8x8 2002 Annual Report Download - page 89

Vesting Schedule and Limitations :
The Option shall become exercisable with respect to, (i) twenty-
five percent (25%) of the Option Shares upon Optionee's completion of one (1)
year of Service measured from the Vesting Commencement Date and (ii) the balance of the Option Shares in a series of thirty
-
six (36)
successive equal monthly installments, subject to Optionee continuing to be an Employee, over the thirty-
six (36) month period measured from
the first anniversary of the Vesting Commencement Date.
Following an assumption or substitution of the Option Shares in connection with a merger or Change in Control, if Optionee's status as an
Employee of the Corporation or the successor corporation is terminated by the Corporation or successor corporation as a result of an
"Involuntary Termination" (as defined below) within two (2) years following their merger or Change in Control, Optionee shall fully vest in
and have the right to exercise the option as to all of the Option Shares, including shares which would not otherwise be vested or exercisable.
For this purpose, "Involuntary Termination" means (i) without Optionee's express written consent, a significant reduction of Optionee's duties,
position or responsibilities, or the removal of such Optionee from such position and responsibilities, unless the Optionee is provided with a
comparable position (i.e., a position of equal or greater organizational level, duties, authority, compensation and status) relative to Optionee's
duties, position or responsibilities in effect immediately prior to such reduction; (ii) without Optionee's express written consent, a material
reduction by the Corporation or successor corporation of Optionee's base salary as in effect immediately prior to such reduction; (iii) without
Optionee's express written consent, a material reduction by the Corporation or successor corporation in the kind or level of employee benefits
to which Optionee is entitled immediately prior to such reduction with the result that Optionee's overall benefits package is significantly
reduced; (iv) without Optionee's express written consent, the relocation of Optionee to a facility or a location more than fifty (50) miles from
his/her current location, or (v) any purported termination of Optionee other than for "Cause" (as defined below).
For this purpose, "Cause" means (i) any act of personal dishonesty taken by Optionee in connection with his or her responsibilities as an
Employee of the Corporation or successor corporation which is intended to result in personal enrichment of Optionee, (ii) Optionee's
conviction of a felony, (iii) any act by Optionee that constitutes material misconduct and is injurious to the Corporation or successor
corporation, or (iv) continued violations by Optionee of Optionee's obligations to the Corporation or successor corporation.
Termination Period :
This Option shall be exercisable for thirty (30) days after Optionee ceases to be an Employee. Upon Optionee's death or Disability, this Option
may be exercised for one (1) year
after Optionee ceases to be an Employee. In no event may Optionee exercise this Option after the
Term/Expiration Date as provided above.
II. AGREEMENT
1. Grant of Option . The Plan Administrator of the Company hereby grants to the Optionee named in the Notice of Grant (the "Optionee"), an
option (the "Option") to purchase the number of Shares set forth in the Notice of Grant, at the exercise price per Share set forth in the Notice of
Grant (the "Exercise Price"), and subject to the terms and conditions of the Plan, which is incorporated herein by reference. Subject to
Section 14(c) of the Plan, in the event of a conflict between the terms and conditions of the Plan and 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 as
defined in Section 422 of the Code. Nevertheless, to the extent that it exceeds the $100,000 rule of Code Section 422(d), this Option shall be
treated as a Nonstatutory Stock Option ("NSO").
1. Exercise of Option .
A. Right to Exercise . This Option shall be exercisable during its term in accordance with the Vesting Schedule set out in
the Notice of Grant and with the applicable provisions of the Plan and this Option Agreement.
B. Method of Exercise . This Option shall be exercisable by delivery of an exercise notice in the form attached as Exhibit A
(the "Exercise Notice") which shall state the election to exercise the Option, the number of Shares with respect to which
the Option is being exercised, 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 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 the aggregate Exercise Price.
No Shares shall be issued pursuant to the exercise of an Option unless such issuance and such exercise comply with Applicable Laws.
Nonstatutory Stock Option
Term/Expiration Date