employer (in their sole discretion) to
satisfy all withholding and payment on account obligations of the Company
and/or the Employer. In this regard, Participant authorizes the Company or the
Employer to withhold all applicable Withholding Taxes legally payable by
Participant from Participant’s wages or other cash compensation payable to
Participant by the Company or the Employer within legal limits. Alternatively,
or in addition, if permissible under local law, the Participant may instruct
and authorizes the Administrator to pay Withholding Taxes, in whole or in part,
by one of the additional following alternatives:

(a)    Participant
providing irrevocable instructions to a Company-designated broker to deliver
cash to the Company (or the Employer) from the Participant’s previously established
account with such broker equal to the Withholding Taxes; or

(b)    Participant
providing irrevocable instructions to a Company-designated broker to sell a
sufficient number of Shares otherwise deliverable to Participant having a Fair Market
Value equal to the Withholding Taxes, provided that such sale does not violate
Company policy or Applicable Laws.

If the Participant fails to make satisfactory
arrangements for the payment of the Withholding Taxes hereunder at the time any
applicable Restricted Stock Units otherwise are scheduled to vest pursuant to Section 3,
the Participant will permanently forfeit such Restricted Stock Units and any
Shares otherwise deliverable with respect thereto, and the Restricted Stock

 

Units will be returned to the Company at no cost to
the Company.

The Participant acknowledges and agrees that should
the amount of withholding of the Withholding Taxes by reducing the number of
Shares deliverable or by withholding from the Participant’s sale proceeds be in
excess of the amount required to be withheld, that the Company and/or the
Employer will refund the excess amount to the Participant within a reasonable
period of time and without interest.

7.   Restriction on the Sale of Shares.   After
issuance of the Shares to the Participant, the Participant must hold the Shares
until the second anniversary of each Vesting Date, or if shorter, the period
required for favorable tax and social security treatment under French law. In addition,
the Shares underlying the Restricted Stock Units shall not be sold during certain
Closed Periods(1) as provided for and defined by Section L. 225-197-1
of the French Commercial Code, as amended, and by the French RSU Plan, so long
as those Closed Periods are applicable to Shares underlying the Restricted
Stock Units.

8.   Rights as Stockholder.   Neither the
Participant nor any person claiming under or through the Participant will have
any of the rights or privileges of a stockholder of the Company in respect of
any Shares deliverable hereunder unless and until certificates representing
such Shares will have been issued, recorded on the records of the Company or
its transfer agents or registrars, and delivered to the Participant.

9.   No Effect on Service.   Participant
acknowledges and agrees that the vesting of the Restricted Stock Units pursuant
to Section 3 hereof is earned only by Participant continuing to be a
Service Provider through the applicable vesting dates (and not through the act
of being hired or acquiring Shares hereunder), except in the event of death as
provided in Section 3. Participant further acknowledges and agrees that
this Agreement, the transactions contemplated hereunder and the vesting
schedule set forth herein do not constitute an express or implied promise of Participant’s
continuation as a Service Provider for the vesting period, for any period, or
at all, and will not interfere with the Participant’s right or the right of the
Employer to terminate Participant’s status as a Service Provider at any time.

10.   Acknowledgment of Nature of Plan and
Restricted Stock Units.   In accepting the Award,
Participant acknowledges that:

(a)    the Plan
is established voluntarily by the Company, it is discretionary in nature and
may be modified, amended, suspended or terminated by the Company at any time,
as provided in the Plan;

(b)    the Award
of Restricted Stock Units is voluntary and occasional and does not create any
contractual or other right to receive future awards of Restricted Stock Units,
or benefits in lieu of Restricted Stock Units even if Restricted Stock Units have
been awarded repeatedly in the past;

(1)             “Closed
Period”is defined in Section L. 225-197-1 of the French
Commercial Code, as amended, as: (i) 10 quotation days preceding and following
the disclosure to the public of the consolidated financial statements or the
annual statements of the Company; or (ii) any period during which the
corporate management of the Company possesses confidential information which
could, if disclosed to the public, significantly impact the quotation of the
Shares, until 10 quotation days after the day such information is disclosed to
the public.

 

(c)    all
decisions with respect to future awards, if any, will be at the sole discretion
of the Company;

(d)    Participant’s
participation in the Plan is voluntary;

(e)    Restricted
Stock Units are an extraordinary item that does not constitute compensation of
any kind for services of any kind rendered to the Company or to the Employer, and
Restricted Stock Units are outside the scope of Participant’s employment
contract, if any;

(f)     Restricted
Stock Units are not part of normal or expected compensation or salary for any
purposes, including, but not limited to, calculation of any severance,
resignation, termination, redundancy, end of service payments, bonuses,
long-service awards, pension or retirement benefits or similar payments;

(g)    neither
the Award of Restricted Stock Units nor any provision of this Agreement, the
Plan or the policies adopted pursuant to the Plan confer upon Participant any
right with respect to employment or continuation of current employment, and in
the event that Participant is not an employee of the Company or any Subsidiary
of the Company, Restricted Stock Units shall not be interpreted to form an
employment contract or relationship with the Company or any Subsidiary of the
Company;

(h)    the future
value of the underlying Shares is unknown and cannot be predicted with
certainty;

(i)     if
Participant receives Shares, the value of such Shares acquired on vesting of Restricted
Stock Units may increase or decrease in value;

(j)     no claim
or entitlement to compensation or damages arises from termination of Restricted
Stock Units, and no claim or entitlement to compensation or damages shall arise
from any diminution in value of the Restricted Stock Units or Shares received
upon vesting of Restricted Stock Units resulting from termination of the
Participant’s employment by the Company or the Employer (for any reason
whatsoever) and Participant irrevocably releases the Company and the Employer
from any such claim that may arise; if, notwithstanding the foregoing, any such
claim is found by a court of competent jurisdiction to have arisen, then, by signing
this Agreement, Participant shall be deemed irrevocably to have waived his or
her entitlement to pursue such claim; and

(k)    in the
event of involuntary termination of Participant’s employment, Participant’s right
to receive Restricted Stock Units and vest under the Plan, if any, will
terminate effective as of the date that Participant is no longer actively
employed (except in the event of death, as provided in Section 3).

10.   Address for Notices.   Any notice to
be given to the Company under the terms of this Agreement will be addressed to
the Company, in care of its [TITLE] at Ikanos Communications, Inc.,
[ADDRESS], or at such other address as the Company may hereafter designate in
writing.

11.   Grant is Not Transferable.   Except to the
limited extent permitted in the event of the Participant’s death, this grant
and the rights and privileges conferred hereby will not be transferred,
assigned, pledged or hypothecated in any way (whether by operation of law or

 

otherwise) and will not be subject to sale under
execution, attachment or similar process. Upon any attempt to transfer, assign,
pledge, hypothecate or otherwise dispose of this grant, or any right or
privilege conferred hereby, or upon any attempted sale under any execution,
attachment or similar process, this grant and the rights and privileges
conferred hereby immediately will become null and void.

12.   Binding Agreement.   Subject to
the limitation on the transferability of this grant contained herein, this
Agreement will be binding upon and inure to the benefit of the heirs, legatees,
legal representatives, successors and assigns of the parties hereto.

13.   Additional Conditions to Issuance of Stock.   If at any
time the Company will determine, in its discretion, that the listing,
registration or qualification of the Shares upon any securities exchange or
under any foreign, state or federal law, or the consent or approval of any governmental
regulatory authority is necessary or desirable as a condition to the issuance
of Shares to the Participant (or his or her estate), such issuance will not
occur unless and until such listing, registration, qualification, consent or
approval will have been effected or obtained free of any conditions not
acceptable to the Company. Where the Company determines that the delivery of
the payment of any Shares will violate federal securities laws or other
Applicable Laws, the Company will defer delivery until the earliest date at
which the Company reasonably anticipates that the delivery of Shares will no
longer cause such violation. The Company will make all reasonable efforts to
meet the requirements of any such foreign, state or federal law or securities exchange
and to obtain any such consent or approval of any such governmental authority.

14.   Data Privacy Notice and
Consent.   Participant hereby explicitly and unambiguously
consents to the collection, use and transfer, in electronic or other form, of Participant’s
personal data as described in this Agreement by and among, as applicable, the Employer,
the Company, its Subsidiaries and its affiliates for the exclusive purpose of implementing,
administering and managing Participant’s participation in the Plan.

Participant understands that the Company and the
Employer may hold certain personal information about Participant, including,
but not limited to, Participant’s name, home address and telephone number, date
of birth, social insurance number or other identification number, salary,
nationality, job title, any shares of stock or directorships held in the
Company, details of all Restricted Stock Units or any other entitlement to
shares awarded, canceled, vested, unvested or outstanding in Participant’s
favor, for the purpose of implementing, administering and managing the Plan (“Data”).
Participant understands that Data may be transferred to any third parties
assisting in the implementation, administration and management of the Plan,
that these recipients may be located in Participant’s country, or elsewhere
(e.g., the United States), and that the recipient’s country may have different
data privacy laws and protections than Participant’s country. Participant
understands that Participant may request a list with the names and addresses of
any potential recipients of the Data by contacting Participant’s local human
resources representative. Participant authorizes the recipients to receive,
possess, use, retain and transfer the Data, in electronic or other form, for
the purposes of implementing, administering and managing Participant’s
participation in the Plan, including any requisite transfer of such Data as may
be required to a broker, escrow agent or other third party with whom the Shares
received upon vesting of the Restricted Stock Units may be deposited.
Participant understands that Data will be held only as long as is necessary to
implement, administer and manage Participant’s participation in the Plan. Participant
understands that Participant may, at any time, view Data, request additional 

 

information about
the storage and processing of Data, require any necessary amendments to Data or
refuse or withdraw the consents herein, in any case without cost, by contacting
in writing Participant’s local human resources representative. Participant
understands that refusal or withdrawal of consent may affect Participant’s
ability to participate in the Plan. For more information on the consequences of
Participant’s refusal to consent or withdrawal of consent, Participant
understands that Participant may contact Participant’s local human resources
representative.

15.   Electronic Delivery.   The Company
may, in its sole discretion, decide to deliver any documents related to
Restricted Stock Units awarded under the Plan or future Restricted Stock Units
that may be awarded under the Plan by electronic means or request Participant’s
consent to participate in the Plan by electronic means. Participant hereby
consents to receive such documents by electronic delivery and agrees to
participate in the Plan through an on-line or electronic system established and
maintained by the Company or another third party designated by the Company.

16.   Plan Governs.   This
Agreement is subject to all terms and provisions of the Plan. In the event of a
conflict between one or more provisions of this Agreement and one or more provisions
of the Plan, the provisions of the Plan will govern.

17.   Administrator Authority.   The
Administrator will have the power to interpret the Plan and this Agreement and
to adopt such rules for the administration, interpretation and application
of the Plan as are consistent therewith and to interpret or revoke any such rules (including,
but not limited to, the determination of whether or not any Restricted Stock
Units have vested). All actions taken and all interpretations and
determinations made by the Administrator in good faith will be final and
binding upon Participant, the Company and all other interested persons. No
member of the Administrator will be personally liable for any action, determination
or interpretation made in good faith with respect to the Plan or this
Agreement.

18.   Captions.   Captions
provided herein are for convenience only and are not to serve as a basis for
interpretation or construction of this Agreement.

19.   Agreement Severable.   In the event
that any provision in this Agreement will be held invalid or unenforceable,
such provision will be severable from, and such invalidity or unenforceability
will not be construed to have any effect on, the remaining provisions of this Agreement.

20.   Modifications to the Agreement.   This
Agreement constitutes the entire understanding of the parties on the subjects
covered. Participant expressly warrants that he or she is not accepting this
Agreement in reliance on any promises, representations, or inducements other
than those contained herein. Modifications to this Agreement or the Plan can be
made only in an express written contract executed by a duly authorized officer
of the Company.

21.   Governing Law.   This
Agreement shall be governed by the laws of the State of California, without
giving effect to the conflict of law principles thereof. For purposes of litigating
any dispute that arises under this Award of Restricted Stock Units or this Agreement,
the parties hereby submit to and consent to the jurisdiction of the State of
California, and agree that such
litigation shall be conducted in the courts of Santa Clara County, California, or the

 

federal courts for the United States for the Northern
District of California, and no other courts, where this Award of Restricted
Stock Units is made and/or to be performed.

22.   Language.   If
Participant has received this Agreement or any other document related to the
Plan translated into a language other than English and if the translated
version is different than the English version, the English version will
control.Exhibit 10.4

Rules of the Ikanos Communications, Inc.

Amended and Restated 2004 Equity Incentive Plan

For the Grant of Stock Options to Employees in France

1.   Introduction.

The Board of Directors (the “Board”) of Ikanos
Communications, Inc. (the “Company”) has established the Ikanos
Communications, Inc. Amended and Restated 2004 Equity Incentive Plan (the “U.S.
Plan”) to attract and retain the best available personnel for positions of
substantial responsibility, to promote the success of the Company’s business
and to provide additional incentive to employees, directors and consultants,
including employees of its French affiliate(s) (a “French Entity”), of
which the Company holds directly or indirectly at least 10% of the share capital.

Section 4(b) of the U.S. Plan specifically
authorizes a committee designated by the Board (the “Committee”), or the Board
itself, to administer the U.S. Plan (the “Administrator”) and to prescribe,
amend and rescind rules and regulations relating to the U.S. Plan,
including rules and regulations relating to sub-plans established for the
purpose of satisfying applicable foreign laws (including qualifying for
preferred tax treatment under applicable foreign tax laws) such as stock options
granted in France.

The Administrator has determined that it is advisable
to establish a sub-plan for the purpose of permitting such stock options
granted to employees of a French Entity to qualify for favorable tax and social
security treatment in France. The Administrator, therefore, intends to establish
a sub-plan to the U.S. Plan for the purpose of granting options which qualify
for the favorable tax and social security treatment in France applicable to
options granted under Sections L. 225-177 to L. 225-186 of the
French Commercial Code, as amended to eligible employees in France who are
French tax resident and/or subject to the French social security contributions
regime.

The terms of the U.S. Plan, as set out in Appendix 1
hereto, shall, subject to the following rules, constitute the Rules of the
Ikanos Communications, Inc. Amended and Restated 2004 Equity Incentive
Plan for the Grant of Stock Options to Employees in France (the “French Plan”).

Under the French Plan, the eligible employees will be
granted only Options as defined in Section 2 below. The provisions of
Sections 7, 8, 9, 10 and 11 of the U.S. Plan permitting the grant of restricted
stock, restricted stock units, stock appreciation rights, performance units,
performance shares and deferred stock units are not applicable to grants made
under this French Plan. The grant of Options is authorized under Section 6
of the U.S. Plan.

2.   Definitions.   Capitalized
terms not otherwise defined herein shall have the same meanings as set forth in
the U.S. Plan. The terms set out below will have the following meanings:

(a)    The term “Option”shall
include both:

 

(i)     purchase
stock options (rights to acquire Shares as defined by the U.S. Plan repurchased
by the Company prior to the vesting of the options); or

(ii)    subscription
stock options (rights to subscribe for newly issued Shares).

(b)    The term “Optionee”is
defined as an eligible person granted an Option pursuant to Section 3 of
the French Plan.

(c)    The term “Grant
Date”shall be the date on which the Administrator both:

(i)     designates
the Optionee; and

(ii)    specifies
the terms and conditions of the Option, including the number of Shares and the method
for determining the exercise price.

(d)    The term “Closed
Period”shall mean the specific periods as set forth by Section L. 225-177
of the French Commercial Code, as amended, during which French qualifying Options
cannot be granted.

(e)    The term “Disability”shall
mean disability as determined in categories 2 and 3 under Section L. 341-4
of the French Social Security Code and subject to fulfillment of related conditions.

(f)     The term “Effective
Grant Date”shall be the date on which the Option is effectively granted (i.e., the date on which the condition
precedent of the expiration of a Closed Period applicable to the Option, if
any, is satisfied). Such condition precedent shall be satisfied when the
Administrator or other authorized body shall determine that the grant of
Options is no longer prevented under a Closed Period. If the Grant Date does
not occur within a Closed Period, or if the Closed Periods are not applicable,
the “Effective Grant Date”shall be the same day as the Grant Date.

(g)    The term “Exercise
Eligibility Date”shall mean the date as from which Options become exercisable
and shall be the expiration of the holding period as defined by Section 163
bis C of the French Tax Code.

3.   Entitlement
to Participate.

(a)    Any
Employee who, on the Effective Grant Date of the Option, is employed under the
terms and conditions of an employment contract (“contrat de travail”) with a
French Entity shall be eligible to receive Options under the French Plan,
provided he or she also satisfies the eligibility requirements set forth in the
U.S. Plan.

(b)    Options
may not be issued to directors of a French Entity, other than the managing directors
(Président du Conseil d’Administration, Directeur Général, Directeur Général
Délégué, Membre du Directoire, Gérant de Sociétés par actions), unless the
director is employed by the

 2
 

 

French Entity, as defined by French law.

(c)    Notwithstanding
any provision of the U.S. Plan, Options may not be issued under the French Plan
to Optionees owning more than ten percent (10%) of the Company’s share capital
or to individuals other than employees and corporate executives of a French
Entity.

4.   Conditions
of the Option/Exercise Price.

(a)    Notwithstanding
any provision in the U.S. Plan, the exercise price and number of underlying
Shares of the Options will not be modified after the Effective Grant Date
except as provided in Section 6 of this French Plan, or as otherwise
authorized by French law. To the extent that modifications are not limited to
those described in Section 6, such modification may result in the Option
not qualifying for favorable tax and social security treatment under French law.

(b)    The method
for determining the exercise price per Share payable pursuant to Options issued
hereunder shall be fixed by the Administrator on the Effective Grant Date. The exercise
price will be the higher of:

(i)     with
respect to purchase Options: the higher of either 80% of the average quotation
price of such Shares during the 20 days of quotation immediately preceding the Effective
Grant Date or 80% of the average purchase price paid for such Shares by the Company;

(ii)    with
respect to subscription Options: 80% of the average quotation price of such
Shares during the 20 days of quotation immediately preceding the Effective
Grant Date; and

(iii)   the
minimum exercise price permitted under the U.S. Plan, as determined on the
Effective Grant Date.

5.   Exercise
of an Option.

(a)   Exercisability.

The Options will become exercisable on the Exercise
Eligibility Date as defined under Section 2 above. However,
notwithstanding the above, in the event of the death of an Optionee, all of his
or her outstanding Options shall become exercisable under the conditions set
forth in Section 7 of the French Plan. In the event of death or
Disability, the Options will qualify for favorable tax and social security
treatment under French law even if the Shares are sold prior to the expiration
of the applicable holding period, as provided in Section 163 bis C of the
French Tax Code. In the event of an acceleration of the Exercise Eligibility
Date of the Options, the Administrator may decide to impose a restriction on
the sale or transfer of Shares as defined in Section 11 below.

 3
 

 

(b)   Payment of Exercise Price and
Withholding.

Notwithstanding any provision of the U.S. Plan, upon
exercise of an Option, the full exercise price will be paid either in cash, by
check or by wire transfer. Under a cashless exercise program, the Optionee may
give irrevocable instructions to a stockbroker to properly deliver the exercise
price to the Company. No delivery of prior owned Shares having a fair market
value on the date of delivery equal to the aggregate option price of the Shares
may be used as consideration for exercising the Options.

The Company and/or the French Entity shall be
permitted to satisfy any income tax withholding or social security charges due
at exercise or sale by withholding any such required amounts from wages or
other cash compensation paid to the Optionee, within legal limits, as well as
from stock sale proceeds to be paid to the Optionee or through withholding in Shares.
If such amounts are due and are not withheld or to be withheld, the Company
and/or the French Entity shall be permitted to acquire the amount due from the
Optionee by means of check, cash or wire transfer and the Company may refuse to
honor the exercise and refuse to deliver Shares if such withholding amounts are
not delivered.

(c)   Optionee’s Account.

The Shares acquired upon exercise of the Options will
be recorded in an account in the name of the shareholder with a broker or in
such other manner as the Company may otherwise determine in order to ensure
compliance with Applicable Law.

6.   Changes
in Capitalization.   Notwithstanding
any provision in the U.S. Plan, adjustments of the Option issued hereunder
shall be made to preclude the dilution or enlargement of benefits under the
Option only in the event of the occurrence of one of the events listed under Section L. 225-181
of the French Commercial Code and according to the provisions of Section L. 228-99
of the French Commercial Code, as amended, as well as according to specific
decrees. Nevertheless, the Administrator may determine to make adjustments in
the case of transactions for which adjustments are not authorized under French
law, in which case the Options may no longer qualify for the favorable tax and
social security regime. In that respect, the Administrator may at its sole
discretion decide that the restriction on the sale or transfer of Shares as
defined in Section 11 below will no longer apply.

7.   Death.   In the
event of the death of an Optionee, all Options held by the Optionee shall become
immediately vested and exercisable and may be exercised in full by his or her
heirs or the legal representative of his or her estate, only within the
six-month period following the death. Any Option that remains unexercised shall
expire six months following the date of the Optionee’s death. The six-month
exercise period will apply without regard to the term of the Option as
described in Section 9 below.

8.   Adjustments
and Change in Control.   In the event of a corporate transaction or
Change in Control, as set forth in Section 15 of the U.S. Plan,
adjustments to the terms and conditions of the French-qualified Options or
underlying Shares may be made only in accordance with the

 4
 

 

U.S. Plan and pursuant to applicable French legal and
tax rules. Nevertheless, should the Administrator, at its discretion, decide to
make adjustments in a manner that is not recognized as an adjustment under
French law, then the Options may no longer qualify as French-qualified Options
and the favorable tax and social security treatment may be lost.

9.   Term
of the Options.   The
term of the Options shall be no longer than ten (10) years from the
Effective Grant Date or such shorter term as the Administrator may provide for,
unless it is extended pursuant to the death provisions in Section 7.

10.   Non-Transferability
of the Options.   Except
in the case of death, Options cannot be transferred to any third party and are
exercisable only by the Optionee during his or her lifetime.

11.   Restriction on
Transfer of Shares.   Notwithstanding
any provision of the U.S. Plan, the Company reserves the right to restrict the
sale or transfer in any manner of any Shares acquired through the exercise of
an Option for a period not to exceed three years from the date the Option is
exercised.

12.   Interpretation.   It is
intended that Options granted under the French Plan shall qualify for the
favorable tax and social security treatment applicable to options granted under
Sections L. 225-177 to L. 225-186 of the French Commercial Code, as
amended, and in accordance with the relevant provisions set forth by French tax
law and the French tax administration. The terms of the French Plan shall be
interpreted accordingly and in accordance with the relevant provisions set
forth by French tax and social security laws and relevant Guidelines published
by French tax and social security administrations and subject to the fulfilment
of legal, tax and reporting obligations.

13.   Employment
Rights.   The adoption of this French Plan shall not confer upon
the Optionees, or any employees of a French Entity, any employment rights and
shall not be construed as a part of any employment contracts that a French
Entity has with its employees.

14.   Amendments.   Subject to
the terms of the U.S. Plan, the Administrator reserves the right to amend or
terminate the French Plan at any time.

15.   Adoption.   The French
Plan was adopted by the Administrator on July 5, 2006.

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APPENDIX 1

[insert copy of the U.S. Plan]

 

 6

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