EXHIBIT 10.13
[LOGO OF HOLOGRAPHIX(TM) INC.]
NON STATUTORY STOCK OPTION AGREEMENT
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1. Grant of Option. Holographix Inc., a Delaware corporation (the
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"Company"), hereby grants to ▇▇▇▇▇▇▇▇ ▇▇▇▇▇ (the "Optionee"), as of May 15, 2000
(the "Grant Date"), an option, pursuant to the Company's 2000 Stock Option Plan
(the "Plan"), to purchase an aggregate of 51,607 shares of Common Stock ("Common
Stock") of the Company at a price of $2.50 per share, purchasable as set forth
in and subject to the terms and conditions of this Agreement and the Plan.
Except where the context otherwise requires, the term "Company" shall include
the parent and all present and future subsidiaries of the Company as defined in
Sections 424(e) and 424(f) of the Internal Revenue Code of 1986, as amended or
replaced from time to time (the "Code").
2. Non-Statutory Stock Option. This option is not intended to qualify as
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an incentive stock option within the meaning of Section 422 of the Code, nor to
qualify for any special tax treatment under the Code.
3. Term of Option: Vesting and Exercise Procedure.
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(a) Term and Vesting Schedule. Subject to the terms and conditions of
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this Agreement and of the Plan, this option may be exercised prior to the tenth
anniversary of the Grant Date (hereinafter the "Expiration Date") in
installments, as follows: 25% of the Shares subject to this option shall vest
twelve months after October 7, 1999, and l/48 of the Shares subject to this
option shall vest each month thereafter on the 7/th/ of each month, subject to
the Optionee continuing to provide services to the Company on such dates.
The right of exercise shall be cumulative so that if the option is not
exercised to the maximum extent permissible during any exercise period, it shall
be exercisable, in whole or in part, with respect to all shares not so purchased
at any time prior to the Expiration Date or the earlier termination of this
option. This option may not be exercised at any time on or after the Expiration
Date.
(i) Acceleration Upon a Change of Control. Notwithstanding the
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foregoing, upon a Change of Control, as defined below, that occurs while
Optionee provides services to the Company, this Option shall become vested and
exercisable as to fifty percent (50%) of the shares subject to this option on
the date the event constituting a Change of Control is consummated. The balance
of the shares subject to this option shall continue to vest on the same schedule
(i.e., the same number of shares shall vest each month) as existed prior to the
Change of Control. For example, if a Change of Control occurs on a date when
25% of Optionee's shares have vested, then an additional 25% of the shares
shall be vested pursuant to this paragraph. The remaining 50% of the shares
subject to this option shall vest at the rate of 1/48th of the shares per month
thereafter,
1
such that all shares are fully vested after an additional 24-month period. If a
Change of Control occurs on a date where more than 50% of Optionee's shares have
already vested, then no additional Shares shall vest pursuant to this paragraph.
(ii) Acceleration Upon a Change of Control and Termination of
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Employment. Notwithstanding the foregoing, in the event the Optionee's
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employment with the Company terminates as a result of an Involuntary Termination
other than for Cause upon or within 12 months after a Change of Control, this
option shall be fully (i.e. 100%) vested and this option may be exercised, in
whole or in part, upon the date of such termination.
The following terms referred to in this Agreement shall have the following
meanings:
Cause. "Cause" shall mean (i) any act of personal dishonesty taken by
the Optionee in connection with his responsibilities as an employee and intended
to result in substantial personal enrichment of the Optionee, (ii) conviction of
a felony that is injurious to the Company, and (iii) a willful act by the
Optionee which constitutes gross misconduct and which is injurious to the
Company.
Change of Control. "Change of Control" shall mean the occurrence of
any of the following events:
(A) Any "person" (as such term is used in Sections 13(d) and
14(d) of the Securities Exchange Act of 1934, as amended) is or becomes the
"beneficial owner" (as defined in Rule 13d-3 under said Act), directly or
indirectly, of securities of Avanex Corporation or its successor ("Avanex")
representing 50% or more of the total voting power represented by Avanex's then
outstanding voting securities other than in a private financing transaction
approved by the Board of Directors;
(B) the direct or indirect sale or exchange by the shareholders
of Avanex of all or substantially all of the stock of Avanex;
(C) merger or consolidation in which Avanex is a party and in
which the shareholders of Avanex before such merger or consolidation do not
retain, directly or indirectly, at a least majority of the beneficial interest
in the voting stock of Avanex after such transaction; or
(D) the sale or disposition by Avanex of all or substantially all
Avanex's assets.
Disability, "Disability" shall mean that the Optionee has been unable
to substantially perform his duties as the result of his incapacity due to
physical or mental illness, and such inability, at least 26 weeks after its
commencement, is determined to be total and permanent by a physician selected by
the Company or its insurers and acceptable to the Optionee or the Optionee's
legal representative (such agreement as to acceptability not to be unreasonably
withheld).
Involuntary Termination. "Involuntary Termination" shall mean (i)
without the Optionee's express written consent, the significant reduction of the
Optionee's duties or
2
responsibilities relative to the Optionee's duties or responsibilities in effect
immediately prior to such reduction; provided, however, that a reduction in
duties or responsibilities solely by virtue of the Company or its parent being
acquired and made part of a larger entity (as, for example, when the Chief
Financial Officer remains as such following a Change of Control and is not made
the Chief Financial Officer of the acquiring corporation) shall not constitute
an "Involuntary Termination"; (ii) without the Optionee's express written
consent, a substantial reduction, without good business reasons, of the
facilities and perquisites (including office space and location) available to
the Optionee immediately prior to such reduction; (iii) without the Optionee's
express written consent, a material reduction in the base compensation of the
Optionee as in effect immediately prior to such reduction, or the ineligibility
of the Optionee to continue to participate in any long-term incentive plan of
the Company; (iv) a material reduction in the kind or level of employee benefits
to which the Optionee is entitled immediately prior to such reduction with the
result that the Optionee's overall benefits package is significantly reduced;
(v) the relocation of the Optionee to a facility or a location more than 50
miles from the Optionee's then present location, without the Optionee's express
written consent; (vi) any purported termination of the Optionee which is not
effected for death or Disability or for Cause, or any purported termination for
which the grounds relied upon are not valid; or (vii) the failure to obtain the
assumption of this agreement by any successors of the Company in a Change of
Control.
(b) Exercise Procedure. Subject to the conditions set forth in this
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Agreement, this option shall be exercised by the Optionee's delivery of written
notice of exercise to the Treasurer of the Company, specifying the number of
shares to be purchased and the purchase price to be paid therefor and
accompanied by payment in full in accordance with Section 4. Such exercise shall
be effective upon receipt by the Treasurer of the Company of such written notice
together with the required payment. The Optionee may purchase less than the
number of shares covered hereby. No partial exercise of this option may be for
any fractional share.
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4. Payment of Purchase Price; Taxes.
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(a) Method of Payment. Payment of the purchase price for
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shares purchased upon exercise of this option shall be made (i) by delivery to
the Company of cash or a check to the order of the Company in an amount equal to
the purchase price of such shares, (ii) subject to the consent of the Company,
by delivery to the Company of shares of Common Stock of the Company then owned
by the Optionee having a fair market value equal in amount to the purchase price
of such shares, (iii) consideration received by the Company under a cashless
exercise program implemented by the Company in connection with the Plan, or (iv)
by any other means which the Board of Directors determines are consistent with
the purpose of the Plan and with applicable laws and regulations (including,
without limitation, the provisions of Rule 16b-3 under the Securities Exchange
Act of 1934 and Regulation T promulgated by the Federal Reserve Board), or (v)
by any combination of such methods of payment.
(b) Valuation of Shares or Other Non-Cash Consideration
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Tendered in Payment of Purchase Price. For the purposes hereof, the fair market
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value of any share of the Company's Common Stock or other non-cash consideration
which may be delivered to the Company in exercise of this option shall be
determined in good faith by the Board of Directors of the Company.
(c) Delivery of Shares Tendered in Payment of Purchase Price.
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If the Optionee exercises options by delivery of shares of Common Stock of the
Company, the certificate or certificates representing the shares of Common
Stock of the Company to be delivered shall be duly executed in blank by the
Optionee or shall be accompanied by a stock power duly executed in blank
suitable for purposes of transferring such shares to the Company. Fractional
shares of Common Stock of the Company will not be accepted in payment of the
purchase price of shares acquired upon exercise of this option.
(d) Taxes. The Optionee acknowledges that income or other
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taxes may be due upon exercise of this option and upon the disposition of shares
acquired through such exercise. Such income or other taxes due from him or her
with respect to this option or the shares issuable pursuant to this option shall
be the Optionee's responsibility. The Company makes no representation or
warranty concerning the tax effects of the exercise of this option or the
disposition of the Common Stock.
5. Delivery of Shares; Compliance With Securities Laws, Etc.
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(a) General. The Company shall, upon payment of the option
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price for the number of shares purchased and paid for, make prompt delivery of
such shares to the Optionee, provided that if any law or regulation requires the
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Company to take any action with respect to such shares before the issuance
thereof, then the date of delivery of such shares shall be extended for the
period necessary to complete such action.
(b) Listing, Qualification, Etc. This option shall be subject
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to the requirement that if, at any time, counsel to the Company shall determine
that the listing, registration or qualification of the shares subject hereto
upon any securities exchange or under any state or federal
4
law, or the consent or approval of any governmental or regulatory body, or that
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 hereunder, this option may not be exercised, in whole or in
part, unless such listing, registration, qualification, consent or approval,
disclosure or satisfaction of such other condition shall have been effected or
obtained on terms acceptable to the Board of Directors. Nothing herein shall be
deemed to require the Company to apply for, effect or obtain such listing,
registration, qualification, or disclosure, or to satisfy such other condition.
6. Investment Representations; Legends. As a condition of accepting
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any option under this Agreement, the Optionee agrees as follows:
(a) Representations. The Optionee represents, warrants and
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covenants that:
(i) Any shares purchased upon exercise of this option
shall be acquired for the Optionee's 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.
(ii) The Optionee has had such opportunity as he or she
has deemed adequate to obtain from representatives of the Company such
information as is necessary to permit the Optionee to evaluate the merits and
risks of his or her investment in the Company.
(iii) The Optionee is able to bear the economic risk of
holding shares acquired pursuant to the exercise of this option for an
indefinite period.
(iv) The Optionee understands that (A) the shares acquired pursuant
to the exercise of this option will not be registered under the Securities Act
and are restricted securities" within the meaning of Rule 144 under the
Securities Act; (B) such 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; (C) in any event, an exemption
from registration under Rule 144 or otherwise under the Securities Act may not
be available for at least two years 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 (D) there is now no registration statement on
file with the Securities and Exchange Commission with respect to any stock of
the Company and the Company has no obligation or current intention to register
any shares acquired pursuant to the exercise of this option under the Securities
Act.
(v) "Lock-UP" Agreement. The Optionee agrees that upon
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the Company's request at any time, whether before or after the exercise of the
option, the Optionee will enter into an agreement pursuant to which, if the
Company desires to make any public offering of shares of Common Stock, then
without the prior written consent of the Company or the managing underwriter, if
any, of any such offering, the Optionee will not sell, make any short sale of,
loan, grant any option for the purchase of, pledge, or otherwise encumber or
otherwise dispose of any shares of Common Stock issued or issuable pursuant to
the option, during such period (not to exceed 180 days) commencing on the
effective date of the registration statement relating to such offering as the
Company may request.
By making payment upon exercise of any option, the Optionee shall be
deemed to have reaffirmed, as of the date of such payment, the representations
made in this Section 6.
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(b) Legends on Stock Certificates. All stock certificates
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representing shares of Common Stock issued to the Optionee upon exercise of this
option prior to the filing of a Form S-8 to register such shares shall have
affixed thereto legends substantially in the following forms, in addition to any
other legends required by applicable state law:
"The shares of stock represented by this certificate have not been
registered under the Securities Act of 1933 and may not be transferred, sold or
otherwise disposed of in the absence of an effective registration statement with
respect to the shares evidenced by this certificate, filed and made effective
under the Securities Act of 1933, or an opinion of counsel satisfactory to the
Company to the effect that registration under such Act is not required."
"The shares of stock represented by this certificate are subject
to certain restrictions on transfer contained in an option agreement, a copy of
which will be furnished upon request by the issuer. "
7. Relationship to Plan. The option contained in this Agreement has been
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granted pursuant to the Plan, and is in all respects subject to the terms,
conditions and definitions of the Plan, as amended from time to time. The
Optionee hereby accepts this option subject to all the terms and provisions of
the Plan and agrees that all decisions under and interpretations of the Plan by
the Board shall be final, binding and conclusive upon the Optionee and his
permitted heirs, executors, administrators, successors and assigns. Where there
may be conflicts between the Plan and this Agreement, this Plan shall take
precedence.
8. No 0bligation to Continue Employment. Nothing contained in the Plan, or
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in this Agreement, shall confer upon the Optionee any right with respect to the
continuation of the Optionee's employment or engagement by the Company or
interfere in any way with the right of the Company at any time to terminate such
employment or engagement or to increase or decrease the compensation of the
Optionee
9. No Rights as Stockholder Until Exercise. The Optionee shall have no
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rights as a shareholder with respect to any shares covered by this option
(including, without limitation, any rights to receive dividends or non-cash
distributions with respect to such shares) unless and until a certificate
representing such shares is duly issued and delivered to the Optionee. No
adjustment shall be made for dividends or other rights for which the record date
is prior to the date such stock certificate is issued.
10. Withholding Taxes. The Company's obligation to deliver shares upon the
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exercise of this option shall be subject to the Optionee's satisfaction of all
applicable federal, state and local income and employment tax withholding
requirements and the requirements set forth in Section 22 of the Plan.
11. Unenforceability. In case any one or more of the provisions or part of any
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provision contained in this Agreement or the Plan shall, for any reason, be held
to be invalid, illegal or unenforceable in any respect, such invalidity,
illegality or unenforceability shall not affect any other provision or part of
this Agreement or Plan, but this Agreement and Plan shall be construed as if
such invalid, illegal or enforceable provision or part of a provision had
never been.
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12. Miscellaneous.
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(a) Except as provided herein, this option may not be amended or otherwise
modified unless evidenced in writing and signed by the Company and the Optionee.
(b) All notices under this option shall be mailed or delivered by hand to
the parties at their respective addresses set forth beneath their names below or
at such other address as may be designated in writing by either of the parties
to one another.
(c) This option shall be governed by and construed in accordance with the
laws of the Commonwealth of Massachusetts.
HOLOGRAPHIX INC.
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Date of Grant: By: /s/ ▇▇▇▇▇ ▇▇▇▇
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May l5, 2000 Title: President
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7
OPTIONEE'S ACCEPTANCE
The undersigned hereby accepts the foregoing option and agrees to the
terms and conditions thereof. The undersigned hereby acknowledges receipt of a
copy of the Company's 2000 Stock Option Plan.
OPTIONEE'S SIGNATURE:
/s/ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
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Date: 1-26-01
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SS#:
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Address: ______________________
______________________
______________________
8
AVANEX CORPORATION
1998 STOCK PLAN
STOCK OPTION AGREEMENT
Unless otherwise defined herein, the terms defined in the 1998 Stock
Plan, as amended (the "Plan") shall have the same defined meanings in this
Option Agreement.
I. NOTICE OF STOCK OPTION GRANT
▇▇▇▇▇▇▇▇ ▇▇▇▇▇
You have been granted an Option to purchase Common Stock of the
Company, subject to the terms and conditions of the Plan and this Option
Agreement, as follows:
Date of Grant November 5, 2001
Vesting Commencement Date November 5, 2001
Exercise Price per Share $4.90
Total Number of Shares Granted 200,000
Total Exercise Price $980,000.00
Type of Option ______ Incentive Stock Option
X Nonstatutory Stock Option
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Term/Expiration Date: November 4, 2011
Exercise and Vesting Schedule:
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Subject to accelerated vesting as set forth below, this Option may be
exercised, in whole or in part, in accordance to the following vesting schedule:
25% of the Shares subject to the Option shall vest twelve months after
the Vesting Commencement Date, and 1/48 of the Shares subject to the Option
shall vest each month thereafter on the same day of the month as the Vesting
Commencement Date, subject to the Optionee continuing to be a Service Provider
on such dates.
Acceleration Upon a Change of Control. Notwithstanding the foregoing,
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upon a Change of Control, as defined below, that occurs while Optionee provides
services to the Company, this Option shall become vested and exercisable as to
fifty percent (50%) of the shares subject to this Option on the date the event
constituting a Change of Control is consummated. The balance of the shares
subject to this Option shall continue to vest on the same schedule (i.e., the
same number of shares
shall vest each month) as existed prior to the Change of Control. For example,
if a Change of Control occurs on a date when 25% of Optionee's shares have
vested, then an additional 25% of the shares shall be vested pursuant to this
paragraph. The remaining 50% of the shares subject to this Option shall vest at
the rate of 1/48/th/ of the shares per month thereafter, such that all shares
are fully vested after an additional 24-month period. If a Change of Control
occurs on a date where more than 50% of Optionee's shares have already vested,
then no additional Shares shall vest pursuant to this paragraph.
Acceleration Upon a Change of Control and Termination of Employment.
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Notwithstanding the foregoing, in the event the Optionee's employment with the
Company terminates as a result of an Involuntary Termination other than for
Cause upon or within 12 months after a Change of Control, this Option shall be
fully (i.e. 100%) vested and this Option may be exercised, in whole or in part,
upon the date of such termination.
The following terms referred to in this Agreement shall have the
following meanings:
(i) Cause. "Cause" shall mean (i) any act of personal
dishonesty taken by the Optionee in connection with his responsibilities as an
employee and intended to result in substantial personal enrichment of the
Optionee, (ii) conviction of a felony that is injurious to the Company, and
(iii) a willful act by the Optionee which constitutes gross misconduct and which
is injurious to the Company.
(ii) Change of Control. "Change of Control" shall mean the
occurrence of any of the following events:
Any "person" (as such term is used in Sections 13(d) and
14(d) of the Securities Exchange Act of 1934, as amended) is
or becomes the "beneficial owner" (as defined in Rule 13d-3
under said Act), directly or indirectly, of securities of
the Company representing 50% or more of the total voting
power represented by the Company's then outstanding voting
securities other than in a private financing transaction
approved by the Board of Directors;
the direct or indirect sale or exchange by the stockholders
of the Company of all or substantially all of the stock of
the Company;
a merger or consolidation in which the Company is a party
and in which the stockholders of the Company before such
merger or consolidation do not retain, directly or
indirectly, at a least majority of the beneficial interest
in the voting stock of the Company after such transaction;
or
the sale or disposition by the Company of all or
substantially all the Company's assets.
(iii) Disability. "Disability" shall mean that the Optionee
has been unable to substantially perform his duties as the result of his
incapacity due to physical or mental illness, and such inability, at least 26
weeks after its commencement, is determined to be total and permanent by a
physician selected by the Company or its insurers and acceptable to the Optionee
or
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the Optionee's legal representative (such agreement as to acceptability not to
be unreasonably withheld).
(iv) Involuntary Termination. "Involuntary Termination"
shall mean (i) without the Optionee's express written consent, the significant
reduction of the Optionee's duties or responsibilities relative to the
Optionee's duties or responsibilities in effect immediately prior to such
reduction; provided, however, that a reduction in duties or responsibilities
solely by virtue of the Company being acquired and made part of a larger entity
(as, for example, when the Chief Financial Officer of Company remains as such
following a Change of Control and is not made the Chief Financial Officer of the
acquiring corporation) shall not constitute an "Involuntary Termination"; (ii)
without the Optionee's express written consent, a substantial reduction, without
good business reasons, of the facilities and perquisites (including office space
and location) available to the Optionee immediately prior to such reduction;
(iii) without the Optionee's express written consent, a material reduction by
the Company in the base compensation of the Optionee as in effect immediately
prior to such reduction, or the ineligibility of the Optionee to continue to
participate in any long-term incentive plan of the Company; (iv) a material
reduction by the Company in the kind or level of employee benefits to which the
Optionee is entitled immediately prior to such reduction with the result that
the Optionee's overall benefits package is significantly reduced; (v) the
relocation of the Optionee to a facility or a location more than 50 miles from
the Optionee's then present location, without the Optionee's express written
consent; (vi) any purported termination of the Optionee by the Company which is
not effected for death or Disability or for Cause, or any purported termination
for which the grounds relied upon are not valid; or (vii) the failure of the
Company to obtain the assumption of this agreement by any successors
contemplated in Section I.(ii) above.
Termination Period:
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This Option may be exercised for three months after Optionee ceases to
be a Service Provider. Upon the death or Disability of the Optionee, this Option
may be exercised for twelve months after Optionee ceases to be a Service
Provider. In no event shall this Option be exercised later than the
Term/Expiration Date as provided above.
In addition, upon an Involuntary Termination of the Optionee's
employement other than for Cause upon or within 12 months after a Change of
Control, this Option may be exercised for twenty-four months after Optionee
ceases to be a Service Provider.
II. AGREEMENT
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▇. ▇▇▇▇▇ of Option.
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The Plan Administrator of the Company hereby grants to the
Optionee named in the Notice of Grant attached as Part I of this Agreement (the
"Optionee") an option (the "Option") to purchase the number of Shares, as set
forth in the Notice of Grant, at the exercise price per share set forth in the
Notice of Grant (the "Exercise Price"), subject to the terms and conditions of
the Plan, which is incorporated herein by reference. Subject to Section 15(c) of
the Plan, in the event of a
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conflict between the terms and conditions of the Plan and the terms and
conditions of this Option Agreement, the terms and conditions of the Plan shall
prevail.
If designated in the Notice of Grant as an Incentive Stock Option
("ISO"), this Option is intended to qualify as an Incentive Stock Option under
Section 422 of the Code. However, if this Option is intended to be an Incentive
Stock Option, to the extent that it exceeds the $100,000 rule of Code Section
422(d) it shall be treated as a Nonstatutory Stock Option ("NSO").
B. Exercise of Option.
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(a) Right to Exercise. This Option is exercisable during its term
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in accordance with the Vesting Schedule set out in the Notice of Grant and the
applicable provisions of the Plan and this Option Agreement.
(b) Method of Exercise. This Option is exercisable by delivery of
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an exercise notice, in the form attached as Exhibit A (the "Exercise Notice"),
which shall state the election to exercise the Option, the number of Shares in
respect of which the Option is being exercised (the "Exercised Shares"), and
such other representations and agreements as may be required by the Company
pursuant to the provisions of the Plan. The Exercise Notice shall be completed
by the Optionee and delivered to the Company. The Exercise Notice shall be
accompanied by payment of the aggregate Exercise Price as to all Exercised
Shares. This Option shall be deemed to be exercised upon receipt by the Company
of such fully executed Exercise Notice accompanied by such aggregate Exercise
Price.
No Shares shall be issued pursuant to the exercise of this
Option unless such issuance and exercise complies with Applicable Laws. Assuming
such compliance, for income tax purposes the Exercised Shares shall be
considered transferred to the Optionee on the date the Option is exercised with
respect to such Exercised Shares.
C. Method of Payment.
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Payment of the aggregate Exercise Price shall be by any of the
following, or a combination thereof, at the election of the Optionee:
1. cash; or
2. check; or
3. consideration received by the Company under a cashless
exercise program implemented by the Company in connection with the Plan; or
4. surrender of other Shares which (i) in the case of Shares
acquired upon exercise of an option, have been owned by the Optionee for more
than six (6) months on the date of surrender, and (ii) have a Fair Market Value
on the date of surrender equal to the aggregate Exercise Price of the Exercised
Shares.
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D. Non-Transferability of Option.
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This Option may not be transferred in any manner otherwise than by
will or by the laws of descent or distribution and may be exercised during the
lifetime of Optionee only by the Optionee. The terms of the Plan and this Option
Agreement shall be binding upon the executors, administrators, heirs, successors
and assigns of the Optionee.
E. Term of Option.
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This Option may be exercised only within the term set out in the
Notice of Grant, and may be exercised during such term only in accordance with
the Plan and the terms of this Option Agreement.
F. Tax Consequences.
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Some of the federal tax consequences relating to this Option, as
of the date of this Option, are set forth below. THIS SUMMARY IS NECESSARILY
INCOMPLETE, AND THE TAX LAWS AND REGULATIONS ARE SUBJECT TO CHANGE. THE OPTIONEE
SHOULD CONSULT A TAX ADVISER BEFORE EXERCISING THIS OPTION OR DISPOSING OF THE
SHARES.
G. Exercising the Option.
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1. Nonstatutory Stock Option. The Optionee may incur regular
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federal income tax liability upon exercise of a NSO. The Optionee will be
treated as having received compensation income (taxable at ordinary income tax
rates) equal to the excess, if any, of the Fair Market Value of the Exercised
Shares on the date of exercise over their aggregate Exercise Price. If the
Optionee is an Employee or a former Employee, the Company will be required to
withhold from his or her compensation or collect from Optionee and pay to the
applicable taxing authorities an amount in cash equal to a percentage of this
compensation income at the time of exercise, and may refuse to honor the
exercise and refuse to deliver Shares if such withholding amounts are not
delivered at the time of exercise.
2. Incentive Stock Option. If this Option qualifies as an ISO,
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the Optionee will have no regular federal income tax liability upon its
exercise, although the excess, if any, of the Fair Market Value of the Exercised
Shares on the date of exercise over their aggregate Exercise Price will be
treated as an adjustment to alternative minimum taxable income for federal tax
purposes and may subject the Optionee to alternative minimum tax in the year of
exercise. In the event that the Optionee ceases to be an Employee but remains a
Service Provider, any Incentive Stock Option of the Optionee that remains
unexercised shall cease to qualify as an Incentive Stock Option and will be
treated for tax purposes as a Nonstatutory Stock Option on the date three (3)
months and one (1) day following such change of status.
3. Disposition of Shares.
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(a) NSO. If the Optionee holds NSO Shares for at least one
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year, any gain realized on disposition of the Shares will be treated as
long-term capital gain for federal income tax purposes.
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(b) ISO. If the Optionee holds ISO Shares for at least one
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year after exercise and two years after the grant date, any gain realized on
disposition of the Shares will be treated as long-term capital gain for federal
income tax purposes. If the Optionee disposes of ISO Shares within one year
after exercise or two years after the grant date, any gain realized on such
disposition will be treated as compensation income (taxable at ordinary income
rates) to the extent of the excess, if any, of the lesser of (A) the difference
between the Fair Market Value of the Shares acquired on the date of exercise and
the aggregate Exercise Price, or (B) the difference between the sale price of
such Shares and the aggregate Exercise Price. Any additional gain will be taxed
as capital gain, short-term or long-term depending on the period that the ISO
Shares were held.
(c) Notice of Disqualifying Disposition of ISO Shares. If
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the Optionee sells or otherwise disposes of any of the Shares acquired pursuant
to an ISO on or before the later of (i) two years after the grant date, or (ii)
one year after the exercise date, the Optionee shall immediately notify the
Company in writing of such disposition. The Optionee agrees that he or she may
be subject to income tax withholding by the Company on the compensation income
recognized from such early disposition of ISO Shares by payment in cash or out
of the current earnings paid to the Optionee.
H. Entire Agreement; Governing Law.
-------------------------------
The Plan is incorporated herein by reference. The Plan and this
Option Agreement constitute the entire agreement of the parties with respect to
the subject matter hereof and supersede in their entirety all prior undertakings
and agreements of the Company and Optionee with respect to the subject matter
hereof, and may not be modified adversely to the Optionee's interest except by
means of a writing signed by the Company and Optionee. This agreement is
governed by the internal substantive laws, but not the choice of law rules, of
California.
I. NO GUARANTEE OF CONTINUED SERVICE.
---------------------------------
OPTIONEE ACKNOWLEDGES AND AGREES THAT THE VESTING OF SHARES
PURSUANT TO THE VESTING SCHEDULE HEREOF IS EARNED ONLY BY CONTINUING AS A
SERVICE PROVIDER AT THE WILL OF THE COMPANY (AND NOT THROUGH THE ACT OF BEING
HIRED, BEING GRANTED AN OPTION OR PURCHASING SHARES HEREUNDER). OPTIONEE FURTHER
ACKNOWLEDGES AND AGREES THAT THIS AGREEMENT, THE TRANSACTIONS CONTEMPLATED
HEREUNDER AND THE VESTING SCHEDULE SET FORTH HEREIN DO NOT CONSTITUTE AN EXPRESS
OR IMPLIED PROMISE OF CONTINUED ENGAGEMENT AS A SERVICE PROVIDER FOR THE VESTING
PERIOD, FOR ANY PERIOD, OR AT ALL, AND SHALL NOT INTERFERE WITH OPTIONEE'S RIGHT
OR THE COMPANY'S RIGHT TO TERMINATE OPTIONEE'S RELATIONSHIP AS A SERVICE
PROVIDER AT ANY TIME, WITH OR WITHOUT CAUSE.
By your signature and the signature of the Company's representative
below, you and the Company agree that this Option is granted under and governed
by the terms and conditions of the Plan and this Option Agreement. Optionee has
reviewed the Plan and this Option Agreement in their entirety, has had an
opportunity to obtain the advice of counsel prior to executing this Option
Agreement and fully understands all provisions of the Plan and Option Agreement.
Optionee hereby agrees to accept as binding, conclusive and final all decisions
or interpretations of the Administrator
-6-
upon any questions relating to the Plan and Option Agreement. Optionee further
agrees to notify the Company upon any change in the residence address indicated
below.
-7-
OPTIONEE: AVANEX CORPORATION
/s/ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇ By /s/ ▇▇▇▇ ▇▇▇▇▇
----------------------------------- -------------------
Signature
/s/ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇ President & Chief Executive Officer
----------------------------------- -------------------------------------
Print Name Title
___________________________________
Residence Address
___________________________________
EXHIBIT A
---------
AVANEX CORPORATION
1998 STOCK PLAN
EXERCISE NOTICE
Avanex Corporation
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: Secretary
1. Exercise of Option. Effective as of today, ________________, _____,
------------------
the undersigned ("Purchaser") hereby elects to purchase ______________ shares
(the "Shares") of the Common Stock of Avanex Corporation (the "Company") under
and pursuant to the 1998 Stock Plan (the "Plan") and the Stock Option Agreement
dated, _____ (the "Option Agreement"). The purchase price for the Shares shall
be $_____, as required by the Option Agreement.
2. Delivery of Payment. Purchaser herewith delivers to the Company the
-------------------
full purchase price for the Shares.
3. Representations of Purchaser. Purchaser acknowledges that Purchaser
----------------------------
has received, read and understood the Plan and the Option Agreement and agrees
to abide by and be bound by their terms and conditions.
4. Rights as Stockholder. Until the issuance (as evidenced by the
---------------------
appropriate entry on the books of the Company or of a duly authorized transfer
agent of the Company) of the Shares, no right to vote or receive dividends or
any other rights as a stockholder shall exist with respect to the Optioned
Stock, notwithstanding the exercise of the Option. The Shares so acquired shall
be issued to the Optionee as soon as practicable after exercise of the Option.
No adjustment will be made for a dividend or other right for which the record
date is prior to the date of issuance, except as provided in Section 13 of the
Plan.
5. Tax Consultation. Purchaser understands that Purchaser may suffer
----------------
adverse tax consequences as a result of Purchaser's purchase or disposition of
the Shares. Purchaser represents that Purchaser has consulted with any tax
consultants Purchaser deems advisable in connection with the purchase or
disposition of the Shares and that Purchaser is not relying on the Company for
any tax advice.
6. Entire Agreement; Governing Law. The Plan and Option Agreement are
-------------------------------
incorporated herein by reference. This Agreement, the Plan and the Option
Agreement constitute the entire agreement of the parties with respect to the
subject matter hereof and supersede in their entirety all prior undertakings and
agreements of the Company and Purchaser with respect to the subject matter
hereof, and may not be modified adversely to the Purchaser's interest except by
means of a writing signed by the Company and Purchaser. This agreement is
governed by the internal substantive laws, but not the choice of law rules, of
California.
Submitted by: Accepted by:
PURCHASER: AVANEX CORPORATION
___________________________________ _____________________________________
Signature By
___________________________________ _____________________________________
Print Name
Address: Address:
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___________________________________ AVANEX CORPORATION
___________________________________ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
_____________________________________
Date Received
-2-
TO: ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
FROM: ▇▇▇▇ ▇▇▇▇▇, President and Chief Executive Officer
DATE: March 18, 2002
RE: Important Change to your Options under the Holographix Inc.
2000 Stock Option Plan
--------------------------------------------------------------------------------
I am pleased to inform you of an important change to your stock option that
was granted under the Holographix Inc. 2000 Stock Option Plan (the "Plan") and
later assumed by Avanex Corporation (the "Company"). The Compensation Committee
of the Company's Board of Directors approved this change in November 2001. I
think that you will find the change very beneficial.
You now will have up to twenty-four (24) months to exercise your option if
your employment with the Company terminates due to an Involuntary Termination
other than for Cause within twelve (12) months after a Change of Control.
However, in no event may you exercise your option after the Expiration Date
stated in your stock option agreement (the "Agreement").
Previously, the maximum time to exercise following your Involuntary
Termination other than for Cause within twelve (12) months after a Change of
Control was twelve (12) months. Please refer to the Agreement and/or the Plan
for the definition of capitalized terms (such as "Involuntary Termination" and
"Cause") that are used but not defined in this memo. Your option will continue
to be a nonstatutory stock option and otherwise will not change, except as
described above.
/s/ ▇▇▇▇ ▇▇▇▇▇
---------------------------------
▇▇▇▇ ▇▇▇▇▇
President and CEO