Document:

C AND E HOLDINGS Inc
                            2816 East Windrose Drive
                             Phoenix, Arizona 85032

March 15, 2000

Carl P. Ranno Esq.
2816 East Windrose Drive
Phoenix, Arizona 85032

     Re: Lock-Up Agreement with C and E Holdings, Inc.

Gentlemen,

     In  consideration  of the sale to the  holder  by C and E  Holdings,  Inc.,
(Company)  of its  Common  Stock  ($.001  par  value),  the  undersigned  holder
warrants, covenants and agrees for the benefit of the Company not to sell, offer
to sell, solicit an offer to buy, contract to sell, make any short sale, pledge,
grant,  grant any option to purchase,  or otherwise  transfer or dispose of, any
shares of Common stock,  or any  securities  convertible  into or exercisable or
exchangeable for Common Stock, owned directly or beneficially by the undersigned
or with respect to which the undersigned has the power of disposition, except in
connection  with or following a completed  merger or  acquisition by the Company
and the Company is no longer  classified  as a blank check  company  pursuant to
Section 7 (b) (3) of the Securities Act of 1933, as amended.

     An attempt to sell, transfer or any type of disposition of the shares shall
be a violation of this letter  agreement and shall be  ineffective  and null and
void.

     In  furtherance  of the  foregoing,  the holder agrees to; (1) delivery his
shares to the  Company  for safe  keeping;  (2) allow the  Company to advise its
Transfer Agent not to transfer said  securities and (3) authorize the company to
deliver a copy of this  Agreement to the  transfer  agent with  instructions  to
decline to make any transfer of securities if such transfer  would  constitute a
violation or breach of this Agreement.

     This  Agreement  shall be  binding  upon the  holder,  its  agents,  heirs,
successors, assignees and beneficiaries.
<PAGE>
     A waiver of the terms and  conditions of this  agreement must be in writing
and executed by the proper officer of the Company and the holder.

     If there is a breach or  threatened  breach of this  Agreement,  the holder
agrees  that  there is no  adequate  remedy at law and said  breach  will  cause
irreparable damage. Accordingly,  the holder agrees that the Company is entitled
to the issuance of an immediate injunction without notice to restrain the breach
or  threatened  breach.  This remedy is not exclusive and the holder agrees that
the  Company  and third  party  beneficiaries  shall be  entitled  to seek other
remedies including a claim for other remedies, including money damages.

THE HOLDER

/s/ Carl P. Ranno
---------------------------
    Carl P. Ranno                   Constituting 1,000,000 shares certificate(s)

                                        2<PAGE>   1

                                                                    EXHIBIT 10.1

                                 LUMINENT, INC.
                             2000 STOCK OPTION PLAN
                          ADOPTED AS OF JULY 15, 2000

        1. Purpose.

                (a) This Plan document is intended to implement and govern two
separate Stock Option Plans of Luminent, Inc., a Delaware corporation
("Company"), and its Parent or Subsidiary Corporation(s), if any:

                        (i)  the Luminent, Inc. 2000 Incentive Stock Option Plan
("Plan A"); and

                        (ii) the Luminent, Inc., 2000 Nonstatutory Stock Option
Plan ("Plan B").

Plan A provides for the granting of options that are intended to qualify as
incentive stock options ("Incentive Stock Options") within the meaning of
Section 422 of the Internal Revenue Code of 1986, as amended (the "Code"). Plan
B provides for the granting of options that are not intended to so qualify.
Unless specified otherwise, all provisions of this Plan relate equally to both
Plan A and Plan B (collectively, the "Plans"), which Plans are condensed into
one plan document solely for purposes of administrative convenience and are not
intended to constitute tandem plans.

                (b) The purpose of these Plans is to retain the best available
persons for positions of substantial responsibility and to provide additional
incentives for the accomplishment of key Company objectives. The Plans are
intended to accomplish this purpose by allowing the Company to grant options
("Options") to purchase shares of the Company's voting Common Stock, $0.001 par
value per share ("Common Stock"). (For purposes of these Plans, "Parent
Corporation" and "Subsidiary Corporation" shall mean corporations as defined in
Code Sections 425(e) and 425(f), respectively. Additionally, "Company" shall
include any Parent Corporation or Subsidiary Corporation that may exist).

        2. Administration. Subject to Section 10, the Plans shall be
administered as follows:

                (a) The Plans shall be administered by the Company's Board of
Directors (the "Board") or a committee ("Committee") appointed by the Board,
which Committee shall be constituted to comply with applicable laws. If the
Committee is administering the Plans, then the functions of the Board specified
herein shall be administered by the Committee as authorized by the Board and to
the extent permitted pursuant to applicable law.

                (b) The Board shall have sole authority in its absolute
discretion (i) to determine which employees, consultants and non-employee
directors of the Company shall receive Options ("Optionees"), and (ii) subject
to the express provisions of these Plans, to determine the time when Options
shall be granted, the terms and conditions of Options other than

<PAGE>   2

those terms and conditions fixed under these Plans, and the number of shares
which may be issued upon exercise of the Options. The Board shall adopt by
resolution such rules and regulations as may be required to carry out the
purposes of the Plans and shall have authority to do everything necessary or
appropriate to administer the Plans. All decisions, determinations and
interpretations of the Board shall be final and binding on all Optionees.
Administration of the Plans with respect to members of the Committee shall not
be delegated, but shall at all times remain vested in the Board. The Board may
from time to time remove members from, or add members to, the Committee, and
vacancies on the Committee shall be filled by the Board. Furthermore, the Board
at any time by resolution may abolish the Committee and revest in the Board the
administration of the Plans.

                (c) With respect to Options granted to a member of the Board,
the Board shall take action by a vote sufficient without counting the vote of
such member of the Board, although such member of the Board may be counted in
determining the presence of a quorum at a meeting of the Board which authorizes
the granting of Options to such member of the Board.

                (d) The Committee, if appointed pursuant to this Section 2,
shall report to the Board the name of the person granted Options, the number of
shares covered by each Option, and the terms and conditions of each such Option.

        3. Eligibility.

                (a) Persons who shall be eligible to receive Options under these
Plans shall be as follows:

                        (i) in the case of Plan A, employees of the Company who
render those types of services which tend to contribute materially to the
success of the Company; and

                        (ii) in the case of Plan B, employees described in
subsection 3(a)(i) above, consultants and advisors, and any non-employee
directors of the Company who render those types of services which tend to
contribute materially to the success of the Company.

                (b) Consultants and advisors who receive options under Plan B
must be natural persons who provide bona fide services to the Company that are
not connected to the offer or sale of securities in a capital-raising
transaction, and do not directly or indirectly provide or maintain a market for
the Company's securities.

                (c) The determination as to whether an employee, consultant or
non-employee director is eligible to receive Options hereunder shall be made by
the Board in its sole discretion, and the decision of the Board shall be binding
and final. Options may be granted to one or more such persons without being
granted to other eligible persons, as the Board may deem fit.

        4. Number of Shares. The maximum aggregate number of shares which may be
optioned and sold under these Plans is 10,400,000 shares of authorized

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<PAGE>   3

but unissued Common Stock of the Company. Shares of Common Stock that (a) are
repurchased by the Company after the issuance hereunder pursuant to the exercise
of an Option, or (b) are not purchased by the Optionee prior to the expiration
or termination of the applicable Option, shall again become available to be
covered by Options to be issued hereunder and shall not, as of the effective
date of such repurchase or expiration, be counted as covered by an outstanding
Option for purposes of the above-described maximum number of shares which may be
optioned hereunder.

        5. Option Price.

                (a) The Option Price for shares of Common Stock to be issued
under Plan A shall be equal to or greater than the fair market value of such
shares on the date on which the Option covering such shares is granted as
determined by the Board of Directors in its sole discretion, exercised in good
faith. The Option Price for shares of Common Stock to be issued under Plan B
shall be equal to or greater than 85% of the fair market value of such shares on
the date on which the Option covering such shares is granted as determined by
the Board of Directors in its sole discretion, exercised in good faith. If on
the date on which such Option is granted the Optionee is a Restricted
Stockholder, then such Option Price shall be equal to or greater than one
hundred ten percent (110%) of the fair market value of the shares on the date
such Option is granted. For the purposes of the Plans, a "Restricted
Stockholder" is an individual who, at the time an Option is granted under the
Plans, owns stock possessing more than ten percent (10%) of the total combined
voting power of all classes of stock of the Company, with stock ownership to be
determined in light of the attribution rules set forth in Section 424(d) of the
Code. The fair market value of shares of Common Stock for all purposes of the
Plans is to be determined by the Board in its sole discretion, exercised in good
faith.

                (b) Notwithstanding the foregoing, the Option Price for a
nonstatutory option granted to an Optionee, other than a Restricted Stockholder,
shall be equal to or greater than 85% of the fair market value of such shares on
the date on which the Option covering such shares is granted.

        6. Term of the Plans. The Plans shall be effective on July 15, 2000, and
continue in effect until July 15, 2010, unless terminated earlier by action
of the Board; no option may be granted hereunder after July 15, 2010.

        7. Exercise of Options. Subject to the limitations set forth herein
and/or in any applicable Stock Option Agreement entered into hereunder, Options
granted under these Plans shall be exercisable in accordance with the following
rules:

                (a) General. Subject to the other provisions of this Section 7,
Options shall vest and become exercisable at such times and in such installments
as the Board shall provide in each individual Stock Option Agreement; provided,
however, that, except in the case of Options granted to officers, directors or
consultants, Options must vest at a rate of at least 20% per year for over a
five-year period from the date the Option is granted; and provided, further,
that by a

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<PAGE>   4

resolution adopted after an Option is granted the Board may, on such terms and
conditions as it may determine to be appropriate and subject to the specific
provisions of this Section 7, accelerate the time at which such Option or
installment thereof may be exercised. For purposes of these Plans, any vested
installment of an Option granted hereunder shall be referred to as an "Accrued
Installment."

                (b) Exercise of Options. An Option may be exercised in
accordance with this Section 7 as to all or any portion of the shares covered by
an Accrued Installment of the Option from time to time during the applicable
option period, except that an Option shall not be exercisable with respect to
fractions of a share.

                (c) Payment. The Option Price shall be paid at the time the
Option is exercised; in cash or its cash equivalent, as determined by the Board.
The Board may, in its sole discretion, accept payment on behalf of the Company
(i) in the form of shares of Common Stock, which 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 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, subject to all restrictions and limitations of
applicable law, (ii) by cancellation of any indebtedness owed by the Company to
the optionee, (iii) by a full recourse promissory note executed by the optionee
(the terms of any promissory note may be changed by the Committee from time to
time to comply with all applicable laws, regulations and rules of the Board of
Governors of the Federal Reserve System, Internal Revenue Service or Securities
and Exchange Commission regulations and any other governmental agency having
jurisdiction), (iv) by requesting that the Company withhold whole shares of
Common Stock then issuable upon exercise of the Stock Option (based on the fair
market value of the Common Stock on the date of exercise), (v) by arrangement
with a broker which is acceptable to the Board where payment of the exercise
price is made pursuant to an irrevocable direction to the broker to deliver all
or part of the proceeds from the sale of the shares underlying the Option to the
Company, or (vi) by any combination of the foregoing. In the case of an
Incentive Stock Option, the right to make payment in the form of already owned
shares may be authorized only at the time of grant. Any payment in the form of
stock already owned by the optionee may be effected by use of an attestation
form approved by the Board; and such stock may be returned to the Company. If
returned, such shares shall again be available for issuance in connection with
future stock options and awards under the Plans. An Optionee's right to use
shares of Common Stock to exercise an Option is expressly conditioned upon his
or her making representations and warranties satisfactory to the Company
regarding his or her title to the shares used to exercise such Option and that
he or she has full power to deliver such shares without obtaining the consent or
approval of any person or governmental authority other than those which have
already given consent or approval in a form satisfactory to the Company. The
equivalent dollar value of the shares used to effect the purchase shall be the
fair market value of the shares as determined by the Board.

                (d) The aggregate fair market value (determined as of the date
of the grant of the Option) of the shares of Common Stock to which Options
granted under Plan A are exercisable for the first time by any employee of the
Company during any calendar year under all incentive

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<PAGE>   5

stock option plans of the Company shall not exceed $100,000. The limitation
imposed by this Section 7(d) shall not apply with respect to Options granted
under Plan B.

                (e) The Board may require the voluntary surrender of all or a
portion of any Option granted under the Plans as a condition precedent to a
grant of a new Option. Subject to the provisions of the Plans, such new Option
shall be exercisable at the price, during such period and on such other terms
and conditions as are specified by the Board at the time the new Option is
granted; provided, however, that should the Board so require, the number of
shares subject to such new Option shall not be greater than the number of shares
subject to the surrendered Option. Upon their surrender, the Options shall be
canceled and the shares previously subject to such canceled Options shall again
be available for grants of Options hereunder.

        8. Termination of Options. Subject to the provisions of this Section 8,
all installments of an Option shall expire and terminate on such date(s) as the
Board shall determine at the time of a grant ("Option Termination Date"), but in
no event later than ten (10) years from the date such Option was granted. Unless
provided otherwise in this Section 8 or in the Stock Option Agreement pursuant
to which an Option is granted, an Option may be exercised when Accrued
Installments accrue as provided in such Stock Option Agreement and at any time
thereafter until, and including, the day before the Option Termination Date. In
no event shall any Option be exercised on or after the expiration of said
maximum applicable period, regardless of the circumstances then existing
(including but not limited to the death or termination of employment of the
Optionee).

                (a) Restricted Stockholders. An Option granted under Plan A to a
Restricted Stockholder shall by its terms not be exercisable after the
expiration of five (5) years from the date such Option was granted.

                (b) Sale or Reorganization of Company. Upon the consummation of
a transaction: (i) that by its terms offers to all or substantially all of the
stockholders of the Company an opportunity to receive cash or securities
(whether debt, equity or other and whether issued by the Company or a third
party) in exchange for all or a portion of their shares of common stock of the
Company, however, a sale of the Company shall not be considered to have occurred
as a result of the pro rata distribution by MRV Communications, Inc., to its
stockholders of capital stock of the Company; (ii) in which the stockholders of
the Company approve a plan of complete dissolution or liquidation of the
Company; or (iii) that involves the sale of all or substantially all of the
Company's property or a sale of more than eighty percent (80%) of the then
outstanding stock of the Company to another corporation (each transaction a
"Sale"), the Board may, without limitation and in its sole and absolute
discretion, do any, or any combination, of the following:

                        a. declare that the time period relating to the exercise
of any Stock Option shall accelerate and become exercisable;

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<PAGE>   6

                        b. declare that any indebtedness incurred pursuant to
Section 7(c) above shall be forgiven and the collateral pledged in connection
with any such loan shall be released in full or in part;

                        c. declare that the value of all or some of the
outstanding Options shall, to the extent determined by the Board at or after
grant, be cashed out by a payment of cash or other property, as the Board may
determine, on the basis of the "Sale Price" (as defined in below) as of the date
the Sale occurs or such other date as the Board may determine prior to the Sale;

                        d. permit a successor corporation, if applicable,
pursuant to a written agreement signed by the parties, to substitute equivalent
Options or provide substantially similar consideration to Optionees as was or
will be provided to stockholders of the Company after making any appropriate
adjustment as such parties deem necessary or appropriate for restrictions
attaching to such Options, including, but not limited to, vesting and exercise
price; provided, however, that the terms and conditions of the substitute
Options shall comply with the provisions of Section 425 of the Code, such that
the excess of the aggregate fair market value of the shares subject to such
substitute Option immediately after the substitution or assumption over the
aggregate option price of such shares is not more than the excess of the
aggregate fair market value of all shares subject to the substitute Option or
the assumption of the old option does not give the holder thereof additional
benefits which he or she did not have under such old option; or

                        e. declare that any unexercised Options issued hereunder
(or any unexercised portion thereof) shall terminate and cease to be effective.

                For purposes of this Section 8(b), "Sale Price" means the higher
of (i) the highest price per share paid in any transaction related to a Sale of
the Company or (ii) the highest price per share paid in any transaction reported
on the exchange or national market system on which the Common Stock is listed,
at any time during the preceding sixty (60) day period as determined by the
Board, except that, in the case of Incentive Stock Options, such price shall be
based only on transactions reported for the date on which the Board decides to
cash out such Options.

                An Optionee's individual Stock Option Agreement may, but is not
required to, provide what occurs upon a Sale. To the extent an Optionee's
individual Stock Option Agreement determines what occurs upon a Sale, the terms
of such Stock Option Agreement shall be dispositive in the event of a Sale;
provided that if the terms of such Optionee's individual Stock Option Agreement,
together with the terms of any other Stock Option Agreement granted hereunder,
pertaining to what occurs upon a Sale would materially impair an acquiror's
ability to use the "pooling of interests" accounting method to account for the
acquisition, as described in the immediately preceding paragraph, then the Board
shall have, in its sole and absolute discretion, the right to modify (to the
least extent possible and still permit the acquiror to use "pooling of
interests") the terms of the Stock Option Agreement, solely with respect to
those terms pertaining to what occurs upon a Sale.

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<PAGE>   7

                Notwithstanding the foregoing, in the event that any such
agreement shall be terminated without consummating the disposition of said stock
or assets:

                (i) any unexercised non-vested installments that had become
exercisable solely by reason of the provision of Section 8(b) shall again become
non-vested and unexercisable as of said termination of such agreement, and

                (ii) the exercise of any option that had become exercisable
solely by reason of this Section 8(b) shall be deemed ineffective and such
installments shall again become non-vested and unexercisable as of said
agreement of such agreement.

                (c) Termination of Employment Other Than By Death or Disability.
If the employment of an Optionee with the Company is terminated for any reason
other than death or permanent and total disability, any installments under the
Option which have not accrued as of the employment termination date shall expire
and become unexercisable as of the employment termination date. All Accrued
Installments as of the employment termination date shall remain exercisable for
a period not to exceed the earlier of (i) three (3) months following the
employment termination date or (ii) the Option Termination Date, determined
without regard to this Section 8(c).

                (d) Death or Disability of Optionee While Employed. If the
employment of an Optionee with the Company is terminated by reason of death or
permanent and total disability, any unexercised, to the extent then exercisable,
Accrued Installments of Options granted hereunder to such Optionee shall expire
and become unexercisable as of the earlier of the applicable Option Termination
Date, or within six months after the date of termination of employment of such
Optionee by reason of his death or permanent and total disability. Any such
Accrued Installments of a deceased Optionee may be exercised prior to their
expiration only by the person or persons to whom the Optionee's Option rights
pass by will or by laws of descent and distribution. Any installments under such
a deceased or disabled Optionee's Option that have not accrued as of the date of
his termination of employment due to death or permanent and total disability
shall expire and become unexercisable as of said termination date. For purposes
of these Plans, the term "permanent and total disability" shall be defined under
Code Section 22(e)(3).

                (e) Extensions. Notwithstanding the provisions covering the
exercisability of Options following termination of employment, as described in
Sections 8(c) and (d), respectively, the Board may, in its sole discretion, with
the consent of the Optionee or the Optionee's estate (in the case of the death
of Optionee), extend the period of time during which Accrued Installments shall
remain exercisable, provided that in no event shall such extension go beyond the
Option Termination Date. In the case of Incentive Stock Options, extensions
under this Section 8(e) may result in loss of the favorable treatment accorded
incentive stock options under the Code.

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<PAGE>   8

        9. Authorization to Issue Options and Stockholder Approval. Options
granted under the Plans, and the exercise of such options, shall be conditioned
upon the Company having obtained all required regulatory approvals, free of any
conditions not acceptable to the Board, authorizing the Company to issue such
Options or shares. The grant of Options under the Plans also is conditioned on
approval of the Plans by the stockholders of the Company within twelve (12)
months after the date hereof.

        10. Stock Option Agreement. The terms and conditions of Options granted
under the Plans shall be evidenced by a Stock Option Agreement executed by the
Company and the person to whom the Option is granted. Each Stock Option
Agreement shall incorporate these Plans by reference and shall include such
provisions as are determined to be necessary or appropriate by the Board.

        11. Stock Restriction Agreement. As a condition to the granting of any
Option hereunder and the subsequent exercise of any such Option, the Board may
require the Optionee to enter into a Stock Restriction Agreement with the
Company for the purpose of limiting the sale or other transfer of ownership of
Common Stock acquired by the Optionee.

        12. Amendment or Termination of the Plans.

                (a) The Board may amend, suspend and/or terminate the Plans at
any time, provided, however, that except as provided in Section 17 below, the
Board shall not amend the Plans in the following respects without stockholder
approval:

                        (i) To increase the maximum number of shares subject to
the Plans;

                        (ii) To change the designation or class of persons
eligible to receive Options under the Plans; or

                        (iii) To extend the term of the Plans or the maximum
Option exercise period.

                (b) Furthermore, the Plans may not, without the approval of the
stockholders, be amended in any manner that would cause Incentive Stock Options
issued hereunder to fail to qualify as Incentive Stock Options as defined in
Code Section 422. Notwithstanding the foregoing, no amendment, suspension or
termination of the Plans shall adversely affect Options granted on or prior to
the date thereof, as evidenced by the execution of a Stock Option Agreement by
both the Company and the Optionee, without the consent of such Optionee.

        13. Options Not Transferable. Options granted under these Plans may not
be sold, pledged, hypothecated, assigned, encumbered, gifted or otherwise
transferred or alienated in any manner, either voluntarily or involuntarily by
operation of law, other than by will or the laws of descent or distribution, and
may be exercised during the lifetime of an Optionee only by such Optionee.

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<PAGE>   9

        14. Restrictions on Issuance of Shares. The Company, during the term of
these Plans, will use its best efforts to seek to obtain from the appropriate
regulatory agencies any requisite authorization in order to issue and sell such
number of shares of its Common Stock as shall be sufficient to satisfy the
requirements of the Plans. The inability of the Company to obtain from any such
regulatory agency having jurisdiction thereof the authorization deemed by the
Company's counsel to be necessary to the lawful issuance and sale of any shares
of its stock hereunder shall relieve the Company of any liability in respect of
the nonissuance or sale of such stock as to which such requisite authorization
shall not have been obtained.

        15. Adjustments Upon Changes in Capitalization. If the outstanding
shares of Common Stock of the Company are increased, decreased, changed into or
exchanged for a different number or kind of shares of the Company through
reorganization, recapitalization, reclassification, stock dividend, stock split
or reverse stock split, upon proper authorization of the Board an appropriate
and proportionate adjustment shall be made in the number or kind of shares, and
the per-share option price thereof, which may be issued in the aggregate and to
individual Optionees under these Plans upon exercise of Options granted under
the Plans; provided, however, that no such adjustment need be made if, upon the
advice of counsel, the Board determines that such adjustment may result in the
receipt of federally taxable income to holders of Options granted hereunder or
the holders of Common Stock or other classes of the Company's securities. If any
Option granted under the Plans shall terminate for any reason or expire before
such Option is exercised in full, the securities which might otherwise have been
issued upon exercise of such Option shall again become available for purposes of
these Plans.

        16. Representations and Warranties. As a condition to the granting and
the exercise of any portion of an Option, the Company may require the person
receiving or exercising such Option to make any representation and/or warranty
to the Company as may, in the judgment of counsel to the Company, be required
under any applicable law or regulation, or any ruling of any governmental agency
with respect to the Company, including but not limited to a representation and
warranty that the Option and/or shares are being acquired 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 under the
Securities Act of 1933, as amended ("1933 Act"), or any other applicable law,
regulation or rule of any governmental agency.

        17. No Enlargement of Employee Rights. These Plans are purely voluntary
on the part of the Company, and while the Company hopes to continue them
indefinitely, the continuance of the Plans shall not be deemed to constitute a
contract between the Company and any employee, or to be consideration for or a
condition of the employment of any employee. Nothing contained in the Plans
shall be deemed to give any employee the right to be retained in the employ of
the Company or to interfere with the right of the Company to discharge or retire
any employee thereof at any time. No employee shall have any right to or
interest in Options authorized hereunder prior to the grant of such an Option to
such employee, and upon such grant he or she shall have only such rights and
interests as are expressly provided herein, subject,

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<PAGE>   10

however, to all applicable provisions of the Company's Articles of
Incorporation, as the same may be amended from time to time.

        18. Legends: Options and Stock Certificates. Unless an appropriate
registration statement is filed pursuant to the 1933 Act with respect to the
shares of Common Stock issuable under these Plans, each certificate representing
such Common Stock shall be endorsed with the following legend or its equivalent:

            "Neither the Option pursuant to which the shares represented by this
            certificate are issued nor said shares have been registered under
            the Federal Securities Act of 1933, as amended ("Act"). Transfer or
            sale of such securities or any interest therein is unlawful except
            after registration, or pursuant to an exemption from the
            registration requirements, as provided in the Act and the
            regulations thereunder."

            In addition to the foregoing legend, each Stock Option Agreement
and each certificate representing shares of Common Stock acquired upon exercise
of an Option shall be endorsed with all legends, if any, required by applicable
state securities laws to be placed on the Stock Option Agreement and/or the
certificate.

        19. Financial Information. The Company shall deliver annually financial
statements to each employee granted an Option hereunder until such Option
expires or is otherwise canceled.

        20. Withholding of Taxes. The grant of Options hereunder and the
issuance of Common Stock pursuant to the exercise of such Options is conditioned
upon the Company's reservation of the right to withhold, in accordance with any
applicable law, from any compensation payable to the Optionee any taxes required
to be withheld by federal, state or local law as a result of the grant of
exercise of any such Option.

        21. Applicable Law. These Plans shall be governed by and construed in
accordance with the laws of the State of California.

        22. Invalid Provision. In the event that any provision of the Plans is
found to be invalid or otherwise unenforceable under any applicable law, such
invalidity or unenforceability shall not be construed as rendering any other
provisions contained herein invalid or unenforceable, and all such other
provisions shall be given full force and effect to the same extent as though the
invalid unenforceable provision was not contained herein.

        23. Limitation on Amount of Securities Offered. Until such time as the
Company becomes subject to the reporting requirements of Sections 13 or 15(d) of
the Exchange Act, the aggregate sales price of Common Stock sold in reliance on
Rule 701 of the Securities Act within the preceding twelve (12) months under the
Plans and any other agreement granting options or

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awards under Rule 701, or number of shares of Common Stock, as the case may be,
shall not exceed the greatest of: (i) $1,000,000, (ii) 15% of the total assets
of the Company, measured as of the end of its most recent balance sheet date (if
no older that its last fiscal year end), or (iii) 15% of the outstanding Common
Stock, including securities (other than securities issued pursuant to the Plans)
convertible or exchangeable for Common Stock. For purposes of this Section 23,
the aggregate sales price of Common Stock sold in reliance on Rule 701 shall be
measured on the date the Option is granted, based on the exercise price of the
Option.

        24. Disclosure Requirements. A copy of this Plan shall be delivered to
all Optionees. Until such time as the Company becomes subject to the reporting
requirements of Sections 13 or 15(d) of the Exchange Act, the Company shall
deliver the following disclosure documents to the Optionee within a reasonable
period of time before the applicable date of exercise, conversion or sale if the
aggregate offering price of securities subject to outstanding offers plus the
offering price of securities sold in the preceding twelve (12) months, as a
result of Options issued under the Plans, exceeds $5,000,000:

                (a) A summary of the material terms of the Plans;

                (b) Information about the risks associated with purchasing the
shares of stock in the Company; and

                (c) Financial statements as of a date no more than 180 days
before the sale of securities pursuant to this Section 24.

        25. Successors and Assigns. The Plans shall be binding on and inure to
the benefit of the Company and the employees to whom an Option is granted
hereunder, and such employees' heirs, executors, administrators, legatees,
personal representatives, assignees and transferees.

                            [signature page follows]

                                       11
<PAGE>   12

        IN WITNESS WHEREOF, pursuant to the due authorization and adoption of
these Plans, as amended, by the Board on July __, 2000, the Company has caused
these Plans to be duly executed by its duly authorized officers.

                                            LUMINENT, INC.

                                            By: /s/ WILLIAM R. SPIVEY
                                               ---------------------------------
                                               William R. Spivey,
                                               Chief Executive Officer

                                       12

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