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Exhibit 10.6
ACME PACKET, INC.
INCENTIVE STOCK OPTION AGREEMENT
This
INCENTIVE STOCK OPTION AGREEMENT, dated as of December 23, 2005
(this
"AGREEMENT"), is between ACME PACKET, INC., a Delaware corporation
(the
"COMPANY"), and Dino DiPalma (the "OPTIONEE"). Capitalized terms
used herein
without definition shall have the meaning ascribed to such terms in
the
Company's 2000 Equity Incentive Plan, a copy of which is attached
hereto as
EXHIBIT A (the "PLAN").
1.
GRANT OF OPTION.
Pursuant to the Plan, the Company grants to the
Optionee an option (the "OPTION") to purchase from the Company all
or any number
of an aggregate of 150,000 shares, subject to adjustment pursuant
to Section 8
of the Plan (the "OPTION SHARES"), of the Company's common stock,
$.001 par
value per share, at a price of $1.00 per share. The Option is
granted as of
December 23, 2005(the "GRANT DATE").
2. CHARACTER OF OPTION. The
Option is intended to be treated as an
"incentive stock option" within the meaning of Section 422 of the
Internal
Revenue Code of 1986, as amended (the "CODE").
3.
DURATION OF
OPTION. Unless subject to earlier expiration or
termination pursuant to the terms of the Plan, the Option shall
expire on ten
year anniversary of the Grant Date.
4.
EXERCISE OF
OPTION.
(a)
Vesting Schedule.
Until its expiration or termination, the Option may
be exercised, in the manner specified in Section 7.1(g) of the
Plan, for 25% of
the Option Shares on December 23, 2006, and for the balance of the
Option Shares
in monthly installments, with each installment being as nearly
equal as
practicable (as determined by the Company in its reasonable
discretion), at the
end of each calendar month beginning January 31, 2007 and ending
December 31,
2009. The provisions of this Section 4(a) shall be subject to the
provisions of
Section 7.1(e) of the Plan.
(b)
ACCELERATION OF
VESTING. Notwithstanding anything in Section 4(a)
above to the contrary but subject to the provisions of Section 4(c)
below, in
the event that (A) a Sale of the Company Transaction (as defined in
Section 4(d)
below) occurs prior to the time that the Option is not exercisable
in full for
all of the Option Shares, and (B) (i) the Optionee suffers any
material adverse
change in authorities, duties or responsibilities, (ii) (ii) the
Optionee
voluntarily terminates his employment with the Company following
any relocation
of the Optionee (without his written consent) by the Company to a
location that
increases Optionee's commute prior to such relocation by more than
fifty (50)
miles or (iii) the Company terminates the Optionee's employment
with the Company
for any reason or no reason (other than Cause, as such term is
defined in
Section 4(d) below) in either case within 365 days of a Sale of the
Company
Transaction, then the exercisability
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of the Option shall be accelerated such that the Option shall
become exercisable
for an additional number of Option Shares equal to fifty percent
(50%) of the
then Unvested Option Shares (as defined below in Section 4(d)
below). The
foregoing provisions of this Section 4(b) shall be implemented
ratably across
all Unvested Option Shares that are subject to the Option
immediately prior to
such Sale of the Company Transaction regardless of when the Option
would have
otherwise become exercisable for such Unvested Option Shares
pursuant to Section
4(a) above. Notwithstanding anything express or implied to the
contrary in the
foregoing provisions of Section 4(a) and this
