Document:

exv4w4

 

Exhibit 4.4

 

MELLANOX TECHNOLOGIES, LTD.

AMENDED AND RESTATED INVESTOR RIGHTS AGREEMENT

 

 

 

TABLE OF CONTENTS

	 	 	 	 	 	 	 	 	 
	 	1.	 	 	Certain Definitions
	 	 	2	 
	 	 	 	 	 
	 	 	 	 
	 	2.	 	 	Restrictions on Transferability
	 	 	3	 
	 	 	 	 	 
	 	 	 	 
	 	3.	 	 	Restrictive Legend
	 	 	4	 
	 	 	 	 	 
	 	 	 	 
	 	4.	 	 	Proposed Transfers
	 	 	4	 
	 	 	 	 	 
	 	 	 	 
	 	 	 	 	4.1   Notice of Proposed Transfers
	 	 	4	 
	 	 	 	 	 
	 	 	 	 
	 	5.	 	 	Registration
	 	 	5	 
	 	 	 	 	 
	 	 	 	 
	 	 	 	 	5.1   Requested Registration.
	 	 	5	 
	 	 	 	 	5.2   Company Registration
	 	 	7	 
	 	 	 	 	5.3   Registration on Form S-3 or Form F-3
	 	 	8	 
	 	 	 	 	5.4   Subsequent Registration Rights
	 	 	9	 
	 	 	 	 	5.5   Expenses of Registration
	 	 	10	 
	 	 	 	 	5.6   Registration Procedures
	 	 	10	 
	 	 	 	 	5.7   Indemnification
	 	 	11	 
	 	 	 	 	5.8   Information by Holder
	 	 	13	 
	 	 	 	 	5.9   Rule 144 Reporting
	 	 	13	 
	 	 	 	 	5.10 Termination of Registration Rights
	 	 	13	 
	 	 	 	 	 
	 	 	 	 
	 	6.	 	 	Financial Information Rights
	 	 	13	 
	 	 	 	 	 
	 	 	 	 
	 	7.	 	 	Observers
	 	 	15	 
	 	 	 	 	 
	 	 	 	 
	 	8.	 	 	Use of Proceeds
	 	 	16	 
	 	 	 	 	 
	 	 	 	 
	 	9.	 	 	Lockup Agreement
	 	 	16	 
	 	 	 	 	 
	 	 	 	 
	 	10.	 	 	Right of First Refusal
	 	 	17	 
	 	 	 	 	 
	 	 	 	 
	 	11.	 	 	Confidential Information and Invention Assignment Agreements
	 	 	18	 
	 	 	 	 	 
	 	 	 	 
	 	12.	 	 	Transfer of Rights
	 	 	18	 
	 	 	 	 	 
	 	 	 	 
	 	13.	 	 	Agreement to Vote
	 	 	18	 
	 	 	 	 	 
	 	 	 	 
	 	14.	 	 	Amendment
	 	 	18	 
	 	 	 	 	 
	 	 	 	 
	 	15.	 	 	Governing Law
	 	 	19	 
	 	 	 	 	 
	 	 	 	 
	 	16.	 	 	Entire Agreement
	 	 	19	 
	 	 	 	 	 
	 	 	 	 
	 	17.	 	 	Notices, etc
	 	 	19	 
	 	 	 	 	 
	 	 	 	 
	 	18.	 	 	Counterparts
	 	 	20	 
	 	 	 	 	 
	 	 	 	 
	 	19.	 	 	Grant of Proxy
	 	 	20	 

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MELLANOX TECHNOLOGIES, LTD.

AMENDED AND RESTATED INVESTOR RIGHTS AGREEMENT

     This Amended and Restated Investor Rights Agreement (this “Agreement”) is made effective as of
October 9, 2001 by and among Mellanox Technologies, Ltd., an Israeli company (the “Company”),
purchasers of the Company’s Series A Preferred Shares, Series B Preferred Shares and Series D
Redeemable Preferred Shares who are signatories to this Agreement (the “Purchasers”) and certain
holders of the Company’s Ordinary Shares who are signatories to this Agreement (the “Founders” and,
together with the Purchasers, the “Major Investors”) and, for purposes of Sections 1, 2, 3, 4, 5,
9, 12, 14, 15, 16, 17 and 18 only, the holder of Series C Preferred shares issued or issuable
pursuant to the Series C Preferred Share Purchase Agreement dated November 5, 2000 (the “Series C
Preferred Shares”).

RECITALS

     A. The Company and certain of the Purchasers are parties to the Series D Redeemable Preferred
Share Purchase Agreement dated as of October 9, 2001 (the “Purchase Agreement”), whereby the
Company will sell, and the Purchasers will buy, shares of the Company’s Series D Redeemable
Preferred (the “Series D Redeemable Preferred Shares”);

     B. Certain of the Purchasers hold shares of the Company’s Series A Preferred Shares and/or
Series B Preferred Shares and/or shares of Ordinary Shares issued upon conversion thereof and
possess registration rights, information rights, and other rights pursuant to that certain Amended
and Restated Investor Rights Agreement dated as of March 24, 2000, between the Company and such
Purchasers (the “Prior Agreement”);

     C. The Purchasers who hold Series A Preferred Shares and/or Series B Preferred Shares desire
to amend and restate in its entirety the Prior Agreement and to accept the rights created pursuant
hereto in lieu of the rights granted to them under the Prior Agreement;

     D. The obligations of the Company and the Purchasers under the Purchase Agreement are
conditioned, among other things, upon the execution and delivery of this Agreement by the Company
and the Major Investors;

     E. The Company desires to grant to the Major Investors, and the Major Investors desire to be
granted, the rights created herein;

     F. The holder of Series C Preferred Shares has been granted certain Registration Rights under
the Series C Preferred Share Purchase Agreement dated November 5, 2000 (the “Series C Purchase
Agreement”); and

     G. The Company, and the Purchasers who hold Series A Preferred Shares and/or Series B
Preferred Shares desire to make the holder of Series C Preferred Shares a party to certain sections
of the Agreement.

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AGREEMENT

     NOW, THEREFORE, in consideration of the mutual promises, representations, warranties,
covenants and conditions set forth in this Agreement and in the Purchase Agreement, the Purchasers
and the Company who are parties to the Prior Agreement hereby agree that the Prior Agreement shall
be superseded and replaced in its entirety by this Agreement and the parties hereto mutually agree
as follows:

     1. Certain Definitions. As used in this Agreement, the following terms shall have the
following respective meanings:

     “Commission” means the Securities and Exchange Commission or any other federal agency at the
time administering the Securities Act.

     “Conversion Shares” means the Company’s Ordinary Shares issued or issuable pursuant to
conversion of the Preferred Shares.

     “Exchange Act” means the Securities Exchange Act of 1934, as amended, or any similar federal
rule or statute and the rules and regulations of the Commission thereunder, all as the same shall
be in effect at the time.

     “Founder Shares” means the Company’s Ordinary Shares issued to a Founder.

     “Holder” means (i) any Purchaser holding Registrable Securities, (ii) any person holding
Registrable Securities to whom the rights under this Agreement have been transferred in accordance
with Section 10 hereof, and (iii) only for the purpose of Sections 1, 2, 3, 4, 5, 9, 12, 14, 15,
16, 17 and 18, any person holding Registrable Securities to whom certain registration rights have
been granted pursuant to Section 8 of the Series C Purchase Agreement.

     “Initiating Holders” means any Holder or Holders who, in the aggregate, hold not less than 30%
of the Registrable Securities then outstanding or any Holder or Holders who in the aggregate hold
not less than 30% of the then outstanding Conversion Shares issued or issuable upon conversion of
the Series D Redeemable Preferred Shares.

     “Preferred Shares” shall mean the Company’s Series A Preferred Shares issued pursuant to the
Series A Preferred Share Purchase Agreement dated June 1, 1999, Series B Preferred Shares issued
pursuant to the Series B Preferred Share Purchase Agreement dated March 24, 2000, Series D
Redeemable Preferred Shares issued pursuant to the Purchase Agreement and, for purposes of Sections
1, 2, 3, 4, 5, 9, 12, 14, 15, 16, 17 and 18 only, Series C Preferred Shares issued or issuable
pursuant to the Series C Purchase Agreement.

     “Qualified Initial Public Offering” shall mean the Company’s initial public offering pursuant
to an effective registration statement under the Securities Act covering the offer and sale of the
Company’s Ordinary Shares to the public with gross proceeds to the Company of not less than Fifty
Million dollars ($50,000,000) at a per share price of at least $16.53 (as adjusted for stock
splits, stock dividends, recapitalizations and the like), or any other public offering
pursuant to an effective registration statement under the Securities Act covering the offer and

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sale of the Company’s Ordinary Shares to the public which shall result in the conversion of all
Preferred Shares into Ordinary Shares.

     “Registrable Securities” means (i) the Conversion Shares, (ii) any Ordinary Shares of the
Company issued or issuable in respect of any of the foregoing upon any stock split, stock dividend,
recapitalization or similar event and (iii) any Ordinary Shares of the Company issued or issuable
under any warrant issued in conjunction with the Purchase Agreement; provided, however, that
securities shall only be treated as Registrable Securities if and so long as (x) they have not been
registered or sold to or through a broker or dealer or underwriter in a public distribution or a
public securities transaction and (y) the registration rights with respect to such securities have
not terminated pursuant to Section 5.10, and provided further that Conversion Shares issuable upon
conversion of Series C Preferred Shares shall be Registrable Securities for the purpose of Sections
1, 2, 3, 4, 5, 9, 12, 14, 15, 16, 17 and 18 only.

     The terms “register,” “registered” and “registration” refer to a registration effected by
preparing and filing a registration statement in compliance with the Securities Act, and the
declaration or ordering of the effectiveness of such registration statement.

     “Registration Expenses” shall mean all expenses incurred by the Company in complying with
Sections 5.1, 5.2 and 5.3 hereof, including without limitation, all registration, qualification and
filing fees, printing expenses, escrow fees, fees and disbursements of counsel for the Company,
blue sky fees and expenses, the expense of any special audits incident to or required by any such
registration (but excluding the compensation of regular employees of the Company which shall be
paid in any event by the Company). Registration Expenses shall also include the reasonable fees and
disbursements for one special counsel to the selling shareholders.

     “Restricted Securities” shall mean the securities of the Company required to bear the legends
set forth in Section 3 hereof.

     “Rule 144” and “Rule 145” shall mean Rules 144 and 145, respectively, promulgated under the
Securities Act, or any similar federal rules thereunder, all as the same shall be in effect at the
time.

     “Securities Act” shall mean the Securities Act of 1933, as amended, or any similar federal
rule or statute and the rules and regulations of the Commission thereunder, all as the same shall
be in effect at the time.

     “Selling Expenses” shall mean all underwriting discounts, selling commissions and stock
transfer taxes applicable to the securities registered by the Holders and, except as set forth
above, all fees and disbursements of counsel for any Holder.

     2. Restrictions on Transferability. The Preferred Shares, the Conversion Shares and
any other securities issued in respect of such shares upon any stock split, stock dividend,
recapitalization, merger, or similar event (collectively, the “Shares”), shall not be sold,
assigned, transferred or pledged except upon the conditions specified in this Agreement, which
conditions are intended to ensure compliance with the provisions of the Securities Act. Each Holder or transferee will cause any proposed
purchaser, assignee, transferee, or pledgee of any such shares

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held by the Holder or transferee to agree to take and hold such securities subject to the restrictions and upon the conditions
specified in this Agreement.

     3. Restrictive Legend. Each certificate representing the Preferred Shares, the
Conversion Shares, the Founder Shares or any other securities issued in respect of such stock upon
any stock split, stock dividend, recapitalization, merger, or similar event, shall (unless
otherwise permitted by the provisions of Section 4 below) be stamped or otherwise imprinted with
legends in substantially the following form (in addition to any legends required by agreement or by
applicable state securities laws):

THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”). SUCH SECURITIES MAY
NOT BE TRANSFERRED UNLESS A REGISTRATION STATEMENT UNDER THE ACT IS
IN EFFECT AS TO SUCH TRANSFER OR IN THE OPINION OF COUNSEL FOR THE
COMPANY, SUCH TRANSFER MAY BE MADE PURSUANT TO RULE 144 OR
REGISTRATION UNDER THE ACT IS OTHERWISE UNNECESSARY IN ORDER FOR
SUCH TRANSFER TO COMPLY WITH THE ACT.

THE SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO A LOCKUP
PERIOD OF UP TO 180 DAYS FOLLOWING THE EFFECTIVE DATE OF A
REGISTRATION STATEMENT OF THE COMPANY FILED UNDER THE SECURITIES ACT
OF 1933, AS AMENDED, AND CERTAIN VOTING PROVISIONS, BOTH AS SET
FORTH IN AN AGREEMENT BETWEEN THE ISSUER AND THE ORIGINAL HOLDER OF
THESE SHARES, A COPY OF WHICH MAY BE OBTAINED AT THE PRINCIPAL
OFFICE OF THE ISSUER. SUCH LOCKUP PERIOD AND VOTING PROVISIONS ARE
BINDING ON TRANSFEREES OF THESE SHARES.

     Each Holder consents to the Company making a notation on its records and giving stop transfer
instructions to any transfer agent of its capital stock in order to implement the restrictions on
transfer established in this Agreement.

     4. Proposed Transfers.

          4.1 Notice of Proposed Transfers. The holder of each certificate representing Restricted Securities by acceptance thereof
agrees to comply in all respects with the provisions of this Section 4. Without in any way limiting
the immediately preceding sentence, no sale, assignment, transfer or pledge of Restricted
Securities shall be made by any holder thereof to any person unless such person shall first agree
in writing to be bound by the restrictions of this Agreement. Prior to any proposed sale,
assignment, transfer or pledge of any Restricted Securities, unless there is in effect a
registration statement under the Securities Act covering the proposed transfer, the holder thereof
shall give written notice to the Company of such holder’s

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intention to effect such transfer, sale,
assignment or pledge. Each such notice shall describe the manner and circumstances of the proposed
transfer, sale, assignment or pledge in sufficient detail, and, if requested by the Company, the
holder shall also provide, at such holder’s expense, either (i) a written opinion of legal counsel
who shall be, and whose legal opinion shall be, reasonably satisfactory to the Company addressed to
the Company, to the effect that the proposed transfer of the Restricted Securities may be effected
without registration under the Securities Act, or (ii) a “no action” letter from the Commission to
the effect that the transfer of such securities without registration will not result in a
recommendation by the staff of the Commission that action be taken with respect thereto, whereupon
the holder of such Restricted Securities shall be entitled to transfer such Restricted Securities
in accordance with the terms of the notice delivered by the holder to the Company; provided,
however, that the Company shall not request an opinion of counsel or “no action” letter with
respect to (i) a transfer not involving a change in beneficial ownership; (ii) a transaction
involving the distribution without consideration of Restricted Securities by the holder to its
constituent partners or members in proportion to their ownership interests in the holder; (iii) a
transaction involving the transfer without consideration of Restricted Securities by an individual
holder during such holder’s lifetime by way of gift or on death by will or intestacy; or (iv) to an
“Affiliate” as that term is defined in Rule 405 promulgated by the Commission under the Securities
Act. Each certificate evidencing the Restricted Securities transferred as above provided shall
bear, except if such transfer is made pursuant to Rule 144, the appropriate restrictive legend set
forth in Section 3 above, except that such certificate shall not bear such restrictive legend if in
the opinion of counsel for such holder and counsel for the Company such legend is not required in
order to establish compliance with any provision of the Securities Act. Notwithstanding the
foregoing, each holder of Restricted Securities agrees that it will not request that a transfer of
the Restricted Securities be made or that the legend set forth in Section 3 be removed from the
certificate representing the Restricted Securities, solely in reliance on Rule 144(k), if as a
result thereof the Company would be rendered subject to the reporting requirements of the Exchange
Act.

     5. Registration.

          5.1 Requested Registration.

               (a) Notice of Registration. In case the Company shall receive from Initiating Holders
a written request that the Company effect any registration with respect to shares of Registrable
Securities, the Company will:

                    (i) promptly give written notice of the proposed registration to all other Holders; and

                    (ii) as soon as practicable, use commercially reasonable efforts to effect such registration
as part of a firm commitment underwritten public offering with underwriters reasonably acceptable
to the Initiating Holders and the Company (including, without limitation, appropriate qualification
under applicable state securities laws and appropriate compliance with applicable regulations
issued under the Securities Act and any other governmental requirements or regulations) as may be
so requested and as would permit or facilitate the sale and distribution of all or such portion of
such Registrable Securities as are specified in such request, together with all or such portion of
the Registrable Securities of any

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Holder or Holders joining in such request by delivering a written
notice to such effect to the Company within twenty days after the date of such written notice from
the Company.

                    Notwithstanding the foregoing, the Company shall not be obligated to take any action to effect
or complete any such registration pursuant to this Section 5.1:

                         (A) prior to 180 days after the effective date of the Company’s first registered public
offering of its Ordinary Shares;

                         (B) Unless the requested registration would have an aggregate offering price of all
Registrable Securities sought to be registered by all Holders exceeding $5,000,000;

                         (C) Following the filing of, and for 180 days immediately following the effective date of, any
registration statement pertaining to securities of the Company (other than a registration of
securities in a Rule 145 transaction or with respect to an employee benefit plan), provided that
the Company is actively employing in good faith commercially reasonable efforts to cause such
registration statement to become effective;

                         (D) After the Company has effected two registrations pursuant to this Section 5.1(a) and such
registrations have been declared or ordered effective; or

                         (E) If the Company shall furnish to the Initiating Holders a certificate signed by the
President of the Company (i) giving notice of its bona fide intention to effect the filing of a
registration statement with the Commission, or (ii) stating that in the good faith judgment of the
Board of Directors it would be seriously detrimental to the Company or its shareholders for a
registration statement to be filed in the near future. In such case, the Company’s obligation to
use its commercially reasonable efforts to register, qualify or comply under this Section 5.1(a)
shall be deferred one or more times for a period not to exceed 120 days from the receipt of the
request to file such registration by such Initiating Holder or Holders, provided that the Company
may not exercise this deferral right more than once per twelve month period.

               Subject to the foregoing clauses (A) through (E), the Company shall use its commercially
reasonable efforts to file a registration statement covering the Registrable Securities so
requested to be registered as soon as practicable after receipt of the request or requests of the
Initiating Holders.

               (b) Underwriting. In the event of a registration pursuant to Section 5.1, the Company
shall advise the Holders as part of the notice given pursuant to Section 5.1(a)(i) that the right
of any Holder to registration pursuant to Section 5.1 shall be conditioned upon such Holder’s
participation in the underwriting arrangements required by this Section 5.1, and the inclusion of
such Holder’s Registrable Securities in the underwriting to the extent requested shall be limited
to the extent provided herein.

               The Company shall, together with all Holders proposing to distribute their securities through
such underwriting, enter into an underwriting agreement in customary form with the managing
underwriter selected for such underwriting by a majority in interest of the

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Initiating Holders, but subject to the Company’s reasonable approval. Notwithstanding any other provision of this Section
5.1, if, in the good faith judgment of the managing underwriter of such public offering, the
inclusion of all of the Registrable Securities requested to be registered would materially and
adversely affect the successful marketing of the offering, then the amount of the Registrable
Securities to be included in the offering shall be reduced and the Registrable Securities and the
other shares to be offered shall participate in such offering as follows: (i) first, the
Registrable Securities requested to be included in such registration by the Holders, and if two or
more Holders are included in the registration, pro rata among such Holders on the basis of the
number of Registrable Securities owned by each such Holder, (ii) second, the Ordinary Shares
requested to be included in such registration by the Company and (iii) third, any Ordinary Shares
other than Registrable Securities requested to be registered by holders of such Ordinary Shares,
pro-rata among such holders. The Company shall so advise all Holders requesting to be included in
the registration and underwriting, and the number of shares of Registrable Securities that may be
included in the registration and underwriting shall be allocated among all Holders requesting to be
included in the registration and underwriting in proportion, as nearly as practicable, to the
respective amounts of Registrable Securities held by them at the time of filing the registration
statement. No Registrable Securities excluded from the underwriting by reason of the underwriter’s
marketing limitation shall be included in such registration. To facilitate the allocation of shares
in accordance with the above provisions, the Company or the underwriters may round the number of
shares allocated to any Holder to the nearest 100 shares. If any Holder of Registrable Securities
disapproves of the terms of the underwriting, such person may elect to withdraw therefrom by
written notice to the Company.

          5.2 Company Registration.

               (a) Notice of Registration. If at any time or from time to time the Company shall
determine to register any of its equity securities, either for its own account or the account of a
Holder or other holders, other than (i) a registration relating solely to employee benefit plans,
(ii) a registration relating solely to a Rule 145 transaction, or (iii) a registration in which the
only equity security being registered is Ordinary Shares issuable upon conversion of convertible
debt securities which are also being registered, the Company will:

                    (i) promptly give to each Holder written notice thereof; and

                    (ii) include in such registration (and any related qualifications including compliance with
Blue Sky laws), and in any underwriting involved therein, all the Registrable Securities specified
in a written request or requests, made within twenty (20) days after the date of such written
notice from the Company, by any Holder.

               (b) Underwriting. If the registration of which the Company gives notice is for a
registered public offering involving an underwriting, the Company shall so advise the Holders as a
part of the written notice given pursuant to Section 5.2(a)(i). In such event, the right of any
Holder to registration pursuant to Section 5.2 shall be conditioned upon such Holder’s
participation in such underwriting and the inclusion of Registrable Securities in the underwriting
shall be limited to the extent provided herein.

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                    All Holders proposing to distribute their securities through such underwriting shall (together
with the Company and the other Holders distributing their securities through such underwriting)
enter into an underwriting agreement in customary form with the managing underwriter selected for
such underwriting by the Company. Notwithstanding any other provision of this Section 5.2, if, in
the good faith judgment of the managing underwriter of such public offering, the inclusion of all
of the Registrable Securities requested to be registered would materially and adversely affect the
successful marketing of the offering, then the amount of the Registrable Securities to be included
in the offering shall be reduced and the Registrable Securities and the other shares to be offered
shall participate in such offering as follows: (i) first, the Ordinary Shares to be included in
such registration by the Company, (ii) second, the Registrable Securities requested to be included
in such registration by the Holders, and if two or more Holders are included in the registration,
pro rata among the Holders on the basis of the number of Registrable Securities owned by each such
Holder, but, except as to the Company’s initial public offering of its securities, in no event less
than 33% of all shares to be included in such offering and (iii) third, any Ordinary Shares other
than Registrable Securities requested to be registered by holders of such Ordinary Shares, pro-rata
among such holders. The Company shall so advise all Holders requesting to be included in the
registration and underwriting, and the number of shares of Registrable Securities that may be
included in the registration and underwriting shall be allocated among all the Holders requesting
to be included in the registration and underwriting in proportion, as nearly as practicable, to the
respective amounts of Registrable Securities held by them at the time of filing the registration
statement. To facilitate the allocation of shares in accordance with the above provisions, the
Company or the underwriters may round the number of shares allocated to any Holder to the nearest
100 shares. If any Holder disapproves of the terms of any such underwriting, such person may elect
to withdraw therefrom by written notice to the Company.

               (c) Right to Terminate Registration. The Company shall have the right to terminate or
withdraw any registration initiated by it under this Section 5.2 prior to the effectiveness of such
registration whether or not any Holder has elected to include securities in such registration.

          5.3 Registration on Form S-3 or Form F-3.

               (a) In addition to the rights set forth in Sections 5.1 and 5.2, if an Initiating Holder or a
group of Initiating Holders request that the Company file a registration statement on Form S-3 or
Form F-3, as applicable (or any successor thereto) for a public offering of shares of Registrable
Securities the reasonably anticipated aggregate price to the public of which would exceed
$1,000,000, and the Company is a registrant entitled to use Form S-3 or Form F-3, as applicable, to
register securities for such an offering, the Company shall use its best efforts to cause such
shares to be registered for the offering on such form (or any successor thereto). The Holders of
the Registrable Securities are entitled to an unlimited number of Form S-3 or Form F-3, as
applicable, registrations; provided, however, that the Company shall be required to file no more
than two (2) such registration statements during any 12-month period. The Company shall:

                    (i) give prompt notice of such request to all Holders; and

8

 

                    (ii) include in such registration (and any related qualifications including compliance with
Blue Sky laws), and in any underwriting involved therein, all the Registrable Securities specified
in a written request or requests, made within twenty (20) days after the date of such written
notice from the Company, by any Holder.

               (b) Underwriting. If the registration of which the Company gives notice is for a
registered public offering involving an underwriting, the Company shall so advise the Holders as a
part of the written notice given pursuant to Section 5.3(a)(i). In such event, the right of any
Holder to registration pursuant to Section 5.3 shall be conditioned upon such Holder’s
participation in such underwriting and the inclusion of Registrable Securities in the underwriting
shall be limited to the extent provided herein.

                    All Holders proposing to distribute their securities through such underwriting shall (together
with the Company and the other Holders distributing their securities through such underwriting)
enter into an underwriting agreement in customary form with the managing underwriter selected for
such underwriting by the Company. Notwithstanding any other provision of this Section 5.3, if, in
the good faith judgment of the managing underwriter of such public offering believes that marketing
factors require a limitation of the number of shares to be underwritten, then, the Company shall so
advise all Holders requesting to be included in the registration and underwriting, and the number
of shares of Registrable Securities that may be included in the registration and underwriting shall
be allocated among all the Holders requesting to be included in the registration and underwriting
in proportion, as nearly as practicable, to the respective amounts of Registrable Securities held
by them at the time of filing the registration statement. To facilitate the allocation of shares in
accordance with the above provisions, the Company or the underwriters may round the number of
shares allocated to any Holder to the nearest 100 shares. If any Holder disapproves of the terms of
any such underwriting, such person may elect to withdraw therefrom by written notice to the
Company.

                    Notwithstanding the foregoing, the Company shall not be obligated to take any action to effect
or complete any such registration pursuant to this Section 5.3 if the Company shall furnish to the
Initiating Holders a certificate signed by the President of the Company (i) giving notice of its
bona fide intention to effect the filing of a registration statement with the Commission, or (ii)
stating that in the good faith judgment of the Board of Directors it would be seriously detrimental
to the Company or its shareholders for a registration statement to be filed in the near future. In
such case, the Company’s obligation to use its commercially reasonable efforts to register, qualify
or comply under this Section 5.3 shall be deferred one or more times for a period not to exceed 120
days from the receipt of the request to file such registration by such Initiating Holder or
Initiating Holders, provided that the Company may not exercise this deferral right more than once
per twelve month period.

                    Subject to the foregoing, the Company shall use its commercially reasonable efforts to file a
registration statement covering the Registrable Securities so requested to be registered as soon as
practicable after receipt of the request or requests of the Initiating Holder or Initiating
Holders.

          5.4 Subsequent Registration Rights.

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               (a) Without the consent of any holder of Registrable Securities hereunder, the Company may
grant to any holder of securities of the Company registration rights inferior to those granted
hereunder.

               (b) The Company shall not enter into any agreement granting any holder or prospective holder
of any securities of the Company registration rights pari passu with or superior to the rights
granted the Purchasers hereunder without (i) the written consent of the holders of a majority of
the then outstanding Registrable Securities, and (ii) the written consent the Holders holding at
least a majority of the then outstanding Conversion Shares issued or issuable upon conversion of
the then outstanding Series D Redeemable Preferred Shares.

          5.5 Expenses of Registration. All Registration Expenses incurred in connection with
(i) two registrations pursuant to Section 5.1, (ii) all registrations pursuant to Section 5.2, and
(iii) all registrations pursuant to Section 5.3, shall be borne by the Company. Unless otherwise
stated, all Selling Expenses relating to securities registered on behalf of the Holders shall be
borne by the Holders of such securities pro rata on the basis of the number of shares so registered
or proposed to be so registered.

          5.6 Registration Procedures. In the case of each registration effected by the Company
pursuant to this Agreement, the Company will keep each Holder advised in writing as to the
initiation of such registration and as to the completion thereof. The Company will:

               (a) Prepare and file with the Commission a registration statement and such amendments and
supplements as may be necessary and use commercially reasonable efforts to cause such registration
statement to become and remain effective for at least 120 days or until the distribution described
in the registration statement has been completed, whichever first occurs;

               (b) Furnish to the Holders participating in such registration and to the underwriters of the
securities being registered such reasonable number of copies of the registration statement,
preliminary prospectus, final prospectus and such other documents as such underwriters may
reasonably request in order to facilitate the public offering of such securities;

               (c) Prepare and file with the SEC such amendments and supplements to such registration
statement and the prospectus used in connection with such registration statement as may be
necessary to comply with the provisions of the Act with respect to the disposition of all
securities covered by such registration statement;

               (d) Use all commercially reasonable efforts to register and qualify the securities covered by
such registration statement under such other securities or Blue Sky laws of such jurisdictions as
shall be reasonably requested by the Holders, provided that the Company shall not be required in
connection therewith or as a condition thereto to qualify to do business or to file a general
consent to service of process in any such states or jurisdictions;

               (e) In the event of any underwritten public offering, enter into and perform its obligations
under an underwriting agreement, in usual and customary form, with the managing underwriter of such
offering;

10

 

               (f) Notify each Holder of Registrable Securities covered by such registration statement at any
time when a prospectus relating thereto is required to be delivered under the Act or the happening
of any event as a result of which the prospectus included in such registration statement,
as then in effect, includes an untrue statement of a material fact or omits to state a material
fact required to be stated therein or necessary to make the statements therein not misleading in
the light of the circumstances then existing;

               (g) Cause all such Registrable Securities registered pursuant hereunder to be listed on each
securities exchange on which similar securities issued by the Company are then listed; and

               (h) Provide a transfer agent and registrar for all Registrable Securities registered pursuant
hereunder and a CUSIP number for all such Registrable Securities, in each case not later than the
effective date of such registration.

          5.7 Indemnification.

               (a) The Company will indemnify each Holder, each of its affiliates, officers and directors and
partners, and each person controlling such Holder within the meaning of Section 15 of the
Securities Act, with respect to which registration has been effected pursuant
to this Agreement, against all expenses, claims, losses, damages or liabilities (or actions in
respect thereof), including any of the foregoing incurred in settlement of any litigation,
commenced or threatened, arising out of or based on any untrue statement (or alleged untrue
statement) of a material fact contained in any registration statement, prospectus, offering
circular or other document, or any amendment or supplement thereto, incident to any such
registration, or based on any omission (or alleged omission) to state therein a material fact
required to be stated therein or necessary to make the statements therein, in light of the
circumstances in which they were made, not misleading, or any violation by the Company of the
Securities Act, the Exchange Act, state securities laws or any rule or regulation promulgated under
such laws applicable to the Company in connection with any such registration, and the Company will
reimburse each such Holder, each of its affiliates, officers and directors, and each person
controlling such Holder, for any legal and any other expenses reasonably incurred, as such expenses
are incurred, in connection with investigating, preparing or defending any such claim, loss,
damage, liability or action, provided that the Company will not be liable in any such case to the
extent that any such claim, loss, damage, liability or expense arises out of or is based on any
untrue statement or omission or alleged untrue statement or omission, made in reliance upon and in
conformity with written information furnished to the Company by an instrument duly executed by such
Holder or controlling person, and stated to be specifically for use therein.

               (b) Each Holder will, if Registrable Securities held by such Holder are included in the
securities as to which such registration is being effected, indemnify the Company, each of its
directors and officers, other holders of the Company’s securities covered by such registration
statement, each person who controls the Company within the meaning of Section 15 of the Securities
Act, and each other such Holder, each of its officers and directors and each person controlling
such Holder within the meaning of Section 15 of the Securities Act, against all claims, losses,
damages and liabilities (or actions in respect thereof) arising out of or based on any untrue
statement (or alleged untrue statement) of a material fact contained in any such

11

 

registration statement, prospectus, offering circular or other document, or any omission (or alleged omission)
to state therein a material fact required to be stated therein or necessary to make the statements
therein not misleading, or any violation by the Holder of the Securities Act, the Exchange Act,
state securities laws or any rule or regulation promulgated under such laws applicable to the
Holder, and will reimburse the Company, such other Holders, such directors, officers, persons,
underwriters or control persons for any legal or any other expenses reasonably incurred, as such
expenses are incurred, in connection with investigating or defending any such claim, loss, damage,
liability or action, but only to the extent that such untrue statement (or alleged untrue
statement) or omission (or alleged omission) is made in such registration statement, prospectus,
offering circular or other document in reliance upon and in conformity with written information
furnished to the Company by an instrument duly executed by such Holder and stated to be
specifically for use therein. Notwithstanding the foregoing, the liability of each Holder under
this subsection 5.7(b) shall be limited in an amount equal to the net proceeds from the offering
received by such Holder, unless such liability arises out of or is based on willful misconduct or
fraud by such Holder.

               (c) Each party entitled to indemnification under this Section 5.7 (the “Indemnified Party”)
shall give notice to the party required to provide indemnification (the “Indemnifying Party”)
promptly after such Indemnified Party has actual knowledge of any claim as to which indemnity may
be sought, and shall permit the Indemnifying Party to assume the
defense of any such claim or any litigation resulting therefrom, provided that counsel for the
Indemnifying Party, who shall conduct the defense of such claim or litigation, shall be approved by
the Indemnified Party (whose approval shall not unreasonably be withheld), and the Indemnified
Party may participate in such defense at such party’s expense, and provided further that the
failure of any Indemnified Party to give notice as provided herein shall not relieve the
Indemnifying Party of its obligations under this Agreement unless the failure to give such notice
is materially prejudicial to an Indemnifying Party’s ability to defend such action and provided
further, that the Indemnifying Party shall not assume the defense for matters as to which there is
a conflict of interest or there are separate and different defenses, in which case the Indemnifying
Party shall pay the reasonable fees and expenses of one counsel to the Indemnified Party. No
Indemnifying Party, in the defense of any such claim or litigation, shall, except with the consent
of each Indemnified Party (whose consent shall not be unreasonably withheld), consent to entry of
any judgment or enter into any settlement which does not include as an unconditional term thereof
the giving by the claimant or plaintiff to such Indemnified Party of a release from all liability
in respect to such claim or litigation.

               (d) If the indemnification provided for in this Section 5.7 is held by a court of competent
jurisdiction to be unavailable to an Indemnified Party with respect to any loss, liability, claim,
damage or expense referred to herein, then the Indemnifying Party, in lieu of indemnifying such
Indemnified Party hereunder, shall contribute to the amount paid or payable by such indemnified
party as a result of such loss, liability, claim, damage or expense in such proportion as is
appropriate to reflect the relative fault of the Indemnifying Party on the one hand and of the
Indemnified Party on the other in connection with the statements or omissions that resulted in such
loss, liability, claim, damage or expense, as well as any other relevant equitable considerations.
The relative fault of the Indemnifying Party and of the Indemnified Party shall be determined by
reference to, among other things, whether the untrue or alleged untrue statement of a material fact
or the omission to state a material fact relates to information

12

 

supplied by the Indemnifying Party or by the Indemnified Party and the parties’ relative intent, knowledge, access to information, and
opportunity to correct or prevent such statement or omission.

               (e) Notwithstanding the foregoing, to the extent that the provisions on indemnification and
contribution contained on the underwriting agreement entered into in connection with the
underwritten public offering are in conflict with the foregoing provisions, the provisions in the
underwriting agreement shall control.

          5.8 Information by Holder. The Holder or Holders of Registrable Securities included in
any registration shall furnish to the Company such information regarding such Holder or Holders,
the Registrable Securities held by them and the distribution proposed by such Holder or Holders as
the Company may request in writing and as shall be required in connection with any registration
referred to in this Agreement.

          5.9 Rule 144 Reporting. With a view to making available the benefits of certain rules and regulations of the
Commission which may at any time permit the sale of the Restricted Securities to the public without
registration, after such time as a public market exists for the Ordinary Shares of the Company, the
Company agrees to use commercially reasonable efforts to:

               (a) Make and keep public information available, as those terms are understood and defined in
Rule 144 under the Securities Act, at all times after the effective date that the Company becomes
subject to the reporting requirements of the Securities Act or the Exchange Act;

               (b) File with the Commission in a timely manner all reports and other documents required of
the Company under the Securities Act and the Exchange Act (at any time after it has become subject
to such reporting requirements); and

               (c) So long as a Holder owns any Restricted Securities, to furnish to the Holder forthwith
upon request a written statement by the Company as to its compliance with the reporting
requirements of said Rule 144 (at any time after 90 days after the effective date of the first
registration statement filed by the Company for an offering of its securities to the general
public), a copy of the most recent annual or quarterly report of the Company, and such other
reports and documents of the Company and other information in the possession of or reasonably
obtainable by the Company as the Holder may reasonably request in availing itself of any rule or
regulation of the Commission allowing the Holder to sell any such securities without registration.

          5.10 Termination of Registration Rights. The rights granted pursuant to Sections 5.1,
5.2 and 5.3 of this Agreement shall terminate as to any Holder upon the earlier of (i) the date
five years after the effective date of a Qualified Initial Public Offering and (ii) the date such
Holder is able to immediately sell all shares of Registrable Securities held or entitled to be held
upon conversion by such Holder under Rule 144 during any 90-day period without regard to Rule
144(k).

     6. Financial Information Rights.

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               (a) The Company will provide the following documents to each Purchaser, as soon as practicable
after the end of the fiscal year ending December 31, 2001 and each fiscal year thereafter, and in
any event within ninety (90) days after the end of each such fiscal year, consolidated balance
sheets of the Company and its subsidiaries, if any, as of the end of such fiscal year, and
consolidated statements of operations and consolidated statements of cash flows and shareholders’
equity of the Company and its subsidiaries, if any, for such year, prepared in accordance with
generally accepted accounting principles and setting forth in each case in comparative form the
figures for the previous fiscal year, all in reasonable detail and audited by independent public
accountants of national standing selected by the Company.

               (b) The Company will provide the following documents to each Purchaser who continues to hold
100,000 shares of Preferred Shares and/or Conversion Shares (subject to adjustment for
recapitalizations, stock splits, stock dividends and the like):

                    (i) As soon as practicable after the end of the first, second and third quarterly accounting
periods in each fiscal year of the Company and in any event within forty-five (45) days thereafter,
a consolidated balance sheet of the Company and its subsidiaries, if any, as of the end of each
such quarterly period, and consolidated statements of operations and consolidated statements of
cash flows of the Company and its subsidiaries, if any, for such period and for the current fiscal
year to date, prepared in accordance with generally accepted accounting principles (other than
accompanying notes), subject to changes resulting from year-end audit adjustments, in reasonable
detail and signed by the principal financial or accounting officer of the Company, and such other
documents generally distributed or made available to the Company’s shareholders; and

                    (ii) As soon as practicable, but in any event at least sixty (60) days prior to the end of
each fiscal year, a budget and business plan for the next fiscal year, prepared on a monthly basis,
including balance sheets, income statements, statements of cash flows and such other matters as the
Board of Directors may determine for such months and, as soon as prepared, any other budgets or
revised budgets prepared by the Company.

               (c) The Company will provide the following documents to each Purchaser who continues to hold
450,000 shares of Preferred Shares and/or Conversion Shares (subject to adjustment for
recapitalizations, stock splits, stock dividends and the like):

                    (i) As soon as practicable after the end of each month, but in any event within thirty (30)
days of the end of each month, an unaudited income statement and statement of cash flows and
balance sheet for and as of the end of such month, prepared in accordance with generally accepted
accounting principles (other than accompanying notes), subject to changes resulting from year-end
audit adjustments, in reasonable detail and signed by the principal financial or accounting officer
of the Company.

               (d) For purposes of determining the minimum holdings pursuant to this Section 6, any Purchaser
which is a partnership or limited liability company shall be deemed to hold any Preferred Shares
originally purchased by such Purchaser and subsequently distributed to constituent partners or
members of such Purchaser, but which have not been resold by such partners or members. If the
partnership or limited liability company is still in existence, the

14

 

Company may satisfy any obligation to distribute reports to individual partners of the partnership or members of a limited
liability company by delivering a single copy of each report to the partnership or limited
liability company as agent for the constituent partners or members.

               (e) Each Purchaser or transferee of rights under this Section 6 acknowledges and agrees that
any information obtained pursuant to this Section 6 which may be considered nonpublic information
will be maintained in confidence by such Purchaser or transferee, will not be disclosed to any
third party without the Company’s consent and will not be utilized by such Purchaser or transferee
in connection with purchases or sales of the Company’s securities except in compliance with
applicable state and Federal securities laws.

               (f) The covenants of the Company set forth in this Section 6 shall terminate and be of no
further force or effect upon the earliest to occur of (i) the closing of the Company’s initial
public offering of its Ordinary Shares; or (ii) the sale of all or substantially all
of the assets of the Company or the acquisition of the Company by another entity by means of
merger or consolidation resulting in the exchange of the outstanding shares of the Company for
securities or consideration issued, or caused to be issued, by the acquiring corporation or its
subsidiary, unless the shareholders of the Company immediately prior to such transaction hold at
least 50% of the voting power of the surviving corporation or its parent in such a transaction.

     7. Observers.

               (a) So long as Intel Atlantic, Inc. (“Intel Atlantic”) holds at least 500,000 Series B
Preferred Shares (as adjusted for stock splits, stock dividends, recapitalizations and the like),
the Company will permit a representative of Intel Atlantic (the “Intel Observer”) to attend all
meetings of the Company’s Board of Directors (the “Board”) and all committees thereof (whether in
person, by telephone or otherwise) in a non-voting, observer capacity, and shall provide to the
Intel Observer, concurrently with the members of the Board, and in the same manner, notice of such
meeting and a copy of all materials, consents and resolutions provided to such members. The Company
acknowledges that Intel Atlantic or its affiliates (collectively, “Intel”) are likely to have, from
time to time, information that may be of interest to the Company (“Information”) regarding a wide
variety of matters including, by way of example only: (1) Intel’s technologies, plans and services,
and plans and strategies relating thereto; (2) current and future investments Intel has made, may
make, may consider or may become aware of with respect to other companies and other technologies,
products and services, including, without limitation, technologies, products and services that may
be competitive with the Company’s; and (3) developments with respect to the technologies, products
and services, and plans and strategies relating thereto, of other companies, including, without
limitation, companies that may be competitive with the Company. The Company recognizes that a
portion of such Information may be of interest to the Company. Such Information may or may not be
known by the Intel Observer. The Company, as a material part of the consideration for this
Agreement, agrees that Intel and the Intel Observer shall have no duty to disclose any Information
to the Company or permit the Company to participate in any projects or investments based on any
Information, or to otherwise take advantage of any opportunity that may be of interest to the
Company if it were aware of such Information, and hereby waives, to the extent permitted by law,
any claim based on the corporate opportunity doctrine or otherwise that could limit Intel’s ability
to pursue opportunities based on such Information or that would require Intel or the Intel Observer to

15

 

disclose any such Information to the Company or offer any opportunity relating thereto to the
Company. Notwithstanding the foregoing, the Company reserves the right to exclude such Intel
Observer from access to any material or meeting or portion thereof if a majority of members on the
Board of Directors of the Company determine in good faith that such exclusion is reasonably
necessary to prevent a conflict of interest, preserve an attorney-client privilege, protect highly
confidential proprietary information, or for other similar reasons.

               (b) If, for any reason, Bessemer Venture Partners, together with all its affiliates (“BVP”),
is not entitled to designate a member of the Board of Directors to represent the Series D
Redeemable Preferred pursuant to Section 13 of this Agreement, and so long as BVP holds at least
250,000 Series D Redeemable Shares or Ordinary Shares issued upon the conversion thereof, the
Company will permit a representative of BVP (the “BVP Observer”) to
attend all meetings of Board and all committees thereof (whether in person, by telephone or
otherwise) in a non-voting, observer capacity, and shall provide to the BVP Observer, concurrently
with the members of the Board, and in the same manner, notice of such meeting and a copy of all
materials, consents and resolutions provided to such members. The Company may require as a
condition precedent to the rights under this Section 7(b) that each person proposing to attend any
meeting of the Board and each person to have access to any of the information provided by the
Company to the Board agree to hold in confidence and trust all information so received during such
meetings or otherwise; and provided further, that the Company reserves the right not to provide
information and to exclude such representative from any meeting or portion thereof if a majority of
members of the Board of Directors of the Company determine in good faith that delivery of such
information or attendance at such meeting or portion thereof by such representative would result in
disclosure of trade secrets to such representative or would adversely affect the attorney-client
privilege between the Company and its counsel.

     8. Use of Proceeds. The Company shall use the proceeds derived from the sale of its
Series D Redeemable Preferred Shares pursuant to the Purchase Agreement primarily for general
operating purposes.

     9. Lockup Agreement. Each Purchaser, Holder, Founder and transferee hereby agrees
that, in connection with the Company’s initial public offering of its securities, if so requested
by the Company or any representative of the underwriters (the “Managing Underwriter”), such
Purchaser, Holder, Founder or transferee shall not sell or otherwise transfer any securities of the
Company during the period specified by the Company’s Board of Directors at the request of the
Managing Underwriter (the “Market Standoff Period”), with such period not to exceed 180 days
following the effective date of a registration statement of the Company filed under the Securities
Act; provided that all officers, directors and one percent (1%) shareholders agree to a similar
restriction. The Company may impose stop-transfer instructions with respect to securities subject
to the foregoing restrictions until the end of such Market Standoff Period. The provisions of this
Section shall not apply to (a) any transactions relating to Ordinary Shares in the open market
after completion of the public offering or (b) any transfers of securities of the Company to
affiliates of a Purchaser or Holder. If the Company or the underwriter of any public offering of
the Company’s securities waive or terminate any standoff or lockup restrictions imposed on a holder
or holders of securities of the Company in an aggregate amount in excess of twenty thousand
(20,000) Ordinary Shares, then such waiver or termination shall be granted to all

16

 

holders subject to standoff or lockup restrictions pro rata based on the number of Ordinary Shares beneficially
held by such holders.

     10. Right of First Refusal.

               (a) The Company hereby grants to each Purchaser the right of first refusal to purchase its Pro
Rata Share of New Securities (as defined in this Section 10) which the Company may, from time to
time, propose to sell and issue. A “Pro Rata Share,” for purposes of
this right of first refusal, equals the proportion that the total number of shares of Ordinary
Shares then held by such Purchaser plus the number of shares of Ordinary Shares issuable upon
conversion of the Preferred Shares then held by such Purchaser bears to the sum of the total number
of shares of Ordinary Shares (as adjusted for stock splits, stock dividends, recapitalizations and
the like) then outstanding plus the number of shares of Ordinary Shares (as adjusted for stock
splits, stock dividends, recapitalizations and the like) issuable upon exercise or conversion of
all then outstanding securities exercisable for or convertible into, directly or indirectly,
Ordinary Shares.

                         (A) Except as set forth below, “New Securities” shall mean any shares of capital stock of the
Company, including Ordinary Shares and any series of preferred shares, whether now authorized or
not, and rights, options or warrants to purchase said shares of Ordinary Shares or Preferred
Shares, and securities of any type whatsoever that are, or may become, convertible into or
exchangeable for said shares of Ordinary Shares or preferred shares. Notwithstanding the foregoing,
“New Securities” does not include: (i) Ordinary Shares issued pursuant to a transaction described
in subarticles 5.3.3.3, 5.3.3.4, 5.3.3.5, 5.3.3.6, 5.3.4 or 5.3.5 of the Restated Articles; (ii) up
to 9,185,542 Ordinary Shares or any other securities pursuant to a share option or other incentive
plan or as part of a compensation arrangement to an officer, employee, director or consultant
approved by the Board of Directors including, without limitation, the exercise of options
outstanding as of the Original Issue Date; (iii) Ordinary Shares issued on conversion of Preferred
Shares; (iv) Ordinary Shares issued in the Company’s Qualified Initial Public Offering; (v)
Ordinary Shares issued to equipment lessors, banks, financial institutions or similar entities, or
to strategic partners of the Company, in a transaction approved by a vote of a majority of the
directors elected pursuant to Article 39.2 of the Restated Articles, the principal purpose of which
is other than raising of capital through the sale of equity securities of the Company.

               (b) In the event the Company proposes to undertake an issuance of New Securities, it shall
give each Purchaser written notice of its intention, describing the amount and type of New
Securities, and the price and terms upon which the Company proposes to issue the same. Each
Purchaser shall have 10 days from the date of receipt of any such notice to agree to purchase up to
its respective Pro Rata Share of such New Securities for the price and upon the terms specified in
the notice by giving written notice to the Company and stating therein the quantity of New
Securities to be purchased.

               (c) Beginning ten days after the notice given pursuant to Section 10(c) above, the Company
shall have 120 days to sell the New Securities not elected or eligible to be purchased by
Purchasers at the price and upon the terms no more favorable to the purchasers of such securities
than specified in the Company’s notice. In the event the Company has not sold all

17

 

of the New Securities within said 120 day period, the Company shall not thereafter issue or sell any New
Securities without first offering such securities in the manner provided above.

               (d) The provisions of this Section 10 will terminate and be of no further force or effect upon
the earlier to occur of: (i) immediately prior to the closing of the Company’s Qualified Initial
Public Offering, or (ii) the sale of all or substantially all of the assets of the Company or the
acquisition of the Company by another entity by means of merger or consolidation resulting in the
exchange of the outstanding shares of the Company for securities
or consideration issued, or caused to be issued, by the acquiring corporation or its
subsidiary, unless the shareholders of the Company immediately prior to such transaction hold at
least 50% of the voting power of the surviving corporation or its parent in such a transaction.

     11. Confidential Information and Invention Assignment Agreements. The Company will
maintain a policy requiring each person now or hereafter employed by it or any subsidiary with
access to confidential information to enter into a Confidential Information and Invention
Assignment Agreement substantially in a form attached to the Purchase Agreement.

     12. Transfer of Rights.

               (a) The rights granted under Sections 5, 6 and 10 of this Agreement may be assigned to any
transferee or assignee, other than a competitor or potential competitor of the Company (as
determined in good faith by the Company’s Board of Directors) in connection with any transfer or
assignment of Registrable Securities by the Holder; and

               (b) notwithstanding the foregoing, the rights granted under Sections 5 and 10 of this
Agreement may be assigned to any wholly-owned subsidiary of a Holder in connection with any
transfer or assignment of Registrable Securities by such Holder,

     provided that: (i) each such transfer is otherwise effected in accordance with applicable
securities laws and the terms of this Agreement; (ii) prior written notice is given to the Company;
(iii) such transferee or assignee agrees to be bound by the provisions of this Agreement; and (iv)
such transferee acquires at least 50,000 shares of Registrable Securities.

     13. Agreement to Vote. As long as BVP holds at least 250,000 shares of Series D
Redeemable Preferred, each holder of Series D Redeemable Preferred Shares agrees to vote all of
their respective shares of Series D Redeemable Preferred so as to elect one (1) representative
designated by BVP as the Series D Director . If BVP holds less than 250,000 shares of Series D
Redeemable Preferred, each holder of Series D Redeemable Preferred shall vote all of their
respective shares of Series D Redeemable Preferred so as to elect one (1) representative designated
by the holders of a majority of the shares of Series D Redeemable Preferred as the Series D
Director.

     14. Amendment. Except as otherwise provided herein, additional parties may be added to
this Agreement, any provision of this Agreement may be amended or the observance thereof may be
waived (either generally or in a particular instance and either retroactively or prospectively),
only with the written consent of the Company, the Holders of a majority of the Registrable
Securities then outstanding. Any amendment or waiver effected in accordance with

18

 

this Section 14 shall be binding upon each Purchaser, Holder of Registrable Securities at the time outstanding,
each future holder of any of such securities, the Founders, and the Company.

     15. Governing Law. This Agreement shall be governed in all respects by the internal
laws of the State of California without regard to conflict of laws provisions.

     16. Entire Agreement. This Agreement constitutes the full and entire understanding and
Agreement among the parties regarding the matters set forth herein. Except as otherwise expressly
provided herein, the provisions hereof shall inure to the benefit of, and be binding upon the
successors, assigns, heirs, executors and administrators of the parties hereto.

     17. Notices, etc. All notices and other communications required or permitted hereunder
shall, for all purposes of this Agreement, be treated as effective or having been given (i) if
delivered personally (including by overnight express or messenger), when received, (ii) if
delivered by facsimile, the first business day after the date of confirmation that the facsimile
has been successfully transmitted to the facsimile number for the party notified, (iii) if sent by
mail to an address in the United States, at the earlier of its receipt or three (3) days after the
same has been deposited in a regularly maintained receptacle for the deposit of the United States
mail, addressed and mailed as aforesaid, or (iv) if sent by mail to an address outside of the
United States, seven (7) days after being mailed to the recipient by certified or registered mail,
return receipt requested and postage prepaid. Such notices or other communications shall be sent to
each party at the address below:

               (a) if to a Purchaser, at such other address as such Purchaser shall have furnished to the
Company;

               (b) if to a Founder, at such other address as such Founder shall have furnished to the
Company; and

               (c) if to the Company, to:

Mellanox Technologies, Ltd.

2900 Stender Way

Santa Clara, CA 95054

Attention: Eyal Waldman, CEO

Fax: (408) 970-3403

     or at such other address as the Company shall have furnished to the Purchasers, with a copy
to:

Latham & Watkins

135 Commonwealth Drive

Menlo Park, CA 94025

Attention: Alan C. Mendelson, Esq.

Fax: (650) 463-2600

     and another copy to: Yigal Arnon & Co.

19

 

22 Rivlin Street

Jerusalem, 91000

Israel

Attention: Barry Levenfeld, Adv.

Fax: +972-2-623-9236

     18. Counterparts. This Agreement may be executed in any number of counterparts, each
of which shall be an original and all of which together shall constitute one instrument.

     19. Grant of Proxy. Should the provisions of Section 13 be construed to constitute the
granting of proxies, such proxies shall be deemed coupled with an interest and are irrevocable for
the term of Section 13.

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

20

 

     IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date first set
forth above.

	 	 	 	 	 	 	 	 	 
	“COMPANY”	 	 	 	“PURCHASERS”
	 
	 	 	 	 	 	 	 	 
	MELLANOX TECHNOLOGIES, LTD.	 	 	 	Entity Investors
	 
	 	 	 	 	 	 	 	 
	An Israeli company

	 	 	 	By:	 	 	 	 
	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	/s/ Eyal Waldman 
	 	 	 	Print Name:	 
	 	 	 	 	 	 	 	 	 
	Eyal Waldman
	 	 	 	 	 	 	 	 
	Chief Executive Officer

	 	 	 	Its:	 	 	 	 
	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	 	 	Individual Investors

Mellanox Amended and Restated Investor Rights Agreement

Signature Page — 1

 

 

	 	 	 
	 

	 	“FOUNDERS”
	 
	 	 
	 

	 	/s/ Eyal Waldman 

	 

	 	EYAL WALDMAN
	 
	 	 
	 

	 	/s/ Roni Ashuri 

	 

	 	RONI ASHURI
	 
	 	 
	 

	 	/s/ Shai Cohen 

	 

	 	SHAI COHEN
	 
	 	 
	 

	 	/s/ Michael Kagan 

	 

	 	MICHAEL KAGAN
	 
	 	 
	 

	 	/s/ Evelyn Landsman 

	 

	 	EVELYN LANDSMAN
	 
	 	 
	 

	 	/s/ Shimon Rotenberg 

	 

	 	SHIMON ROTENBERG
	 
	 	 
	 

	 	/s/ Eitan Zehavi 

	 

	 	EITAN ZEHAVI
	 
	 	 
	 

	 	/s/ Udi Katz 

	 

	 	UDI KATZ
	 
	 	 
	 

	 	/s/ Alon Webman 

	 

	 	ALON WEBMAN

Mellanox Amended and Restated Investor Rights Agreement

Signature Page — 2exv10w1

 

Exhibit 10.1

Mellanox Technologies Ltd.

1999 United States Equity Incentive Plan

Adopted August 26, 1999

Amended September 3, 2004

Approved By Shareholders [August 26, 1999]

Termination Date: August 25, 2009

1. Purposes.

     (a) Eligible Stock Award Recipients. The persons eligible to
receive Stock Awards are the Employees, Directors and Consultants of the
Company and its Affiliates.

     (b) Available Stock Awards. The purpose of the Plan is to provide a
means by which eligible recipients of Stock Awards may be given an
opportunity to benefit from increases in value of the Ordinary Shares
through the granting of the following Stock Awards: (i) Incentive Stock
Options, (ii) Nonstatutory Stock Options, (iii) stock bonuses and (iv)
rights to acquire restricted stock.

     (c) General Purpose. The Company, by means of the Plan, seeks to retain
the services of the group of persons eligible to receive Stock Awards, to
secure and retain the services of new members of this group and to provide
incentives for such persons to exert maximum efforts for the success of the
Company and its Affiliates.

2. Definitions.

     (a) “Affiliate” means any parent corporation or subsidiary
corporation of the Company, whether now or hereafter existing, as those
terms are defined in Sections 424(e) and (f), respectively, of the Code.

     (b) “Board” means the Board of Directors of the Company.

     (c) “Code ” means the Internal Revenue Code of 1986, as amended.

     (d) “Committee” means a committee of one or more members of the Board
appointed by the Board in accordance with subsection 3(c).

     (e) “Company” means Mellanox Technologies Ltd., an Israeli corporation.

     (f) “Consultant” means any person, including an advisor, (i) engaged by
the Company or an Affiliate to render consulting or advisory services and
who is compensated for such services or (ii) who is a member of the Board of
Directors of an Affiliate. However, the term “Consultant” shall not include
either Directors who are not compensated by the Company

1

 

for their services as Directors or Directors who are merely paid a
director’s fee by the Company for their services as Directors.

     (g) “Continuous Service” means that the Participant’s service with the
Company or an Affiliate, whether as an Employee, Director or Consultant, is
not interrupted or terminated. The Participant’s Continuous Service shall
not be deemed to have terminated merely because of a change in the capacity
in which the Participant renders service to the Company or an Affiliate as
an Employee, Consultant or Director or a change in the entity for which the
Participant renders such service, provided that there is no interruption or
termination of the Participant’s Continuous Service. For example, a change
in status from an Employee of the Company to a Consultant of an Affiliate or
a Director will not constitute an interruption of Continuous Service. The
Board or the chief executive officer of the Company, in that party’s sole
discretion, may determine whether Continuous Service shall be considered
interrupted in the case of any leave of absence approved by that party,
including sick leave, military leave or any other personal leave.

     (h) “Covered Employee” means the chief executive officer and the four
(4) other highest compensated officers of the Company for whom total
compensation is required to be reported to shareholders under the Exchange
Act, as determined for purposes of Section 162(m) of the Code.

     (i) “Director” means a member of the Board of Directors of the Company.

     (j) “Disability” means (i) before the Listing Date, the inability of a
person, in the opinion of a qualified physician acceptable to the Company,
to perform the major duties of that person’s position with the Company or
an Affiliate of the Company because of the sickness or injury of the person
and (ii) after the Listing Date, the permanent and total disability of a
person within the meaning of Section 22(e)(3) of the Code.

     (k) “Employee” means any person employed by the Company or an
Affiliate. Mere service as a Director or payment of a director’s fee by the
Company or an Affiliate shall not be sufficient to constitute “employment”
by the Company or an Affiliate.

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

     (m) “Fair Market Value” means, as of any date, the value of the
Ordinary Shares determined as follows:

          (i) If the Ordinary Shares are listed on any established stock exchange
or traded on the Nasdaq National Market or the Nasdaq SmallCap Market, the
Fair Market Value of an Ordinary Share shall be the closing sales price for
such stock (or the closing bid, if no sales were reported) as quoted on such
exchange or market (or the exchange or market with the greatest volume of
trading in the Ordinary Shares) 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 Board deems reliable.

2

 

          (ii) In the absence of such markets for the Ordinary Shares, the Fair
Market Value shall be determined in good faith by the Board.

          (iii) Prior to the Listing Date, the value of the Ordinary Shares shall
be determined in a manner consistent with Section 260.140.50 of Title 10 of
the California Code of Regulations.

     (n) “Incentive Stock Option” means an Option intended to qualify as an
incentive stock option within the meaning of Section 422 of the Code and the
regulations promulgated thereunder.

     (o) “Listing Date” means the first date upon which any security of the
Company is listed (or approved for listing) upon notice of issuance on any
securities exchange or designated (or approved for designation) upon notice
of issuance as a national market security on an interdealer quotation system
if such securities exchange or interdealer quotation system has been
certified in accordance with the provisions of Section 25100(o) of the
California Corporate Securities Law of 1968.

     (p) “Non-Employee Director” means a Director who either (i) is not a
current Employee or Officer of the Company or its parent or a subsidiary,
does not receive compensation (directly or indirectly) from the Company or
its parent or a subsidiary for services rendered as a consultant or in any
capacity other than as a Director (except for an amount as to which
disclosure would not be required under Item 404(a) of Regulation S-K
promulgated pursuant to the Securities Act (“Regulation S-K”)), does not
possess an interest in any other transaction as to which disclosure would be
required under Item 404(a) of Regulation S-K and is not engaged in a
business relationship as to which disclosure would be required under Item
404(b) of Regulation S-K; or (ii) is otherwise considered a “non-employee
director” for purposes of Rule 16b-3.

     (q) “Nonstatutory Stock Option” means an Option not intended to qualify
as an Incentive Stock Option.

     (r) “Officer” means (i) before the Listing Date, any person designated
by the Company as an officer and (ii) on and after the Listing Date, a
person who is an officer of the Company within the meaning of Section 16 of
the Exchange Act and the rules and regulations promulgated thereunder.

     (s) “Option” means an Incentive Stock Option or a Nonstatutory Stock
Option granted pursuant to the Plan.

     (t) “Option Agreement” means a written agreement between the Company
and an Optionholder evidencing the terms and conditions of an individual
Option grant. Each Option Agreement shall be subject to the terms and
conditions of the Plan.

     (u) “Optionholder” means a person to whom an Option is granted
pursuant to the Plan or, if applicable, such other person who holds an
outstanding Option.

3

 

     (v) “Ordinary Shares” means the Ordinary Shares of nominal value NIS
0.01 each of the Company.

     (w) “Outside Director” means a Director who either (i) is not a current
employee of the Company or an “affiliated corporation” (within the meaning
of Treasury Regulations promulgated under Section 162(m) of the Code), is
not a former employee of the Company or an “affiliated corporation”
receiving compensation for prior services (other than benefits under a tax
qualified pension plan), was not an officer of the Company or an “affiliated
corporation” at any time and is not currently receiving direct or indirect
remuneration from the Company or an “affiliated corporation” for services in
any capacity other than as a Director or (ii) is otherwise considered an
“outside director” for purposes of Section 162(m) of the Code.

     (x) “Participant” means a person to whom a Stock Award is granted
pursuant to the Plan or, if applicable, such other person who holds an
outstanding Stock Award.

     (y) “Plan” means this Mellanox Technologies Ltd. 1999 United States
Equity Incentive Plan.

     (z) “Rule 16b-3” means Rule 16b-3 promulgated under the Exchange Act or
any successor to Rule 16b-3, as in effect from time to time.

     (aa) “Securities Act” means the Securities Act of 1933, as amended.

     (bb) “Stock Award” means any right granted under the Plan, including an
Option, a stock bonus and a right to acquire restricted stock.

     (cc) “Stock Award Agreement” means a written agreement between the
Company and a holder of a Stock Award evidencing the terms and conditions of
an individual Stock Award grant. Each Stock Award Agreement shall be subject
to the terms and conditions of the Plan.

     (dd) “Ten Percent Shareholder” means a person who owns (or is deemed to
own pursuant to Section 424(d) of the Code) stock possessing more than ten
percent (10%) of the total combined voting power of all classes of stock of
the Company or of any of its Affiliates.

3. Administration.

     (a) Administration by Board. The Board shall administer the Plan
unless and until the Board delegates administration to a Committee, as
provided in subsection 3(c). Any interpretation of the Plan by the Board
and any decision by the Board under the Plan shall be final and binding on
all persons. Notwithstanding the above, the Board shall automatically have a
residual authority if no Committee shall be constituted or if such Committee
shall cease to operate for any reason whatsoever.

     (b) Powers of Board.

4

 

          (i) The Board shall have full power and authority (1) to designate
Participants; (2) to determine the terms and provisions of respective Stock
Award Agreements (which need not be identical) including, but not limited
to, the number of Ordinary Shares in the Company to be covered by each Stock
Award, the time(s) when and the extent to which the Stock Awards may be
exercised, any conditions upon which the vesting of the Ordinary Shares
acquired pursuant to a Stock Award may be accelerated, and the nature and
duration of restrictions as to transferability or restrictions constituting
substantial risk of forfeiture; (3) to accelerate the right of a Participant
to exercise, in whole or in part, any previously granted Stock Award; (4) to
interpret the provisions and supervise the administration of the Plan; (5)
to determine the Fair Market Value of the Ordinary Shares; (6) to designate
Options as Incentive Stock Options or Nonstatutory Stock Options; and (7) to
determine any other matter which is necessary or desirable for, or
incidental to administration of the Plan.

          (ii) All decisions and selections made by the Board or the Committee
pursuant to the provisions of the Plan shall be made by a majority of its
members except that no member of the Board or the Committee shall vote on,
or be counted for quorum purposes, with respect to any proposed action of
the Board or the Committee relating to any Stock Award to be granted to that
member. Any decision reduced to writing and signed by a majority of the
members who are authorized to make such decision shall be fully effective as
if it had been made by a majority at a meeting duly held.

          (iii) The interpretation and construction by the Board of any provision
of the Plan or of any Stock Award thereunder shall be final and conclusive
unless otherwise determined by the Board.

          (iv) Subject to the Company decision, each member of the Board or the
Committee shall be indemnified and held harmless by the Company against any
cost or expense (including counsel fees) reasonably incurred by such member,
or any liability (including any sum paid in settlement of a claim with the
approval of the Company) arising out of any act or omission to act in
connection with the Plan unless arising out of such member’s own fraud or
bad faith, to the extent permitted by applicable law. Such indemnification
shall be in addition to any rights of indemnification the member may have as
a director or otherwise under the Company’s Articles of Association, any
agreement, any vote of shareholders or disinterested directors, insurance
policy or otherwise.

     (c) Delegation to Committee.

          (i) General. The Board may delegate administration of the Plan to a
Committee or Committees of two (2) or more members of the Board, and the
term “Committee” shall apply to any person or persons to whom such authority
has been delegated. If administration is delegated to a Committee, the
Committee shall have, in connection with the administration of the Plan, the
powers theretofore possessed by the Board, including the power to delegate
to a subcommittee any of the administrative powers the Committee is
authorized to exercise (and references in this Plan to the Board shall
thereafter be to the Committee or subcommittee), subject, however, to such
resolutions, not inconsistent with the provisions of the Plan, as may be
adopted from time to time by the Board. The Board may abolish the Committee

5

 

at any time and revest in the Board the administration of the Plan. The
Committee shall select
one of its members as its chairman (“the Chairman”) and shall hold its
meetings at such times and places as the Chairman shall determine. The
Committee shall keep records of its meetings and shall make such rules and
regulations for the conduct of its business as it shall deem advisable.

          (ii) Committee Composition when Ordinary Shares are Publicly Traded.
At such time as the Ordinary Shares are publicly traded, in the discretion
of the Board, a Committee may consist solely of two or more Outside
Directors, in accordance with Section 162(m) of the Code, and/or solely of
two or more Non-Employee Directors, in accordance with Rule 16b-3. Within
the scope of such authority, the Board or the Committee may (1) delegate to
a committee of one or more members of the Board who are not Outside
Directors the authority to grant Stock Awards to eligible persons who are
either (a) not then Covered Employees and are not expected to be Covered
Employees at the time of recognition of income resulting from such Stock
Award or (b) not persons with respect to whom the Company wishes to comply
with Section 162(m) of the Code and/or) (2) delegate to a committee of one
or more members of the Board who are not Non-Employee Directors the
authority to grant Stock Awards to eligible persons who are not then subject
to Section 16 of the Exchange Act.

4. Shares Subject to the Plan.

     (a) Share Reserve. Subject to the provisions of Section 11
relating to adjustments
upon changes in Ordinary Shares, the number of Ordinary Shares that may
be issued pursuant to
Stock Awards pursuant to the Plan and pursuant to the Mellanox
Technologies Ltd. 1999 Israeli
Share Option Plan shall not exceed in the aggregate two million two
hundred seventy thousand
(2,270,000) Ordinary Shares.

     (b) Reversion of Shares to the Share Reserve. If any Stock Award
shall for any
reason expire or otherwise terminate, in whole or in part, without
having been exercised in full,
the Ordinary Shares not acquired under such Stock Award shall revert to
and again become
available for issuance under the Plan and under the Mellanox
Technologies Ltd. 1999 Israeli
Share Option Plan.

     (c) Source of Shares. The Ordinary Shares subject to the Plan and to
the Mellanox Technologies Ltd. 1999 Israeli Share Option Plan may be
unissued shares or reacquired shares, bought on the market or otherwise, if
permitted by law.

     (d) Share Reserve Limitation. Prior to the Listing Date and to the
extent then required by Section 260.140.45 of Title 10 of the California
Code of Regulations, the total number of Ordinary Shares issuable upon
exercise of all outstanding Stock Awards and the total number of Ordinary
Shares provided for under any stock bonus or similar plan of the Company
shall not exceed the applicable percentage as calculated in accordance with
the conditions and

6

 

exclusions of Section 260.140.45 of Title 10 of the California Code of
Regulations, based on the Ordinary Shares that are outstanding at the time
the calculation is made.1

5. Eligibility.

     (a) Eligibility
for Specific Stock  Awards. Incentive Stock Options may
be granted
only to Employees. Stock Awards other than Incentive Stock Options may be
granted to
Employees, Directors and Consultants.

     (b) Ten Percent Shareholders.

          (i) A Ten Percent Shareholder shall not be granted an Incentive Stock
Option unless the exercise price of such Option is at least one hundred ten
percent (110%) of the Fair Market Value of the Ordinary Shares at the date
of grant and the Option is not exercisable after the expiration of five (5)
years from the date of grant.

          (ii) Prior to the Listing Date, a Ten Percent Stockholder shall not be
granted a Nonstatutory Stock Option unless the exercise price of such Option
is at least (i) one hundred ten percent (110%) of the Fair Market Value of
the Ordinary Shares at the date of grant or (ii) such lower percentage of
the Fair Market Value of the Ordinary Shares at the date of grant as is
permitted by Section 260.140.41 of Title 10 of the California Code of
Regulations at the time of the grant of the Option.

          (iii) Prior to the Listing Date, a Ten Percent Stockholder shall not be
granted a restricted stock award unless the purchase price of the restricted
stock is at least (i) one hundred percent (100%) of the Fair Market Value of
the Ordinary Shares at the date of grant or (ii) such lower percentage of
the Fair Market Value of the Ordinary Shares at the date of grant as is
permitted by Section 260.140.41 of Title 10 of the California Code of
Regulations at the time of the grant of the Option.

     (c) Consultants.

          (i) Prior to the Listing Date, a Consultant shall not be eligible for
the grant of a Stock Award if, at the time of grant, either the offer or the
sale of the Company’s securities to such Consultant is not exempt under Rule
701 of the Securities Act (“Rule 701”) because of the nature of the services
that the Consultant is providing to the Company, or because the Consultant
is not a natural person, or as otherwise provided by Rule 701, unless the
Company determines that such grant need not comply with the requirements of
Rule 701 and will satisfy another

 

			
	1	 	Section 260.140.45 generally provides that the total number of
shares issuable upon exercise of all outstanding options (exclusive of
certain rights) and the total number of shares called for under any stock
bonus or similar plan shall not exceed a number of shares which is equal to
30% of the then outstanding shares of the issuer (convertible preferred or
convertible senior common shares counted on an as if converted basis),
exclusive of shares subject to promotional waivers under Section 260.141,
unless a percentage higher than 30% is approved by at least two-thirds of
the outstanding shares entitled to vote.

7

 

exemption under the Securities Act as well as comply with the
securities laws of all other relevant jurisdictions.

          (ii) From and after the Listing Date, a Consultant shall not be
eligible for the grant of a Stock Award if, at the time of grant, a Form S-8
Registration Statement under the Securities Act (“Form S-8”) is not
available to register either the offer or the sale of the Company’s
securities to such Consultant because of the nature of the services that the
Consultant is providing to the Company, or because the Consultant is not a
natural person, or as otherwise provided by the rules governing the use of
Form S-8, unless the Company determines both (i) that such grant (A) shall
be registered in another manner under the Securities Act (e.g., on a Form
S-3 Registration Statement) or (B) does not require registration under the
Securities Act in order to comply with the requirements of the Securities
Act, if applicable, and (ii) that such grant complies with the securities
laws of all other relevant jurisdictions.

          (iii) Rule 701 and Form S-8 generally are available to consultants and
advisors only if (1) they are natural persons; (2) they provide bona fide
services to the issuer, its parents, its majority-owned subsidiaries or (for
Rule 701 purposes only) majority-owned subsidiaries of the issuer’s parent;
and (3) the services are not in connection with the offer or sale of
securities in a capital-raising transaction, and do not directly or
indirectly promote or maintain a market for the issuer’s securities.

6. Option Provisions.

     Each Option shall be in such form and shall contain such terms and
conditions as the Board shall deem appropriate. All Options shall be
separately designated Incentive Stock Options or Nonstatutory Stock Options
at the time of grant, and, if certificates are issued, a separate
certificate or certificates will be issued for Ordinary Shares purchased on
exercise of each type of Option. The provisions of separate Options need not
be identical, but each Option shall include (through incorporation of
provisions hereof by reference in the Option or otherwise) the substance of
each of the following provisions:

     (a) Term. Subject to the provisions of subsection 5(b) regarding Ten
Percent
Shareholders, no Option shall be exercisable after the expiration of ten
(10) years from the date it
was granted.

     (b) Exercise Price of an Incentive Stock Option. Subject to the
provisions of
subsection 5(b) regarding Ten Percent Shareholders, the exercise price
of each Incentive Stock
Option shall be not less than one hundred percent (100%) of the Fair
Market Value of the
Ordinary Shares subject to the Option on the date the Option is
granted. Notwithstanding the
foregoing, an Incentive Stock Option may be granted with an exercise
price lower than that set
forth in the preceding sentence if such Option is granted pursuant to
an assumption or
substitution for another option in a manner satisfying the provisions
of Section 424(a) of the
Code.

     (c) Exercise Price of a Nonstatutory Stock Option. Subject to the
provisions of subsection 5(b) regarding Ten Percent Shareholders, the
exercise price of each Nonstatutory

8

 

Stock Option granted prior to the Listing Date shall be not less than
eighty-five percent (85%) of the Fair Market Value of the Ordinary Shares
subject to the Option on the date the Option is granted. The exercise price
of each Nonstatutory Stock Option granted on or after the Listing Date shall
be not less than eighty-five percent (85%) of the Fair Market Value of the
Ordinary Shares subject to the Option on the date the Option is granted.
Notwithstanding the foregoing, a Nonstatutory Stock Option may be granted
with an exercise price lower than that set forth in the preceding sentence
if such Option is granted pursuant to an assumption or substitution for
another option in a manner satisfying the provisions of Section 424(a) of
the Code.

     (d) Consideration. The purchase price of Ordinary Shares acquired
pursuant to an
Option shall be paid, to the extent permitted by applicable statutes
and regulations, either (i) in
cash at the time the Option is exercised or (ii) at the discretion of
the Board at the time of the
grant of the Option (or subsequently in the case of a Nonstatutory
Stock Option) in any other
form of legal consideration that may be acceptable to the Board.

     (e) Transferability of an Incentive Stock Option. An Incentive Stock
Option shall
not be transferable except by will or by the laws of descent and
distribution and shall be
exercisable during the lifetime of the Optionholder only by the
Optionholder. Notwithstanding
the foregoing, the Optionholder may, by delivering written notice to
the Company, in a form
satisfactory to the Company, designate a third party who, in the event
of the death of the
Optionholder, shall thereafter be entitled to exercise the Option.

     (f) Transferability of a Nonstatutory Stock Option. A Nonstatutory
Stock Option
granted prior to the Listing Date shall not be transferable except by
will or by the laws of descent
and distribution and, to the extent provided in the Option Agreement,
to such further extent as
permitted by Section 260.140.41(d) of Title 10 of the California Code
of Regulations at the time
of the grant of the Option, and shall be exercisable during the
lifetime of the Optionholder only
by the Optionholder. A Nonstatutory Stock Option granted on or after
the Listing Date shall be
transferable to the extent provided in the Option Agreement. If the
Nonstatutory Stock Option
does not provide for transferability, then the Nonstatutory Stock
Option shall not be transferable
except by will or by the laws of descent and distribution and shall be
exercisable during the
lifetime of the Optionholder only by the Optionholder.
Notwithstanding the foregoing, the
Optionholder may, by delivering written notice to the Company, in a
form satisfactory to the
Company, designate a third party who, in the event of the death of the
Optionholder, shall
thereafter be entitled to exercise the Option.

     (g) Vesting Generally. The total number of Ordinary Shares subject to
an Option
may, but need not, vest and therefore become exercisable in periodic
installments that may, but
need not, be equal. The Option may be subject to such other terms and
conditions on the time or
times when it may be exercised (which may be based on performance or
other criteria) as the
Board may deem appropriate. The vesting provisions of individual
Options may vary. The
provisions of this subsection 6(g) are subject to any Option provisions
governing the minimum
number of Ordinary Shares as to which an Option may be exercised.

     (h) Minimum Vesting Prior to the Listing Date. Notwithstanding
the foregoing subsection 6(g), to the extent that the following restrictions
on vesting are required by Section

9

 

260.140.41(f) of Title 10 of the California Code of Regulations at the time of the grant
of the Option, then:

          (i) Options granted prior to the Listing Date to an Employee who is not an Officer,
Director or Consultant shall provide for vesting of the total number of Ordinary Shares
at a rate of at least twenty percent (20%) per year over five (5) years from the date the
Option was granted, subject to reasonable conditions such as continued employment; and

          (ii) Options granted prior to the Listing Date to Officers, Directors or Consultants
may be made fully exercisable, subject to reasonable conditions such as continued
employment, at any time or during any period established by the Company.

     (i) Termination of Continuous Service. In the event an Optionholder’s Continuous
Service terminates (other than upon the Optionholder’s death or Disability), the
Optionholder may exercise his or her Option (to the extent that the Optionholder was
entitled to exercise such Option as of the date of termination) but only within such
period of time ending on the earlier of (i) the date three (3) months following the
termination of the Optionholder’s Continuous Service (or such longer or shorter period
specified in the Option Agreement, which period shall not be less than thirty (30) days
for Options granted prior to the Listing Date unless such termination is for cause), or
(ii) the expiration of the term of the Option as set forth in the Option Agreement. If,
after termination, the Optionholder does not exercise his or her Option within the time
specified in the Option Agreement, the Option shall terminate.

     (j) Extension of Termination Date. An Optionholder’s Option Agreement may also
provide that if the exercise of the Option following the termination of the
Optionholder’s Continuous Service (other than upon the Optionholder’s death or
Disability) would be prohibited at any time solely because the issuance of Ordinary
Shares would violate the registration requirements under the Securities Act, then the
Option shall terminate on the earlier of (i) the expiration of the term of the Option set
forth in subsection 6(a) or (ii) the expiration of a period of three (3) months after the
termination of the Optionholder’s Continuous Service during which the exercise of the
Option would not be in violation of such registration requirements.

     (k) Disability of Optionholder. In the event that an Optionholder’s Continuous
Service terminates as a result of the Optionholder’s Disability, the Optionholder may
exercise his or her Option (to the extent that the Optionholder was entitled to exercise
such Option as of the date of termination), but only within such period of time ending on
the earlier of (i) the date twelve (12) months following such termination (or such longer
or shorter period specified in the Option Agreement, which period shall not be less than
six (6) months for Options granted prior to the Listing Date) or (ii) the expiration of
the term of the Option as set forth in the Option Agreement. If, after termination, the
Optionholder does not exercise his or her Option within the time specified herein, the
Option shall terminate.

     (l) Death of Optionholder. In the event (i) an Optionholder’s Continuous Service
terminates as a result of the Optionholder’s death or (ii) the Optionholder dies within
the period (if any) specified in the Option Agreement after the termination of the
Optionholder’s Continuous Service for a reason other than death, then the Option may be
exercised (to the extent

10

 

the Optionholder was entitled to exercise such Option as of the date of death) by the
Optionholder’s estate, by a person who acquired the right to exercise the Option by
bequest or inheritance or by a person designated to exercise the option upon the
Optionholder’s death pursuant to subsection 6(e) or 6(f), but only within the period
ending on the earlier of (1) the date eighteen (18) months following the date of death
(or such longer or shorter period specified in the Option Agreement, which period shall
not be less than six (6) months for Options granted prior to the Listing Date) or (2) the
expiration of the term of such Option as set forth in the Option Agreement. If, after
death, the Option is not exercised within the time specified herein, the Option shall
terminate.

     (m) Early Exercise. The Option may, but need not, include a provision whereby the
Optionholder may elect at any time before the Optionholder’s Continuous Service
terminates to exercise the Option as to any part or all of the Ordinary Shares subject to
the Option prior to the full vesting of the Option. Subject to the “Repurchase
Limitation” in subsection 10(h), any unvested Ordinary Shares so purchased may be subject
to a repurchase option in favor of the Repurchaser as defined in Section 14(b)(i) below
or to any other restriction the Board determines to be appropriate.

7. Provisions of Stock Awards Other Than Options.

     (a) Stock Bonus Awards. Each stock bonus agreement shall be in such form and
shall contain such terms and conditions as the Board shall deem appropriate. The terms
and conditions of stock bonus agreements may change from time to time, and the terms and
conditions of separate stock bonus agreements need not be identical, but each stock bonus
agreement shall include (through incorporation of provisions hereof by reference in the
agreement or otherwise) the substance of each of the following provisions:

          (i) Consideration. A stock bonus may be awarded in consideration for past services
actually rendered to the Company or an Affiliate for its benefit.

          (ii) Vesting. Subject to the “Repurchase Limitation” in subsection 10(h), Ordinary
Shares awarded under the stock bonus agreement may, but need not, be subject to a share
repurchase option in favor of the Company in accordance with a vesting schedule to be
determined by the Board.

          (iii) Termination of Participant’s Continuous Service. Subject to the “Repurchase
Limitation” in subsection 10(h), in the event a Participant’s Continuous Service
terminates, the Company may reacquire any or all of the Ordinary Shares held by the
Participant which have not vested as of the date of termination under the terms of the
stock bonus agreement.

          (iv) Transferability. For a stock bonus award made before the Listing Date, rights
to acquire Ordinary Shares under the stock bonus agreement shall not be transferable
except by will or by the laws of descent and distribution and shall be exercisable during
the lifetime of the Participant only by the Participant. For a stock bonus award made on
or after the Listing Date, rights to acquire Ordinary Shares under the stock bonus
agreement shall be

11

 

transferable by the Participant only upon such terms and conditions as are set
forth in the stock bonus agreement, as the Board shall determine in its
discretion, so long as Ordinary Shares awarded under the stock bonus agreement
remain subject to the terms of the stock bonus agreement.

     (b) Restricted Stock Awards. Each restricted stock purchase agreement shall
be in such form and shall contain such terms and conditions as the Board shall
deem appropriate. The terms and conditions of the restricted stock purchase
agreements may change from time to time, and the terms and conditions of separate
restricted stock purchase agreements need not be identical, but each restricted
stock purchase agreement shall include (through incorporation of provisions
hereof by reference in the agreement or otherwise) the substance of each of the
following provisions:

          (i) Purchase Price. Subject to the provisions of subsection 5(b) regarding
Ten Percent Shareholders, the purchase price under each restricted stock purchase
agreement shall be such amount as the Board shall determine and designate in such
restricted stock purchase agreement. For restricted stock awards made prior to
the Listing Date, the purchase price shall not be less than eighty-five percent
(85%) of the Ordinary Shares’ Fair Market Value on the date such award is made or
at the time the purchase is consummated. For restricted stock awards made on or
after the Listing Date, the purchase price shall not be less than eighty-five
percent (85%) of the Ordinary Shares’ Fair Market Value on the date such award is
made or at the time the purchase is consummated.

          (ii) Consideration. The purchase price of Ordinary Shares acquired pursuant
to the restricted stock purchase agreement shall be paid either: (i) in cash at
the time of purchase; (ii) at the discretion of the Board, according to a
deferred payment or other similar arrangement with the Participant; or (iii) in
any other form of legal consideration that may be acceptable to the Board in its
discretion.

          (iii) Vesting. Subject to the “Repurchase Limitation” in subsection 10(h),
Ordinary Shares acquired under the restricted stock purchase agreement may, but
need not, be subject to a share repurchase option in favor of the Company in
accordance with a vesting schedule to be determined by the Board.

          (iv) Termination of Participant’s Continuous Service. Subject to the
“Repurchase Limitation” in subsection 10(h), in the event a Participant’s
Continuous Service terminates, the Company may repurchase or otherwise reacquire
any or all of the Ordinary Shares held by the Participant which have not vested
as of the date of termination under the terms of the restricted stock purchase
agreement.

          (v) Transferability. For a restricted stock award made before the Listing
Date, rights to acquire Ordinary Shares under the restricted stock purchase
agreement shall not be transferable except by will or by the laws of descent and
distribution and shall be exercisable during the lifetime of the Participant only
by the Participant. For a restricted stock award made on or after the Listing
Date, rights to acquire Ordinary Shares under the restricted stock purchase
agreement shall be transferable by the Participant only upon such terms and
conditions as are set

12

 

forth in the restricted stock purchase agreement, as the Board shall determine in its
discretion, so long as Ordinary Shares awarded under the restricted stock purchase
agreement remain subject to the terms of the restricted stock purchase agreement.

8. Covenants of the Company.

     (a) Availability of Shares. During the terms of the Stock Awards, the Company
shall keep available at all times the number of Ordinary Shares required to satisfy
such Stock
Awards.

     (b) Securities Law Compliance. The Company shall seek to obtain from each
regulatory commission or agency having jurisdiction over the Plan such authority as
may be
required to grant Stock Awards and to issue and sell Ordinary Shares upon exercise of
the Stock
Awards; provided, however, that this undertaking shall not require the Company to
register
under the Securities Act the Plan, any Stock Award or any Ordinary Shares issued or
issuable
pursuant to any such Stock Award. If, after reasonable efforts, the Company is unable
to obtain
from any such regulatory commission or agency the authority which counsel for the
Company
deems necessary for the lawful issuance and sale of Ordinary Shares under the Plan,
the
Company shall be relieved from any liability for failure to issue and sell Ordinary
Shares upon
exercise of such Stock Awards unless and until such authority is obtained.

9. Use of Proceeds From Stock.

     Proceeds from the sale of Ordinary Shares pursuant to Stock Awards shall
constitute general funds of the Company.

10. Miscellaneous.

     (a) Acceleration of Exercisability and Vesting. The Board shall have the power
to
accelerate the time at which a Stock Award may first be exercised or the time during
which a
Stock Award or any part thereof will vest in accordance with the Plan,
notwithstanding the
provisions in the Stock Award stating the time at which it may first be exercised or
the time
during which it will vest.

     (b) Shareholder Rights. No Participant shall be deemed to be the holder of, or to
have any of the rights of a holder with respect to, any Ordinary Shares subject to
such Stock
Award unless and until such Participant has satisfied all requirements for exercise
of the Stock
Award pursuant to its terms.

     (c) No Employment or other Service Rights. Nothing in the Plan or any instrument
executed or Stock Award granted pursuant thereto shall confer upon any Participant any
right to continue to serve the Company or an Affiliate in the capacity in effect at the
time the Stock Award was granted or shall affect the right of the Company or an Affiliate
to terminate (i) the employment of an Employee with or without notice and with or without
cause, (ii) the service of a Consultant pursuant to the terms of such Consultant’s
agreement with the Company or an Affiliate or (iii) the service of a Director pursuant to
the Articles of Association of the Company

13

 

or the Articles of Association or Bylaws of an Affiliate, and any applicable
provisions of the corporate law of the state in which the Company or the
Affiliate is incorporated, as the case may be.

     (d) Incentive Stock Option $100,000 Limitation. To the extent that the
aggregate
Fair Market Value (determined at the time of grant) of Ordinary Shares with
respect to which
Incentive Stock Options are exercisable for the first time by any
Optionholder during any
calendar year (under all plans of the Company and its Affiliates) exceeds one
hundred thousand
dollars ($100,000), the Options or portions thereof which exceed such limit
(according to the
order in which they were granted) shall be treated as Nonstatutory Stock
Options.

     (e) Investment Assurances. The Company may require a Participant, as a
condition
of exercising or acquiring Ordinary Shares under any Stock Award, (i) to give
written assurances
satisfactory to the Company as to the Participant’s knowledge and experience
in financial and
business matters and/or to employ a purchaser representative reasonably
satisfactory to the
Company who is knowledgeable and experienced in financial and business
matters and that he or
she is capable of evaluating, alone or together with the purchaser
representative, the merits and
risks of exercising the Stock Award; and (ii) to give written assurances
satisfactory to the
Company stating that the Participant is acquiring Ordinary Shares subject to
the Stock Award for
the Participant’s own account and not with any present intention of selling
or otherwise
distributing the Ordinary Shares. The foregoing requirements, and any
assurances given
pursuant to such requirements, shall be inoperative if (iii) the issuance of
the Ordinary Shares
upon the exercise or acquisition of Ordinary Shares under the Stock Award has
been registered
under a then currently effective registration statement under the Securities
Act or (iv) as to any
particular requirement, a determination is made by counsel for the Company
that such
requirement need not be met in the circumstances under the then applicable
securities laws. The
Company may, upon advice of counsel to the Company, place legends on stock
certificates
issued under the Plan as such counsel deems necessary or appropriate in order
to comply with
applicable securities laws, including, but not limited to, legends
restricting the transfer of the
Ordinary Shares.

     (f) Withholding Obligations. To the extent provided by the terms of a Stock
Award
Agreement, the Participant may satisfy any federal, state or local tax
withholding obligation
relating to the exercise or acquisition of Ordinary Shares under a Stock
Award by any of the
following means (in addition to the Company’s right to withhold from any
compensation paid to
the Participant by the Company) or by a combination of such means: (i)
tendering a cash
payment; (ii) authorizing the Company to withhold Ordinary Shares from the
Ordinary Shares
otherwise issuable to the participant as a result of the exercise or
acquisition of Ordinary Shares
under the Stock Award in an amount not to exceed the minimum amount of tax
required to be
withheld by law; or (iii) delivering to the Company owned and unencumbered
Ordinary Shares
that have been held by the Participant for a period of not less than six
months prior to the date of
delivery, in an amount not to exceed the minimum amount of tax required to be
withheld by law.

     (g) Information Obligation. Prior to the Listing Date, to the extent
required by
Section 260.140.46 of Title 10 of the California Code of Regulations, the
Company shall deliver

14

 

financial statements to Participants at least annually. This subsection 10(g)
shall not apply to key Employees whose duties in connection with the Company
assure them access to equivalent information.

     (h) Repurchase Limitation. The terms of any repurchase option shall be
specified in the Stock Award and may be either at Fair Market Value at the time
of repurchase or at not less than the original purchase price. To the extent
required by Section 260.140.41 and Section 260.140.42 of Title 10 of the
California Code of Regulations at the time a Stock Award is made, any repurchase
option contained in a Stock Award granted prior to the Listing Date to a person
who is not an Officer, Director or Consultant shall be upon the terms described
below:

          (i) Fair Market Value. If the repurchase option gives the Company the right
to repurchase the Ordinary Shares upon termination of employment at not less than
the Fair Market Value of the Ordinary Shares to be purchased on the date of
termination of Continuous Service, then (i) the right to repurchase shall be
exercised for cash or cancellation of purchase money indebtedness for the
Ordinary Shares within ninety (90) days of termination of Continuous Service (or
in the case of Ordinary Shares issued upon exercise of Stock Awards after such
date of termination, within ninety (90) days after the date of the exercise) or
such longer period as may be agreed to by the Company and the Participant (for
example, for purposes of satisfying the requirements of Section 1202(c)(3) of the
Code regarding “qualified small business stock”) and (ii) the right terminates
when the Ordinary Shares become publicly traded.

          (ii) Original Purchase Price. If the repurchase option gives the Company the
right to repurchase the Ordinary Shares upon termination of Continuous Service at
the original purchase price, then (i) the right to repurchase at the original
purchase price shall lapse at the rate of at least twenty percent (20%) of the
Ordinary Shares per year over five (5) years from the date the Stock Award is
granted (without respect to the date the Stock Award was exercised or became
exercisable) and (ii) the right to repurchase shall be exercised for cash or
cancellation of purchase money indebtedness for the Ordinary Shares within ninety
(90) days of termination of Continuous Service (or in the case of Ordinary Shares
issued upon exercise of Options after such date of termination, within ninety
(90) days after the date of the exercise) or such longer period as may be agreed
to by the Company and the Participant (for example, for purposes of satisfying
the requirements of Section 1202(c)(3) of the Code regarding “qualified small
business stock”).

11. Adjustments upon Changes in Stock.

     (a) Capitalization Adjustments. If any change is made in the Ordinary
Shares subject to the Plan, or subject to any Stock Award, without the receipt of
consideration by the Company (through merger, consolidation, reorganization,
recapitalization, reincorporation, stock dividend, dividend in property other
than cash, stock split, liquidating dividend, combination of shares, exchange of
            shares, change in corporate structure or other transaction not involving the
receipt of consideration by the Company), the Plan will be appropriately adjusted
in the class(es) and maximum number of securities subject to the Plan pursuant to
subsection 4(a), and the outstanding Stock Awards will be appropriately adjusted
in the class(es) and number of securities and price per share of Ordinary Shares
subject to such outstanding Stock Awards. The

15

 

Board shall make such adjustments, and its determination shall be final, binding and
conclusive. (The conversion of any convertible securities of the Company shall not be
treated as a transaction “without receipt of consideration” by the Company.)

     (b) Adjustments.

          (i) In the event of a merger of the Company with or into another corporation, or
Company while unexercised Stock Awards remain outstanding under the Plan, each
outstanding Stock Award shall be assumed or there shall be substituted for the Ordinary
Shares subject to the unexercised portions of such outstanding Stock Awards an
appropriate number of shares of each class of shares or other securities of the successor
company (or a parent or subsidiary of the successor company) that were distributed to the
shareholders of the Company in respect of such shares, and appropriate adjustments shall
be made in the exercise price per share to reflect such action, all as will be determined
by the Board whose determination shall be final.

          (ii) Notwithstanding the above and subject to any applicable law, the Board, in its
discretion, may determine that there shall be a clause in a Stock Award Agreement
instructing that, if in any such transaction as described in subsection 11(b)(i) above,
the successor company (or parent or subsidiary of the successor company) does not agree
to assume or substitute for the Stock Award, the vesting and, if applicable,
exercisability of the Ordinary Shares subject to such Stock Award shall be accelerated so
that any unvested Ordinary Shares shall be immediately vested in full as of the date ten
(10) days prior to the effective date of such transaction.

          (iii) For the purposes of subsection 11(b)(i) above, the Stock Award shall be
considered assumed or substituted if, following the merger or acquisition, the Stock
Award confers the right to purchase or receive, for each Ordinary Share subject to the
Stock Award immediately prior to the merger or acquisition, the consideration (whether
shares, options, cash, or other securities or property) received in the merger or
acquisition by holders of Ordinary Shares for each Ordinary Share held on the effective
date of the transaction (and if such holders were offered a choice of consideration, the
type of consideration chosen by the holders of a majority of the outstanding Ordinary
Shares); provided, however, that if such consideration received in the merger or
acquisition is not solely ordinary shares (or their equivalent) of the successor company
or its parent or subsidiary, the Board may, with the consent of the successor company,
provide for the consideration to be received upon the exercise of the Stock Award to be
solely ordinary shares (or their equivalent) of the successor company or its parent or
subsidiary equal in fair market value to the per Ordinary Share consideration received by
holders of a majority of the outstanding Ordinary Shares in the merger or acquisition;
and provided further that the Board may determine, in its discretion, that in lieu of
such assumption or substitution of Stock Awards for stock awards of the successor company
or its parent or subsidiary, such Stock Awards will be substituted for any other type of
asset or property including cash that is fair under the circumstances.

          (iv) If the Company is liquidated or dissolved while unexercised Stock Awards remain
outstanding under the Plan, then the Board, in its discretion, may determine that such
outstanding Stock Awards may be exercised in full by the Participants as of the effective
date of

16

 

any such liquidation or dissolution of the Company without regard to the vesting
schedule of the Stock Award, by the Participants giving notice in writing to the
Company of their intention to so exercise.

          (v) If the Company is liquidated or dissolved while Ordinary Shares
acquired pursuant to Stock Awards remain unvested, then the Board, in its
discretion, may determine that such unvested Ordinary Shares shall be deemed to
be vested as of the effective date of any such liquidation or dissolution of the
Company without regard to the vesting schedule of the Stock Award.

     (c) Bring Along Right. Anything herein to the contrary notwithstanding, if
prior to the completion of a public offering of the Company’s shares, all or
substantially all of the shares of the Company are to be sold, or upon a merger
or reorganization or the like, all or substantially all of the shares of the
Company are to be exchanged for securities of another Company (a “Transaction”),
then each Participant shall be obliged to sell or exchange, as the case may be,
any Ordinary Shares such Participant purchased under the Plan, in accordance
with the instructions issued by the Board in connection with the Transaction,
whose determination shall be final.

12. Amendment of the Plan and Stock Awards.

     (a) Amendment of Plan. The Board at any time, and from time to time,
may amend
the Plan. However, except as provided in Section 11 relating to adjustments
upon changes in
Ordinary Shares, no amendment shall be effective unless approved by the
shareholders of the
Company to the extent shareholder approval is necessary to satisfy the
requirements of Section
422 of the Code, Rule 16b-3 or any Nasdaq or securities exchange listing
requirements.

     (b) Shareholder Approval. The Board may, in its sole discretion, submit any
other
amendment to the Plan for shareholder approval, including, but not limited
to, amendments to
the Plan intended to satisfy the requirements of Section 162(m) of the Code
and the regulations
thereunder regarding the exclusion of performance-based compensation from
the limit on
corporate deducibility of compensation paid to certain executive officers.

     (c) Contemplated Amendments. It is expressly contemplated that the Board
may amend the Plan in any respect the Board deems necessary or advisable to
provide eligible Employees with the maximum benefits provided or to be provided
under the provisions of the Code and the regulations promulgated thereunder
relating to Incentive Stock Options and/or to bring the Plan and/or Incentive
Stock Options granted under it into compliance therewith.

     (d) No Impairment of Rights. Rights under any Stock Award granted before
amendment of the Plan shall not be impaired by any amendment of the Plan
unless (i) the
Company requests the consent of the Participant and (ii) the Participant
consents in writing.

     (e) Amendment of Stock Awards. The Board at any time, and from time to time,
may amend the terms of any one or more Stock Awards; provided, however, that
the rights under
any Stock Award shall not be impaired by any such amendment unless (i) the
Company requests
the consent of the Participant and (ii) the Participant consents in writing.

17

 

13. Termination or Suspension of the Plan.

     (a) Plan Term. The Board may suspend or terminate the Plan at any
time. Unless
sooner terminated, the Plan shall terminate on the day before the tenth
(10th) anniversary of the
date the Plan is adopted by the Board or approved by the shareholders of
the Company,
whichever is earlier. No Stock Awards may be granted under the Plan while
the Plan is
suspended or after it is terminated.

     (b) No Impairment of Rights. Suspension or termination of the Plan shall
not
impair rights and obligations under any Stock Award granted while the Plan
is in effect except
with the written consent of the Participant.

13A. Restriction on Sale.

     Notwithstanding anything to the the contrary herein, prior to the
Listing Date, a Participant may not sell, pledge or otherwise transfer any
            shares issued under this Plan, or any interest in such Shares, prior to the
expiration of six (6) months from the date of issuance of such shares. Any
sale, pledge or transfer of Shares after such six (6) month period shall be
subject to the right of first refusal set forth below and any such relevant
terms and restrictions as may be contained in the Company’s Articles of
Association.

14. Right of First Refusal.

     (a) No Right of First Refusal for Participants. Notwithstanding
anything to the
contrary in the Articles of Association of the Company, none of the
Participants shall have a
right of first refusal in relation with any sale of shares in the Company.

     (b) Right of First Refusal for other Shareholders.

          (i) The sale of Ordinary Shares acquired by the Participants under the
Plan shall be subject to the right of first refusal of other shareholders of
the Company as set forth in the Articles of Association of the Company. In the
event that the Articles of Association of the Company shall not contain any
provision regarding rights of first refusal, then, unless otherwise provided by
the Board, until such time as the Company shall effectuate a public offering of
the Company’s shares, the sale of Ordinary Shares issuable upon exercise of a
Stock Award shall be subject to a right of first refusal on the part of the
Repurchaser(s). Repurchaser(s) means (i) the Company, if permitted by
applicable laws; (ii) if the Company is not permitted by applicable laws, then
any Affiliate designated by a unanimous decision reached by the Board; or (iii)
if no unanimous decision is reached by the Board, then the Company existing
shareholders (save, for avoidance of doubt, for other Participants who already
have acquired Ordinary Shares pursuant to a Stock Award under the Plan), pro
rata in accordance with their shareholding. The Participant shall give a notice
of sale (the “Notice”) to the Company in order to offer the Ordinary Shares to
the Repurchaser(s).

          (ii) The notice shall specify the name of each proposed purchaser or other
Transferee (“Proposed Transferee”), the number of Ordinary Shares offered for
sale, the price

18

 

per Ordinary Share and the payment terms. The Repurchaser(s) will be entitled for thirty
(30) days from the day of receipt of the Notice (the “30 Days Period”), to purchase all
or part of the offered Ordinary Shares. If by the end of the 30 Days Period not all of
the offered Ordinary Shares have been purchased by the Repurchase(s), the Participant
will be entitled to sell such Ordinary Shares at any time during the ninety (90) days
following the end of the 30 Days Period on terms not more favorable than those set out
in the Notice, provided that the Proposed Transferee agrees in writing that the
provisions of this subsection 14(b) shall continue to apply to the Ordinary Shares in
the hands of such Proposed Transferee.

15. Effective Date of Plan.

     The Plan shall become effective as determined by the Board, but no Stock Award
shall be exercised (or, in the case of a stock bonus, shall be granted) unless and until
the Plan has been approved by the shareholders of the Company, which approval shall be
within twelve (12) months before or after the date the Plan is adopted by the Board.

16. Choice of Law.

     The law of Israel shall govern all questions concerning the construction,
validity and interpretation of this Plan, without regard to such state’s conflict of
laws rules.

19

 

MELLANOX TECHNOLOGIES, LTD.

EARLY EXERCISE STOCK PURCHASE AGREEMENT

(1999 United States Equity Incentive Plan)

     This Agreement is made by and between Mellanox Technologies,
Ltd., an Israeli corporation (the “Company”),
and ___ (“Purchaser”).

Witnesseth:

     Whereas, Purchaser holds a stock option dated
____ to purchase ordinary Shares of the Company (the “Option”) pursuant to the Company’s 1999 United States Equity Incentive
Plan (the “Plan”); and

     Whereas, the Option consists of a Stock Option Grant Notice and a Stock Option
Agreement; and

     Whereas, Purchaser desires to exercise the Option on the terms and conditions
contained herein; and

     Whereas, Purchaser wishes to take advantage of the early exercise provision of the Purchaser’s
Option and therefore to enter into this Agreement;

     Now, therefore, it is agreed between the parties as follows:

     1. Incorporation of Plan and Option by Reference. This Agreement is subject
to all of the terms and conditions as set forth in the Plan and the Option. If there is a
conflict
between the terms of this Agreement and/or the Option and the terms of the Plan, the terms of
the Plan shall control. If there is a conflict between the terms of this Agreement and the
terms of
the Option, the terms of the Option shall control. Defined terms not explicitly defined in
this
Agreement but defined in the Plan shall have the same definitions as in the Plan. Defined
terms
not explicitly defined in this Agreement or the Plan but defined in the Option shall have the
same
definitions as in the Option.

     2. Purchase and Sale of Ordinary Shares.

          (a) Agreement To Purchase And Sell Ordinary Shares. Purchaser hereby
agrees to purchase from the Company, and the Company hereby agrees to sell to Purchaser,
Ordinary Shares of the Company (the “Shares”) in accordance with the Notice of Exercise duly
executed by Purchaser and attached hereto as Exhibit A.

          (b) Closing. The closing hereunder, including payment for and delivery of the
Ordinary Shares, shall occur at the offices of the Company immediately following the execution
of this Agreement, or at such other time and place as the parties may mutually agree;
provided,
however, that if shareholder approval of the Plan is required before the Option may be
exercised,
then the Option may not be exercised, and the closing shall be delayed, until such shareholder

1

 

approval is obtained. If such shareholder approval is not obtained within the time limit
specified in the Plan, then this Agreement shall be null and void.

     3. Unvested Share Repurchase or Assignment Option.

          (a) Repurchase Option. In the event Purchaser’s Continuous Service terminates,
then the Company shall have an irrevocable option (the “Repurchase Option”) for a period
of ninety (90) days after said termination (or in the case of shares issued upon exercise
of the Option after such date of termination, within ninety (90) days after the date of
the exercise), or such longer period as may be agreed to by the Company and the
Purchaser, to repurchase from Purchaser or Purchaser’s personal representative, as the
case may be, or, at its sole discretion, assign to one or more individuals and/or
entities (each, an “Assignee”), the right to purchase from Purchaser or Purchaser’s
personal representative, those shares that Purchaser received pursuant to the exercise of
the Option that have not as yet vested as of such termination date in accordance with the
Vesting Schedule indicated on Purchaser’s Stock Option Grant Notice (the “Unvested
Shares”).

          (b)
Shares Repurchasable or Assignable at Purchaser’s Original Exercise
Price. The Company or the Assignee(s), as the case may be, may repurchase all or any of
the
Unvested Shares at a price equal to the Purchaser’s Exercise Price (“Option Price”) for
such
shares as indicated on Purchaser’s Stock Option Grant Notice or may assign to the
Assignee(s)
the right to purchase any Unvested Shares at the Option Price.

     4. Exercise of Repurchase Option. The Repurchase Option shall be
exercised by
written notice signed by an Officer of the Company and delivered or mailed as
provided herein.
Such notice shall identify the number of Ordinary Shares to be purchased, the
identity of the
Assignee(s) of the Repurchase Option, if any, and shall notify Purchaser of the
time, place and
date for settlement of such purchase, which shall be scheduled by the Company or the
Assignee(s), as the case may be, within the term of the Repurchase Option set forth
above. The
Company shall be entitled to pay for any Ordinary Shares purchased pursuant to its
Repurchase
Option, at the Company’s option, in cash or by offset against any indebtedness owing
to the
Company by Purchaser (including without limitation any Note given in payment for the
Ordinary
Shares), or by a combination of both. Upon delivery of such notice and payment of
the purchase
price, the Company or Assignee(s), as the case may be, shall become the legal and
beneficial
owner(s) of the Ordinary Shares being (re)purchased and all rights and interest
therein or related
thereto, and the Company or Assignee(s), as the case may be, shall have the right to
transfer to
its own name the Ordinary Shares being (re)purchased by the Company or the
Assignee(s), as the
case may be, without further action by Purchaser. As a condition to the Company’s
obligations
under this Agreement, the spouse of the Purchaser, if any, shall execute and deliver
to the
Company the Consent of Spouse attached hereto as Exhibit C.

     5.
Capitalization Adjustments to Ordinary Shares. In the event
of a “Capitalization Adjustment” affecting the Company’s outstanding Ordinary Shares as a
class as
designated in the Plan, then any and all new, substituted or additional securities
or other property
to which Purchaser is entitled by reason of Purchaser’s ownership of Ordinary Shares
shall be
immediately subject to the Repurchase Option and be included in the word “Ordinary
Shares” for
all purposes of the Repurchase Option with the same force and effect as the Ordinary
Shares

2

 

presently subject to the Repurchase Option, but only to the extent the Ordinary
Shares are, at the time, covered by such Repurchase Option. While the total
Option Price shall remain the same after each such event, the Option Price per
share of Ordinary Shares upon exercise of the Repurchase Option shall be
appropriately adjusted.

     6. Change in Control. In the event of a “Change in Control” as
designated in the
Plan, then the Repurchase Option may be assigned by the Company to the successor
of the
Company (or such successor’s parent company), if any, in connection with such
Change in
Control. To the extent the Repurchase Option remains in effect following such
Change in
Control, it shall apply to the new capital stock or other property received in
exchange for the
Ordinary Shares in consummation of the Change in Control, but only to the extent
the Ordinary
Shares was at the time covered by such right. Appropriate adjustments shall be
made to the price
per share payable upon exercise of the Repurchase Option to reflect the Change
in Control upon
the Company’s capital structure; provided, however, that the aggregate Option
Price shall remain
the same.

     7. Rights
of Purchaser. Subject to the provisions of the Option,
Purchaser shall
exercise all rights and privileges of a shareholder of the Company with respect
to the Shares.
Purchaser shall be deemed to be the holder of the shares for purposes of
receiving any dividends
that may be paid with respect to such shares and for purposes of exercising any
voting rights
relating to such shares, even if some or all of such shares have not yet vested
and been released
from the Company’s Repurchase Option.

     8. Limitations on Transfer. In addition to any other
limitation on transfer created
by applicable securities laws, Purchaser shall not sell, assign, hypothecate,
donate, encumber or
otherwise dispose of any interest in the Ordinary Shares while the Ordinary
Shares are subject to
the Repurchase Option. After any Ordinary Shares have been released from the
Repurchase
Option, Purchaser shall not sell, assign, hypothecate, donate, encumber or
otherwise dispose of
any interest in the Ordinary Shares except in compliance with the provisions
herein and
applicable securities laws. Furthermore, the Ordinary Shares shall be subject to
any right of first
refusal in favor of the Company or its assignees that may be contained in the
Company’s
Bylaws.

     9. Restrictive Legends. All certificates representing the
Ordinary Shares shall have
endorsed thereon legends in substantially the following forms (in addition to
any other legend
which may be required by other agreements between the parties hereto):

          (a)“THE SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT
TO AN OPTION SET FORTH IN AN AGREEMENT BETWEEN THE COMPANY AND THE
REGISTERED HOLDER, OR SUCH HOLDER’S PREDECESSOR IN INTEREST, A COPY
OF WHICH IS ON FILE AT THE PRINCIPAL OFFICE OF THIS COMPANY. ANY
TRANSFER OR ATTEMPTED TRANSFER OF ANY SHARES SUBJECT TO SUCH
OPTION IS VOID WITHOUT THE PRIOR EXPRESS WRITTEN CONSENT OF THE
COMPANY.”

          (b)“THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT
BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 AS AMENDED. THEY

3

 

MAY NOT BE SOLD, OFFERED FOR SALE, PLEDGED OR HYPOTHECATED IN THE ABSENCE OF AN
EFFECTIVE REGISTRATION STATEMENT AS TO THE SECURITIES UNDER SAID ACT OR AN OPINION OF
COUNSEL SATISFACTORY TO THE COMPANY THAT SUCH REGISTRATION IS NOT REQUIRED.”

          (c) Any legend required by appropriate blue sky officials.

     10. Investment Representations. In connection with the purchase of
the Ordinary Shares, Purchaser represents to the Company the following:

          (a)Purchaser is aware of the Company’s business affairs and
financial condition
and has acquired sufficient information about the Company to reach an informed and
knowledgeable decision to acquire the Ordinary Shares. Purchaser is acquiring the
Ordinary
Shares for investment for Purchaser’s own account only and not with a view to, or for
resale in
connection with, any “distribution” thereof within the meaning of the Securities Act.

          (b)Purchaser understands that the Ordinary Shares have not been registered under
the Securities Act by reason of a specific exemption therefrom, which exemption depends
upon,
among other things, the bona fide nature of Purchaser’s investment intent as expressed
herein.

          (c) Purchaser further acknowledges and understands that the Ordinary Shares must be
held indefinitely unless the Ordinary Share are subsequently registered under the
Securities Act or an exemption from such registration is available. Purchaser
understands that the certificate evidencing the Ordinary Shares will be imprinted with a
legend that prohibits the transfer of the Ordinary Shares unless the Ordinary Shares are
registered or such registration is not required in the opinion of counsel for the
Company.

          (d) Purchaser is familiar with the provisions of Rules 144 and 701, under the
Securities Act, as in effect from time to time, which, in substance, permit limited
public resale of
“restricted securities” acquired, directly or indirectly, from the issuer thereof
(or from an affiliate
of such issuer), in a non-public offering subject to the satisfaction of certain
conditions. Rule
701 provides that if the issuer qualifies under Rule 701 at the time of issuance of
the securities,
such issuance will be exempt from registration under the Securities Act. In the
event the
Company becomes subject to the reporting requirements of Section 13 or 15(d) of the
Securities
Exchange Act of 1934, the securities exempt under Rule 701 may be sold by Purchaser
ninety
(90) days thereafter, subject to the satisfaction of certain of the conditions
specified by Rule 144
and the market stand-off provision described in Purchaser’s Stock Option Agreement.

     In the event that the sale of the Ordinary Shares does not qualify under Rule 701
at the time of purchase, then the Ordinary Shares may be resold by Purchaser in certain
limited circumstances subject to the provisions of Rule 144, which requires, among other
things: (i) the availability of certain public information about the Company and (ii)
the resale occurring following the required holding period under Rule 144 after the
Purchaser has purchased, and made full payment of (within the meaning of Rule 144), the
securities to be sold.

          (e) Purchaser further understands that at the time Purchaser wishes to sell the
Ordinary Shares there may be no public market upon which to make such a sale, and
that, even if
such a public market then exists, the Company may not be satisfying the current
public current

4

 

information requirements of Rule 144 or 701, and that, in such event, Purchaser would be
precluded from selling the Ordinary Shares under Rule 144 or 701 even if the minimum
holding period requirement had been satisfied.

     11. Section 83(b) Election. Purchaser understands that
Section 83(a) of the Code,
taxes as ordinary income the difference between the amount paid for the Ordinary
Shares and the
fair market value of the Ordinary Shares as of the date any restrictions on the
Ordinary Shares
lapse. In this context, “restriction” includes the right of the Company to buy back
the Ordinary
Shares pursuant to the Repurchase Option set forth above. Purchaser understands that
Purchaser
may elect to be taxed at the time the Ordinary Share are purchased, rather than when
and as the
Repurchase Option expires, by filing an election under Section 83(b) (an “83(b)
Election”) of the
Code with the Internal Revenue Service within thirty (30) days from the date of
purchase. Even
if the fair market value of the Ordinary Shares at the time of the execution of this
Agreement
equals the amount paid for the Ordinary Shares, the 83(b) Election must be made to
avoid
income under Section 83(a) in the future. Purchaser understands that failure to file
such an 83(b)
Election in a timely manner may result in adverse tax consequences for Purchaser.
Purchaser
further understands that Purchaser must file an additional copy of such 83(b)
Election with his or
her federal income tax return for the calendar year in which the date of this
Agreement falls.
Purchaser acknowledges that the foregoing is only a summary of the effect of United
States
federal income taxation with respect to purchase of the Ordinary Shares hereunder,
and does not
purport to be complete. Purchaser further acknowledges that the Company has
directed
Purchaser to seek independent advice regarding the applicable provisions of the
Code, the
income tax laws of any municipality, state or foreign country in which Purchaser may
reside, and
the tax consequences of Purchaser’s death. Purchaser assumes all responsibility
for filing an
83(b) Election and paying all taxes resulting from such election or the lapse of the
restrictions on
the Ordinary Shares.

     12. Refusal to Transfer. The Company shall not be
required (a) to transfer on its
books any Ordinary Shares of the Company which shall have been transferred in
violation of any
of the provisions set forth in this Agreement or (b) to treat as owner of such
shares or to accord
the right to vote as such owner or to pay dividends to any transferee to whom such
shares shall
have been so transferred.

     13. No Employment Rights. This Agreement is not an employment contract
and
nothing in this Agreement shall affect in any manner whatsoever the right or power
of the
Company (or a parent or subsidiary of the Company) to terminate Purchaser’s
employment for
any reason at any time, with or without cause and with or without notice.

     14. Miscellaneous.

          (a) Notices. Any notice required or permitted hereunder shall be given in
writing and shall be deemed effectively given upon personal delivery or sent by telegram
or fax or upon deposit in the United States Post Office, by registered or certified mail
with postage and fees prepaid, addressed to the other party hereto at such party’s
address hereinafter shown below its signature or at such other address as such party may
designate by ten (10) days’ advance written notice to the other party hereto.

5

 

          (b) Successors and Assigns. This Agreement shall inure to the benefit of the
successors and assigns of the Company and, subject to the restrictions on transfer
herein set forth, be binding upon Purchaser, Purchaser’s successors, and assigns. The
Company may assign the Repurchase Option hereunder at any time or from time to time, in
whole or in part.

          (c) Attorneys’ Fees; Specific Performance. Purchaser shall reimburse the Company
for all costs incurred by the Company in enforcing the performance of, or protecting its
rights under, any part of this Agreement, including reasonable costs of investigation
and attorneys’ fees. It is the intention of the parties that the Company, upon exercise
of the Repurchase Option and payment of the Option Price, pursuant to the terms of this
Agreement, shall be entitled to receive the Ordinary Shares, in specie, in order to have
such Ordinary Shares available for future issuance without dilution of the holdings of
other shareholders. Furthermore, it is expressly agreed between the parties that money
damages are inadequate to compensate the Company for the Ordinary Shares and that the
Company shall, upon proper exercise of the Repurchase Option, be entitled to specific
enforcement of its rights to purchase and receive said Ordinary Shares.

          (d) Governing Law; Venue. This Agreement shall be governed by and
construed in accordance with the laws of the State of California. The parties
agree that any
action brought by either party to interpret or enforce any provision of this
Agreement shall be
brought in, and each party agrees to, and does hereby, submit to the jurisdiction
and venue of, the
appropriate state or federal court for the district encompassing the Company’s
principal place of
business.

          (e) Further Execution. The parties agree to take all such further action(s) as
may reasonably be necessary to carry out and consummate this Agreement as soon as
practicable, and to take whatever steps may be necessary to obtain any governmental
approval in
connection with or otherwise qualify the issuance of the securities that are the
subject of this
Agreement.

          (f) Independent Counsel. Purchaser acknowledges that this Agreement has
been prepared on behalf of the Company by Latham & Watkins, counsel to the Company
and
that Latham & Watkins does not represent, and is not acting on behalf of, Purchaser.
Purchaser
has been provided with an opportunity to consult with Purchaser’s own counsel with
respect to
this Agreement.

          (g) Entire Agreement; Amendment. This Agreement constitutes the entire
agreement between the parties with respect to the subject matter hereof and
supersedes and
merges all prior agreements or understandings, whether written or oral. This
Agreement may not
be amended, modified or revoked, in whole or in part, except by an agreement in
writing signed
by each of the parties hereto.

          (h) Severability. If one or more provisions of this Agreement are held to be
unenforceable under applicable law, the parties agree to renegotiate such provision in
good faith. In the event that the parties cannot reach a mutually agreeable and
enforceable replacement for such provision, then (i) such provision shall be excluded
from this Agreement, (ii) the balance of

6

 

the Agreement shall be interpreted as if such provision were so excluded and
(iii) the balance of the Agreement shall be enforceable in accordance with its terms.

     (i) Counterparts. This Agreement may be executed in two or more counterparts, each
of which shall be deemed an original and all of which together shall constitute one
instrument.

     In
witness whereof, the parties hereto have executed this
Agreement as of
________________.

	 	 	 	 	 	 	 
	 	 	Mellanox Technologies, Ltd.  
	 
	 	 	 	 	 	 
	 

	 	By	 	 	 	 
	 

	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	Title	 	 	 	 
	 

	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	Address:
	 	P.O. Box 586	 	 
	 

	 	 	 	Yokneam 20692	 	 
	 

	 	 	 	Israel	 	 
	 
	 	 	 	 	 	 
	 	 	Purchaser
	 
	 	 	 	 	 	 
	 	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	Address:	 	 	 	 
	 

	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	 	 	 	 	 

7

 

Attachments:

	 	 	 
	Exhibit A

	 	Notice of Exercise
	 
	 	 
	Exhibit B

	 	Assignment Separate from Certificate
	 
	 	 
	Exhibit C

	 	Consent of Spouse

 

 

Exhibit A

NOTICE OF EXERCISE

Exh. A-1

 

 

NOTICE OF EXERCISE

(Standard Form)

Mellanox Technologies Ltd.

PO Box 586

Yokneam Israel, 20692

Date of Exercise:                                         

Ladies and Gentlemen:

          This constitutes notice under my stock option that I elect to purchase the number of shares for the
price set forth below.

	 	 	 	 	 	 	 
	 

	 	Type of option (check one):
	Incentive o
	 	Nonstatutory o
	 
	 	 	 	 	 	 
	 

	 	Stock option dated:	 	 	 	 
	 

	 	 	 

	 	 
	 

	 	Number of shares as to which option
is exercised:	 	 	 	 
	 

	 	 	 

	 	 
	 

	 	Certificates to be issued in name of:	 	 	 	 
	 

	 	 	 

	 	 
	 

	 	Total exercise price:	$	 	 	 
	 

	 	 	 	 

	 	 
	 

	 	Method of payment delivered herewith:
	Cash o	 	 
	 
	 	 	 	 	 	 
	 
	 	 	$	 	 	 
	 

	 	 	 	 

	 	 

          By this exercise, I agree (i) to provide such additional documents as you may require pursuant to
the terms of the 1999 United States Equity Incentive Plan, (ii) to provide for the payment by me to
you (in the manner designated by you) of your withholding obligation, if any, relating to the
exercise of this option, and (iii) if this exercise relates to an incentive stock option, to notify
you in writing within fifteen (15) days after the date of any disposition of any of the shares of
Common Stock issued upon exercise of this option that occurs within two (2) years after the date of
grant of this option or within one (1) year after such Ordinary Shares are issued upon exercise of
this option.

          I hereby make the following certifications and representations with respect to the number of
Ordinary Shares of the Company listed above (the “Shares”), which are being acquired by me for my
own account upon exercise of the Option as set forth above:

 

 

          I acknowledge that the Shares have not been registered under the Securities Act of 1933, as amended
(the “Securities Act”), and are deemed to constitute “restricted securities” under Rule 701 and
“control securities” under Rule 144 promulgated under the Securities Act. I warrant and represent
to the Company that I have no present intention of distributing or selling said Shares, except as
permitted under the Securities Act and any applicable state securities laws.

          I further acknowledge that I will not be able to resell the Shares for at least ninety (90) days
after the stock of the Company becomes publicly traded (i.e., subject to the reporting requirements
of Section 13 or 15(d) of the Securities Exchange Act of 1934) under Rule 701 and that more
restrictive conditions apply to affiliates of the Company under Rule 144.

          I further acknowledge that all certificates representing any of the Shares subject to the
provisions of the Option shall have endorsed thereon appropriate legends reflecting the foregoing
limitations, as well as any legends reflecting restrictions pursuant to the Company’s Articles of
Incorporation, Bylaws and/or applicable securities laws.

          I further agree that, if required by the Company (or a representative of the underwriters) in
connection with the first underwritten registration of the offering of any securities of the
Company under the Securities Act, I will not sell, dispose of, transfer, make any short sale of,
grant any option for the purchase of, or enter into any hedging or similar transaction with the
same economic effect as a sale, any Shares or other securities of the Company held by me, for a
period of time specified by the underwriter(s) (not to exceed one hundred eighty (180) days)
following the effective date of the registration statement of the Company filed under the
Securities Act. I further agree to execute and deliver such other agreements as may be reasonably
requested by the Company and/or the underwriter(s) that are consistent with the foregoing or that
are necessary to give further effect thereto. In order to enforce the foregoing covenant, the
Company may impose stop-transfer instructions with respect to my Shares until the end of such
period.

Very
truly yours,

 

 

 

Exhibit B

STOCK ASSIGNMENT SEPARATE FROM CERTIFICATE

Exh. B-1

 

 

STOCK ASSIGNMENT SEPARATE FROM CERTIFICATE

     For
Value Received, the undersigned hereby sells, assigns and transfers unto
Mellanox Technologies, Ltd., a corporation organized under the laws of Israel (the
“Company”), pursuant to the Repurchase Option under that certain Early Exercise Stock
Purchase Agreement, dated                      by and between the undersigned and the
Company (the “Agreement”),                      (                    ) Ordinary Shares of the
Company standing in the undersigned’s name on the books of the Company represented by
Certificate No(s)
                     and does hereby irrevocably constitute and appoint the
Company’s Secretary attorney to transfer said Ordinary Shares on the books of the Company with full
power of substitution in the premises. This Assignment may be used only in accordance with and
subject to the terms and conditions of the Agreement, in connection with the repurchase of Ordinary
Shares issued to the undersigned pursuant to the Agreement, and only to the extent that such shares
remain subject to the Company’s Repurchase Option under the Agreement.

     Dated:
                                        

	 	 	 	 	 
	 

	 	 

(Signature)
	 	 
	 
	 	 	 	 
	 
	 	 	 	 
	 

	 	 

(Print Name)
	 	 

(Instruction:
Please do not fill in any blanks other than the “Signature” line and the “Print Name”
line. The purpose of this Assignment is to enable the Company to exercise its Repurchase Option set
forth in the Agreement without requiring additional signatures on the part of Purchaser.)

1

 

Exhibit
C

CONSENT OF SPOUSE

1

 

CONSENT OF SPOUSE

     The undersigned spouse of Optionholder has read and hereby approves the terms and conditions
of the Stock Option Grant Notice, the Stock Option Agreement and the United States Equity Incentive
Plan. In consideration of the Company’s granting his or her spouse the right to purchase Ordinary
Shares as set forth in this Stock Option Grant Notice, the undersigned hereby agrees to be
irrevocably bound by the terms and conditions of this Stock Option Grant Notice, the Plan and the
Stock Option Agreement and further agrees that any community property interest shall be similarly
bound. The undersigned hereby appoints the undersigned’s spouse as attorney-in-fact for the
undersigned with respect to any amendment or exercise of rights under this Stock Option Grant
Notice, the Plan or this Stock Option Agreement.

Dated:                                         

	 	 	 	 	 
	 

	 	 

Spouse of Optionee
	 	 
	 
	 	 	 	 
	 
	 	 	 	 
	 

	 	 

[Print Name]
	 	 

2

 

Mellanox Technologies Ltd.

Stock Option Grant Notice

(1999 United States Equity Incentive Plan — Standard Form)

Mellanox Technologies Ltd. (the “Company”), pursuant to its 1999 United States Equity
Incentive Plan (the “Plan”), hereby grants to Optionholder an option to purchase the number
of the Company’s Ordinary Shares set forth below. This option is subject to all of the terms
and conditions as set forth herein and in the Stock Option Agreement, the Plan and the Notice
of Exercise, all of which are attached hereto and incorporated herein in their entirety.

	 	 	 	 	 
	Optionholder:

	 	 

	 	 
	Date of Grant:

	 	 

	 	 
	Vesting Commencement Date:

	 	 

	 	 
	Number of Shares Subject to Option:

	 	 

	 	 
	Exercise Price (Per Share):

	 	 

	 	 
	Total Exercise Price:

	 	 

	 	 
	Expiration Date:

	 	 

	 	 

	 	 	 
	Type of Grant:

	 	o Incentive Stock Option 1                  o Nonstatutory Stock Option
	 
	 	 
	Exercise Schedule:

	 	Early Exercise Permitted
	 
	 	 
	Vesting Schedule:

	 	1/4th of the shares vest one year after the Vesting Commencement Date.

1/48th of the shares vest monthly thereafter over the next three years.
	 
	 	 
	Payment:

	 	By one or a combination of the following items (described in the Stock Option Agreement):
	 
	 

	 	     By cash or check
	 

	 	     Pursuant to a Regulation T Program if the Shares are publicly traded
	 

	 	     By delivery of already-owned shares if the Shares are publicly traded

Additional Terms/Acknowledgements: The undersigned Optionholder acknowledges receipt of,
and understands and agrees to, this Grant Notice, the Stock Option Agreement and the Plan.
Optionholder further acknowledges that as of the Date of Grant, this Grant Notice, the Stock
Option Agreement and the Plan set forth the entire understanding between Optionholder and the
Company regarding the acquisition of stock in the Company and supersede all prior oral and
written agreements on that subject with the exception of (i) options previously granted and
delivered to Optionholder under the Plan, and (ii) the following agreements only:

	 	 	 	 	 	 	 	 	 	 	 
	Other
Agreements:	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	Mellanox Technologies Ltd.	 	 	 	Optionholder:	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	By:
	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 
	 	 	Signature	 	 	 	Signature
	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	Title:

	 	 	 	 	 	Date:	 	 	 	 
	 

	 	 
	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	Date:
	 	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	 	 	 

Attachments: Stock Option Agreement, 1999 United States Equity Incentive Plan and Notice of Exercise

 

			
	1	 	If this is an incentive stock option, it (plus your other outstanding
incentive stock options) cannot be first exercisable
for more than $100,000 in any calendar year. Any excess over $100,000 is a nonstatutory stock
option.

 

 

Attachment I

Stock Option Agreement

See
1999 Plan Stock Option Agreement

 

 

Attachment II

See 1999 United States Equity Incentive Plan

 

 

Mellanox
Technologies Ltd. 

Stock Option Grant Notice

(1999 United States Equity Incentive Plan)

Mellanox Technologies Ltd. (the “Company”), pursuant to its 1999 United States Equity
Incentive Plan (the “Plan”), hereby grants to Optionholder an option to purchase the number of the
Company’s Ordinary Shares set forth below. This option is subject to all of the terms and
conditions as set forth herein and in the Stock Option Agreement, the Plan and the Notice of
Exercise, all of which are attached hereto and incorporated herein in their entirety.

	 	 	 	 	 
	Optionholder:

	 	 

	 	 
	Date of Grant:

	 	 

	 	 
	Vesting Commencement Date:

	 	 

	 	 
	Number of Shares Subject to Option:

	 	 

	 	 
	Exercise Price (Per Share):

	 	 

	 	 
	Total Exercise Price:

	 	 

	 	 
	Expiration Date:

	 	 

	 	 

	 	 	 
	Type of Grant1:

	 	Incentive stock options or Nonstatutory stock options.
	 
	 	 
	Exercise Schedule:

	 	Early Exercise Permitted
	 
	 	 
	Vesting Schedule:

	 	1/4th of the shares vest one year after the Vesting Commencement Date.

1/48th of the shares vest monthly thereafter over the next three years.
	 
	 	 
	 

	 	If, in the event of a “Change of Control”, and within twelve (12) months thereafter,
the Company terminates Optionholder’s employment without “Cause” or if Optionholder
resigns for “Good Reason,” fifty percent (50%) of the shares subject to this option to
purchase Ordinary Shares of the Company that are unvested on the date of such termination
or resignation shall vest immediately upon such termination or resignation.
	 
	 	 
	 

	 	A “Change of Control” shall mean (i) a merger or consolidation of the Company, whether
or not approved by the Board of Directors, other than a merger or consolidation which
would result in the voting securities of the Company outstanding immediately prior thereto
continuing to represent (either by remaining outstanding or by being converted into voting
securities of the surviving entity) at least fifty percent (50%) of the total voting power
represented by the voting securities of the Company or such surviving entity outstanding
immediately after such merger or consolidation, or (ii) a plan of complete liquidation of
the Company or an agreement for the sale or disposition by the Company of all or
substantially all of the Company’s assets, approved by the shareholders of the
Company.
	 
	 	 
	 

	 	“Cause” shall mean (1) Optionholder’s willful refusal or willful failure to comply
with a lawful instruction of the Board, or (2) Optionholder’s conviction of any felony
involving an act of moral turpitude. The Company may not terminate Optionholder for Cause
unless the Company gives Optionholder written notice of its intent to terminate
Optionholder for Cause with an explicit written explanation for all reasons for the
for-Cause termination, and the Company, in good faith, permits Optionholder thirty (30)
days to cure the alleged wrongs. If Optionholder cures the alleged wrongs, within thirty
(30) days of such notice, Optionholder cannot be terminated for Cause.
	 
	 	 
	 

	 	“Good Reason” shall mean any of the following events which is not cured by the Company
within 15 days after Optionholder gives written notice thereof to the Company: (i) any
reduction of or failure to pay Optionholder’s base salary in effect immediately prior to
the Change of Control; (ii) any other material breach by the Company of any material term
of

 

			
	1	 	If this is an incentive stock option, it (plus your other outstanding incentive
stock options) cannot be first
exercisable for more than $100,000 in any calendar year. Any excess over $100,000
is a nonstatutory stock option.

1

 

	 	 	 
	 

	 	Optionholder’s employment with the Company; (iii) any material adverse change
in Optionholder’s job titles, duties, responsibilities, status, reporting
responsibilities or perquisites granted hereunder, without Optionholder’s
consent; or (iv) any change in Optionholder’s principal work location which
increases Optionholder’s one-way commute from home to the office by more than
50 miles. “Good Reason” shall cease to exist for an event on the 30th day
following the later of its occurrence or Optionholder’s knowledge thereof,
unless Optionholder has given the Company notice thereof prior to such date.
	 
	 	 
	Payment:

	 	By one or a combination of the following items (described in the Stock Option Agreement):
	 
	 	 
	 

	 	      By cash or check
	 

	 	      Pursuant to a Regulation T Program if the Shares are publicly traded
	 

	 	      By delivery of already-owned shares if the Shares are publicly traded

Additional Terms/Acknowledgements: The undersigned Optionholder acknowledges receipt of, and
understands and agrees to, this Stock Option Grant Notice, the Stock Option Agreement and the Plan.
Optionholder further acknowledges that as of the Date of Grant, this Grant Notice, the Stock Option
Agreement and the Plan set forth the entire understanding between Optionholder and the Company
regarding the acquisition of stock in the Company and supersede all prior oral and written
agreements on that subject with the exception of (i) options previously granted and delivered to
Optionholder under the Plan, and (ii) the following agreements only:

	 	 	 	 	 	 	 	 	 	 	 
	         Other
Agreements:	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	Mellanox
Technologies Ltd.	 	 	 	 	 	Optionholder:	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	By:
	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 
	 	 	Signature	 	 	 	Signature
	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	Title:

	 	 	 	 	 	    Date:	 	 
	 

	 	 
	 	 	 	 	 	  
	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	Date:
	 	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	 	 	 

Attachments: Stock Option Agreement, 1999 United States Equity Incentive Plan and Notice of
Exercise

 

 

Attachment I

See Stock Option Agreement

 

 

Mellanox
Technologies Ltd. 

1999 United States
Equity Incentive Plan

Stock
Option Agreement 

(Incentive and Nonstatutory
Stock Options)

     Pursuant to your Stock Option Grant Notice (“Grant Notice”) and this Stock Option
Agreement, Mellanox Technologies Ltd. (the “Company”) has granted you an option under its 1999
United States Equity Incentive Plan (the “Plan”) to purchase the number of the Company’s Ordinary
Shares indicated in your Grant Notice at the exercise price indicated in your Grant Notice. Defined
terms not explicitly defined in this Stock Option Agreement but defined in the Plan shall have the
same definitions as in the Plan.

     The details of your option are as follows:

     1. Vesting. Subject to the limitations contained herein, your option will vest as
provided in your Grant Notice, provided that vesting will cease upon the termination of
your Continuous Service.

     2.
Number of Shares and
Exercise Price. The number of Ordinary Shares
subject to your option and your exercise price per share referenced in your Grant Notice
may be adjusted from time to time for Capitalization Adjustments, as provided in the Plan.

     3.
Exercise Prior to Vesting
(“Early Exercise”). If permitted in your Grant
Notice (i.e., the “Exercise Schedule” indicates that “Early Exercise” of your option is
permitted) and subject to the provisions of your option, you may elect at any time that is
both (i) during the period of your Continuous Service and (ii) during the term of your
option, to exercise all or part of your option, including the nonvested portion of your
option; provided, however, that:

          (a) a partial exercise of your option shall be deemed to cover first vested Ordinary Shares
and then the earliest vesting installment of unvested Ordinary Shares;

          (b) any Ordinary Shares so purchased from installments that have not vested as of the date of
exercise shall be subject to the purchase option in favor of the Company as described in the
Company’s form of Early Exercise Stock Purchase Agreement;

          (c) you shall enter into the Company’s form of Early Exercise Stock Purchase Agreement with a
vesting schedule that will result in the same vesting as if no early exercise had occurred; and

          (d) if your option is an incentive stock option, then, as provided in the Plan, to the extent
that the aggregate Fair Market Value (determined at the time of grant) of the Ordinary Shares with
respect to which your option plus all other incentive stock options you hold are exercisable for
the first time by you during any calendar year (under all plans of the Company and its Affiliates)
exceeds one hundred thousand dollars ($100,000), your option(s) or
portions

1

 

thereof that exceed such limit (according to the order in which they were granted) shall be
treated as nonstatutory stock options.

     4. Method
of Payment. Payment of the exercise price is due in full upon exercise of
all or any part of your option. You may elect to make payment of the exercise price in cash or by
check or in any other manner permitted by your Grant
Notice, which may include one or more of the
following:

          (e) In the Company’s sole discretion at the time your option is exercised and provided that at
the time of exercise the Ordinary Shares are publicly traded and quoted regularly in The Wall
Street Journal, pursuant to a program developed under Regulation T as promulgated by the Federal
Reserve Board that, prior to the issuance of Ordinary Shares, results in either the receipt of cash
(or check) by the Company or the receipt of irrevocable instructions to pay the aggregate exercise
price to the Company from the sales proceeds.

          (f) Provided that at the time of exercise the Ordinary Shares are publicly traded and quoted
regularly in The Wall Street Journal, by delivery of already-owned Ordinary Shares either that you
have held for the period required to avoid a charge to the Company’s reported earnings (generally
six months) or that you did not acquire, directly or indirectly from the Company, that are owned
free and clear of any liens, claims, encumbrances or security interests, and that are valued at
Fair Market Value on the date of exercise. “Delivery” for these purposes, in the sole discretion of
the Company at the time you exercise your option, shall include delivery to the Company of your
attestation of ownership of such Ordinary Shares in a form approved by the Company.
Notwithstanding the foregoing, you may not exercise your option by tender to the Company of
Ordinary Shares to the extent such tender would violate the provisions of any law, regulation or
agreement restricting the redemption of the Company’s stock.

          (g) Pursuant to the following deferred payment alternative if Early Exercise is permitted:

               (i) Not less than one hundred percent (100%) of the aggregate exercise price, plus accrued
interest, shall be due four (4) years from date of exercise or, at the Company’s election, upon
termination of your Continuous Service.

               (ii) Interest shall be compounded at least annually and shall be charged at the minimum rate
of interest necessary to avoid the treatment as interest, under any applicable provisions of the
Code, of any portion of any amounts other than amounts stated to be interest under the deferred
payment arrangement.

               (iii) In order to elect the deferred payment alternative, you must, as a part of your written
notice of exercise, give notice of the election of this payment alternative and, in order to
secure the payment of the deferred exercise price to the Company hereunder, if the Company so
requests, you must tender to the Company a promissory note and a security agreement covering the
purchased Ordinary Shares, both in form and substance satisfactory to the Company, or such other
or additional documentation as the Company may request.]

 

 

     5.
 Whole Shares. You may exercise your option only for whole Ordinary
Shares.

     6. Securities Law Compliance. Notwithstanding anything to the contrary
contained herein, you may not exercise your option unless the Ordinary Shares issuable upon such
exercise are then registered under the Securities Act or, if such Ordinary Shares are not then so
registered, the Company has determined that such exercise and issuance would be exempt from the
registration requirements of the Securities Act. The exercise of your option must also comply with
other applicable laws and regulations governing your option, and you may not exercise your option
if the Company determines that such exercise would not be in material compliance with such laws and
regulations.

     7. Term. The term of your option commences on the Date of Grant and
expires upon the earliest  of the following:

          (h) three (3) months after the termination of your Continuous Service for any reason other
than your Disability or death, provided that if during any part of such three- (3-) month period
your option is not exercisable solely because of the condition set forth in the preceding paragraph
relating to “Securities Law Compliance,” your option shall not expire until the earlier of the
Expiration Date or until it shall have been exercisable for an aggregate period of three (3) months
after the termination of your Continuous Service;

          (i) twelve (12) months after the termination of your Continuous Service due to your
Disability;

          (j) eighteen (18) months after your death if you die either during your Continuous Service or
within three (3) months after your Continuous Service terminates;

          (k) the Expiration Date indicated in your Grant
Notice; or

          (l) the tenth (10th) anniversary of the Date of
Grant.

     If your option is an incentive stock option, note that, to obtain the federal income tax
advantages associated with an “incentive stock option,” the Code requires that at all times
beginning on the date of grant of your option and ending on the day three (3) months before the
date of your option’s exercise, you must be an employee of the Company or an Affiliate, except in
the event of your death or Disability. The Company has provided for extended exercisability of your
option under certain circumstances for your benefit but cannot guarantee that your option will
necessarily be treated as an “incentive stock option” if you continue to provide services to the
Company or an Affiliate as a Consultant or Director after your employment terminates or if you
otherwise exercise your option more than three (3) months after the date your employment
terminates.

     8. Exercise.

          (m) You may exercise the vested portion of your option (and the unvested portion of your
option if your Grant Notice so permits) during its term by delivering a Notice of Exercise (in a
form designated by the Company) together with the exercise price to the Secretary

 

of the Company, or to such other person as the Company may designate, during regular business
hours, together with such additional documents as the Company may then require.

          (n) By exercising your option you agree that, as a condition to any exercise of your option,
the Company may require you to enter into an arrangement providing for the payment by you to the
Company of any tax withholding obligation of the Company arising by reason of (1) the exercise of
your option, (2) the lapse of any substantial risk of forfeiture to which the Ordinary Shares are
subject at the time of exercise, or (3) the disposition of Ordinary Shares acquired upon such
exercise.

          (o) If your option is an incentive stock option, by exercising your option you agree that you
will notify the Company in writing within fifteen (15) days after the date of any disposition of
any of the Ordinary Shares issued upon exercise of your option that occurs within two (2) years
after the date of your option grant or within one (1) year after such Ordinary Shares are
transferred upon exercise of your option.

          (p) By exercising your option you agree that the Company (or a representative of the
underwriter(s)) may, in connection with the first underwritten registration of the offering of any
securities of the Company under the Securities Act, require that you not sell, dispose of,
transfer, make any short sale of, grant any option for the purchase of, or enter into any hedging
or similar transaction with the same economic effect as a sale, any Ordinary Shares or other
securities of the Company held by you, for a period of time specified by the underwriter(s) (not
to exceed one hundred eighty (180) days) following the effective date of the registration
statement of the Company filed under the Securities Act. You further agree to execute and deliver
such other agreements as may be reasonably requested by the Company and/or the underwriter(s) that
are consistent with the foregoing or that are necessary to give further effect thereto. In order
to enforce the foregoing covenant, the Company may impose stop-transfer instructions with respect
to your Ordinary Shares until the end of such period.

     9.
 Transferability. Your option is not transferable, except by will or by
the laws of descent and distribution, and is exercisable during your life only by you.
Notwithstanding the foregoing, by delivering written notice to the Company, in a form satisfactory
to the Company, you may designate a third party who, in the event of your death, shall thereafter
be entitled to exercise your option.

     10.
 Right
of First Refusal. Ordinary Shares that you acquire upon
exercise of your option are subject to the right of first refusal that is described in the Plan.

     11. Option not a Service Contract. Your option is not an employment or
service contract, and nothing in your option shall be deemed to create in any way whatsoever any
obligation on your part to continue in the employ of the Company or an Affiliate, or of the Company
or an Affiliate to continue your employment. In addition, nothing in your option shall obligate the
Company or an Affiliate, their respective shareholders, Boards of Directors, Officers or Employees
to continue any relationship that you might have as a Director or Consultant for the Company or an
Affiliate.

 

     12. Withholding Obligations.

          (q) At the time you exercise your option, in whole or in part, or at any time thereafter
as requested by the Company, you hereby authorize withholding from payroll and any other amounts
payable to you, and otherwise agree to make adequate provision for (including by means of a
“cashless exercise” pursuant to a program developed under Regulation T as promulgated by the
Federal Reserve Board to the extent permitted by the Company), any sums required to satisfy the
federal, state, local and foreign tax withholding obligations of the Company or an Affiliate, if
any, which arise in connection with your option.

          (r) Upon your request and subject to approval by the Company, in its sole discretion, and
compliance with any applicable conditions or restrictions of law, the Company may withhold from
fully vested Ordinary Shares otherwise issuable to you upon the exercise of your option a number of
whole Ordinary Shares having a Fair Market Value, determined by the Company as of the date of
exercise, not in excess of the minimum amount of tax required to be withheld by law. If the date of
determination of any tax withholding obligation is deferred to a date later than the date of
exercise of your option, share withholding pursuant to the preceding sentence shall not be
permitted unless you make a proper and timely election under Section 83(b) of the Code, covering
the aggregate number of Ordinary Shares acquired upon such exercise with respect to which such
determination is otherwise deferred, to accelerate the determination of such tax withholding
obligation to the date of exercise of your option. Notwithstanding the filing of such election,
Ordinary Shares shall be withheld solely from fully vested Ordinary Shares determined as of the
date of exercise of your option that are otherwise issuable to you upon such exercise. Any adverse
consequences to you arising in connection with such share withholding procedure shall be your sole
responsibility.

          (s) You may not exercise your option unless the tax withholding obligations of the Company
and/or any Affiliate are satisfied. Accordingly, you may not be able to exercise your option when
desired even though your option is vested, and the Company shall have no obligation to issue a
certificate for such Ordinary Shares or release such Ordinary Shares from any escrow provided for
herein.

     13. Notices. Any notices provided for in your option or the Plan shall be
given in writing and shall be deemed effectively given upon receipt or, in the case of notices
delivered by mail by the Company to you, five (5) days after deposit in the United States mail,
postage prepaid, addressed to you at the last address you provided to the Company.

     14. Governing Plan Document. Your option is subject to all the provisions of
the Plan, the provisions of which are hereby made a part of your option, and is further subject to
all interpretations, amendments, rules and regulations which may from time to time be promulgated
and adopted pursuant to the Plan. In the event of any conflict between the provisions of your
option and those of the Plan, the provisions of the Plan shall control.

 

Attachment II

See 1999 United States Equity Incentive Plan

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