Document:

<PAGE>   1
                                                                   Exhibit 10.02

                         ARROWPOINT COMMUNICATIONS, INC.

                  2000 NON-EMPLOYEE DIRECTOR STOCK OPTION PLAN

1.    Purpose.

      The purpose of this 2000 Non-Employee Director Stock Option Plan (the
"Plan") of ArrowPoint Communications, Inc. (the "Company") is to encourage
ownership in the Company by non-employee directors of the Company whose services
are considered essential to the Company's future progress and to provide them
with a further incentive to remain as directors of the Company.

2.    Administration.

      The Board of Directors shall supervise and administer the Plan. All
questions concerning interpretation of the Plan or any options granted under it
shall be resolved by the Board of Directors and such resolution shall be final
and binding upon all persons having an interest in the Plan. The Board of
Directors may, to the full extent permitted by or consistent with applicable
laws or regulations, delegate any or all of its powers under the Plan to a
committee appointed by the Board of Directors, and if a committee is so
appointed, all references to the Board of Directors in the Plan shall mean and
relate to such committee.

3. Participation in the Plan.

      Directors of the Company who are not employees of the Company or any
subsidiary of the Company ("non-employee directors") shall be eligible to
receive options under the Plan.

4. Stock Subject to the Plan.

      (a) The maximum number of shares of the Company's Common Stock, par value
$.001 per share ("Common Stock"), which may be issued under the Plan shall be
300,000 shares, subject to adjustment as provided in Section 7.

      (b) If any outstanding option under the Plan for any reason expires or is
terminated without having been exercised in full, the shares covered by the
unexercised portion of such option shall again become available for issuance
pursuant to the Plan.

      (c) All options granted under the Plan shall be non-statutory options not
<PAGE>   2
entitled to special tax treatment under Section 422 of the Internal Revenue Code
of 1986, as amended (the "Code").

      (d) Shares issued under the Plan may consist in whole or in part of
authorized but unissued shares or treasury shares.

5.    Terms, Conditions and Form of Options.

      Each option granted under the Plan shall be evidenced by a written
agreement in such form as the Company shall from time to time approve, which
agreements shall comply with and be subject to the following terms and
conditions:

      (a) Option Grant Dates. Options shall automatically be granted to the
Directors as follows:

            (i) each person serving as a non-employee director on the date (the
"IPO Date") of the final prospectus relating to the Company's initial public
offering of Common Stock pursuant to an effective registration statement under
the Securities Act of 1933, as amended, shall be granted an option to purchase
20,000 shares of Common Stock on the IPO Date;

            (ii) each person who first becomes a non-employee director following
the IPO Date shall be granted an option to purchase 20,000 shares of Common
Stock on the date of his or her election to the Board of Directors; and

            (iii) each non-employee director shall be granted an option to
purchase 10,000 shares of Common Stock on January 31 of each year, beginning
January 31, 2001, provided he or she attended at least 75% of the meetings of
the Board of Directors or any committees on which he or she served in the
preceding year.

      Each date of grant of an option pursuant to this Section 5(a) is
hereinafter referred to as an "Option Grant Date."

      (b) Option Exercise Price. The option exercise price per share for each
option granted under the Plan shall equal (i) the closing price on any national
securities exchange on which the Common Stock is listed, (ii) the closing price
of the Common Stock on the Nasdaq National Market or (iii) the average of the
closing bid and asked prices in the over-the-counter market, whichever is
applicable, as published in The Wall Street Journal, on the Option Grant Date.
If no sales of Common Stock were made on the Option Grant Date, the price of the
Common Stock for purposes of clauses (i) and (ii) above shall be the reported
price for the next preceding day on which sales

                                       2
<PAGE>   3
were made.

      (c) Transferability of Options. Except as the Board may otherwise
determine or provide in an option granted under the Plan, any option granted
under the Plan to an optionee shall not be transferable by the optionee other
than by will or the laws of descent and distribution, and shall be exercisable
during the optionee's lifetime only by the optionee or the optionee's guardian
or legal representative. References to an optionee, to the extent relevant in
the context, shall include references to authorized transferees.

      (d) Vesting Period.

            (i) General. Each option granted under the Plan pursuant to Section
5(a) above shall become exercisable in full on the first anniversary of the
Option Grant Date; provided that the optionee is serving as a director of the
Company on such anniversary.

            (ii) Acceleration Upon a Change In Control. Notwithstanding the
foregoing, each outstanding option granted under the Plan shall immediately
become exercisable for 50% of the shares covered thereby upon the occurrence of
Change in Control Event (as defined in Section 8) with respect to the Company.

            (iii) Right to Receive Restricted Stock. Notwithstanding the
provisions of Section 5(d)(i) above, the Board shall have the authority to grant
options (including options granted pursuant to Section 5(a) above) which are
immediately exercisable subject to the Company's right to repurchase any
unvested shares of stock acquired by the optionee on exercise of an option in
the event such optionee's service as a director terminates for any reason.

      (e) Termination. Each option shall terminate, and may no longer be
exercised, on the earlier of (i) the date ten years after the Option Grant Date
of such option or (ii) the first anniversary of the date on which the optionee
ceases to serve as a director of the Company.

      (f) Exercise Procedure. An option may be exercised only by written notice
to the Company at its principal office accompanied by (i) payment in cash or by
certified or bank check of the full consideration for the shares as to which
they are exercised, (ii) delivery of outstanding shares of Common Stock (which
have been outstanding for at least six months) having a fair market value on the
last business day preceding the date of exercise equal to the option exercise
price, or (iii) an irrevocable undertaking by a creditworthy broker to deliver
promptly to the Company sufficient funds to pay the

                                       3
<PAGE>   4
exercise price or delivery of irrevocable instructions to a creditworthy broker
to deliver promptly to the Company cash or a check sufficient to pay the
exercise price.

      (g) Exercise by Representative Following Death of Director. An optionee,
by written notice to the Company, may designate one or more persons (and from
time to time change such designation), including his or her legal
representative, who, by reason of the optionee's death, shall acquire the right
to exercise all or a portion of the option. If the person or persons so
designated wish to exercise any portion of the option, they must do so within
the term of the option as provided herein. Any exercise by a representative
shall be subject to the provisions of the Plan.

6.    Limitation of Rights.

      (a) No Right to Continue as a Director. Neither the Plan, nor the granting
of an option nor any other action taken pursuant to the Plan, shall constitute
or be evidence of any agreement or understanding, express or implied, that the
Company will retain the optionee as a director for any period of time.

      (b) No Stockholders' Rights for Options. An optionee shall have no rights
as a stockholder with respect to the shares covered by his or her option until
the date of the issuance to him or her of a stock certificate therefor, and no
adjustment will be made for dividends or other rights (except as provided in
Section 7) for which the record date is prior to the date such certificate is
issued.

      (c) Compliance with Securities Laws. Each option shall be subject to the
requirement that if, at any time, counsel to the Company shall determine that
the listing, registration or qualification of the shares subject to such option
upon any securities exchange or under any state or federal law, or the consent
or approval of any governmental or regulatory body, or the disclosure of
non-public information or the satisfaction of any other condition is necessary
as a condition of, or in connection with, the issuance or purchase of shares
thereunder, such option may not be exercised, in whole or in part, unless such
listing, registration, qualification, consent or approval, or satisfaction of
such condition shall have been effected or obtained on conditions acceptable to
the Board of Directors. Nothing herein shall be deemed to require the Company to
apply for or to obtain such listing, registration or qualification, or to
satisfy such condition.

7.    Adjustment Provisions for Mergers, Recapitalizations and Related
Transactions.

      If, through or as a result of any merger, consolidation, reorganization,

                                       4
<PAGE>   5
recapitalization, reclassification, stock dividend, stock split, reverse stock
split, or other similar transaction, (i) the outstanding shares of Common Stock
are exchanged for a different number or kind of securities of the Company or of
another entity, or (ii) additional shares or new or different shares or other
securities of the Company or of another entity are distributed with respect to
such shares of Common Stock, the Board of Directors shall make an appropriate
and proportionate adjustment in (x) the maximum number and kind of shares
reserved for issuance under the Plan, (y) the number and kind of shares or other
securities subject to then outstanding options under the Plan, and (z) the price
for each share subject to any then outstanding options under the Plan (without
changing the aggregate purchase price for such options), to the end that each
option shall be exercisable, for the same aggregate exercise price, for such
securities as such optionholder would have held immediately following such event
if he had exercised such option immediately prior to such event. No fractional
shares will be issued under the Plan on account of any such adjustments.

8.    Definition of "Change in Control Event". A "Change in Control Event" shall
mean:

      (a)   the acquisition by an individual, entity or group (within the
            meaning of Section 13(d)(3) or 14(d)(2) of the Securities
            Exchange Act of 1934, as amended (the "Exchange Act")) (a
            "Person") of beneficial ownership of any capital stock of the
            Company after the date of adoption of this Plan by the Board of
            Directors if, after such acquisition, such Person beneficially
            owns (within the meaning of Rule 13d-3 promulgated under the
            Exchange Act) 30% or more of either (x) the then-outstanding
            shares of common stock of the Company (the "Outstanding Company
            Common Stock") or (y) the combined voting power of the
            then-outstanding securities of the Company entitled to vote
            generally in the election of directors (the "Outstanding Company
            Voting Securities"); provided, however, that for purposes of this
            subsection (i), the following acquisitions shall not constitute a
            Change in Control Event: (A) any acquisition directly from the
            Company or an underwriter or agent of the Company (excluding an
            acquisition pursuant to the exercise, conversion or exchange of
            any security exercisable for, convertible into or exchangeable
            for common stock or voting securities of the Company, unless the
            Person exercising, converting or exchanging such security
            acquired such security directly from the Company or an
            underwriter or agent of the Company), (B) any acquisition by any
            employee benefit plan (or related trust) sponsored or maintained
            by the Company or any corporation controlled by the Company, or
            (C) any acquisition by any corporation pursuant to a Business
            Combination (as defined below)

                                       5
<PAGE>   6
            which complies with clauses (x) and (y) of subsection (iii) of this
            definition; or

      (b)   such time as the Continuing Directors (as defined below) do not
            constitute a majority of the Board (or, if applicable, the Board
            of Directors of a successor corporation to the Company), where
            the term "Continuing Director" means at any date a member of the
            Board (x) who was a member of the Board on the date of the
            initial adoption of this Plan by the Board or (y) who was
            nominated or elected subsequent to such date by at least a
            majority of the directors who were Continuing Directors at the
            time of such nomination or election or whose election to the
            Board was recommended or endorsed by at least a majority of the
            directors who were Continuing Directors at the time of such
            nomination or election; provided, however, that there shall be
            excluded from this clause (y) any individual whose initial
            assumption of office occurred as a result of an actual or
            threatened election contest with respect to the election or
            removal of directors or other actual or threatened solicitation
            of proxies or consents, by or on behalf of a person other than
            the Board; or

      (c)   the consummation of a merger, consolidation, reorganization,
            recapitalization or statutory share exchange involving the
            Company or a sale or other disposition of all or substantially
            all of the assets of the Company (a "Business Combination"),
            unless, immediately following such Business Combination, each of
            the following two conditions is satisfied: (x) all or
            substantially all of the individuals and entities who were the
            beneficial owners of the Outstanding Company Common Stock and
            Outstanding Company Voting Securities immediately prior to such
            Business Combination beneficially own, directly or indirectly,
            more than 50% of the then-outstanding shares of common stock and
            the combined voting power of the then-outstanding securities
            entitled to vote generally in the election of directors,
            respectively, of the resulting or acquiring corporation in such
            Business Combination (which shall include, without limitation, a
            corporation which as a result of such transaction owns the
            Company or substantially all of the Company's assets either
            directly or through one or more subsidiaries) (such resulting or
            acquiring corporation is referred to herein as the "Acquiring
            Corporation") in substantially the same proportions as their
            ownership of the Outstanding Company Common Stock and Outstanding
            Company Voting Securities, respectively, immediately prior to
            such Business Combination and (y) no Person (excluding the
            Acquiring Corporation or any employee benefit plan (or related
            trust) maintained or sponsored by the Company or by the

                                       6
<PAGE>   7
            Acquiring Corporation) beneficially owns, directly or indirectly,
            30% or more of the then-outstanding shares of common stock of the
            Acquiring Corporation, or of the combined voting power of the
            then-outstanding securities of such corporation entitled to vote
            generally in the election of directors (except to the extent that
            such ownership existed prior to the Business Combination).

9.    Termination and Amendment of the Plan.

      The Board of Directors may suspend or terminate the Plan or amend it in
any respect whatsoever.

10.   Notice.

      Any written notice to the Company required by any of the provisions of the
Plan shall be addressed to the Treasurer of the Company and shall become
effective when it is received.

11.   Governing Law.

      The Plan and all determinations made and actions taken pursuant hereto
shall be governed by the internal laws of the State of Delaware (without regard
to any applicable conflicts of laws or principles).

12.   Effective Date.

      The Plan shall become effective on the date hereof.

                                       7<PAGE>   1
                                                                  EXHIBIT 10.03

                           STOCK RESTRICTION AGREEMENT

         This Agreement is made this 15th day of April, 1997, between ArrowPoint
Communications, Inc., a Delaware corporation (the "Company"), and Chin-Cheng Wu
(the "Employee").

         In consideration of the mutual promises and covenants contained in this
Agreement and for other valuable consideration, receipt of which is hereby
acknowledged, the parties hereto agree as follows:

         1.       Purchase of Shares. The Company shall issue and sell to the
Employee, and the Employee shall purchase from the Company, subject to the terms
and conditions set forth in this Agreement, 1,000,000 shares (the "Shares") of
common stock, $.001 par value, of the Company ("Common Stock"), at a purchase
price of $.001 per share. The aggregate purchase price for the Shares shall be
paid by the Employee by check payable to the order of the Company or such other
method as may be acceptable to the Company. Upon receipt of payment by the
Company for the Shares, the Company shall issue to the Employee one or more
certificates in the name of the Employee for that number of Shares purchased by
the Employee. The Employee agrees that the Shares shall be subject to the
Purchase Option set forth in Section 2 of this Agreement and the restrictions on
transfer set forth in Section 5 of this Agreement.

         2.       Purchase Option.

                  (a) In the event that the Employee ceases to be employed by
the Company for any reason prior to September 30, 2001, the Company shall have
the right and option (the "Purchase Option") to purchase from the Employee, for
the sum of $0.001 per share (the "Option Price"), up to the total number of
Shares that have not vested according to the vesting schedule in Section 3 (the
"Vesting Schedule").

                  (b) For purposes of this Agreement, employment with the
Company shall include employment with a parent or subsidiary of the Company.

         3.       Vesting.

                  (a) The Shares shall vest in the amount of 25% of the total
number of Shares on September 30, 1997 and on the last day of each month
thereafter in the amount of 1.5625% of the total number of Shares.

                  (b) In the event of as Acquisition (as defined below), then
50% of the number of Shares which are not then vested shall become vested
immediately prior to the closing of the Acquisition.

                  (c) For the purposes of this Agreement, "Acquisition" shall
mean any (i) merger or consolidation which results in the voting securities of
the Company outstanding immediately prior thereto representing immediately
thereafter (either by remaining outstanding or by being converted into voting
securities of the surviving or acquiring entity) less than a
<PAGE>   2
majority of the combined voting power of the voting securities of the Company or
such surviving or acquiring entity outstanding immediately after such merger or
consolidation, (ii) sale of all or substantially all the assets of the Company
or (iii) sale of shares of capital stock of the Company, in a single transaction
or series of related transactions, representing at least 80% of the voting power
of the voting securities of the Company.

                  (d) Notwithstanding the foregoing, in the event of an
Acquisition, if the Employee is not offered a position with the acquiring
company (or the subsidiary or unit of the acquiring company formed by such
acquisition) at a location within a 30-mile radius of the Company's headquarters
as it existed on the day before the execution of the definitive agreement with
respect to the Acquisition, with responsibilities and compensation at least
equivalent to his responsibilities and compensation with the Company on the day
before the execution of the definitive agreement with respect to the
Acquisition, then the Vesting Schedule shall be accelerated so that all Shares
which are not then vested shall become vested immediately prior to the closing
of the Acquisition.

                  (e) Notwithstanding the foregoing, if following an Acquisition
(x) the Employee's employment is terminated by the acquiring company (or a
subsidiary thereof) without Good Cause (as defined below) or (y) the Employee
resigns from employment by the acquiring company (or a subsidiary thereof) for
Good Reason (as defined below), all securities or other property received in the
Acquisition (which, pursuant to Section 10(b) below, shall become subject to the
Purchase Option) which are not then vested shall become vested immediately prior
to such employment termination.

                  (f) For the purposes of this Section 3, "Good Cause" shall
mean (a) a good faith finding by the Board of Directors of the acquiring company
of (i) the failure of the Employee to perform, to the reasonable satisfaction of
the Board of Directors or the officer of the acquiring company to whom he
reports, his reasonably assigned duties for the acquiring company, which failure
continues for a period of 15 days after written notice by the acquiring company
to the Employee informing the Employee with reasonable specificity of such
failure, or (ii) gross negligence or willful misconduct on the part of the
Employee, or (b) the conviction of the Employee of, or the entry of a pleading
of guilty or nolo contendere by the Employee to, any crime involving moral
turpitude or any felony. For the purposes of this Section 3, "Good Reason" shall
mean a diminution in the Employee's compensation, a material adverse change in
the Employee's position or responsibilities or a relocation of the Employee
beyond a 30-mile radius from the location of the Company's headquarters as it
existed on the day before the execution of the definitive agreement with respect
to the Acquisition.

                  (g) The Company may in its discretion accelerate the Vesting
Schedule at any time.

         4.       Exercise of Purchase Option and Closing.

                  (a) The Company may exercise the Purchase Option by sending to
the Employee (or his estate), within 60 days after the termination of the
employment of the Employee with the Company, a written notice of exercise of the
Purchase Option. Such notice shall specify the number of Shares to be purchased.
If and to the extent the Purchase Option is

                                       2
<PAGE>   3
not so exercised by the giving of such a notice within such 60-day period, the
Purchase Option shall automatically expire and terminate effective upon the
expiration of such 60-day period.

                  (b) Within 10 days after his receipt of the Company's notice
of the exercise of the Purchase Option pursuant to subsection (a) above, the
Employee (or his estate) shall (in accordance with the provisions of the joint
Escrow Instructions attached hereto) tender to the Company at its principal
offices the certificate or certificates representing the Shares which the
Company has elected to purchase, duly endorsed in blank by the Employee or with
duly endorsed stock powers attached thereto, all in form suitable for the
transfer of such Shares to the Company. Upon its receipt of such certificate or
certificates, the Company shall deliver or mail to the Employee a check in the
amount of the aggregate Option Price therefor.

                  (c) After the time at which any Shares are required to be
delivered to the Company for transfer to the Company pursuant to subsection (b)
above, the Company shall not pay any dividend to the Employee on account of such
Shares or permit the Employee to exercise any of the privileges or rights of a
stockholder with respect to such Shares, but shall, in so far as permitted by
law, treat the Company as the owner of such Shares.

                  (d) The Option Price may be payable, at the option of the
Company, in cancellation of all or a portion of any outstanding indebtedness of
the Employee to the Company or in cash (by check) or both.

                  (e) The Company shall not purchase any fraction of a Share
upon exercise of the Purchase Option, and any fraction of a Share resulting from
a computation made pursuant to Section 4 of this Agreement shall be rounded to
the nearest whole Share (with any one-half Share being rounded upward).

         5.       Restrictions on Transfer.

                  (a) Except as otherwise provided in subsection (b) below, the
Employee shall not, during the term of the Purchase Option, sell, assign,
transfer, pledge, hypothecate or otherwise dispose of, by operation of law or
otherwise (collectively "transfer"), any of the Shares, or any interest therein,
unless and until such Shares are no longer subject to the Purchase Option.

                  (b) Notwithstanding the foregoing, the Employee may transfer
(i) any or all of his Shares to his spouse or children or to a trust established
for the benefit of his spouse, children or himself or (ii) any or all of his
Shares under his will, provided that such Shares shall remain subject to this
Agreement (including without limitation the restrictions on transfer set forth
in this Section 5 and the Purchase Option) and such permitted transferee shall,
as a condition to such transfer, deliver to the Company a written instrument
confirming that such transferee shall be bound by all of the terms and
conditions of this Agreement.

         6.       Escrow. The Employee and the Company shall, upon the execution
of this Agreement, execute joint Escrow Instructions in the form appended
hereto. The joint Escrow Instructions shall be delivered to the Secretary of the
Company, as escrow agent thereunder. The Employee shall deliver to such escrow
agent the certificate(s) evidencing the Shares and a stock

                                       3
<PAGE>   4
assignment duly endorsed in blank. Such materials shall be held by such escrow
agent pursuant to the terms of such joint Escrow Instructions.

         7.       Effect of Prohibited Transfer. The Company shall not be
required (a) to transfer on its books any of the Shares which shall have been
sold or transferred in violation of any of the provisions set forth in this
Agreement, or (b) to treat as owner of such Shares or to pay dividends to any
transferee to whom any such Shares shall have been so sold or transferred.

         8.       Restrictive Legend. All certificates representing the Shares
shall have affixed thereto the following legend, in addition to any other
legends that may be required under federal or state securities laws:

         "The shares of stock represented by this certificate are subject to
         restrictions on transfer and an option to purchase set forth in a
         certain Stock Restriction Agreement between the Corporation and the
         registered owner of these shares (or his predecessor in interest), and
         such Agreement is available for inspection without charge at the office
         of the Secretary of the Corporation."

         9.       Investment Representations. The Employee represents, warrants
and covenants as follows:

                  (a) The Employee is purchasing the Shares for his own account
for investment only, and not with a view to, or for sale in connection with, any
distribution of the Shares in violation of the Securities Act of 1933 (the
"Securities Act"), or any rule or regulation under the Securities Act.

                  (b) The Employee has had such opportunity as he has deemed
adequate to obtain from representatives of the Company such information as is
necessary to permit him to evaluate the merits and risks of his investment in
the Company.

                  (c) The Employee has sufficient experience in business,
financial and investment matters to be able to evaluate the risks involved in
the purchase of the Shares and to make an informed investment decision with
respect to such purchase.

                  (d) The Employee can afford a complete loss of the value of
the Shares and is able to bear the economic risk of holding such Shares for an
indefinite period.

                  (e) The Employee understands that (i) the Shares have not been
registered under the Securities Act and are "restricted securities" within the
meaning of Rule 144 under the Securities Act, (ii) the Shares cannot be sold,
transferred or otherwise disposed of unless they are subsequently registered
under the Securities Act or an exemption from registration is then available;
(iii) in any event, the exemption from registration under Rule 144 will not be
available for at least one year and even then will not be available unless a
public market then exists for the Common Stock, adequate information concerning
the Company is then available to the public, and other terms and conditions of
Rule 144 are complied with; and (iv) there is now no registration statement on
file with the Securities and Exchange Commission with respect to any

                                       4
<PAGE>   5
stock of the Company and the Company has no obligation or current intention to
register the Shares under the Securities Act.

                  (f) A legend substantially in the following form will be
placed on the certificate representing the Shares:

                  "The shares represented by this certificate have not been
                  registered under the Securities Act of 1933, as amended, and
                  may not be sold, transferred or otherwise disposed of in the
                  absence of an effective registration statement under such Act
                  or an opinion of counsel satisfactory to the corporation to
                  the effect that such registration is not required."

         10.      Adjustments for Stock Splits, Stock Dividends, etc.

                  (a) If from time to time during the term of the Purchase
Option there is any stock split-up, stock dividend, stock distribution or other
reclassification of the Common Stock of the Company, any and all new,
substituted or additional securities to which the Employee is entitled by reason
of his ownership of the Shares shall be immediately subject to the Purchase
Option, the restrictions on transfer and other provisions of this Agreement in
the same manner and to the same extent as the Shares, and the Option Price shall
be appropriately adjusted.

                  (b) If the Shares are converted into or exchanged for, or
stockholders of the Company receive by reason of any distribution in total or
partial liquidation, securities of another corporation, or other property
(including cash), pursuant to an Acquisition, then the rights of the Company
under this Agreement shall inure to the benefit of the Company's successor and
this Agreement shall apply to the securities or other property received upon
such conversion, exchange or distribution in the same manner and to the same
extent as the Shares provided that (i) to account for the acceleration of
vesting under Section 3(b) above, on each vesting date subsequent to the
Acquisition, one-half of the amount of securities or other property that would
have otherwise vested in accordance with the original Vesting Schedule shall
become vested and (ii) the Vesting Schedule shall be subject to further
acceleration following the Acquisition pursuant to Section 3(d).

         11.      Withholding Taxes. If the Employee elects, in accordance with
Section 83(b) of the Internal Revenue Code of 1986, as amended, to recognize
ordinary income in the year of acquisition of the Shares, the Company will
require at the time of such election an additional payment for withholding tax
purposes based on the difference, if any, between the purchase price for such
Shares and the fair market value of such Shares as of the day immediately
preceding the date of the purchase of such Shares by the Employee.

         12.      Miscellaneous.

                  (a) Severability. The invalidity or unenforceability of any
provision of this Agreement shall not affect the validity or enforceability of
any other provision of this Agreement, and each other provision of this
Agreement shall be severable and enforceable to the extent permitted by law.

                                       5
<PAGE>   6
                  (b) Waiver. Any provision contained in this Agreement may be
waived, either generally or in any particular instance, by the Board of
Directors of the Company; provided that the Company may not waive, or otherwise
limit or reduce its rights under, the Purchase Option or accelerate the Vesting
Schedule without the consent of the holders of a majority of the then
outstanding shares of Series A Convertible Preferred Stock of the Company (if
any).

                  (c) Binding Effect. This Agreement shall be binding upon and
inure to the benefit of the Company and the Employee and their respective heirs,
executors, administrators, legal representatives, successors and assigns,
subject to the restrictions on transfer set forth in Section 5 of this
Agreement.

                  (d) No Rights To Employment. Nothing contained in this
Agreement shall be construed as giving the Employee any right to be retained, in
any position, as an employee of the Company.

                  (e) Notice. All notices, requests, consents, and other
communications under this Agreement shall be in writing and shall be delivered
by hand, sent via a reputable nationwide overnight courier service or mailed by
first class certified or registered mail, return receipt requested, postage
prepaid, to the Company or the Employee at their addresses set forth on the
signature page hereto. Notices provided in accordance with this Section 12 shall
be deemed delivered upon personal delivery, one business day after being sent
via a reputable nationwide overnight courier service, or two business days after
deposit in the mail.

                  (f) Pronouns. Whenever the context may require, any pronouns
used in this Agreement shall include the corresponding masculine, feminine or
neuter forms, and the singular form of nouns and pronouns shall include the
plural, and vice versa.

                  (g) Entire Agreement. This Agreement constitutes the entire
agreement between the parties, and supersedes all prior agreements and
understandings, relating to the subject matter of this Agreement.
Notwithstanding the foregoing, the Employee acknowledges that he is a party to a
Right of First Refusal and Co-Sale Agreement with the Company and certain other
persons which imposes certain restrictions on the transfer of the shares issued
thereunder and a purchase option in favor of the Company and certain other.
persons which are in addition to the transfer restrictions and purchase rights
set forth herein.

                  (h) Amendment. This Agreement may be amended or modified only
by a written instrument executed by both the Company and the Employee.

                  (i) Governing Law. This Agreement shall be construed,
interpreted and enforced in accordance with the laws of the State of Delaware.

                                       6
<PAGE>   7
         IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the day and year first above written.

         ArrowPoint Communications, Inc.

         By: /s/ Chin-Cheng Wu
            ----------------------------
            Chin-Cheng Wu, President
            ----------------------------
            (print name and title)

         Address: 235 Littleton Road
                  Westford, MA 01886

         Chin-Cheng Wu

         /s/ Chin-Cheng Wu
         ----------------------------
         Address: 3 Coburn Road
                  Hopkinton, MA 01748

                                       7
<PAGE>   8
                            JOINT ESCROW INSTRUCTIONS

                                  April 15,1997

Secretary
ArrowPoint Communications, Inc.
235 Littleton Road
Westford, MA 01886

Dear Sir/Madam:

         As Escrow Agent for ArrowPoint Communications, Inc., a Delaware
corporation (the "Company"), and the undersigned employee (the "Holder"), you
are hereby authorized and directed to hold the documents delivered to you
pursuant to the terms of that certain Stock Restriction Agreement (the
"Agreement") of even date herewith, to which a copy of these joint Escrow
Instructions is attached, in accordance with the following instructions:

         1.       Appointment. The Holder does hereby irrevocably constitute and
appoint you as his attorney-in-fact and agent for the term of this escrow to
execute with respect to the Shares (as defined in the Agreement) all documents
necessary or appropriate to make such Shares negotiable and to complete any
transaction herein contemplated. Subject to the provisions of this paragraph 1
and the terms of the Agreement, the Holder shall exercise all rights and
privileges of a stockholder of the Company while the Shares are held by you.

         2.       Closing.

                  (a) Upon any purchase by the Company of the Shares pursuant to
the Agreement, the Company shall give to the Holder and you a written notice
specifying the purchase price for the Shares, as determined pursuant to the
Agreement, and the time for a closing hereunder (the "Closing") at the principal
office of the Company. The Holder and the Company hereby irrevocably authorize
and direct you to close the transaction contemplated by such notice in
accordance with the terms of said notice.

                  (b) At the Closing (unless you have previously received
written notice from the Holder of a dispute between the Holder and the Company
with respect to the Company's purchase of the Shares, in which case you shall
continue to hold the Shares in escrow until you have received a written notice
signed by both the Holder and the Company setting forth the resolution of such
dispute and instructions with respect to the disposition of the Shares) you are
directed (i) to date the stock assignment form or forms necessary for the
transfer of the Shares, (ii) to fill in on such form or forms the number of
Shares being transferred, and (iii) to deliver same, together with the
certificate or certificates evidencing the Shares to be transferred, to the
Company against the simultaneous delivery to you of the purchase price for the
Shares being purchased pursuant to the Agreement.

         3.       Withdrawal. Upon receipt of a written notice from the Holder
that the Purchase Option (as defined in the Agreement) has terminated or expired
with respect to certain Shares,

<PAGE>   9
you shall deliver a certificate requesting such Shares to the Holder (unless you
have previously received written notice from the Company of a dispute between
the Holder and the Company with respect to the termination or expiration of the
Purchase Option with respect to such Shares, in which case you shall continue to
hold such Shares in escrow until you have received a written notice signed by
both the Holder and the Company setting forth the resolution of such dispute and
instructions with respect to the disposition of such Shares).

         4.       Duties and Responsibilities.

                  (a) Your duties hereunder may be altered, amended, modified or
revoked only by a writing signed by all of the parties hereto.

                  (b) You shall be obligated only for the performance of such
duties as are specifically set forth herein and may rely and shall be protected
in relying or refraining from acting on any instrument reasonably believed by
you to be genuine and to have been signed or presented by the proper party or
parties. You shall not be personally liable for any act you may do or omit to do
hereunder as Escrow Agent or as attorney-in-fact of the Holder while acting in
good faith and in the exercise of your own good judgment, and any act done or
omitted by you pursuant to the advice of your own attorneys shall be conclusive
evidence of such good faith.

                  (c) You are hereby expressly authorized to disregard any and
all warnings given by any of the parties hereto or by any other person or
corporation, excepting only orders or process of courts of law, and are hereby
expressly authorized to comply with and obey orders, judgments or decrees of any
court. In case you obey or comply with any such order, judgment or decree of any
court, you shall not be liable to any of the parties hereto or to any other
person, firm or corporation by reason of such compliance, notwithstanding any
such order, judgment or decree being subsequently reversed, modified, annulled,
set aside, vacated or found to have been entered without jurisdiction.

                  (d) You shall not be liable in any respect on account of the
identity, authority or rights of the parties executing or delivering or
purporting to execute or deliver the Agreement or any documents or papers
deposited or called for hereunder.

                  (e) You shall be entitled to employ such legal counsel and
other experts as you may deem necessary properly to advise you in connection
with your obligations hereunder and may rely upon the advice of such counsel.

                  (f) Your responsibilities as Escrow Agent hereunder shall
terminate if you shall resign by written notice to each party. In the event of
any such termination, the Company shall appoint a successor Escrow Agent.

                  (g) If you reasonably require other or further instruments in
connection with these joint Escrow Instructions or obligations in respect
hereto, the necessary parties hereto shall join in furnishing such instruments.

                  (h) It is understood and agreed that should any dispute arise
with respect to the delivery and/or ownership or right of possession of the
securities held by you hereunder, you are authorized and directed to retain in
your possession without liability to anyone all or any part

                                       2
<PAGE>   10
of said securities until such dispute shall have been settled either by mutual
written agreement of the parties concerned or by a final order, decree or
judgment of a court of competent jurisdiction after the time for appeal has
expired and no appeal has been perfected, but you shall be under no duty
whatsoever to institute or defend any such proceedings.

         5.       Notices. All notices, requests, consents, and other
communications hereunder shall be in writing and shall be delivered by hand,
sent via a reputable nationwide overnight courier service or mailed by first
class certified or registered mail, return receipt requested, postage prepaid:

         If to the Company, at 235 Littleton Road, Westford, MA 01886, Attn:
         President;

         If to the Holder, at 3 Coburn Road, Hopkinton, MA 01748; or

         If to you, at your address set forth in the introduction hereto.

         Notices provided in accordance with this Section 5 shall be deemed
delivered upon personal delivery, one business day after being sent via a
reputable nationwide overnight courier service, or two business days after
deposit in the mail.

         6.       Substitution of Property. In the event that, pursuant to
Section 10(b) of the Agreement, other securities or property are received in
respect of the Shares and become subject to the Purchase Option, such other
securities or property shall be held in escrow pursuant to the terms hereof
applicable to the Shares.

         7.       Miscellaneous.

                  (a) By signing these joint Escrow Instructions, you become a
party hereto only for the purpose of said joint Escrow Instructions, and you do
not become a party to the Agreement.

                  (b) This instrument shall be binding upon and inure to the
benefit of the parties hereto and their respective successors and permitted
assigns.

                                                 Very truly yours,

                                                 /s/ Chin-Cheng Wu
                                                 ---------------------------
                                                 Chin-Cheng Wu

                                                 ArrowPoint Communications, Inc.

                                                 By: /s/ Chin-Cheng Wu
                                                    ---------------------------
                                                    Chin-Cheng Wu, President
                                                    ---------------------------
                                                    (print name and title)

                                       3
<PAGE>   11
ESCROW AGENT:

/s/ Chin-Cheng Wu
------------------------------
Chin-Cheng Wu
Secretary
ArrowPoint Communications, Inc.

                                       4

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00000-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00000-of-00352.parquet"}]]