Document:

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                                                                 Exhibit 10.27.2

                             NOVELLUS SYSTEMS, INC.

                           RESTRICTED STOCK AGREEMENT

        THIS AGREEMENT is entered into as of the 16th day of December, 1999, by
and between Novellus Systems, Inc., a California corporation (the "Company") and
Richard Hill ("Recipient").

                              W I T N E S S E T H:

        WHEREAS, the Company regards Recipient as a valuable contributor to the
Company and has determined that it would be in the interest of the Company and
its shareholders to issue the Stock (as defined below) provided for in this
Agreement to Recipient as a reward and incentive for his continued service with
the Company;

        WHEREAS, the issuance of the Stock pursuant to this Agreement shall be
in accordance with the Company's 1992 Stock Option Plan, as amended (the "Plan")
and subject to the terms of the Plan pertaining to stock grants to employees
thereunder.

        NOW, THEREFORE, in consideration of the mutual covenants hereinafter set
forth, the parties to this Agreement hereby agree as follows:

        1.     Restricted Stock Grant.

               (a)    Stock Grant. On the Effective Date (as defined in
Section 1(c) below), the Company will grant and issue to Recipient 20,000 shares
of Common Stock, no par value, of the Company (the "Stock") as a consideration
for past services performed by Recipient for the Company. Stock certificates
evidencing the Stock will be retained by the Company, accompanied by blank stock
powers executed by Recipient, for the period during which the Stock constitutes
Restricted Stock (as defined below) pursuant to the terms of Sections 2 and 3
hereof.

               (b)    Rights of Shareholder; Additional Securities. All shares
of Stock issued hereunder shall be deemed issued to Recipient as fully paid and
nonassessable shares, and Recipient shall have all rights of a shareholder with
respect thereto, including the right to vote, receive dividends (including stock
dividends), participate in stock splits or other recapitalizations, and exchange
such shares in a merger, consolidation or other reorganization. The term
"Stock," in addition to the shares purchased pursuant to this Agreement, also
refers to all securities received as a result of ownership of the Stock
(hereinafter called "Additional Securities"), including, without limitation,
warrants, options and securities received as a stock dividend or as a result of
any stock split, or as a result of a recapitalization, reorganization, exchange
or the like.

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               (c)    Date. The "Effective Date" for purposes of this Agreement
shall be December 16, 1999.

        2.     Transfer Restrictions. No Stock issued to the Recipient hereunder
shall be sold, transferred by gift, pledged, hypothecated, or otherwise
transferred or disposed of by the Recipient prior to the date when the Recipient
shall become vested in such Stock pursuant to Section 3 below, and such Stock
shall constitute "Restricted Stock" until such date. Any attempt to transfer
Stock in violation of this Section 2 shall be null and void and shall be
disregarded by the Company.

        3.     Forfeiture Condition.

               (a)    Vesting of the Stock. In the event that Recipient's
employment with the Company shall terminate for any reason prior to (1) December
16, 2000, the date on which 33-% of the shares of Stock shall be deemed vested
and cease to be Restricted Stock for the purpose of this Section 3(a) ("1st
Vesting Date"), (2) December 16, 2001, the date on which 33-% of the shares of
Stock issued shall be deemed vested and cease to be Restricted Stock for the
purpose of this Section 3(a) ("2nd Vesting Date"), or (3) December 16, 2002, the
date on which 33-% of the shares of Stock issued shall be deemed vested and
cease to be Restricted Stock for the purpose of this Section 3(a) ("3rd Vesting
Date"), the unvested Stock shall be forfeited and transferred to the Company in
the amounts and in the manner provided in this Section 3(a) effective as of the
date of such termination without further action by Recipient or the Company. In
such event, the Company shall thereafter be authorized to take such action as it
deems appropriate to retire the unvested Stock through use of the executed stock
power and share certificate held by the Company in the escrow established
pursuant to Section 4 below. Subject to the foregoing, the Company and Recipient
agree that (w) 33-% of the Stock shall be vested and no longer be deemed
Restricted Stock as of the 1st Vesting Date (unless the Stock shall have been
previously forfeited by Recipient pursuant to this Section 3); (x) 33-% of the
Stock shall be vested and no longer be deemed Restricted Stock as of the 2nd
Vesting Date (unless the Stock or a portion of the Stock shall have been
previously forfeited by Recipient pursuant to this Section 3); (y) 33-% of the
Stock shall be vested and no longer be deemed Restricted Stock as of the 3rd
Vesting Date (unless the Stock, or a portion of the Stock shall have been
previously forfeited by Recipient pursuant to this Section 3); and (z)
irrespective of the occurrence of the 1st Vesting Date, the 2nd Vesting Date or
the 3rd Vesting Date, 100% of the Stock shall be vested and no longer be deemed
Restricted Stock upon the termination of Recipient's employment with the Company
as a result of his death, Permanent Disability, Involuntary Termination Without
Cause or Constructive Termination.

               (b)    Definitions. For purposes of this Section, the following
definitions shall apply:

                      (i)    "CONSTRUCTIVE TERMINATION" shall mean any
termination by Recipient of his employment with the Company within sixty (60)
days following the occurrence of any of the following: (A) unless approved in
writing in advance by Recipient, the assignment to Recipient of any duties
materially inconsistent with his position, duties,

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responsibilities, authority and status, or the removal of any material duties,
responsibilities or authority from such position, except to the extent necessary
in connection with a disability that would qualify under the Company's existing
disability plan, if any, but for any requirement in such plan that the
disability continue for any period of time, for the period of such disability;
(B) unless made on a substantially equal percentage basis as part of a general
reduction applicable to all employees of the Company of the same or greater
rank, a reduction in Recipient's annual base salary in effect at the time any
determination thereof is to be made; or (C) unless approved in writing in
advance by the Recipient's Representative, the Company's requiring the Recipient
to work, apart from reasonable business trips, more than 100 miles from the
location at which Recipient was working on the date of this Agreement;

                      (ii)   "INVOLUNTARY TERMINATION WITHOUT CAUSE" shall mean
the termination by the Company of Recipient's employment with the Company other
than as a result of one or more of the following reasons: (w) chronic alcoholism
or drug addiction, to the extent discharge therefor is permitted by applicable
law; (x) misappropriation of any money or other assets or properties of the
Company or any subsidiary of the Company; (y) the conviction of Recipient of any
felony, or of any lesser crime or offense materially and adversely affecting the
property, reputation or goodwill of the Company or any of its subsidiaries; or
(z) willful or gross neglect by Recipient of his duties, or willful misconduct
by Recipient in connection with the performance of his duties, which neglect or
misconduct shall have an adverse effect on the Company or one of its
subsidiaries and which shall remain unremedied for thirty (30) days after
written notice (indicating with reasonable specificity the events of neglect
and/or misconduct) given to Recipient by the Company through its Board of
Directors; and

                      (iii)  "PERMANENT DISABILITY" shall mean a physical or
mental condition that prevents Recipient from performing his employment duties
to the Company for a period of ninety (90) consecutive days or one hundred
twenty (120) days during any one hundred eighty (180) day period.

        4.     Escrow of Stock. For purposes of facilitating the enforcement of
the provisions of Sections 2 and 3, Recipient agrees, immediately upon receipt
of the certificate(s) for the Stock, to deliver such certificate(s), together
with a stock power executed in blank by Recipient and Recipient's spouse (if
required for transfer) with respect to each such stock certificate, to the
Secretary or Assistant Secretary of the Company, or their designee, to hold in
escrow for so long as such Stock remains Restricted Stock, with the authority to
take all such actions and to effectuate all such transfers and/or releases as
may be necessary or appropriate to accomplish the objectives of this Agreement
in accordance with the terms hereof. Recipient hereby acknowledges that the
appointment of the Secretary or Assistant Secretary of the Company (or their
designee) as the escrow holder hereunder with the stated authorities is a
material inducement to the Company to make this Agreement and that such
appointment is coupled with an interest and is accordingly irrevocable.
Recipient agrees that such escrow holder shall not be liable to any party hereto
(or to any other party) for any actions or omissions unless such escrow holder
is grossly negligent relative thereto. The escrow holder may rely upon any
letter, notice or other document executed by any signature purported to be
genuine and may resign at any time. Any Additional Securities shall be retained
by the Company in the same

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manner and subject to the same conditions as the Restricted Stock with respect
to which they were issued. Recipient shall be entitled to direct the Company to
exercise any warrant or option received as Additional Securities upon supplying
the funds necessary to do so, in which event the securities so purchased shall
constitute Additional Securities, but the Recipient may not direct the Company
to sell any such warrant or option. If Additional Securities consist of a
convertible security, Recipient may exercise any conversion right, and any
securities so acquired shall be deemed Additional Securities. Additional
Securities shall be subject to the provisions of Sections 2, 4 and 6 in the same
manner as the Restricted Stock.

        5.     Withholding of Taxes. At such time as the Stock becomes vested as
provided in Section 3 hereof, Recipient shall immediately pay the Company the
amount necessary to satisfy any applicable federal, state, and local income and
employment tax withholding requirements. After the possibility of forfeiture
under Section 3 has lapsed and subject to the approval of the Stock Option
Committee if required by Rule 16b-3 of the Securities and Exchange Commission,
Recipient may surrender to the Company any number of shares of Stock necessary
to pay all or part of any withholding tax due arising from shares awarded under
this Agreement, based on the fair market value of such shares surrendered. The
fair market value shall be the closing price of the Company's Common Stock on
the NASDAQ National Market System for the last trading day prior to surrender,
as reported in The Wall Street Journal.

        6.     Corporate Transaction.

               (a)    Definition. For purposes of this Section 6, a "Corporate
Transaction" shall include any of the following shareholder-approved
transactions to which the Company is a party:

                      (i)    a merger or consolidation in which the Company is
not the surviving entity, except for a transaction the principal purpose of
which is to change the state of the Company's incorporation;

                      (ii)   the sale, transfer or other disposition of all or
substantially all of the assets of the Company in liquidation or dissolution of
the Company; or

                      (iii)  any reverse merger in which the Company is the
surviving entity but in which securities representing more than fifty percent
(50%) of the total combined voting power of the Company's outstanding securities
are transferred to holders different from those who held such securities
immediately prior to such merger.

               (b)    Release of Forfeiture Condition. In the event of any
Corporate Transaction, any Restricted Stock shall vest in its entirety and
thereby be released from restrictions on transfer and the Forfeiture Condition,
immediately prior to the specified effective date of the Corporate Transaction.

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        7.     Legends; Stop Transfer.

               (a)    All certificates for shares of the Stock shall bear
substantially the following legends:

               THE SHARES REPRESENTED BY THIS CERTIFICATE ARE RESTRICTED BY THE
               TERMS OF THAT CERTAIN RESTRICTED STOCK AGREEMENT BETWEEN THE
               COMPANY AND THE NAMED SHAREHOLDER. THE SHARES REPRESENTED BY THIS
               CERTIFICATE MAY BE TRANSFERRED ONLY IN ACCORDANCE WITH SUCH
               AGREEMENT, A COPY OF WHICH IS ON FILE WITH THE SECRETARY OF THE
               COMPANY.

               (b)    The certificates for shares of the Stock shall also bear
any other legends required by applicable state corporate or securities laws. 8.
NO EFFECT ON TERMS OF EMPLOYMENT. THIS AGREEMENT SHALL NOT CONFER UPON RECIPIENT
ANY RIGHT WITH RESPECT TO CONTINUATION OF RECIPIENT'S EMPLOYMENT WITH THE
COMPANY, NOR SHALL IT INTERFERE IN ANY WAY WITH THE RIGHT OF RECIPIENT OR THE
COMPANY TO TERMINATE RECIPIENT'S EMPLOYMENT WITH THE COMPANY AT ANY TIME FOR ANY
REASON WITH OR WITHOUT CAUSE OR CHANGE THE TERMS OF EMPLOYMENT OF RECIPIENT.

        9.     Successors. This Agreement shall be binding upon and shall inure
to the benefit of the parties hereto and their respective heirs, executors,
administrators, successors and assigns.

        10.    Governance of the Plan. The Stock is being issued to Recipient
hereunder pursuant to the terms of the Plan, which shall govern with respect to
Recipient in the event of any conflict with the terms of this Agreement.

        11.    California Law. The interpretation, performance and enforcement
of this Agreement shall be governed by the laws of the State of California.

        IN WITNESS WHEREOF, the parties hereto have duly executed this
Restricted Stock Agreement as of the date first above written.

NOVELLUS SYSTEMS, INC.,                 RECIPIENT:
a California corporation

By: _____________________________       _______________________________________
                                        Richard Hill
Title: __________________________

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                                  ATTACHMENT A

                                CONSENT OF SPOUSE
                                 (IF APPLICABLE)

        I, _____________________, spouse of Richard Hill have read and approved
the foregoing Agreement. In consideration of the right of my spouse to acquire
shares of Novellus Systems, Inc., as set forth in the Agreement, I hereby
appoint my spouse as my attorney-in-fact in respect to the exercise of any
rights under the Agreement insofar as I may have any rights under the community
property laws of the State of California or similar laws relating to marital
property in effect in the state of our residence as of the date of the signing
of the foregoing Agreement.

Dated:  December 16, 1999               _______________________________________

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                      ASSIGNMENT SEPARATE FROM CERTIFICATE

        FOR VALUE RECEIVED and pursuant to that certain Restricted Stock
Agreement between the undersigned ("Recipient") and Novellus Systems, Inc. (the
"Company") dated December 16, 1999 (the "Agreement"), Recipient hereby sells,
assigns and transfers unto the Company _______ thousand (_______) shares of
Common Stock of the Company standing in Recipient's name on the books of the
Company represented by Certificate No. _________ herewith and does hereby
irrevocably constitute and appoint the Secretary of the Company to transfer said
stock on the books of the Company with full power of substitution in the
premises. THIS ASSIGNMENT MAY ONLY BE USED AS AUTHORIZED BY THE AGREEMENT AND
THE EXHIBITS THERETO.

Dated: ____________________, _______

                                        By: ___________________________________

                                            ___________________________________

INSTRUCTION:  Please do not fill in any blanks other than the signature line.
              The purpose of this assignment is to enable the Company to effect
              the forfeiture condition set forth in the Agreement without
              requiring additional signatures on the part of Recipient.<PAGE>   1

                                                                   EXHIBIT 10.24

                                  HARMONIC INC.
                       1999 NONSTATUTORY STOCK OPTION PLAN

        1. Purposes of the Plan. The purposes of this Nonstatutory Stock Option
Plan are:

           - to attract and retain the best available personnel for positions of
substantial responsibility,

           - to provide additional incentive to Employees and Consultants, and

           - to promote the success of the Company's business.

        Options granted under the Plan will be Nonstatutory Stock Options.

        2. Definitions. As used herein, the following definitions shall apply:

               (a) "Administrator" means the Board or any of its Committees as
shall be administering the Plan, in accordance with Section 4 of the Plan.

               (b) "Applicable Laws" means the requirements relating to the
administration of stock option plans under U.S. state corporate laws, U.S.
federal and state securities laws, the Code, any stock exchange or quotation
system on which the Common Stock is listed or quoted and the applicable laws of
any foreign country or jurisdiction where Options are, or will be, granted under
the Plan.

               (c) "Board" means the Board of Directors of the Company.

               (d) "Code" means the Internal Revenue Code of 1986, as amended.

               (e) "Committee" means a committee of Directors appointed by the
Board in accordance with Section 4 of the Plan.

               (f) "Common Stock" means the Common Stock of the Company.

               (g) "Company" means Harmonic Inc., a Delaware corporation.

               (h) "Consultant" means any person, including an advisor, engaged
by the Company or a Parent or Subsidiary to render services to such entity.

               (i) "Director" means a member of the Board.

               (j) "Disability" means total and permanent disability as defined
in Section 22(e)(3) of the Code.

               (k) "Employee" means any person, including Officers, employed by
the Company or any Parent or Subsidiary of the Company. A Service Provider shall
not cease to be an Employee

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in the case of (i) any leave of absence approved by the Company or (ii)
transfers between locations of the Company or between the Company, its Parent,
any Subsidiary, or any successor. Neither service as a Director nor payment of a
director's fee by the Company shall be sufficient to constitute "employment" by
the Company.

               (l) "Exchange Act" means the Securities Exchange Act of 1934, as
amended.

               (m) "Fair Market Value" means, as of any date, the value of
Common Stock determined as follows:

                      (i) If the Common Stock is listed on any established stock
exchange or a national market system, including without limitation the Nasdaq
National Market or The Nasdaq SmallCap Market of The Nasdaq Stock Market, its
Fair Market Value shall be the closing sales price for such stock (or the
closing bid, if no sales were reported) as quoted on such exchange or system for
the last market trading day prior to the time of determination, as reported in
The Wall Street Journal or such other source as the Administrator deems
reliable;

                      (ii) If the Common Stock is regularly quoted by a
recognized securities dealer but selling prices are not reported, the Fair
Market Value of a Share of Common Stock shall be the mean between the high bid
and low asked prices for the Common Stock on the last market trading day prior
to the day of determination, as reported in The Wall Street Journal or such
other source as the Administrator deems reliable;

                      (iii) In the absence of an established market for the
Common Stock, the Fair Market Value shall be determined in good faith by the
Administrator.

               (n) "Notice of Grant" means a written or electronic notice
evidencing certain terms and conditions of an individual Option grant. The
Notice of Grant is part of the Option Agreement.

               (o) "Officer" means a person who is an officer of the Company
within the meaning of Nasdaq guidelines, including all employees with the
corporate rank of vice-president or higher, and employees with lesser rank but
comparable authority.

               (p) "Option" means a nonstatutory stock option granted pursuant
to the Plan, that is not intended to qualify as an incentive stock option within
the meaning of Section 422 of the Code and the regulations promulgated
thereunder.

               (q) "Option Agreement" means an agreement between the Company and
an Optionee evidencing the terms and conditions of an individual Option grant.
The Option Agreement is subject to the terms and conditions of the Plan.

               (r) "Optioned Stock" means the Common Stock subject to an Option.

               (s) "Optionee" means the holder of an outstanding Option granted
under the Plan.

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               (t) "Parent" means a "parent corporation," whether now or
hereafter existing, as defined in Section 424(e) of the Code.

               (u) "Plan" means this 1999 Nonstatutory Stock Option Plan.

               (v) "Service Provider" means an Employee including an Officer or
Consultant.

               (w) "Share" means a share of the Common Stock, as adjusted in
accordance with Section 12 of the Plan.

               (x) "Subsidiary" means a "subsidiary corporation," whether now or
hereafter existing, as defined in Section 424(f) of the Code.

        3. Stock Subject to the Plan. Subject to the provisions of Section 12 of
the Plan, the maximum aggregate number of Shares which may be optioned and sold
under the Plan is 400,000 Shares. The Shares may be authorized, but unissued, or
reacquired Common Stock.

               If an Option expires or becomes unexercisable without having been
exercised in full, or is surrendered pursuant to an Option Exchange Program, the
unpurchased Shares which were subject thereto shall become available for future
grant or sale under the Plan (unless the Plan has terminated).

        4. Administration of the Plan.

               (a) Administration. The Plan shall be administered by (i) the
Board or (ii) a Committee, which committee shall be constituted to satisfy
Applicable Laws.

               (b) Powers of the Administrator. Subject to the provisions of the
Plan, and in the case of a Committee, subject to the specific duties delegated
by the Board to such Committee, the Administrator shall have the authority, in
its discretion:

                      (i) to determine the Fair Market Value of the Common
Stock;

                      (ii) to select the Service Providers to whom Options may
be granted hereunder;

                      (iii) to determine whether and to what extent Options are
granted hereunder;

                      (iv) to determine the number of shares of Common Stock to
be covered by each Option granted hereunder;

                      (v) to approve forms of agreement for use under the Plan;

                      (vi) to determine the terms and conditions, not
inconsistent with the terms of the Plan, of any award granted hereunder. Such
terms and conditions include, but are not limited to, the exercise price, the
time or times when Options may be exercised (which may be based on

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performance criteria), any vesting acceleration or waiver of forfeiture
restrictions, and any restriction or limitation regarding any Option or the
shares of Common Stock relating thereto, based in each case on such factors as
the Administrator, in its sole discretion, shall determine;

                      (vii) to construe and interpret the terms of the Plan and
awards granted pursuant to the Plan;

                      (viii) to prescribe, amend and rescind rules and
regulations relating to the Plan, including rules and regulations relating to
sub-plans established for the purpose of qualifying for preferred tax treatment
under foreign tax laws;

                      (ix) to modify or amend each Option (subject to Section
14(b) of the Plan), including the discretionary authority to extend the
post-termination exercisability period of Options longer than is otherwise
provided for in the Plan;

                      (x) to authorize any person to execute on behalf of the
Company any instrument required to effect the grant of an Option previously
granted by the Administrator;

                      (xi) to determine the terms and restrictions applicable to
Options;

                      (xii) to allow Optionees to satisfy withholding tax
obligations by electing to have the Company withhold from the Shares to be
issued upon exercise of an Option that number of Shares having a Fair Market
Value equal to the amount required to be withheld. The Fair Market Value of the
Shares to be withheld shall be determined on the date that the amount of tax to
be withheld is to be determined. All elections by an Optionee to have Shares
withheld for this purpose shall be made in such form and under such conditions
as the Administrator may deem necessary or advisable; and

                      (xiii) to make all other determinations deemed necessary
or advisable for administering the Plan.

               (c) Effect of Administrator's Decision. The Administrator's
decisions, determinations and interpretations shall be final and binding on all
Optionees and any other holders of Options.

        5. Eligibility. Options may be granted to Service Providers; provided,
however, that notwithstanding anything to the contrary contained in the Plan,
Options may not be granted to Officers and Directors.

        6. Limitation. Neither the Plan nor any Option shall confer upon an
Optionee any right with respect to continuing the Optionee's relationship as a
Service Provider with the Company, nor shall they interfere in any way with the
Optionee's right or the Company's right to terminate such relationship at any
time, with or without cause.

        7. Term of Plan. The Plan shall become effective upon its adoption by
the Board. It shall continue in effect for ten (10) years, unless sooner
terminated under Section 14 of the Plan.

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        8. Term of Option. The term of each Option shall be stated in the Option
Agreement.

        9. Option Exercise Price and Consideration.

               (a) Exercise Price. The per share exercise price for the Shares
to be issued pursuant to exercise of an Option shall be determined by the
Administrator.

               (b) Waiting Period and Exercise Dates. At the time an Option is
granted, the Administrator shall fix the period within which the Option may be
exercised and shall determine any conditions which must be satisfied before the
Option may be exercised.

               (c) Form of Consideration. The Administrator shall determine the
acceptable form of consideration for exercising an Option, including the method
of payment. Such consideration may consist entirely of:

                      (i) cash;

                      (ii) check;

                      (iii) promissory note;

                      (iv) other Shares which (A) in the case of Shares acquired
upon exercise of an option, 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 aggregate exercise price of the Shares as to which said
Option shall be exercised;

                      (v) consideration received by the Company under a cashless
exercise program implemented by the Company in connection with the Plan;

                      (vi) a reduction in the amount of any Company liability to
the Optionee, including any liability attributable to the Optionee's
participation in any Company-sponsored deferred compensation program or
arrangement;

                      (vii) such other consideration and method of payment for
the issuance of Shares to the extent permitted by Applicable Laws; or

                      (viii) any combination of the foregoing methods of
payment.

        10. Exercise of Option.

               (a) Procedure for Exercise; Rights as a Shareholder. Any Option
granted hereunder shall be exercisable according to the terms of the Plan and at
such times and under such conditions as determined by the Administrator and set
forth in the Option Agreement. An Option may not be exercised for a fraction of
a Share.

               An Option shall be deemed exercised when the Company receives:
(i) written or electronic notice of exercise (in accordance with the Option
Agreement) from the person entitled to

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exercise the Option, and (ii) full payment for the Shares with respect to which
the Option is exercised. Full payment may consist of any consideration and
method of payment authorized by the Administrator and permitted by the Option
Agreement and the Plan. Shares issued upon exercise of an Option shall be issued
in the name of the Optionee or, if requested by the Optionee, in the name of the
Optionee and his or her spouse. Until the Shares are issued (as evidenced by the
appropriate entry on the books of the Company or of a duly authorized transfer
agent of the Company), no right to vote or receive dividends or any other rights
as a shareholder shall exist with respect to the Optioned Stock, notwithstanding
the exercise of the Option. The Company shall issue (or cause to be issued) such
Shares promptly after the Option is exercised. No adjustment will be made for a
dividend or other right for which the record date is prior to the date the
Shares are issued, except as provided in Section 12 of the Plan.

               Exercising an Option in any manner shall decrease the number of
Shares thereafter available, both for purposes of the Plan and for sale under
the Option, by the number of Shares as to which the Option is exercised.

               (b) Termination of Relationship as a Service Provider. If an
Optionee ceases to be a Service Provider, other than upon the Optionee's death
or Disability, the Optionee may exercise his or her Option, but only within such
period of time as is specified in the Option Agreement, and only to the extent
that the Option is vested on the date of termination (but in no event later than
the expiration of the term of such Option as set forth in the Option Agreement).
In the absence of a specified time in the Option Agreement, the Option shall
remain exercisable for thirty (30) days following the Optionee's termination.
If, on the date of termination, the Optionee is not vested as to his or her
entire Option, the Shares covered by the unvested portion of the Option shall
revert to the Plan. If, after termination, the Optionee does not exercise his or
her Option within the time specified by the Administrator, the Option shall
terminate, and the Shares covered by such Option shall revert to the Plan.

               (c) Disability of Optionee. If an Optionee ceases to be a Service
Provider as a result of the Optionee's Disability, the Optionee may exercise his
or her Option within such period of time as is specified in the Option
Agreement, to the extent the Option is vested on the date of termination (but in
no event later than the expiration of the term of such Option as set forth in
the Option Agreement). In the absence of a specified time in the Option
Agreement, the Option shall remain exercisable for twelve (12) months following
the Optionee's termination. If, on the date of termination, the Optionee is not
vested as to his or her entire Option, the Shares covered by the unvested
portion of the Option shall revert to the Plan. If, after termination, the
Optionee does not exercise his or her Option within the time specified herein,
the Option shall terminate, and the Shares covered by such Option shall revert
to the Plan.

               (d) Death of Optionee. If an Optionee dies while a Service
Provider, the Option may be exercised within such period of time as is specified
in the Option Agreement (but in no event later than the expiration of the term
of such Option as set forth in the Notice of Grant), by the Optionee's estate or
by a person who acquires the right to exercise the Option by bequest or
inheritance, but only to the extent that the Option is vested on the date of
death. In the absence of a specified time in the Option Agreement, the Option
shall remain exercisable for twelve (12) months following the Optionee's
termination. If, at the time of death, the Optionee is not vested as to his or

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her entire Option, the Shares covered by the unvested portion of the Option
shall immediately revert to the Plan. The Option may be exercised by the
executor or administrator of the Optionee's estate or, if none, by the person(s)
entitled to exercise the Option under the Optionee's will or the laws of descent
or distribution. If the Option is not so exercised within the time specified
herein, the Option shall terminate, and the Shares covered by such Option shall
revert to the Plan.

               (e) Buyout Provisions. The Administrator may at any time offer to
buy out for a payment in cash or Shares, an Option previously granted based on
such terms and conditions as the Administrator shall establish and communicate
to the Optionee at the time that such offer is made.

        11. Non-Transferability of Options. Unless determined otherwise by the
Administrator, an Option may not be sold, pledged, assigned, hypothecated,
transferred, or disposed of in any manner other than by will or by the laws of
descent or distribution and may be exercised, during the lifetime of the
Optionee, only by the Optionee. If the Administrator makes an Option
transferable, such Option shall contain such additional terms and conditions as
the Administrator deems appropriate.

        12. Adjustments Upon Changes in Capitalization, Dissolution, Merger or
Asset Sale.

               (a) Changes in Capitalization. Subject to any required action by
the shareholders of the Company, the number of shares of Common Stock covered by
each outstanding Option, and the number of shares of Common Stock which have
been authorized for issuance under the Plan but as to which no Options have yet
been granted or which have been returned to the Plan upon cancellation or
expiration of an Option, as well as the price per share of Common Stock covered
by each such outstanding Option, shall be proportionately adjusted for any
increase or decrease in the number of issued shares of Common Stock resulting
from a stock split, reverse stock split, stock dividend, combination or
reclassification of the Common Stock, or any other increase or decrease in the
number of issued shares of Common Stock effected without receipt of
consideration by the Company; provided, however, that conversion of any
convertible securities of the Company shall not be deemed to have been "effected
without receipt of consideration." Such adjustment shall be made by the Board,
whose determination in that respect shall be final, binding and conclusive.
Except as expressly provided herein, no issuance by the Company of shares of
stock of any class, or securities convertible into shares of stock of any class,
shall affect, and no adjustment by reason thereof shall be made with respect to,
the number or price of shares of Common Stock subject to an Option.

               (b) Dissolution or Liquidation. In the event of the proposed
dissolution or liquidation of the Company, the Administrator shall notify each
Optionee as soon as practicable prior to the effective date of such proposed
transaction. The Administrator in its discretion may provide for an Optionee to
have the right to exercise his or her Option until ten (10) days prior to such
transaction as to all of the Optioned Stock covered thereby, including Shares as
to which the Option would not otherwise be exercisable. In addition, the
Administrator may provide that any Company repurchase option applicable to any
Shares purchased upon exercise of an Option shall lapse as to all such Shares,
provided the proposed dissolution or liquidation takes place at the time and in
the manner contemplated. To the extent it has not been previously exercised, an
Option will terminate immediately prior to the consummation of such proposed
action.

                                       7
<PAGE>   8

               (c) Merger or Asset Sale. In the event of a merger of the Company
with or into another corporation, or the sale of substantially all of the assets
of the Company, each outstanding Option shall be assumed or an equivalent option
or right substituted by the successor corporation or a Parent or Subsidiary of
the successor corporation. In the event that the successor corporation refuses
to assume or substitute for the Option, the Optionee shall fully vest in and
have the right to exercise the Option as to all of the Optioned Stock, including
Shares as to which it would not otherwise be vested or exercisable. If an Option
becomes fully vested and exercisable in lieu of assumption or substitution in
the event of a merger or sale of assets, the Administrator shall notify the
Optionee in writing or electronically that the Option shall be fully vested and
exercisable for a period of fifteen (15) days from the date of such notice, and
the Option shall terminate upon the expiration of such period. For the purposes
of this paragraph, the Option shall be considered assumed if, following the
merger or sale of assets, the option or right confers the right to purchase or
receive, for each Share of Optioned Stock, immediately prior to the merger or
sale of assets, the consideration (whether stock, cash, or other securities or
property) received in the merger or sale of assets by holders of Common Stock
for each Share held on the effective date of the transaction (and if holders
were offered a choice of consideration, the type of consideration chosen by the
holders of a majority of the outstanding Shares); provided, however, that if
such consideration received in the merger or sale of assets is not solely common
stock of the successor corporation or its Parent, the Administrator may, with
the consent of the successor corporation, provide for the consideration to be
received upon the exercise of the Option, for each Share of Optioned Stock to be
solely common stock of the successor corporation or its Parent equal in fair
market value to the per share consideration received by holders of Common Stock
in the merger or sale of assets.

        13. Date of Grant. The date of grant of an Option shall be, for all
purposes, the date on which the Administrator makes the determination granting
such Option, or such other later date as is determined by the Administrator.
Notice of the determination shall be provided to each Optionee within a
reasonable time after the date of such grant.

        14. Amendment and Termination of the Plan.

               (a) Amendment and Termination. The Board may at any time amend,
alter, suspend or terminate the Plan.

               (b) Effect of Amendment or Termination. No amendment, alteration,
suspension or termination of the Plan shall impair the rights of any Optionee,
unless mutually agreed otherwise between the Optionee and the Administrator,
which agreement must be in writing and signed by the Optionee and the Company.
Termination of the Plan shall not affect the Administrator's ability to exercise
the powers granted to it hereunder with respect to options granted under the
Plan prior to the date of such termination.

        15. Conditions Upon Issuance of Shares.

               (a) Legal Compliance. Shares shall not be issued pursuant to the
exercise of an Option unless the exercise of such Option and the issuance and
delivery of such Shares shall comply with Applicable Laws and shall be further
subject to the approval of counsel for the Company with respect to such
compliance.

                                       8
<PAGE>   9

               (b) Investment Representations. As a condition to the exercise of
an Option the Company may require the person exercising such Option to represent
and warrant at the time of any such exercise that the Shares are being purchased
only for investment and without any present intention to sell or distribute such
Shares if, in the opinion of counsel for the Company, such a representation is
required.

        16. Inability to Obtain Authority. The inability of the Company to
obtain authority from any regulatory body having jurisdiction, which authority
is deemed by the Company's counsel to be necessary to the lawful issuance and
sale of any Shares hereunder, shall relieve the Company of any liability in
respect of the failure to issue or sell such Shares as to which such requisite
authority shall not have been obtained.

        17. Reservation of Shares. The Company, during the term of this Plan,
will at all times reserve and keep available such number of Shares as shall be
sufficient to satisfy the requirements of the Plan.

                                       9
<PAGE>   10

                                  HARMONIC INC.
                       1999 NONSTATUTORY STOCK OPTION PLAN

                             STOCK OPTION AGREEMENT

        Unless otherwise defined herein, the terms defined in the Plan shall
have the same defined meanings in this Option Agreement.

I.      NOTICE OF STOCK OPTION GRANT

        [OPTIONEE'S NAME AND ADDRESS]

        You have been granted an option to purchase Common Stock of the Company,
subject to the terms and conditions of the Plan and this Option Agreement, as
follows:

        Grant Number                        ____________________________

        Date of Grant                       ____________________________

        Vesting Commencement Date           ____________________________

        Exercise Price per Share           $____________________________

        Total Number of Shares Granted      ____________________________

        Total Exercise Price               $____________________________

        Type of Option:                     Nonstatutory Stock Option

        Term/Expiration Date:               ____________________________

        Vesting Schedule:

        Subject to the Optionee continuing to be a Service Provider on such
dates, this Option shall vest and become exercisable in accordance with the
following schedule:

        25% of the Shares subject to the Option shall vest twelve months after
the Vesting Commencement Date, and 1/48 of the Shares subject to the Option
shall vest each month thereafter.

        Termination Period:

        This Option may be exercised for thirty (30) days after Optionee ceases
to be a Service Provider. Upon the death or Disability of the Optionee, this
Option may be exercised for such longer period as provided in the Plan. In no
event shall this Option be exercised later than the Term/Expiration Date as
provided above.

<PAGE>   11

II.     AGREEMENT

        1. Grant of Option. The Plan Administrator of the Company hereby grants
to the Optionee named in the Notice of Grant attached as Part I of this
Agreement (the "Optionee") an option (the "Option") to purchase the number of
Shares, as set forth in the Notice of Grant, at the exercise price per share set
forth in the Notice of Grant (the "Exercise Price"), subject to the terms and
conditions of the Plan, which is incorporated herein by reference. Subject to
Section 14(b) of the Plan, in the event of a conflict between the terms and
conditions of the Plan and the terms and conditions of this Option Agreement,
the terms and conditions of the Plan shall prevail.

        2. Exercise of Option.

               (a) Right to Exercise. This Option is exercisable during its term
in accordance with the Vesting Schedule set out in the Notice of Grant and the
applicable provisions of the Plan and this Option Agreement.

               (b) Method of Exercise. This Option is exercisable by delivery of
an exercise notice, in the form attached as Exhibit A (the "Exercise Notice"),
which shall state the election to exercise the Option, the number of Shares in
respect of which the Option is being exercised (the "Exercised Shares"), and
such other representations and agreements as may be required by the Company
pursuant to the provisions of the Plan. The Exercise Notice shall be completed
by the Optionee and delivered to Stock Option Administrator. The Exercise Notice
shall be accompanied by payment of the aggregate Exercise Price as to all
Exercised Shares. This Option shall be deemed to be exercised upon receipt by
the Company of such fully executed Exercise Notice accompanied by such aggregate
Exercise Price.

               No Shares shall be issued pursuant to the exercise of this Option
unless such issuance and exercise complies with Applicable Laws. Assuming such
compliance, for income tax purposes the Exercised Shares shall be considered
transferred to the Optionee on the date the Option is exercised with respect to
such Exercised Shares.

        3. Method of Payment. Payment of the aggregate Exercise Price shall be
by any of the following, or a combination thereof, at the election of the
Optionee:

               (a) cash;

               (b) check;

               (c) consideration received by the Company under a cashless
exercise program implemented by the Company in connection with the Plan; or

               (d) surrender of other Shares which (i) in the case of Shares
acquired upon exercise of an option, have been owned by the Optionee for more
than six (6) months on the date of surrender, AND (ii) have a Fair Market Value
on the date of surrender equal to the aggregate Exercise Price of the Exercised
Shares.

                                       2
<PAGE>   12

        4. Non-Transferability of Option. This Option may not be transferred in
any manner otherwise than by will or by the laws of descent or distribution and
may be exercised during the lifetime of Optionee only by the Optionee. The terms
of the Plan and this Option Agreement shall be binding upon the executors,
administrators, heirs, successors and assigns of the Optionee.

        5. Term of Option. This Option may be exercised only within the term set
out in the Notice of Grant, and may be exercised during such term only in
accordance with the Plan and the terms of this Option Agreement.

        6. Tax Consequences. Some of the federal tax consequences relating to
this Option, as of the date of this Option, are set forth below. THIS SUMMARY IS
NECESSARILY INCOMPLETE, AND THE TAX LAWS AND REGULATIONS ARE SUBJECT TO CHANGE.
THE OPTIONEE SHOULD CONSULT A TAX ADVISER BEFORE EXERCISING THIS OPTION OR
DISPOSING OF THE SHARES.

               (a) Exercising the Option. The Optionee may incur regular federal
income tax liability upon exercise of an NSO. The Optionee will be treated as
having received compensation income (taxable at ordinary income tax rates) equal
to the excess, if any, of the Fair Market Value of the Exercised Shares on the
date of exercise over their aggregate Exercise Price. If the Optionee is an
Employee or a former Employee, the Company will be required to withhold from his
or her compensation or collect from Optionee and pay to the applicable taxing
authorities an amount in cash equal to a percentage of this compensation income
at the time of exercise, and may refuse to honor the exercise and refuse to
deliver Shares if such withholding amounts are not delivered at the time of
exercise.

               (b) Disposition of Shares. If the Optionee holds NSO Shares for
at least one year, any gain realized on disposition of the Shares will be
treated as long-term capital gain for federal income tax purposes.

        7. Entire Agreement; Governing Law. The Plan is incorporated herein by
reference. The Plan and this Option Agreement constitute the entire agreement of
the parties with respect to the subject matter hereof and supersede in their
entirety all prior undertakings and agreements of the Company and Optionee with
respect to the subject matter hereof, and may not be modified adversely to the
Optionee's interest except by means of a writing signed by the Company and
Optionee. This agreement is governed by the internal substantive laws, but not
the choice of law rules, of California.

        8. No guarantee of continued service. Optionee acknowledges and agrees
that the vesting of shares pursuant to the vesting schedule hereof is earned
only by continuing as a service provider at the will of the company (and not
through the act of being hired, being granted an option or purchasing shares
hereunder). Optionee 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 continued engagement as a
service provider for the vesting period, for any period, or at all, and shall
not interfere with optionee's right or the company's right to terminate
optionee's relationship as a service provider at any time, with or without
cause.

                                       3
<PAGE>   13

        By your signature and the signature of the Company's representative
below, you and the Company agree that this Option is granted under and governed
by the terms and conditions of the Plan and this Option Agreement. Optionee has
reviewed the Plan and this Option Agreement in their entirety, has had an
opportunity to obtain the advice of counsel prior to executing this Option
Agreement and fully understands all provisions of the Plan and Option Agreement.
Optionee hereby agrees to accept as binding, conclusive and final all decisions
or interpretations of the Administrator upon any questions relating to the Plan
and Option Agreement. Optionee further agrees to notify the Company upon any
change in the residence address indicated below.

OPTIONEE                                     HARMONIC INC.

------------------------------------         -----------------------------------
Signature                                    By

------------------------------------         -----------------------------------
Print Name                                   Title

------------------------------------
Residence Address

------------------------------------

                                       4
<PAGE>   14

                                    EXHIBIT A

                                  HARMONIC INC.

                       1999 NONSTATUTORY STOCK OPTION PLAN

                                 EXERCISE NOTICE

Harmonic Inc.
549 Baltic Way
Sunnyvale, CA  94089-1140

Attention:  Stock Option Administrator

        1. Exercise of Option. Effective as of today, ________________, _____,
the undersigned ("Purchaser") hereby elects to purchase ______________ shares
(the "Shares") of the Common Stock of Harmonic Inc. (the "Company") under and
pursuant to the 1999 Nonstatutory Stock Option Plan (the "Plan") and the Stock
Option Agreement dated _____________ (the "Option Agreement"). The purchase
price for the Shares shall be $____________ , as required by the Option
Agreement.

        2. Delivery of Payment. Purchaser herewith delivers to the Company the
full purchase price for the Shares.

        3. Representations of Purchaser. Purchaser acknowledges that Purchaser
has received, read and understood the Plan and the Option Agreement and agrees
to abide by and be bound by their terms and conditions.

        4. Rights as Shareholder. Until the issuance (as evidenced by the
appropriate entry on the books of the Company or of a duly authorized transfer
agent of the Company) of the Shares, no right to vote or receive dividends or
any other rights as a shareholder shall exist with respect to the Optioned
Stock, notwithstanding the exercise of the Option. The Shares so acquired shall
be issued to the Optionee as soon as practicable after exercise of the Option.
No adjustment will be made for a dividend or other right for which the record
date is prior to the date of issuance, except as provided in Section 12 of the
Plan.

        5. Tax Consultation. Purchaser understands that Purchaser may suffer
adverse tax consequences as a result of Purchaser's purchase or disposition of
the Shares. Purchaser represents that Purchaser has consulted with any tax
consultants Purchaser deems advisable in connection with the purchase or
disposition of the Shares and that Purchaser is not relying on the Company for
any tax advice.

<PAGE>   15

        6. Entire Agreement; Governing Law. The Plan and Option Agreement are
incorporated herein by reference. This Agreement, the Plan and the Option
Agreement constitute the entire agreement of the parties with respect to the
subject matter hereof and supersede in their entirety all prior undertakings and
agreements of the Company and Purchaser with respect to the subject matter
hereof, and may not be modified adversely to the Purchaser's interest except by
means of a writing signed by the Company and Purchaser. This agreement is
governed by the internal substantive laws, but not the choice of law rules, of
Delaware.

Submitted by:                              Accepted by:

PURCHASER                                  HARMONIC INC.

------------------------------------       -------------------------------------
Signature                                  By

------------------------------------       -------------------------------------
Print Name                                 Title

Address:
        ----------------------------

        ----------------------------

        ----------------------------

                                       2

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