{"id":38237,"date":"2015-09-17T11:25:58","date_gmt":"2015-09-17T16:25:58","guid":{"rendered":"https:\/\/content.findlaw-admin.com\/ability-legal\/contracts\/uncategorized\/1995-stock-option-plan.html"},"modified":"2015-09-17T11:25:58","modified_gmt":"2015-09-17T16:25:58","slug":"1995-stock-option-plan","status":"publish","type":"corporate_contracts","link":"https:\/\/corporate.findlaw.com\/contracts\/compensation\/1995-stock-option-plan.html","title":{"rendered":"1995 Stock Option Plan"},"content":{"rendered":"<pre>                                                                                \n                          EXODUS COMMUNICATIONS, INC.\n\n                            1995 STOCK OPTION PLAN\n\n                            As Adopted May 19, 1995\n\n     1.   PURPOSE.  This 1995 Stock Option Plan ('Plan') is established as a\n          -------                                 ----                      \ncompensatory plan to attract, retain and provide equity incentives to selected\npersons to promote the financial success of Exodus Communications, Inc., a\nCalifornia corporation (the 'Company').  Capitalized terms not previously\n                             -------                                     \ndefined herein are defined in Section 17 of this Plan.\n\n     2.   TYPES OF OPTIONS AND SHARES.  Options granted under this Plan (the\n          ---------------------------                                       \n'Options') may be either (a) incentive stock options ('ISOs') within the meaning\n--------                                               ----                     \nof Section 422 of the Internal Revenue Code of 1986, as amended (the 'Revenue\n                                                                      -------\nCode'), or (b) nonqualified stock options ('NQSOs'), as designated at the time\n----                                        -----                             \nof grant.  The shares of stock that may be purchased upon exercise of Options\ngranted under this Plan are shares of the common stock of the Company (the\n                                                                          \n'Shares').\n-------   \n\n     3.   NUMBER OF SHARES.  The aggregate number of Shares that may be issued\n          ----------------                                                    \npursuant to Options granted under this Plan is 900,000 Shares, subject to\nadjustment as provided in this Plan.  If any Option expires or is terminated\nwithout being exercised in whole or in part, the unexercised or released Shares\nfrom such Option shall be available for future grant and purchase under this\nPlan.  At all times during the term of this Plan, the Company shall reserve and\nkeep available such number of Shares as shall be required to satisfy the\nrequirements of outstanding Options under this Plan.\n\n     4.   ELIGIBILITY. Options may be granted to employees, officers, directors,\n          -----------\nconsultants and advisers (provided such consultants and advisers render bona\nfide services not in connection with the offer and sale of securities in a\ncapital-raising transaction) of the Company or any Parent, Subsidiary or\nAffiliate of the Company. ISOs may be granted only to employees (including\nofficers and directors who are also employees) of the Company or a Parent or\nSubsidiary of the Company. The Committee (as defined in Section 14) in its sole\ndiscretion shall select the recipients of Options ('Optionees'). An Optionee may\n                                                    ---------   \nbe granted more than one Option under this Plan. The Company may also, from time\nto time, substitute or assume outstanding options granted by another company,\nwhether in connection with an acquisition of such other company or otherwise, by\neither (a) granting an Option under this Plan in replacement of the option\nassumed by the Company, or (b) treating the assumed option as if it had been\ngranted under this Plan if the terms of such assumed option could be applied to\nan Option granted under this Plan. Such substitution or assumption shall be\npermissible if the holder of the substituted or assumed option would have been\neligible to be granted an Option hereunder if the other company had applied the\nrules of this Plan to such grant.\n\n                                       1\n\n \n     5.   TERMS AND CONDITIONS OF OPTIONS. The Committee shall determine whether\n          -------------------------------\neach Option is to be an ISO or an NQSO, the number of Shares subject to the\nOption, the exercise price of the Option, the period during which the Option may\nbe exercised, and all other terms and conditions of the Option, subject to the\nfollowing:\n\n          5.1  Form of Option Grant.  Each Option granted under this Plan shall\n               --------------------                                            \nbe evidenced by a written Stock Option Grant (the 'Grant') in such form (which\n                                                   -----                      \nneed not be the same for each Optionee) as the Committee shall from time to time\napprove, which Grant shall comply with and be subject to the terms and\nconditions of this Plan.\n\n          5.2  Date of Grant.  The date of grant of an Option shall be the date\n               -------------                                                   \non which the Committee makes the determination to grant such Option unless\notherwise specified by the Committee.  The Grant representing the Option will be\ndelivered to Optionee with a copy of this Plan within a reasonable time after\nthe granting of the Option.\n\n          5.3  Exercise Price.  The exercise price of an Option shall be\n               --------------                                           \ndetermined by the Committee when the Option is granted and may not be less than\n100% of the Fair Market Value of the Shares on the date the Option is granted.\nThe exercise price of any Option granted to a person owning more than 10% of the\ntotal combined voting power of all classes of stock of the Company or any Parent\nor Subsidiary of the Company ('Ten Percent Shareholder') shall not be less than\n                               -----------------------                         \n110% of the Fair Market Value of the Shares on the date the Option is granted.\n\n          5.4  Exercise Period. Options shall be exercisable within the times or\n               ---------------\nupon the events determined by the Committee as set forth in the Grant; provided,\nhowever, that no Option shall be exercisable after the expiration of ten (10)\nyears from the date the Option is granted, and provided further that no ISO\ngranted to a Ten Percent Shareholder shall be exercisable after the expiration\nof five (5) years from the date the Option is granted.\n\n          5.5  Limitations on ISOs.  The aggregate Fair Market Value (determined\n               -------------------                                              \nas of the time an Option is granted) of stock with respect to which ISOs are\nexercisable for the first time by an Optionee during any calendar year (under\nthis Plan or under any other incentive stock option plan of the Company or any\nParent or Subsidiary of the Company) shall not exceed $100,000.  If the Fair\nMarket Value of Shares of Shares with respect to which ISOs are exercisable for\nthe first time by an Optionee during any calendar year exceeds $100,000, the\nOptions for the first $100,000 worth of Shares to become exercisable in such\nyear shall be ISOs and the Options for the amount in excess of $100,000 that\nbecomes exercisable in that year shall be NQSOs.  In the event that the Revenue\nCode or the regulations promulgated thereunder are amended after the effective\ndate of this Plan to provide for a different limit on the Fair Market Value of\nShares permitted to be subject to ISOs, such different limit shall be\nincorporated herein and shall apply to any Options granted after the effective\ndate of such amendment.\n\n          5.6  Options Non-Transferable.  Options granted under this Plan, and\n               ------------------------                                       \nany interest therein, shall not be transferable or assignable by Optionee, and\nmay not be made subject to execution, attachment or similar process, otherwise\nthan by will or by the laws of descent and distribution or pursuant to a\nqualified domestic relations order as defined by the Code or Title I \n\n                                       2\n\n \nof the Employee Retirement Income Security Act, or the rules thereunder, and\nshall be exercisable during the lifetime of Optionee only by Optionee.\n\n          5.7  Assumed Options.  In the event the Company assumes an option\n               ---------------                                             \ngranted by another company, the terms and conditions of such option shall remain\nunchanged (except the exercise price and the number and nature of shares\nissuable upon exercise, which will be adjusted appropriately pursuant to Section\n424(c) of the Revenue Code).  In the event the Company elects to grant a new\noption rather than assuming an existing option (as specified in Section 4), such\nnew option need not be granted at Fair Market Value on the date of grant and may\ninstead be granted with a similarly adjusted exercise price.\n\n     6.   EXERCISE OF OPTIONS.\n          ------------------- \n\n          6.1  Notice.  Options may be exercised only by delivery to the Company\n               ------                                                           \nof a written stock option exercise agreement (the 'Exercise Agreement') in a\n                                                   ------------------       \nform approved by the Committee (which need not be the same for each Optionee),\nstating the number of Shares being purchased, the restrictions imposed on the\nShares, if any, and such representations and agreements regarding Optionee's\ninvestment intent and access to information, if any, as may be required by the\nCompany to comply with applicable securities laws, together with payment in full\nof the exercise price for the number of Shares being purchased.\n\n          6.2  Payment.  Payment for the Shares may be made in cash (by check)\n               -------                                                        \nor, where approved by the Committee in its sole discretion and where permitted\nby law:  (a) by cancellation of indebtedness of the Company to the Optionee; (b)\nby surrender of shares of common stock of the Company, free and clear of all\nliens, claims, encumbrances and security interests, having a Fair Market Value\nequal to the applicable exercise price of the Options that have been owned by\nOptionee for more than six (6) months (and which have been paid for within the\nmeaning of the Securities and Exchange Commission ('SEC') Rule 144 and, if such\n                                                    ---                        \nShares were purchased from the Company by use of a promissory note, such note\nhas been fully paid with respect to such shares), or were obtained by Optionee\nin the open public market; (c) by waiver of compensation due or accrued to\nOptionee for services rendered; (d) provided that a public market for the\nCompany's stock exists, through a 'same day sale' commitment from Optionee and a\nbroker-dealer that is a member of the National Association of Securities Dealers\n(a 'NASD Dealer') whereby Optionee irrevocably elects to exercise the Option and\n    -----------                                                                 \nto sell a portion of the Shares so purchased to pay for the exercise price and\nwhereby the NASD Dealer irrevocably commits upon receipt of such Shares to\nforward the exercise price directly to the Company; (e) provided that a public\nmarket for the Company's stock exists, through a 'margin' commitment from\nOptionee and a NASD Dealer whereby Optionee irrevocably elects to exercise the\nOption and to pledge the Shares so purchased to the NASD Dealer in a margin\naccount as security for a loan from the NASD Dealer in the amount of the\nexercise price, and whereby the NASD Dealer irrevocably commits upon receipt of\nsuch Shares to forward the exercise price directly to the Company; or (f) by any\ncombination of the foregoing.\n\n          6.3  Withholding Taxes.  Prior to issuance of the Shares upon exercise\n               -----------------                                                \nof an Option, Optionee shall pay or make adequate provision for any federal or\nstate withholding obligations of the Company, if applicable.  Where approved by\nthe Committee in its sole\n\n                                       3\n\n \ndiscretion, Optionee may provide for payment of withholding taxes upon exercise\nof the Option by requesting that the Company retain Shares with a Fair Market\nValue equal to the minimum amount of taxes required to be withheld.  In such\ncase, the Company shall issue the net number of Shares to Optionee by deducting\nthe Shares retained from the Shares exercised.  The Fair Market Value of the\nShares to be withheld shall be determined on the date that the amount of tax to\nbe withheld is to be determined in accordance with Section 83 of the Revenue\nCode (the 'Tax Date').  All elections by Optionees to have Shares withheld for\n           --------                                                           \nthis purpose shall be made in writing in a form acceptable to the Committee and\nshall be subject to the following restrictions:\n\n(a)  the election must be made on or prior to the applicable Tax Date and, once\n     made, the election shall be irrevocable as to the particular Shares as to\n     which the election is made; and\n\n(b)  all elections shall be subject to the consent or disapproval of the\n     Committee.\n\nIn addition, if Optionee is an Insider, and if the Company is subject to Section\n16(b) of the Exchange Act, the following shall apply:\n\n(c)  the election may not be made within six (6) months after the date of grant\n     of the Option, except as otherwise permitted by Rule 16b-3(e) promulgated\n     under Section 16 of the Exchange Act;\n\n(d)  the election must be made either six (6) months prior to the Tax Date or in\n     the 10-day period beginning on the third day following the public release\n     of the Company's quarterly or annual summary statement of operations; and\n\n(e)  if the Option is exercised within six (6) months after the date of grant\n     and the Tax Date is deferred until six (6) months after the date of grant\n     of the Option because no election is filed under Section 83(b) of the\n     Revenue Code, Optionee shall receive the full number of Shares with respect\n     to which the Option is exercised, but Optionee shall be unconditionally\n     obligated to tender back to the Company the proper number of Shares on the\n     Tax Date.\n\n          6.4  Limitations on Exercise. Notwithstanding the exercise periods set\n               -----------------------\nforth in the Grant, exercise of an Option shall always be subject to the\nfollowing:\n\n               6.4.1  If Optionee ceases to be employed by the Company or any\nParent, Subsidiary or Affiliate of the Company for any reason except death or\nDisability, Optionee may exercise such Optionee's Options to the extent (and\nonly to the extent) that they would have been exercisable upon the date of\ntermination, within ninety (90) days after the date of termination (or such\nshorter time period as may be specified in the Grant);\n\n               6.4.2  If Optionee is an Insider and the Company is subject to\nSection 16(b) of the Exchange Act and Optionee ceases to be employed by the\nCompany, Optionee's Option will remain exercisable, to the extent (and only to\nthe extent) that it was exercisable on the date of termination, until the later\nof (a) the last date such Option would be exercisable under Section 6.4.1 or\n6.4.3, as applicable, or (b) the end of the thirty (30) day period commencing on\nthe date\n\n                                       4\n\n \nsix (6) months after the grant of such Option, with any extension beyond ninety\n(90) days after termination of employment deemed to be as an NQSO, and provided\nfurther that in no event may an Option be exercisable later than the expiration\ndate of the Option;\n\n               6.4.3  If Optionee's employment with the Company or any Parent,\nSubsidiary or Affiliate of the Company is terminated because of the death or\nDisability of Optionee, Optionee's Options may be exercised to the extent (and\nonly to the extent) that they would have been exercisable by Optionee on the\ndate of termination, by Optionee (or Optionee's legal representative) within\ntwelve (12) months after the date of termination (or such shorter time period of\nno less than six (6) months as may be specified in the Grant), but in any event\nno later than the expiration date of the Options.\n\n               6.4.4  The Committee shall have discretion to determine whether\nOptionee has ceased to be employed by the Company or any Parent, Subsidiary or\nAffiliate of the Company, whether or not such cessation was due to Disability,\nand the effective date on which such employment terminated.\n\n               6.4.5  In the case of an Optionee who is a director, consultant\nor adviser, the Committee will have the discretion to determine whether Optionee\nis 'employed by the Company or any Parent, Subsidiary or Affiliate of the\nCompany' pursuant to the foregoing Sections.\n\n               6.4.6  The Committee may specify a reasonable minimum number of\nShares that may be purchased on any exercise of an Option, provided that such\nminimum number will not prevent Optionee from exercising the full number of\nShares as to which the Option is then exercisable.\n\n               6.4.7  An Option shall not be exercisable unless such exercise is\nin compliance with all applicable federal and state securities laws, rules and\nregulations of any governmental body and the requirements of any stock exchange\nor national market system upon which the Shares may then be listed, as they are\nin effect on the date of exercise. The Company shall be under no obligation to\nregister the Shares with the SEC or to effect compliance with the registration,\nqualification or listing requirements of any other securities laws, stock\nexchange or national market system, and the Company shall have no liability for\nany inability or failure to do so.\n\n     7.   RESTRICTIONS ON SHARES.  At the discretion of the Committee, the\n          ----------------------                                          \nCompany may reserve to itself and\/or its assignee(s) in the Grant (a) a right of\nfirst refusal to purchase all Shares that an Optionee (or a subsequent\ntransferee) may propose to transfer to a third party and\/or (b) a right to\nrepurchase a portion of or all Shares held by an Optionee upon Optionee's\ntermination of employment or service with the Company or a Parent, Subsidiary or\nAffiliate of the Company, for any reason within a specified time as determined\nby the Committee at the time of grant at Optionee's original purchase price, the\nFair Market Value of such Shares or a price determined by a formula or other\nprovision set forth in the Grant.\n\n     8.   MODIFICATION, EXTENSION AND RENEWAL OF OPTIONS.  The Committee shall\n          -----------------------------------------------                     \nhave the power to modify, extend or renew outstanding Options and to authorize\nthe grant of new Options \n\n                                       5\n\n \nin substitution therefor, provided that any such action may not, without the\nwritten consent of Optionee, impair any rights under any Option previously\ngranted. Any outstanding ISO that is modified, extended, renewed or otherwise\naltered shall be treated in accordance with Section 424(h) of the Revenue Code.\nThe Committee shall have the power to reduce the exercise price of outstanding\nOptions without the consent of Optionees by a written notice to the Optionees\naffected; provided, however, that the exercise price per Share may not be\nreduced below the minimum exercise price that would be permitted under Section\n5.3 of this Plan for Options granted on the date the action is taken to reduce\nthe exercise price; and provided further that the exercise price may not be\nreduced below the par value of the Shares.\n\n     9.   STOCK OWNERSHIP; FINANCIAL STATEMENTS.  No Optionee shall have any of\n          -------------------------------------                                \nthe rights of a shareholder with respect to any Shares subject to an Option\nuntil such Option is properly exercised.  No adjustment shall be made for\ndividends or distributions or other rights for which the record date is prior to\nsuch date, except as provided in this Plan.  However, the Company shall provide\nto each Optionee, annually during the period for which he has one or more\nOptions outstanding, copies of the financial statements of the Company,\nconsisting of, at a minimum, a balance sheet and an income statement, at such\ntime after the close of each fiscal year of the Company as such statements are\nreleased by the Company to its shareholders.  The Company shall not be required\nto provide such information to key employees whose duties in connection with the\nCompany assume their access to equivalent information.\n\n     10.  NO OBLIGATION TO EMPLOY.  Nothing in this Plan or any Option granted\n          -----------------------                                             \nunder this Plan shall confer on any Optionee any right to continue in the employ\nof, or other relationship with, the Company or any Parent, Subsidiary or\nAffiliate of the Company or limit in any way the right of the Company or any\nParent, Subsidiary or Affiliate of the Company to terminate Optionee's\nemployment or other relationship at any time, with or without cause.\n\n     11.  ADJUSTMENT OF OPTION SHARES.  In the event that the number of\n          ---------------------------                                  \noutstanding shares of common stock of the Company is changed by a stock\ndividend, stock split, reverse stock split, recapitalization, combination,\nreclassification or similar change in the capital structure of the Company\nwithout consideration, or if a substantial portion of the assets of the Company\nare distributed, without consideration in a spin-off or similar transaction, to\nthe share holders of the Company, the number of Shares available under this Plan\nand the number of Shares subject to outstanding Options and the exercise price\nper Share of such Options shall be proportionately adjusted, subject to any\nrequired action by the Board of Directors (the 'Board') or shareholders of the\n                                                -----                         \nCompany and compliance with applicable securities laws; provided, however, that\na fractional share shall not be issued upon exercise of any Option and any\nfractions of a Share that would have resulted shall either be cashed out at Fair\nMarket Value or the number of Shares issuable under the Option shall be rounded\nup to the nearest whole number, as determined by the Committee; and provided\nfurther that the exercise price may not be decreased to below the par value, if\nany, for the Shares.\n\n     12.  ASSUMPTION OF OPTIONS BY SUCCESSORS.\n          ----------------------------------- \n\n          12.1  Assumption or Substitution.  In the event of (a) a merger or\n                --------------------------                                  \nconsolidation in which the Company is not the surviving corporation (other than\na merger or consolidation with a \n\n                                       6\n\n \nwholly owned subsidiary, a reincorporation, or other transaction in which there\nis no substantial change in the shareholders of the corporation and the Options\ngranted under this Plan are assumed or replaced by the successor corporation,\nwhich assumption shall be binding on all Optionees), (b) a dissolution or\nliquidation of the Company, (c) the sale of substantially all of the assets of\nthe Company, or (d) any other transaction which qualifies as a 'corporate\ntransaction' under Section 424(a) of the Revenue Code wherein the shareholders\nof the Company give up all of their equity interest in the Company (except for\nthe acquisition, sale or transfer of all or substantially all of the outstanding\nshares of the Company), any or all outstanding Options may be assumed or\nreplaced by the successor corporation, which assumption shall be binding on all\nOptionees. In the alternative, the successor corporation may substitute an\nequivalent option or provide substantially similar consideration to Optionees as\nwas provided to shareholders (after taking into account the existing provisions\nof Optionee's options, such as the exercise price and the vesting schedule). The\nsuccessor corporation may also issue, in place of outstanding shares of the\nCompany held by Optionee as a result of the exercise of an Option that is\nsubject to repurchase, substantially similar shares or other property subject to\nsimilar repurchase restrictions no less favorable to Optionee.\n\n          12.2  Expiration.  In the event such successor corporation, if any,\n                ----------                                                   \nrefuses to assume or substitute Options, as provided above, pursuant to a\ntransaction described in Sections 12.1 above, or there is no successor\ncorporation, and if the Company is ceasing to exist as a separate corporate\nentity, the Options shall, notwithstanding any contrary terms in the Grant,\nexpire on (and, in the case of a merger or consolidation described in Subsection\n12.1(a) above, if the Company has reserved to itself a right to repurchase\nShares issued on exercise of Options at the original purchase price of such\nShares, such right shall terminate on), a date at least 20 days after the Board\ngives written notice to Optionees specifying the terms and conditions of such\ntermination.\n\n          12.3  Additional Provisions.  Subject to the foregoing provisions of\n                ---------------------                                         \nthis Section 12, in the event of the occurrence of any transaction described in\nSection 12.1, any outstanding Option shall be treated as provided in the\napplicable agreement or plan of merger, consolidation, dissolution, liquidation,\nsale of assets or other 'corporate transaction'.\n\n     13.  ADOPTION AND SHAREHOLDER APPROVAL. This Plan shall become effective on\n          ---------------------------------\nthe date that it is adopted by the Board of the Company. This Plan shall be\napproved by the shareholders of the Company, in any manner permitted by\napplicable corporate law, within twelve months before or after the date this\nPlan is adopted by the Board. Upon the effective date of the Plan, the Board may\ngrant Options pursuant to this Plan; provided that, in the event that\nshareholder approval is not obtained within the time period provided herein, all\nOptions granted hereunder shall terminate. No Option that is issued as a result\nof any increase in the number of shares authorized to be issued under this Plan\nshall be exercised prior to the time such increase has been approved by the\nshareholders of the Company and all such Options granted pursuant to such\nincrease shall similarly terminate if such shareholder approval is not obtained.\nAfter the Company becomes subject to Section 16(b) of the Exchange Act, the\nCompany will comply with the requirements of Rule 16b-3 with respect to\nshareholder approval.\n\n                                       7\n\n \n     14.  ADMINISTRATION.  This Plan may be administered by the Board or a\n          --------------                                                  \ncommittee appointed by the Board (the 'Committee').  As used in this Plan,\n                                       ---------                          \nreferences to the 'Committee' shall mean either the committee appointed by the\nBoard to administer this Plan or the Board if no committee has been established.\n\n          14.1  Composition of the Committee.  If, after the Company registers\n                ----------------------------                                  \nunder the Exchange Act, two or more members of the Board are Outside Directors,\nthe Committee will be comprised of at least two members of the Board, all of\nwhom are Outside Directors and Disinterested Persons.  The Company will take\nappropriate steps to comply with the disinterested administration by the Board\nof a Committee consisting of not less than two members of the Board, each of\nwhom is a Disinterested Person.\n\n          14.2  Committee Authority.  the Committee is authorized, without\n                -------------------                                       \nlimitation, to:\n\n(a)  construe and interpret the Plan, any Grant and any other agreement or\n     document executed pursuant to the Plan;\n\n(b)  prescribe, amend and rescind rules and regulations relating to the Plan;\n\n(c)  select persons to receive Options;\n\n(d)  determine the form and term of Options;\n\n(e)  determine the number of Shares subject to Options;\n\n(f)  grant waivers of Plan or Option conditions;\n\n(g)  determine the vesting and exercisability of Options;\n\n(h)  correct any defect, supply any omission, or reconcile any inconsistency in\n     the Plan or any other agreement or document executed or distributed in\n     connection with the Plan;\n\n(i)  make all other determinations necessary or advisable for the administration\n     of the Plan.\n\n          14.3  Committee Interpretation Binding.  Any interpretation or\n                --------------------------------                        \ndetermination made by the Committee with respect to any of the provisions of\nthis Plan or any Option granted under this Plan shall be made in its sole\ndiscretion and shall be final and binding upon the Company and all persons\nhaving an interest in any Option or any Shares purchased pursuant to an Option.\n\n     15.  TERM OF PLAN.  Options may be granted pursuant to this Plan from time\n          ------------                                                         \nto time within a period of ten (10) years after the date on which this Plan is\nadopted by the Board.\n\n     16.  AMENDMENT OR TERMINATION OF PLAN.  The Committee may at any time\n          --------------------------------                                \nterminate or amend this Plan in any respect including (but not limited to)\namendment of any form of grant, exercise agreement or instrument to be executed\npursuant to this Plan; provided, however, that the Committee shall not, without\nthe approval of the shareholders of the Company, amend this Plan in any manner\nthat requires such shareholder approval pursuant to the Revenue Code or the\n\n                                       8\n\n \nregulations promulgated thereunder as such provisions apply to ISO plans or\npursuant to the Exchange Act or Rule 16b-3 (or its successor) promulgated\nthereunder.\n\n     17.  CERTAIN DEFINITIONS.  As used in this Plan, the following terms shall\n          -------------------                                                  \nhave the following meanings:\n\n          17.1  'Affiliate' means any corporation that directly, or indirectly\n                 ---------                                                    \nthrough one or more intermediaries, controls or is controlled by, or is under\ncommon control with, another corporation, where 'control' (including the terms\n'controlled by' and 'under common control with') means the possession, direct or\nindirect, of the power to cause the direction of the management and policies of\nthe corporation, whether through the ownership of voting securities, by contract\nor otherwise.\n\n          17.2  'Disability' shall mean the inability of the Optionee to engage\n                 ----------                                                    \nin employment with the Company by reason of any medically determinable physical\nor mental impairment.\n\n          17.3  'Disinterested Person' shall have the meaning set forth in Rule\n                 --------------------                                          \n16b-3(c)(2) as promulgated by the SEC under Section 16(b) of the Exchange Act,\nas such rule is amended from time to time and as interpreted by the SEC.\n\n          17.4  'Fair Market Value' shall mean the fair market value of the\n                 -----------------                                         \nShares as determined by the Committee from time to time in good faith.  If a\npublic market exists for the Shares, the Fair Market Value shall be the average\nof the last reported bid and asked prices for common stock of the Company on the\nlast trading day prior to the date of determination (or the average closing\nprice over the number of consecutive working days preceding the date of\ndetermination as the Committee shall deem appropriate) or, in the event the\ncommon stock of the Company is listed on a stock exchange or on the NASDAQ\nNational Market System, the Fair Market Value shall be the closing price on such\nexchange or quotation system on the last trading day prior to the date of\ndetermination (or the average closing price over the number of consecutive\nworking days preceding the date of determination as the Committee shall deem\nappropriate).\n\n          17.5  'Insider' shall mean an Optionee who is not an officer or\n                 -------                                                 \ndirector of the Company or other person whose transactions in the Company or\nother person whose transactions in the Company's Common Stock are subject to\nSection 16(b) of the Exchange Act.\n\n          17.6  'Outside Director' shall mean any director who is not (a) a\n                 ----------------                                          \ncurrent employee of the Company or any Parent, Subsidiary or Affiliate of the\nCompany, (b) a former employee of the Company or any Parent, Subsidiary or\nAffiliate of the Company who is receiving compensation for prior services (other\nthan benefits under a tax-qualified pension plan), (c) a current or former\nofficer of the Company or any Parent, Subsidiary or Affiliate of the Company or\n(d) a person currently receiving compensation for personal services in any\ncapacity, other than as a director, from the Company or any Parent, Subsidiary\nor Affiliate of the Company; provided, however, that at such time as the term\n'Outside Director,' as used in Section 162(m) of the Revenue Code is defined in\nregulations promulgated under such Section, 'Outside Director' shall \n\n                                       9\n\n \nhave the meaning set forth in such regulations, as amended from time to time and\nas interpreted by the Internal Revenue Service.\n\n          17.7  'Parent' means any corporation (other than the Company) in an\n                 ------                                                      \nunbroken chain of corporations ending with the Company if, at the time of the\ngranting of the Option, each of such corporations other than the Company owns\nstock possessing 50% or more of the total combined voting power of all classes\nof stock in one of the other corporations in such chain.\n\n          17.8  'Subsidiary' means any corporation (other than the Company) in\n                 ----------   \nan unbroken chain of corporations beginning with the Company if, at the time of\ngranting of the Option, each of the corporations other than the last corporation\nin the unbroken chain owns stock possessing 50% or more of the total combined\nvoting power of all classes of stock in one of the other corporations in such\nchain.\n\n                        ______________________________\n\n                                 (END OF PLAN)\n\n                                       10\n\n \n                          EXODUS COMMUNICATIONS, INC.\n                                        \n                              STOCK OPTION GRANT\n\n                                        \nOptionee:                          ______________________________________\n\nAddress:                           ______________________________________\n\n                                   ______________________________________\n\nTotal Shares Subject to Option:    ______________________________________\n\nExercise Price per Share:          ______________________________________\n\nDate of Grant:                     ______________________________________\n\nVesting Commencement Date:         ______________________________________\n\nExpiration Date:                   ______________________________________\n\nType of Option:                         [_]  Incentive Stock Option\n                                        [_] Nonqualified Stock Option\n\n     1.  GRANT OF OPTION.  Exodus Communications, Inc., a California corporation\n         ---------------                                                        \n(the 'Company'), hereby grants to the optionee named above ('Optionee') an\n      -------                                                --------     \noption (this 'Option') to purchase the total number of shares of common stock of\n              ------                                                            \nthe Company, no par value, set forth above (the 'Shares') at the exercise price\n                                                 ------                        \nper share set forth above (the 'Exercise Price'), subject to all of the terms\n                                --------------                               \nand conditions of this Stock Option Grant (this 'Grant') and the Company's 1995\n                                                 -----                         \nStock Option Plan, as amended to the date hereof (the 'Plan').  If designated as\n                                                       ----                     \nan Incentive Stock Option above, this Option is intended to qualify as an\n'incentive stock option' ('ISO') within the meaning of Section 422 of the\n                           ---                                           \nInternal Revenue Code of 1986, as amended (the 'Revenue Code').  Unless\n                                                ------------           \notherwise defined herein, capitalized terms used herein shall have the meanings\nascribed to them in the Plan.\n\n     2.  EXERCISE PERIOD OF OPTION.  Subject to the terms and conditions of the\n         -------------------------                                             \nPlan and this Grant, this Option shall become exercisable as to portions of the\nShares as follows:  (a) This Option shall not be exercisable with respect to any\nof the Shares until the expiration of six (6) months from the Vesting\nCommencement Date or ____________________, 199____ (the 'First Vesting Date');\n                                                         ------------------   \n(b) if Optionee has been continuously employed by the Company within the meaning\nof Section 4 below at all times during the time period beginning on the Vesting\nCommencement Date set forth above and ending on the First Vesting Date, then on\nthe First Vesting Date this Option shall become exercisable as to Twelve percent\n(12%) of the Shares; and (c) thereafter this Option shall become exercisable as\nto an additional Two percent (2%) of the Shares upon the \n\n                                       1\n\n \n                                                     Exodus Communications, Inc.\n                                                              Stock Option Grant\n\n\nexpiration of each full calendar month for the next succeeding Forty-four (44)\nmonths provided that Optionee has remained continuously employed by the Company\nat all times during the relevant month; provided that Optionee shall in no event\n                                        --------\nbe entitled under this Option to purchase a number of shares of the Company's\ncommon stock greater than the 'Total Shares Subject to Option' indicated above.\nNotwithstanding anything herein to the contrary, this Option shall expire on the\nExpiration Date set forth above and must be exercised, if at all, on or before\nthe Expiration Date; and provided further that this Option must become\nexercisable as to at least 20% of the Shares for each full year since the Date\nof Grant.\n\n     3.  RESTRICTION ON EXERCISE.  This Option may not be exercised unless such\n         -----------------------                                               \nexercise is in compliance with the Securities Act and all applicable state\nsecurities laws as they are in effect on the date of exercise, and the\nrequirements of any stock exchange or national market system on which the\nCompany's common stock may be listed at the time of exercise.  Optionee\nunderstands that the Company is under no obligation to register, qualify or list\nthe Shares with the SEC, any state securities commission or any stock exchange\nto effect such compliance.\n\n     4.  TERMINATION OF OPTION.  Except as provided below in this Section, this\n         ---------------------                                                 \nOption shall terminate and may not be exercised if Optionee ceases to be\nemployed by the Company or any Parent or Subsidiary of the Company (or, in the\ncase of a nonqualified stock option, an Affiliate of the Company).  Optionee\nshall be considered to be employed by the Company for all purposes under Section\n2 and this Section 4 if Optionee is an officer, director or full-time employee\nof the Company or any Parent or Subsidiary (or, if applicable, Affiliate) of the\nCompany or if the Committee determines that Optionee is rendering substantial\nservices as a part-time employee, consultant or adviser to the Company or any\nParent or Subsidiary (or Affiliate) of the Company.  The Committee shall have\ndiscretion to determine whether Optionee has ceased to be employed by the\nCompany or any Parent, Subsidiary (or Affiliate) of the Company and the\neffective date on which such employment terminated (the 'Termination Date').\n                                                         ----------------   \n\n          4.1  Termination Generally.  If Optionee ceases to be employed by the\n               ---------------------                                           \nCompany or any Parent, Subsidiary or Affiliate of the Company for any reason\nexcept death or Disability, this Option, to the extent (and only to the extent)\nthat it would have been exercisable by Optionee on the Termination Date, may be\nexercised by Optionee within ninety (90) days after the Termination Date, but in\nno event later than the Expiration Date.\n\n          4.2  Death or Disability.  If Optionee's employment with the Company\n               -------------------                                            \nor any Parent, Subsidiary or Affiliate of the Company is terminated because of\nthe death or the Disability of Optionee, this Option, to the extent (and only to\nthe extent) that it would have been exercisable by Optionee on the Termination\nDate, may be exercised by Optionee (or Optionee's legal representative) within\ntwelve (12) months after the Termination Date, but in no event later than the\nExpiration Date.\n\n          4.3  No Right to Employment.  Nothing in the Plan or this Grant shall\n               ----------------------                                          \nconfer on Optionee any right to continue in the employ of, or other relationship\nwith, the Company or any Parent, Subsidiary or Affiliate of the Company or limit\nin any way the right of the Company \n\n                                       2\n\n \n                                                     Exodus Communications, Inc.\n                                                              Stock Option Grant\n\n\nor any Parent, Subsidiary or Affiliate of the Company to terminate Optionee's\nemployment or other relationship at any time, with or without cause.\n\n     5.   MANNER OF EXERCISE.\n          ------------------ \n\n          5.1  Exercise Agreement.  This Option shall be exercisable by delivery\n               ------------------                                               \nto the Company of an executed written Stock Option Exercise Agreement in the\nform attached hereto as Exhibit A, or in such other form as may be approved by\n                        ---------                                             \nthe Company, which shall set forth Optionee's election to exercise some or all\nof this Option, the number of Shares being purchased, any restrictions imposed\non the Shares and such other representations and agreements as may be required\nby the Company to comply with applicable securities laws.\n\n          5.2  Exercise Price.  Such Exercise Agreement shall be accompanied by\n               --------------                                                  \nfull payment of the Exercise Price for the Shares being purchased.  Payment for\nthe Shares may be made in cash (by check).\n\n          5.3  Withholding Taxes.  Prior to the issuance of the Shares upon\n               -----------------                                           \nexercise of this Option, Optionee must pay or make adequate provision for any\napplicable federal or state withholding obligations of the Company.  Optionee\nmay provide for payment of Optionee's minimum statutory withholding taxes upon\nexercise of the Option by requesting that the Company retain Shares with a Fair\nMarket Value equal to the minimum amount of taxes required to be withheld, all\nas set forth in Section 6(c) of the Plan.  In such case, the Company shall issue\nthe net number of Shares to Optionee by deducting the Shares retained from the\nShares exercised.\n\n          5.4  Issuance of Shares.  Provided that such notice and payment are in\n               ------------------                                               \nform and substance satisfactory to counsel for the Company, the Company shall\ncause the Shares to be issued in the name of Optionee, Optionee's legal\nrepresentative or Optionee's donee.\n\n     6.   NOTICE OF DISQUALIFYING DISPOSITION OF ISO SHARES.  If the Option\n          -------------------------------------------------                \ngranted to Optionee herein is an ISO, and if Optionee sells or otherwise\ndisposes of any of the Shares acquired pursuant to the ISO within (a) the date\ntwo years after the Date of Grant, or (b) the date one year after exercise of\nthe ISO with respect to the Shares to be sold or disposed, Optionee shall\nimmediately notify the Company in writing of such disposition.  Optionee\nacknowledges and agrees that Optionee may be subject to income tax withholding\nby the Company on the compensation income recognized by Optionee from any such\nearly disposition by payment in cash (or in Shares, to the extent permissible\nunder Section 5.3) or out of the current wages or other earnings payable to\nOptionee.\n\n     7.   NONTRANSFERABILITY OF OPTION.  If this Option is an ISO, then this\n          ----------------------------                                      \nOption may not be transferred in any manner other than by will or by the law of\ndescent and distribution and may be exercised during the lifetime of Optionee\nonly by Optionee.  Otherwise, this Option may only be transferred pursuant to a\nqualified domestic relations order as defined by the Revenue Code or Title I of\nthe Employee Retirement Income Security Act, or the rules thereunder.  The terms\nof this Option shall be binding upon the executors, administrators, successors\nand assigns of Optionee.\n\n                                       3\n\n \n                                                     Exodus Communications, Inc.\n                                                              Stock Option Grant\n\n\n     8.   TAX CONSEQUENCES.  Set forth below is a brief summary as of the date\n          ----------------                                                    \nthis form of Grant was adopted of some of the federal and California tax\nconsequences of exercise of this Option and disposition of the Shares. THIS\nSUMMARY IS NECESSARILY INCOMPLETE, AND THE TAX LAWS AND REGULATIONS ARE SUBJECT\nTO CHANGE. OPTIONEE SHOULD CONSULT A TAX ADVISER BEFORE EXERCISING THIS OPTION\nOR DISPOSING OF THE SHARES.\n\n          8.1  Exercise of ISO.  If this Option qualifies as an ISO, there will\n               ---------------                                                 \nbe no regular federal income tax liability or California income tax liability\nupon the exercise of the Option, although the excess, if any, of the Fair Market\nValue of the Shares on the date of exercise over the Exercise Price will be\ntreated as an adjustment to alternative minimum taxable income for federal\nincome tax purposes and may subject Optionee to an alternative minimum tax\nliability in the year of exercise.\n\n          8.2  Exercise of ISO on Disability.  If this Option qualifies as an\n               -----------------------------                                 \nISO and has been exercised at any time following three (3) months after a\nTermination Date that occurred due to the Disability of the Optionee not meeting\nthe requirements for total and permanent disability set forth in Section\n22(e)(3) of the Revenue Code, then the exercise of this Option will be treated\nas the exercise of a nonqualified option ('NQSO') described in Section 8.3\n                                           ----                           \nbelow.\n\n          8.3  Exercise of Nonqualified Stock Option.  If this Option does not\n               -------------------------------------                          \nqualify as an ISO, there may be a regular federal income tax liability and a\nCalifornia income tax liability upon the exercise of the Option.  Optionee will\nbe treated as having received compensation income (taxable at ordinary income\ntax rates) equal to the excess, if any, of the Fair Market Value of the Shares\non the date of exercise over the Exercise Price.  The Company will be required\nto withhold from Optionee's compensation or collect from Optionee and pay to the\napplicable taxing authorities an amount equal to a percentage of this\ncompensation income at the time of exercise.\n\n          8.4  Disposition of Shares.  In the case of an NQSO, if Shares are\n               ---------------------                                        \nheld for more than one year before disposition, any gain on disposition of the\nShares will be treated as long- term capital gain for federal and California\nincome tax purposes.  In the case of an ISO, if Shares are held for more than\none year after the date of exercise and more than two years after the Date of\nGrant, any gain on disposition on the Shares will be treated as long-term\ncapital gain for federal and California income tax purposes.  If Shares acquired\npursuant to an ISO are disposed of within such one year or two year periods (a\n'disqualifying disposition'), gain on such disqualifying disposition will be\n--------------------------                                                  \ntreated as compensation income (taxable at ordinary income rates) to the extent\nof the excess, if any, of the fair market value of the Shares on the date of\nexercise over the Exercise Price (the 'Spread'), or, if less, the difference\n                                       ------                               \nbetween the amount realized on the sale of such Shares and the Exercise Price.\nAny gain in excess of the Spread shall be treated as capital gain.\n\n                                       4\n\n \n                                                     Exodus Communications, Inc.\n                                                              Stock Option Grant\n\n\n     9.   INTERPRETATION. Any dispute regarding the interpretation of this Grant\n          --------------\nshall be submitted by Optionee or the Company to the Committee for review. The\nresolution of such a dispute by the Board or Committee shall be final and\nbinding on the Company and on Optionee.\n\n     10.  PRIVILEGES OF STOCK OWNERSHIP.  Optionee shall not have any of the\n          -----------------------------                                     \nrights of a shareholder with respect to any Shares until Optionee exercises the\nOption and pays the Exercise Price.\n\n     11.  NOTICES.  Any notice required to be given or delivered to the Company\n          -------                                                              \nunder the terms of this Grant shall be in writing and addressed to the Corporate\nSecretary of the Company at its principal corporate offices.  Any notice\nrequired to be given or delivered to Optionee shall be in writing and addressed\nto Optionee at the address indicated above or to such other address as such\nparty may hereafter designate in writing from time to time to the Company.  All\nnotices shall be deemed to have been given or delivered upon personal delivery,\nthree days after deposit in the United States mail by certified or registered\nmail (return receipt requested), one business day after deposit with any return\nreceipt express courier (prepaid), or one business day after transmission by\nrapifax or telecopier.\n\n     12.  SUCCESSORS AND ASSIGNS.  The Company may assign any of its rights\n          ----------------------                                           \nunder this Grant.  This Grant shall be binding upon and inure to the benefit of\nthe successors and assigns of the Company.  Subject to the restrictions on\ntransfer set forth herein, this Grant shall be binding upon Optionee and\nOptionee's heirs, executors, administrators, legal representatives, successors\nand assigns.\n\n     13.  ENTIRE AGREEMENT.  The Plan and the Stock Option Exercise Agreement\n          ----------------                                                   \nattached as Exhibit A are incorporated herein by this reference.  This Grant,\n            ---------                                                        \nthe Plan and the Stock Option Exercise Agreement constitute the entire agreement\nof the parties hereto and supersede all prior undertakings and agreements with\nrespect to the subject matter hereof.\n\n\n                                        EXODUS COMMUNICATIONS, INC.\n\n                                        By:____________________________\n\n                                        Name:__________________________\n \n                                        Title:_________________________\n\n\n                                  ACCEPTANCE\n                                  ----------\n                                        \n     Optionee hereby acknowledges receipt of a copy of the Plan and this Stock\nOption Grant, represents that Optionee has read and understands the terms and\nprovisions thereof, and accepts this Option subject to all the terms and\nconditions of the Plan and this Stock Option Grant.  Optionee acknowledges that\nthere may be adverse tax consequences upon exercise of this Option \n\n                                       5\n\n \n                                                     Exodus Communications, Inc.\n                                                              Stock Option Grant\n\n\nor disposition of the Shares and that Optionee should consult a tax adviser\nprior to such exercise or disposition.\n\n                                        _______________________________\n                                        OPTIONEE\n\n                                       6\n\n \n                                                     Exodus Communications, Inc.\n                                                              Stock Option Grant\n\n\n                                   EXHIBIT A\n                                        \n                    Form of Stock Option Exercise Agreement\n\n                                       7\n\n \n\n                                   Exhibit A\n                                   ---------\n\n                          EXODUS COMMUNICATIONS, INC.\n\n                        STOCK OPTION EXERCISE AGREEMENT\n\n     This Exercise Agreement is made this __________ day of\n____________________, 19____ between Exodus Communications, Inc., a California\ncorporation (the 'Company'), and the optionee named below ('Optionee') pursuant\n                  -------                                   --------           \nto the Company's 1995 Stock Option Plan (the 'Plan').  Unless otherwise defined\n                                              ----                             \nherein capitalized terms used herein shall have the meanings ascribed to them in\nthe Plan.\n\nOptionee:                     _________________________________________________\n\nSocial Security Number:       _________________________________________________\n\nAddress:                      _________________________________________________\n\n                              _________________________________________________\n\nNumber of Shares Purchased:   _________________________________________________\n\nPurchase Price per Share:     _________________________________________________\n\nAggregate Purchase Price:     _________________________________________________\n\nDate of Option Grant:         _________________________________________________\n\nType of Option:                    [  ]  Incentive Stock Option\n                                   [  ]  Nonqualified Stock Option\n\n     Optionee hereby delivers to the Company the Aggregate Purchase Price in\ncash (by check) in the amount of $_______________, receipt of which is\nacknowledged by the Company.\n\n     The Company and Optionee hereby agree as follows:\n\n     1.   PURCHASE OF SHARES.  On this date and subject to the terms and\n          ------------------                                            \nconditions of this Exercise Agreement, Optionee hereby exercises the Option\nGrant between the Company and Optionee dated as of the Date of Grant set forth\nabove, with respect to the Number of Shares Purchased set forth above of the\nCompany's common stock (the 'Shares') at an aggregate purchase price equal to\n                             ------                                          \nthe Aggregate Purchase Price set forth above (the 'Aggregate Purchase Price')\n                                                   ------------------------  \nand the Price per Share set forth above (the 'Purchase Price Per Share').  The\n                                              ------------------------        \nterm 'Shares' refers to the Shares purchased under this Exercise Agreement and\nincludes all securities received (a) in replacement of the Shares, and (b) as a\nresult of stock dividends or stock splits with respect to the Shares.\n\n                                                                        STOCKOPT\n\n                                       11\n\n \n                                                     Exodus Communications, Inc.\n                                                 Stock Option Exercise Agreement\n\n\n     2.   REPRESENTATIONS AND WARRANTIES OF OPTIONEE.  Optionee represents and\n          ------------------------------------------                          \nwarrants to the Company as follows:\n\n(a)  Optionee has received, read and understood the Plan and the Grant and\n     agrees to abide by and be bound by their terms and conditions.\n\n(b)  Optionee is purchasing the Shares for Optionee's own account for investment\n     purposes only and not with a view to, or for sale in connection with, a\n     distribution of the Shares within the meaning of the Securities Act.\n\n(c)  Optionee has no present intention of selling or otherwise disposing of all\n     or any portion of the Shares.\n\n(d)  Optionee is fully aware of the highly speculative nature of the investment\n     in the Shares; the financial hazards involved; and the lack of liquidity of\n     the Shares and the restrictions on transferability of the Shares (e.g.,\n                                                                       ---- \n     that Optionee may not be able to sell or dispose of the Shares or use them\n     as collateral for loans).\n\n(e)  Optionee is capable of evaluating the merits and risks of this investment,\n     has the ability to protect Optionee's own interests in this transaction and\n     is financially capable of bearing a total loss of this investment.\n\n     3.   COMPLIANCE WITH SECURITIES LAWS.  Optionee understands and\n          -------------------------------\nacknowledges that the Shares have not been registered under the Securities Act\nand that, notwithstanding any other provision of the Grant to the contrary, the\nexercise of any rights to purchase any Shares is expressly conditioned upon\ncompliance with the Securities Act and all applicable state securities laws.\nOptionee agrees to cooperate with the Company to ensure compliance with such\nlaws. The Shares are being issued under the Securities Act pursuant to (the\nCompany will check the applicable box):\n\n               [  ] the exemption provided by Rule 701;\n               [  ] the exemption provided by Rule 504;\n               [  ] Section 4(2) of the Securities Act;\n               [  ] other:____________________________.\n\n     4.   FEDERAL RESTRICTIONS ON TRANSFER.  Optionee understands that the\n          --------------------------------\nShares must be held indefinitely unless they are registered under the Securities\nAct or unless an exemption from such registration is available and that the\ncertificate(s) representing the Shares will bear a legend to that effect.\nOptionee understands that the Company is under no obligation to register the\nShares and that an exemption may not be available or may not permit Optionee to\ntransfer Shares in the amounts or at the times proposed by Optionee.\n\n          4.1  Rule 144.  Optionee has been advised that Rule 144 promulgated\n               --------                                                      \nunder the Securities Act, which permits certain resales of unregistered\nsecurities, is not presently available with respect to the Shares and, in any\nevent, requires that the Shares be paid for and then held for a minimum of two\nyears before they may be resold under Rule 144.  Prior to an initial public\n\n                                                                        STOCKOPT\n\n                                       12\n\n \n                                                     Exodus Communications, Inc.\n                                                 Stock Option Exercise Agreement\n\n\noffering of the Company's stock, 'nonaffiliates' (i.e. persons other than\nofficers, directors and major shareholders of the Company) may resell only under\nRule 144(k), which requires that the Shares be paid for and held for a minimum\nof three years.  Rule 144(k) is not available to affiliates.\n\n          4.2  Rule 701.  If the exemption relied upon for exercise of the\n               --------                                                   \nShares is Rule 701, the Shares will become freely transferable, subject to\nlimited conditions regarding the method of sale, by nonaffiliates ninety (90)\ndays after the first sale of common stock of the Company to the general public\npursuant to a registration statement filed with and declared effective by the\nSEC, subject to any lengthier market standoff agreement contained in this\nExercise Agreement or entered into by Optionee.  Affiliates must comply with the\nprovisions (other than the holding period requirements) of Rule 144.\n\n     5.   STATE LAW RESTRICTIONS ON TRANSFER.  Optionee understands that\n          ----------------------------------\ntransfer of the Shares may be restricted by Section 260.141.11 of the Rules of\nthe California Commissioner of Corporations, a copy of which is attached hereto\nas Attachment 1, and that the certificate(s) representing the Shares may bear a\n   ------------  \nlegend to that effect.\n\n     6.   MARKET STANDOFF AGREEMENT.  Optionee agrees in connection with any\n          -------------------------                                         \nregistration of the Company's securities that, upon the request of the Company\nor the underwriters managing any public offering of the Company's securities,\nOptionee will not sell or otherwise dispose of any Shares or any other\nsecurities of the Company without the prior written consent of the Company or\nsuch underwriters, as the case may be, for such period of time (not to exceed\n180 days) after the effective date of such registration as the Company or the\nunderwriters may specify for employee shareholders generally.\n\n     7.   COMPANY'S RIGHT OF FIRST REFUSAL.  Before any Shares held by Optionee\n          --------------------------------                                     \nor any transferee (either being sometimes referred to herein as the 'Holder')\n                                                                     ------  \nmay be sold or otherwise transferred (including transfer by gift or operation of\nlaw), the Company shall have an assignable right of first refusal to purchase\nthe Shares on the terms and conditions set forth in this Section (the 'Right of\n                                                                       --------\nFirst Refusal').\n-------------   \n\n          7.1  Notice of Proposed Transfer.  The Holder of the Shares shall\n               ---------------------------                                 \ndeliver to the Company a written notice (the 'Notice') stating:  (a) the\n                                              ------                    \nHolder's bona fide intention to sell or otherwise transfer such Shares; (b) the\nname of each proposed purchaser or other transferee ('Proposed Transferee'); (c)\n                                                      -------------------       \nthe number of Shares to be transferred to each Proposed Transferee; and (d) the\nbona fide cash price or other consideration for which the Holder proposes to\ntransfer the Shares (the 'Offered Price'); and the Holder shall offer to sell\n                          -------------                                      \nthe Shares at the Offered Price to the Company.\n\n          7.2  Exercise of Right of First Refusal.  At any time within thirty\n               ----------------------------------                            \n(30) days after receipt of the Notice, the Company and its assignee may, by\ngiving written notice to the Holder, elect to purchase all (but not less than\nall) of the Shares proposed to be transferred to any one or more of the Proposed\nTransferees, at the purchase price determined in accordance with subsection 7.3\nbelow.\n\n                                                                        STOCKOPT\n\n                                       13\n\n \n                                                     Exodus Communications, Inc.\n                                                 Stock Option Exercise Agreement\n\n\n          7.3  Purchase Price.  The purchase price for the Shares purchased\n               --------------                                              \nunder this Section shall be the Offered Price. If the Offered Price includes\nconsideration other than cash, the cash equivalent value of the non-cash\nconsideration shall be determined by the Board of Directors of the Company in\ngood faith.\n\n          7.4  Payment.  Payment of the purchase price shall be made, at the\n               -------                                                      \noption of the Company or its assignee, either (a) in cash (by check), by\ncancellation of all or a portion of any outstanding indebtedness of the Holder\nto the Company or such assignee, or by any combination thereof within thirty\n(30) days after receipt of the Notice or (b) in the manner and at the time(s)\nset forth in the Notice.\n\n          7.5  Holder's Right to Transfer.  If all of the Shares proposed in the\n               --------------------------                                       \nNotice to be transferred to a given Proposed Transferee are not purchased by the\nCompany and\/or its assignee as provided in this Section, then the Holder may\nsell or otherwise transfer such Shares to that Proposed Transferee at the\nOffered Price or at a higher price, provided that such sale or other transfer is\nconsummated within one hundred twenty (120) days after the date of the Notice\nand provided further that any such sale or other transfer is effected in\naccordance with any applicable securities laws and the Proposed Transferee\nagrees in writing that the provisions of this Section shall continue to apply to\nthe Shares in the hands of such Proposed Transferee.  If the Shares described in\nthe Notice are not transferred to the Proposed Transferee within such period, a\nnew Notice shall be given to the Company, and the Company shall again be offered\nthe Right of First Refusal, before any Shares held by the Holder may be sold or\notherwise transferred.\n\n          7.6  Exception for Certain Family Transfers.  Anything to the contrary\n               --------------------------------------                           \ncontained in this Section notwithstanding, the transfer of any or all of the\nShares during Optionee's lifetime or on Optionee's death by will or intestacy to\nOptionee's immediate family or a trust for the benefit of Optionee or Optionee's\nimmediate family shall be exempt from the provisions of this Section; provided\nthat, as a condition to receiving the Shares, the transferee or other recipient\nshall agree in writing to receive and hold the Shares so transferred subject to\nthe provisions of this Exercise Agreement, and to transfer such Shares no\nfurther except in accordance with the terms of this Exercise Agreement.  As used\nherein, 'immediate family' shall mean spouse, lineal descendant or antecedent,\n         ----------------                                                     \nbrother or sister.\n\n          7.7  Termination of Right of First Refusal.  The Right of First\n               -------------------------------------                     \nRefusal shall terminate as to any Shares upon the first sale of common stock of\nthe Company to the general public pursuant to a registration statement filed\nwith and declared effective by the SEC (other than a registration statement\nsolely covering an employee benefit plan or corporate reorganization).\n\n     8.   COMPLIANCE WITH STATE SECURITIES LAWS.  THE SALE OF THE SECURITIES\n          -------------------------------------\nTHAT ARE THE SUBJECT OF THIS EXERCISE AGREEMENT, IF NOT YET QUALIFIED WITH THE\nCALIFORNIA COMMISSIONER OF CORPORATIONS AND NOT EXEMPT FROM SUCH QUALIFICATION,\nIS SUBJECT TO SUCH QUALIFICATION, AND THE ISSUANCE OF SUCH SECURITIES, AND THE\nRECEIPT OF ANY PART OF THE CONSIDERATION THEREFOR PRIOR TO SUCH QUALIFICATION IS\nUNLAWFUL UNLESS THE SALE IS\n\n                                                                        STOCKOPT\n\n                                       14\n\n \n                                                     Exodus Communications, Inc.\n                                                 Stock Option Exercise Agreement\n\n\nEXEMPT.  THE RIGHTS OF THE PARTIES TO THIS EXERCISE AGREEMENT ARE EXPRESSLY\nCONDITIONED UPON SUCH QUALIFICATION BEING OBTAINED OR AN EXEMPTION BEING\nAVAILABLE.\n\n     9.   COMPANY'S REPURCHASE OPTION.  The Company, and\/or its assignees, shall\n          ---------------------------                                           \nhave the option to repurchase no less than all of the Shares on the terms and\nconditions set forth in this Section (the 'Repurchase Option') if Optionee\n                                           -----------------              \nshould cease to be employed by the Company for any reason, or no reason,\nincluding, without limitation, Optionee's death, disability, voluntary\nresignation or termination by the Company with or without cause.\n\n          9.1  Right of Termination Unaffected.  Nothing in this Exercise\n               -------------------------------                           \nAgreement shall be construed to limit or otherwise affect in any manner\nwhatsoever the right or power of the Company to terminate Optionee's employment\nat any time, for any reason or no reason, with or without cause.  For purposes\nof this Exercise Agreement, Optionee shall be considered to be 'employed by the\nCompany' if Optionee is an officer, director or full-time employee of the\nCompany or any Parent, Subsidiary or Affiliate of the Company or if the\nCommittee determines that Optionee is rendering substantial services as a part-\ntime employee, consultant or adviser to the Company or any Parent, Subsidiary or\nAffiliate of the Company.  The Committee shall have discretion to determine\nwhether Optionee has ceased to be employed by the Company or any Parent,\nSubsidiary or Affiliate of the Company, whether or not such cessation was due to\na Disability, and determine the Termination Date.\n\n          9.2  Exercise of Repurchase Option.  At any time within ninety (90)\n               -----------------------------                                 \ndays after the later of the Termination Date or the date the Optionee purchased\nthe Shares, the Company, and\/or its assignees, may elect to repurchase no less\nthan all of the Shares by giving Optionee written notice of exercise of the\nRepurchase Option.\n\n          9.3  Calculation of Repurchase Price.  The Company and\/or its\n               -------------------------------                         \nassignees shall have the option to repurchase from Optionee (or from Optionee's\npersonal representative as the case may be) no less than all of the Shares at\nthe higher of Fair Market Value of such Shares on the Termination Date or the\nPurchase Price per Share.  If the Repurchase Option of the Shares is assigned,\nthe assignee must pay the Company upon assignment cash equal to the difference\nbetween the Purchase Price per Share and the Fair Market Value of the Shares\nwhere the original Purchase Price is less than the Fair Market Value.\n\n          9.4  Payment of Repurchase Price.  The repurchase price shall be\n               ---------------------------                                \npayable, at the option of the Company or its assignees, by check or by\ncancellation of all or a portion of any outstanding indebtedness of Optionee to\nthe Company or such assignee, or by any combination thereof.  The repurchase\nprice shall be paid without interest within thirty (30) days after exercise of\nthe Repurchase Option.\n\n          9.5  Termination of Repurchase Option.  The Repurchase Option shall\n               --------------------------------                              \nterminate as to any Shares upon the first sale of common stock of the Company to\nthe general public pursuant to a registration statement filed with and declared\neffective by the SEC (other\n\n                                                                        STOCKOPT\n\n                                       15\n\n \n                                                     Exodus Communications, Inc.\n                                                 Stock Option Exercise Agreement\n\n\nthan a registration statement solely covering an employee benefit plan or\ncorporate reorganization).\n\n     10.  ESCROW.  As security for the faithful performance of this Exercise\n          ------                                                            \nAgreement, Optionee agrees, immediately upon receipt of the certificate(s)\nevidencing the Shares, to deliver such certificate(s), together with a stock\npower in the form of Attachment 2 attached hereto, executed by Optionee and by\n                     ------------                                             \nOptionee's spouse, if any (with the transferee, certificate number, date and\nnumber of Shares left blank), to the Secretary of the Company or its designee\n                                                                             \n('Escrow Holder'), who is hereby appointed to hold such certificate(s) and stock\n---------------                                                                 \npower in escrow and to take all such actions and to effectuate all such\ntransfers and\/or releases of such Shares as are in accordance with the terms of\nthis Exercise Agreement.  Optionee and the Company agree that Escrow Holder\nshall not be liable to any party to this Exercise Agreement (or to any other\nparty) for any actions or omissions unless Escrow Holder is grossly negligent\nrelative thereto.  The Escrow Holder may rely upon any letter, notice or other\ndocument executed by any signature purported to be genuine and may rely on\nadvice of counsel and obey any order of any court with respect to the\ntransactions contemplated herein.  The Shares shall be released from escrow upon\ntermination of both the Repurchase Option and the Right of First Refusal;\nprovided, however, that such release shall not affect the rights of the Company\nwith respect to any pledge of Shares to the Company.\n\n     11.  LEGENDS.  Optionee understands and agrees that the Shares are subject\n          -------                                                              \nto a Right of First Refusal and a Repurchase Option held by the Company (or its\nassignee) as set forth herein and that the certificate(s) representing the\nShares will bear legends in substantially the following forms:\n\n     'THE SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO CERTAIN\n     RESTRICTIONS ON PUBLIC RESALE AND TRANSFER AND RIGHT OF FIRST\n     REFUSAL AND REPURCHASE OPTIONS HELD BY THE ISSUER AND\/OR ITS\n     ASSIGNEE(S) AND MAY NOT BE TRANSFERRED EXCEPT AS SET FORTH IN AN\n     AGREEMENT BETWEEN THE ISSUER AND THE ORIGINAL HOLDER OF THESE\n     SHARES, A COPY OF WHICH MAY BE OBTAINED AT THE PRINCIPAL OFFICE OF\n     THE ISSUER. SUCH TRANSFER RESTRICTIONS AND RIGHTS OF FIRST REFUSAL\n     AND REPURCHASE ARE BINDING ON TRANSFEREES OF THESE SHARES.'\n\n     'THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER\n     THE SECURITIES ACT OF 1933, AS AMENDED (THE 'ACT'), OR UNDER THE\n     SECURITIES LAWS OF CERTAIN STATES. THESE SECURITIES ARE SUBJECT TO\n     RESTRICTIONS ON TRANSFERABILITY AND RESALE AND MAY NOT BE\n     TRANSFERRED OR RESOLD EXCEPT AS PERMITTED UNDER THE ACT AND THE\n     APPLICABLE STATE SECURITIES LAWS, PURSUANT TO REGISTRATION OR\n     EXEMPTION THEREFROM. INVESTORS SHOULD BE AWARE THAT THEY MAY BE\n     REQUIRED TO BEAR THE FINANCIAL RISKS OF THIS INVESTMENT FOR AN\n     INDEFINITE PERIOD OF TIME. THE ISSUER OF THESE SECURITIES MAY\n     REQUIRE AN OPINION\n\n                                                                        STOCKOPT\n\n                                       16\n\n \n                                                     Exodus Communications, Inc.\n                                                 Stock Option Exercise Agreement\n\n\n     OF COUNSEL IN FORM AND SUBSTANCE SATISFACTORY TO THE ISSUER TO THE\n     EFFECT THAT THE PROPOSED TRANSFER OR RESALE IS IN COMPLIANCE WITH\n     THE ACT AND ANY APPLICABLE STATE SECURITIES LAWS.'\n\n     The California Commissioner of Corporations may require that the following\nlegend also be placed upon the share certificate(s) evidencing ownership of the\nShares:\n\n     'IT IS UNLAWFUL TO CONSUMMATE A SALE OR TRANSFER OF THIS SECURITY,\n     OR ANY INTEREST THEREIN, OR TO RECEIVE ANY CONSIDERATION THEREFOR,\n     WITHOUT THE PRIOR WRITTEN CONSENT OF THE COMMISSIONER OF\n     CORPORATIONS OF THE STATE OF CALIFORNIA, EXCEPT AS PERMITTED IN THE\n     COMMISSIONER'S RULES.'\n\n     If the foregoing legend is required, Optionee acknowledges receipt of a\ncopy of Section 260.141.11 of the Rules of the California Corporations\nCommissioner, attached as Attachment 1.\n                          ------------ \n\n     12.  STOP-TRANSFER NOTICES.  Optionee understands and agrees that, in order\n          ---------------------                                                 \nto ensure compliance with the restrictions referred to herein, the Company may\nissue appropriate 'stop-transfer' instructions to its transfer agent, if any,\nand that, if the Company transfers its own securities, it may make appropriate\nnotations to the same effect in its own records.\n\n     13.  TAX CONSEQUENCES.  OPTIONEE UNDERSTANDS THAT OPTIONEE MAY SUFFER\n          ----------------                                                \nADVERSE TAX CONSEQUENCES AS A RESULT OF OPTIONEE'S PURCHASE OR DISPOSITION OF\nTHE SHARES.  OPTIONEE REPRESENTS THAT OPTIONEE HAS CONSULTED WITH ANY TAX\nCONSULTANT(S) OPTIONEE DEEMS ADVISABLE IN CONNECTION WITH THE PURCHASE OR\nDISPOSITION OF THE SHARES AND THAT OPTIONEE IS NOT RELYING ON THE COMPANY FOR\nANY TAX ADVICE.  IN PARTICULAR, IF THE SHARES ARE SUBJECT TO REPURCHASE BY THE\nCOMPANY OR IF OPTIONEE IS AN INSIDER SUBJECT TO SECTION 16(b) OF THE EXCHANGE\nACT, OPTIONEE REPRESENTS THAT OPTIONEE HAS CONSULTED WITH OPTIONEE'S TAX\nADVISERS CONCERNING THE ADVISABILITY OF FILING AN 83(b) ELECTION WITH THE\nINTERNAL REVENUE SERVICE.\n\n                                                                        STOCKOPT\n\n                                       17\n\n \n                                                     Exodus Communications, Inc.\n                                                 Stock Option Exercise Agreement\n\n\n     14.  ENTIRE AGREEMENT.  The Plan and Grant are incorporated herein by\n          ----------------                                                \nreference.  This Exercise Agreement, the Plan and the Grant constitute the\nentire agreement of the parties and supersede in their entirety all prior\nundertakings and agreements of the Company and Optionee with respect to the\nsubject matter hereof, and is governed by California law except for that body of\nlaw pertaining to conflict of laws.\n\nSubmitted by:                           Accepted by:\n\nOPTIONEE: ________________________      EXODUS COMMUNICATIONS, INC.\n               (print name)\n\n__________________________________      By:________________________________\n           (signature)\n                                        Its:_______________________________\n\nDated: ___________________________      Dated:_____________________________\n\n                                                                        STOCKOPT\n\n                                       18\n\n \n                                 ATTACHMENT 1\n                                 ------------\n\n                    CALIFORNIA COMMISSIONER RULE 260.141.11\n                    ---------------------------------------\n\n(a)  The issuer of any security upon which a restriction on transfer has been\n     imposed pursuant to Sections 260.102.6, 260.141.10 or 260.534 shall cause a\n     copy of this section to be delivered to each issuee or transferee of such\n     security at the time the certificate evidencing the security is delivered\n     to the issuee or transferee.\n\n(b)  It is unlawful for the holder of any such security to consummate a sale or\n     transfer of such security, or any interest therein, without the prior\n     written consent of the Commissioner (until this condition is removed\n     pursuant to Section 260.141.12 of these rules), except:\n\n(1)  to the issuer;\n(2)  pursuant to the order or process of any court;\n(3)  to any person described in Subdivision (i) of Section 25102 of the Code or\n     Section 260.105.14 of these rules:\n(4)  to the transferor's ancestors, descendants or spouse, or any custodian or\n     trustee for the account of the transferor or the transferor's ancestors,\n     descendants, or spouse; or to a transferee by a trustee or custodian for\n     the account of the transferee or the transferee's ancestors, descendants or\n     spouse;\n(5)  to holders of securities of the same class of the same issuer;\n(6)  by way of gift or donation intervivos or on death;\n(7)  by or through a broker-dealer licensed under the Code (either acting as\n     such or as a finder) to a resident of a foreign state, territory or country\n     who is neither domiciled in this state to the knowledge of the broker-\n     dealer, nor actually present in this state if the sale of such securities\n     is not in violation of any securities law of the foreign state, territory\n     or country concerned;\n(8)  to a broker-dealer licensed under the Code in a principal transaction, or\n     as an underwriter or member of an underwriting syndicate or selling group;\n(9)  if the interest sold or transferred is a pledge or other lien given by the\n     purchaser to the seller upon a sale of the security for which the\n     Commissioner's written consent is obtained or under this rule not required;\n(10) by way of a sale qualified under Section 25111, 25112, 25113, or 25121 of\n     the Code, of the securities to be transferred, provided that no order under\n     Section 25140 or subdivision (a) of Section 25143 is in effect with respect\n     to such qualification;\n(11) by a corporation to a wholly owned subsidiary of such corporation, or by a\n     wholly owned subsidiary of a corporation to such corporation;\n(12) by way of an exchange qualified under Section 25111, 25112 or 25113 of the\n     Code, provided that no order under Section 25140 or subdivision (a) of\n     Section 25143 is in effect with respect to such qualification;\n(13) between residents of foreign states, territories or countries who are\n     neither domiciled nor actually present in this state;\n(14) to the State Controller pursuant to the Unclaimed Property Law or the\n     administrator of the unclaimed property law of another state; or\n\n                                                                        \n                                       1                             STOCKOPT\n\n \n                                                     Exodus Communications, Inc.\n                                                 Stock Option Exercise Agreement\n\n\n(15) by the State Controller pursuant to the Unclaimed Property Law or by the\n     administrator of the unclaimed property law of another state if, in either\n     such case, such person (i) discloses to potential purchasers at the sale\n     that transfer of the securities is restricted under this rule, (ii)\n     delivers to each purchaser a copy of this rule, and (iii) advises the\n     Commissioner of the name of each purchaser;\n(16) by a trustee to a successor trustee when such transfer does not involve a\n     change in the beneficial ownership of the securities;\n(17) by way of an offer and sale of outstanding securities in an issuer\n     transaction that is subject to the qualification requirements of Section\n     25110 of the Code but exempt from that qualification requirement by\n     subdivision (f) of Section 25102;\n\nprovided that any such transfer is on the condition that any certificate\nevidencing the security issued to such transferee shall contain the legend\nrequired by this section.\n\n(c)  The certificates representing all such securities subject to such a\n     restriction on transfer, whether upon initial issuance or upon any transfer\n     thereof, shall bear on their face a legend, prominently stamped or printed\n     thereon in capital letters of not less than 10-point size, reading as\n     follows:\n\nIT IS UNLAWFUL TO CONSUMMATE A SALE OR TRANSFER OF THIS SECURITY, OR ANY\nINTEREST THEREIN, OR TO RECEIVE ANY CONSIDERATION THEREFORE, WITHOUT THE PRIOR\nWRITTEN CONSENT OF THE COMMISSIONER OF CORPORATIONS OF THE STATE OF CALIFORNIA,\nEXCEPT AS PERMITTED IN THE COMMISSIONER'S RULES.\n\n                                       2                              STOCKOPT\n\n \n                                                     Exodus Communications, Inc.\n                                                 Stock Option Exercise Agreement\n\n\n                                 ATTACHMENT 2\n                                 ------------\n\n                          STOCK POWER AND ASSIGNMENT\n\n                           SEPARATE FROM CERTIFICATE\n\n\n     FOR VALUE RECEIVED and pursuant to that certain Stock Option Exercise\nAgreement dated as of __________________, 19___, the undersigned hereby sells,\nassigns and transfers unto _________________________, _______________________\nshares of the common stock of _______________________, a California corporation,\nstanding in the undersigned's name on the books of said corporation represented\nby Certificate No. _____ delivered herewith, and does hereby irrevocably\nconstitute the Secretary of said corporation as attorney-in-fact, with full\npower of substitution, to transfer said stock on the books of said corporation.\n\nDated: ________________, 19___\n\n \n                                        _______________________________________\n                                        (Signature)\n\n\n                                        _______________________________________\n                                        (Please Print Name)\n\n\n                                        _______________________________________\n                                        (Spouse's Signature, if any)\n\n\n                                        ______________________________________\n                                        (Please Print Name)\n\n                                       1                              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