SUN MICROSYSTEMS, INC.
DIRECTORS’ NONSTATUTORY STOCK OPTION AGREEMENT
SUN MICROSYSTEMS, INC., a Delaware corporation (the “Company”) has granted to (the “Optionee”), an
option to purchase a total of shares of the Company’s Common Stock, at the price determined as provided herein, and in
all respects subject to the terms, definitions and provisions of the 1988 Directors’ Stock Option Plan (the “Plan”) adopted by the
Company which is incorporated herein by reference. The terms defined in the Plan shall have the same defined meanings herein.
This option is a nonstatutory option and is not intended to qualify for any special tax benefits to the Optionee.
The option price is $ for each share of Common Stock, which is 100% of the fair market value of the Common Stock
on the date of grant of this Option.
This Option shall be exercisable during its term in accordance with the provisions of Section 9 of the Plan as follows:
(i) This Option shall become exercisable in cumulative installments of twenty-five percent (25%) of the Shares subject
to the Option on each of the first, second, third and fourth anniversaries of the date of grant specified on page 3 of this
Agreement (each a “Vesting Date”); provided, however, if the Company’s Annual Meeting of Stockholders for any year after
the Annual Meeting date on which the Option is granted is held prior to a Vesting Date, the Vesting Date for that year shall be
the date of the Annual Meeting of Stockholders. Notwithstanding the foregoing, in no event shall any portion of the Option
vest before the date six (6) months after the date of grant of the Option.
(ii) This Option may not be exercised for a fraction of a share.
(iii) In the event of Optionee’s death, disability or other termination of service as a Director, the exercisability of the
Option is governed by Section 6, 7 and 8 of this Agreement.
This Option shall be exercis