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Exhibit 10.5
EMULEX CORPORATION
2004 EMPLOYEE STOCK INCENTIVE PLAN
NONQUALIFIED STOCK OPTION AGREEMENT
This
Nonqualified Stock Option Agreement is made and entered into by
and
between Emulex Corporation, a Delaware
corporation ("Company"), and the Employee
identified in the "Emulex Corporation
Notice of Grant of Stock Option" ("Grant
Notice") which is attached hereto
("Optionee"), as of the "Grant Date" set forth
in the Grant Notice, with respect to the
following facts:
A. The
Company has adopted and the stockholders of the Company have
approved the Emulex Corporation 2004
Employee Stock Incentive Plan ("Plan")
pursuant to which the Company is authorized
to grant stock options to employees
of the Company or its subsidiaries;
B.
Optionee has received and reviewed a copy of the Plan; and
C.
Optionee is an employee of the Company or a subsidiary.
NOW,
THEREFORE, in consideration of the premises and intending to be
legally bound, the parties agree as
follows:
1. GRANT
OF STOCK OPTION. Subject to the terms and conditions set forth
herein, the Company hereby grants to
Optionee a nonqualified stock option
("Option") to purchase from the Company, at
the "Option Price Per Share" set
forth in the Grant Notice, the "Total
Number of Shares" of the Company's
authorized and unissued or reacquired
shares of common stock set forth in the
Grant Notice.
2.
NONQUALIFIED STOCK OPTION. The Stock Option granted to Optionee
pursuant to this Agreement is intended to
be a "non-qualified stock option" and
is not subject to the qualification
requirements and limitations applicable to
incentive stock options under Section 422
of the Internal Revenue Code of 1986,
as amended ("Code").
3.
ADMINISTRATION. The Plan provides that the Plan Administrator shall
be
the Board of Directors of the Company
("Board") or a committee ("Committee")
consisting of not less than two (2)
individuals appointed by the Board. Subject
to the provisions of the Plan, the Plan
Administrator shall have authority to
construe and interpret the Plan and this
Agreement, to promulgate, amend, and
rescind rules and regulations relating to
the administration of the Plan and
this Agreement, and to make all of the
determinations necessary or advisable for
administration of the Plan and this
Agreement. The interpretation and
construction by the Plan Administrator of
any provision of this Agreement, shall
be final and binding upon all parties. No
member of the Plan Administrator shall
be liable for any action or determination
undertaken or made in good faith with
respect to the Plan or this Agreement.
4. TERM OF
STOCK OPTION. Unless earlier exercised pursuant to Section 5
below, the Stock Option shall terminate on,
and shall not be exercisable after,
the expiration of the earliest of (a) ten
(10) years after the Grant Date set
forth in the Grant Notice or, if earlier,
the Termination Date set forth in the
Grant Notice, (b) three (3) months after
the date Optionee's employment with the
Company and its subsidiaries terminates, if
such termination is for any reason
other than Disability (as defined in the
Plan), death or cause, or (c) the date
the Optionee's employment with the Company
and its subsidiaries terminates if
such termination is for cause as determined
by the Plan Administrator, in its
sole discretion, or (d) one (1) year after
the date Optionee's employment with
the Company and its subsidiaries
terminates, if such termination is a result of
death or Disability, or death results
within not more than three
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months of the date on which the Optionee
ceases to be an employee. Outstanding
Options that are not exercisable at the
time Participant's employment with the
Company and its subsidiaries terminates for
any reason (including upon the
Optionholder's death or Disability) shall
be forfeited and expire at the close
of business on the date of such
termination.
5.
EXERCISE.
5.1 EXERCISABILITY. Subject to the terms and conditions of this
Agreement, and unless otherwise defined in
the Grant Notice, the Stock Option
shall become exercisable on a cumulative
basis as to 25% of the Total Number of
Shares of Common Stock of the Company
specified in the Grant Notice one year
after the Grant Date specified in the Grant
Notice and an additional 6-1/4% of
such Total Number of Shares at any time
after the end of each consecutive
calendar quarter thereafter, if Optionee is
still employed by the Company or one
of its subsidiaries on such dates, until
the Stock Option has become exercisable
with respect to the Total Number of Shares
of Common Stock of the Company set
forth in the Grant Notice. The Stock Option
may be exercised by Optionee with
respect to any shares of Common Stock of
the Company covered by the Stock Option
at any time on or after the date on which
the Stock Option becomes exercisable
with respect to such shares; provided that
the other terms of this Agreement,
and any terms required by any broker used
by the Optionee, are complied with.
Anything set forth in this Agreement to the contrary
notwithstanding, the Stock Option may not
be exercised after the time Optionee
ceases to be an employee of the Company and
its subsidiaries (irrespective of
the cause) except to the extent it would
have been exercisable by Optionee at
such time.
5.2 NOTICE OF EXERCISE. Optionee shall exercise the Option by
delivering to the Company, either in person
or by certified or registered mail,
written notice of election to exercise and
payment in full of the purchase price
as provided in Subsection 5.3 of this
Agreement. The written notice shall set
forth the whole number of shares with
respect to which the Option is being
exercised.
5.3 PAYMENT OF PURCHASE PRICE. The purchase price for any shares
of
common stock of the Company with respect to
which Optionee exercises this Option
shall be paid in full at the time Optionee
delivers to the Company the written
notice of election to exercise. The
purchase price shall be paid in cash, by
certified bank check, or, at the discretion
of the Plan Administrator, upon such
terms and conditions as the Plan
Administrator shall approve, either (a) by
delivery to the Company of other Common
Stock, duly endorsed for transfer to the
Company, with a Fair Market Value on the
date of delivery equal to the exercise
price (or portion thereof) due for the
number of shares being acquired, or by
means of attestation whereby the
Participant identifies for delivery specific
shares of Common Stock, that have a Fair
Market Value on the date of attestation
equal to the exercise price (or portion
thereof) and receives a number of shares
of Common Stock equal to the difference
between the number of shares thereby
purchased and the number of identified
attestation shares of Common Stock (a
"STOCK FOR STOCK EXCHANGE"), provided that
any shares of Common Sto
