EXHIBIT 10.11
RESTRICTED STOCK AGREEMENT (PERFORMANCE SHARES)
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This Agreement is made as of the 4th day of April, 2000, by and between
TELLIUM, INC., a Delaware corporation (the "Company"), having an address at 0
Xxxxxxxx Xxxxx, Xxxxxxxxx, Xxx Xxxxxx 00000, and Xxxxx X. Xxxx, having an
address at 0 Xxxxx Xxxx Xxxxx, Xxxxxxxxxxxxx, XX 00000 ("Employee").
WHEREAS, Employee is the holder of the option (the "Option") to purchase
the number of shares of the Company's common stock set forth on Annex I, and
Employee desires to exercise such Option as to the number of shares of the
Company's common stock set forth on Annex I;
WHEREAS, in connection with such exercise, the Company has agreed to make a
loan to the Employee in the amount set forth on Annex I to pay the exercise
price of such Option;
WHEREAS, it is a condition precedent to the Company's making of such loan
that Employee enter into this Agreement with the Company concerning the rights
and restrictions of the shares issuable upon exercise of the Option; and
WHEREAS, in connection with his exercise of the Option, Employee shall
become a party to the Company's Amended and Restated Stockholders' Agreement,
dated as of December 2, 1999, as amended (the "Stockholders Agreement");
NOW, THEREFORE, in consideration of the premises and the mutual covenants
herein contained and for other good and valuable consideration, the receipt and
adequacy of which are hereby acknowledged, the parties hereto, intending to be
legally bound, agree as follows:
I. OWNERSHIP OF SHARES
1.1 Shares. The Employee hereby exercises his Option to purchase from the
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Company the number of shares of the Company's common stock, par value $0.001 per
share (the "Shares"), set forth on Annex I, at the exercise price (the "Per
Share Price") set forth on Annex I, for an aggregate consideration (the
"Purchase Price") equal to the amount set forth on Annex I, which Purchase Price
is being paid concurrently herewith in cash in the amount set forth on Annex I
and by delivery of a purchase-money promissory note (the "Note") in the form
attached hereto as Exhibit A, payment of which is being secured by a pledge of
the Shares under a Stock Pledge Agreement (the "Pledge Agreement") being
delivered herewith in the form attached hereto as Exhibit B. Employee hereby
agrees to deliver to the Secretary of the Company a duly executed blank
Assignment Separate from Certificate (in the form attached hereto as Exhibit C).
The certificates representing the Shares, subject to the Company's Repurchase
Right under Article IV hereof, shall be held in escrow by the Secretary of the
Company as provided in Article VI hereof.
1.2 Restricted Securities. Employee hereby confirms that Employee has
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been informed that the Shares are restricted securities under the Securities Act
of 1933, as amended (the "1933 Act") and may not be resold or transferred unless
the Shares are first registered under the federal securities laws or unless an
exemption from such registration is available. Accordingly, Employee hereby
acknowledges that Employee is prepared to hold the Shares for an indefinite
period and that Employee is aware that
Rule 144 of the Securities and Exchange Commission (the "Commission") issued
under the 1933 Act is not presently available to exempt the offer and sale of
the Shares from the registration requirements of the 1933 Act. Employee is aware
of the adoption of Rule 144 promulgated under the 1933 Act by the Commission,
which permits limited public resales of securities acquired in a nonpublic
offering, subject to the satisfaction of certain conditions. Employee
understands that Rule 144 is conditioned upon, among other things: (i) the
availability of certain current public information about the Company, (ii) the
resale occurring not earlier than one (1) year after the party has purchased and
paid for the securities to be sold, (iii) the sale being made through a broker
in an unsolicited "broker's transaction", and (iv) the amount of securities
being sold during any three-month period not exceeding specified limitations.
Employee acknowledges and understands that the Company may not be satisfying the
current public information requirement of Rule 144 at the time Employee wishes
to sell the Shares or other conditions under Rule 144 which are required of the
Company. If so, Employee understands that he will be precluded from selling the
securities under Rule 144 even if the one-year holding period of said Rule has
been satisfied. Prior to Employee's acquisition of the Shares, Employee acquired
sufficient information about the Company to reach an informed and knowledgeable
decision to acquire the Shares. Employee has such knowledge and experience in
financial and business matters so as to make him capable of utilizing said
information to evaluate the risks of the prospective investment and to make an
informed investment decision. Employee is able to bear the economic risk of his
investment in the Shares.
1.3 Disposition of Shares. Employee hereby agrees that Employee shall
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make no disposition of the Shares (other than a permitted transfer under Section
3.1 hereof) unless and until:
(a) Employee shall have notified the Company of the proposed
disposition and provided a written summary of the terms and conditions of the
proposed disposition; and
(b) Employee shall have complied with all requirements of this
Agreement and the Stockholders Agreement, applicable to the disposition of the
Shares.
The Company shall not be required (i) to transfer on its books any Shares
that have been sold or transferred in violation of the provisions of this
Article I or (ii) to treat as the owner of the Shares, or otherwise to accord
voting or dividend rights to, any transferee to whom the Shares have been
transferred in contravention of this Agreement.
1.4 Restrictive Legends. In order to reflect the restrictions on
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disposition of the Shares, the stock certificates representing the Shares will
be endorsed with the following restrictive legends, in addition to any legends
required by the Stockholders Agreement:
"THE SECURITIES REPRESENTED BY THIS CERTIFICATE MAY NOT BE TRANSFERRED,
SOLD, ASSIGNED, PLEDGED, HYPOTHECATED OR OTHERWISE DISPOSED OF (A "TRANSFER")
EXCEPT IN ACCORDANCE WITH THE PROVISIONS OF A RESTRICTED STOCK AGREEMENT DATED
AS OF _____ __, 2000, AS IT MAY BE AMENDED FROM TIME TO TIME. PURSUANT TO SUCH
AGREEMENT, THE SECURITIES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO CERTAIN
REPURCHASE RIGHTS EXERCISABLE BY TELLIUM, INC. AND ANY TRANSFEREE OF THESE
SECURITIES TAKES SUBJECT TO SUCH REPURCHASE RIGHTS. COPIES OF THE RESTRICTED
STOCK AGREEMENT ARE ON FILE WITH THE COMPANY.
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THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933 (THE "ACT") OR STATE SECURITIES LAWS AND NO
TRANSFER OF THESE SECURITIES MAY BE MADE EXCEPT (A) PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT UNDER THE ACT, OR (B) PURSUANT TO AN EXEMPTION THEREFROM
WITH RESPECT TO WHICH THE COMPANY MAY, UPON REQUEST, REQUIRE A SATISFACTORY
OPINION OF COUNSEL FOR THE HOLDER THAT SUCH TRANSFER IS EXEMPT FROM THE
REQUIREMENTS OF THE ACT."
1.5 Definitions. Whenever the following terms are used in this Agreement,
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they shall have the meaning specified below unless the context clearly indicates
to the contrary.
"Employment Agreement" shall mean the Employment Agreement, dated as of
12/21/99, between the Employee and the Company.
"Performance Shares" shall mean the Shares listed as Performance Shares on
Annex I.
"Vesting Measurement Date" shall mean the date set forth on Annex I as the
Vesting Measurement Date.
"Vesting Schedule" shall mean the Vesting Schedule set forth on Annex I.
II. SPECIAL PROVISIONS
2.1 Stockholder Rights. Subject to any repurchase rights of the Company
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under this Agreement, Employee (or any successor in interest) shall have all the
rights of a stockholder (including voting and dividend rights) with respect to
the Shares, including the Shares held in escrow under Article VI, but subject,
however, to the transfer restrictions of Article III.
2.2 Section 83(b) Election. Employee understands that under Section 83 of
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the Internal Revenue Code of 1986, as amended, and the rules and regulations
promulgated thereunder (the "Code"), upon the lapse of any forfeiture
restrictions applicable to the Shares, Employee must include as compensation
income the difference between the Purchase Price paid for the Shares and their
Fair Market Value (as defined in the Stock Option Agreement, dated as of
December 21, 1999, between the Company and Employee) on the date on which any
such forfeiture restrictions applicable to such Shares lapse. For this purpose,
the term "forfeiture restrictions" includes the right of the Company to
repurchase the Shares pursuant to its Repurchase Right under Article IV of this
Agreement. Employee understands that he shall, at the time of the execution and
delivery of this Agreement, be required to elect to include as compensation
income an amount equal to the difference (if any) between the Purchase Price
paid for the Shares and the Fair Market Value for the Shares at the time the
Shares are acquired hereunder rather than when and as such Shares cease to be
subject to such forfeiture restrictions, by filing an election under Section
83(b) of the Code, substantially in the form of Exhibit D hereto, with the
Internal Revenue Service (the "I.R.S.") within thirty (30) days after the date
of purchase of the Shares hereunder. If the Fair Market Value of the Shares at
the date of purchase does not exceed the Purchase Price paid (and thus no amount
must be included as compensation income), the election may avoid potential
adverse tax consequences in the future.
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2.3 Registration of Shares. Immediately following the registration of the
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Company's common stock under Section 12 of the Securities Exchange Act of 1934,
as amended, the Company shall use all commercially reasonable efforts to file a
Form S-8/S-3 under the 1933 Act, registering the Shares under the 1933 Act so
that the Shares may be resold from time to time by Employee. Notwithstanding
the foregoing, Employee agrees to be bound by the provisions of Section 7.4(a)
of the Stockholders Agreement, the terms and conditions of which are
incorporated herein by reference, as if Employee were a "Stockholder" and the
Shares issuable or issued hereunder were "Shares" (as each such term is defined
therein).
III. TRANSFER RESTRICTIONS
3.1 Restrictions on Transfer of Unvested Shares. The Unvested Shares (as
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defined below) shall not be transferable in part or whole other than to the
Company pursuant to the Pledge Agreement or by will or by the laws of descent
and distribution or pursuant to a domestic relations order or by gift to members
of Employee's family, to trusts solely for the benefit of such family members,
to persons with whom Employee has had a significant pre-existing business or
personal relationship and to partnerships, limited liability companies,
corporations or other entities in which such family members, friends and/or
trusts are the only partners, and to charitable organizations (and any entity
for which the principal purpose is to make a gift to a charitable organization).
Following transfer, for purposes of the Unvested Shares, a transferee of any
Unvested Shares shall be deemed to be Employee, provided that the Unvested
Shares shall be subject to the Repurchase Right under Article IV as if the
Unvested Shares were held by the original Employee.
3.2 Definition of Owner. For purposes of Article IV of this Agreement,
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the term "Owner" shall include the Employee and all subsequent holders of the
Shares who own such Shares pursuant to a permitted transfer from the Employee in
accordance with Section 3.1 above or who otherwise derive their ownership
through a permitted transfer from Employee.
IV. REPURCHASE RIGHT
4.1 Grant. (a) Employee hereby grants the Company the right (the
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"Repurchase Right") to repurchase at a per share price equal to the Per Share
Price plus interest on the Per Share Price accruing at the interest rate set
forth in the Note from the date of purchase of the Unvested Shares by Employee
to the date of repurchase of the Unvested Shares by the Company, all or (at the
discretion of the Company and with the consent of the Employee) any portion of
the Shares in which the Employee has not acquired a vested interest in
accordance with the vesting provisions of Section 4.3 (such shares to be herein
called the "Unvested Shares"), which Repurchase Right shall be exercisable at
any time during the one year period following the date on which the employment
of Employee is terminated pursuant to Sections 4(a), 4(b), 4(c) or 4(d) of the
Employment Agreement (a "Repurchase Event").
(b) Except as this Section 4 provides, the termination of the
Employment Agreement shall have no effect on the Unvested Shares or the terms
and conditions of this Agreement.
4.2 Exercise of the Repurchase Right. The Repurchase Right shall be
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exercisable by written notice delivered to the Owner of the Unvested Shares
prior to the expiration of the applicable one year
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period specified in Section 4.1. The notice shall indicate the number of
Unvested Shares to be repurchased and the date on which the repurchase is to be
effected, such date to be not more than thirty (30) days after the date of
notice. To the extent one or more certificates representing Unvested Shares may
have been previously delivered out of escrow to the Owner, then the Owner shall,
prior to the close of business on the date specified for the repurchase, deliver
to the Secretary of the Company the certificates representing the Unvested
Shares to be repurchased, each certificate to be properly endorsed for transfer.
The payment of the amount of the appropriate repurchase price shall,
concurrently with the receipt of such stock certificates (either from escrow in
accordance with Section 6.3 or from Owner as herein provided), be paid first by
reducing such amount by the amount of any indebtedness and accrued interest
thereon due from the Owner to the Company and then the remainder shall be paid
by delivery to the Owner of a certified check payable to the Owner. In respect
to any purchase of Unvested Shares pursuant to this Section 4.2, the Company may
elect (but shall have no obligation) to cause its designee to purchase such
Unvested Shares.
4.3 Termination of the Repurchase Right. The Repurchase Right shall
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terminate, and cease to be exercisable, with respect to the Unvested Shares as
described in subsections (a) and (b) of this Section 4.3.
(a) The Repurchase Right shall terminate, and cease to be exercisable,
with respect to any Unvested Shares for which it is not timely exercised under
Section 4.2.
(b) The Repurchase Right shall terminate, and cease to be exercisable,
with respect to the Performance Shares in which the Employee vests in accordance
with the Vesting Schedule set forth on Annex I. Accordingly, provided no
Repurchase Events shall have taken place, the Employee shall acquire a vested
interest in, and the Repurchase Right provided in Section 4.1 shall lapse with
respect to, the Performance Shares, in accordance with such Vesting Schedules.
(c) All Performance Shares shall, however, continue to be subject to
the market stand-off provisions of Section 2.3 above.
(d) The provisions of Section 4.3(b) above shall cease to apply with
respect to any Unvested Shares that have not yet vested upon the occurrence of a
Repurchase Event described in Section 4.1 above.
4.4 Additional Shares or Substituted Securities. In the event of any
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stock dividend, stock split, recapitalization or other change affecting the
Company's outstanding Common Stock as a class effected without receipt of
consideration, any new, substituted or additional securities or other property
(including money paid other than as a regular cash dividend) which is by reason
of any such transaction distributed with respect to the Shares shall be
immediately subject to the Repurchase Right, but only to the extent the Shares
are at the time covered by such right. Appropriate adjustments to reflect the
distribution of such securities or property shall be made to the number of
Shares hereunder and to the price per share to be paid upon the exercise of the
Repurchase Right in order to reflect the effect of any such transaction upon the
Company's capital structure; provided, however, that the aggregate Purchase
Price shall remain the same.
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4.5 Corporate Transaction. Notwithstanding anything contained in this
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Agreement to the contrary, in the event of a Corporate Transaction, all Unvested
Shares shall immediately vest and the Repurchase Right shall lapse. For
purposes hereof, the term "Corporate Transaction" shall mean (i) a sale or
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acquisition of beneficial ownership of equity securities of the Company
constituting 50% or more of the total voting power of the Company's shareholders
to or by a party or group of related parties (other than the Company or a person
that directly or indirectly controls, is controlled by, or is under common
control with the Company) in a transaction or series of related transactions,
(ii) a merger or consolidation of the Company with or into another entity in
connection with which the holders of equity securities of the Company prior to
such transaction possess less than 50% of the total voting power of the
surviving company after such transaction, (iii) a complete liquidation or
dissolution of the Company, (iv) a sale of all or substantially all of the
assets of the Company or (v) a change in the composition of the Board over a
period of thirty-six (36) consecutive months (or less) such that a majority of
the Board members (rounded up to the nearest whole number) ceases, by reason of
one or more proxy contests for the election of Board members, to be comprised of
individuals who either (x) have been Board members continuously since the
beginning of such period or (y) have been elected or nominated for election as
Board members during such period by at least a majority of the Board members
described in clause (x) who were still in office at the time such election or
nomination was approved by the Board or by persons who were nominated by such
Board members.
4.6 Certain Additional Payments by the Company.
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(a) Anything in this Agreement to the contrary notwithstanding and
except as set forth below, in the event it shall be determined that as a result
of the acceleration of the vesting of the then-Unvested Shares (the "Accelerated
Shares") pursuant to Section 4.5 above upon the occurrence of a Corporate
Transaction, the Employee would be required to pay an Excise Tax with respect to
the Accelerated Shares, then the Employee shall be entitled to receive an
additional payment (a "Gross-Up Payment") in an amount such that after payment
by the Employee of all taxes (including any interest or penalties imposed with
respect to such taxes), including without limitation any income taxes (and any
interest and penalties imposed with respect thereto) and Excise Tax imposed upon
the Gross-Up Payment, the Employee retains an amount of the Gross-Up Payment
equal to the amount of the Excise Tax attributable to the Accelerated Shares.
(b) Subject to the provisions of Section 4.6(c), all determinations
required to be made under this Section 4.6, including whether and when a Gross-
Up Payment is required and the amount of such Gross-Up Payment and the
assumptions to be utilized in arriving at such determination, shall be made by
Deloitte & Touche or such other nationally recognized certified public
accounting firm as may be designated by the Company (the "Accounting Firm")
which shall provide detailed supporting calculations both to the Company and the
Employee within 15 business days of the receipt of notice from the Employee that
he has received Accelerated Shares, or such earlier time as is requested by the
Company. Any determination by the Accounting Firm shall be binding upon the
Company and the Employee. As a result of the uncertainty in the application of
Section 4999 of the Code at the time of the initial determination by the
Accounting Firm hereunder, it is possible that Gross-Up Payments which will not
have been made by the Company should have been made ("Underpayment"), consistent
with the calculations required to be made hereunder. In the event that the
Company exhausts its remedies pursuant to Section 4.6(c) and the Employee
thereafter is required to make a payment of any Excise Tax,
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the Accounting Firm shall determine the amount of the Underpayment that has
occurred and any such Underpayment shall be promptly paid by the Company to or
for the benefit of the Employee.
(c) The Employee shall notify the Company in writing of any claim by
the Internal Revenue Service that, if successful, would require the payment by
the Company of the Gross-Up Payment. Such notification shall be given as soon
as practicable but no later than ten business days after the Employee is
informed in writing of such claim and shall apprise the Company of the nature of
such claim and the date on which such claim is requested to be paid. The
Employee shall not pay such claim prior to the expiration of the 30-day period
following the date on which it gives such notice to the Company (or such shorter
period ending on the date that any payment of taxes with respect to such claim
is due). If the Company notifies the Employee in writing prior to the
expiration of such period that it desires to contest such claim, the Employee
shall:
(i) give the Company any information reasonably requested by
the Company relating to such claim,
(ii) take such action in connection with contesting such claim
as the Company shall reasonably request in writing from time to time,
including without limitation, accepting legal representation with
respect to such claim by an attorney reasonably selected by the
Company,
(iii) cooperate with the Company in good faith in order
effectively to contest such claim, and
(iv) permit the Company to participate in any proceedings
related to such claim;
provided, however, that the Company shall bear and pay directly all costs
and expenses (including additional interest and penalties) incurred in
connection with such contest and shall indemnify and hold the Employee harmless,
on an after-tax basis, for any Excise Tax or income tax (including interest and
penalties with respect thereto) imposed as a result of such representation and
payment of costs and expenses. Without limitation on the foregoing provisions
of this Section 4.6(c), the Company shall control all proceedings taken in
connection with such contest and, at its sole option, may pursue or forgo any
and all administrative appeals, proceedings, hearings and conferences with the
taxing authority in respect of such claim and may, at its sole option, either
direct the Employee to pay the tax claimed and xxx for a refund or contest the
claim in any permissible manner, and the Employee agrees to prosecute such
contest to a determination before any administrative tribunal, in a court of
initial jurisdiction and in one or more appellate courts, as the Company shall
determine; provided, however, that if the Company directs the Employee to pay
such claim and xxx for a refund, the Company shall advance the amount of such
payment to the Employee, on an interest-free basis and shall indemnify and hold
the Employee harmless, on an after-tax basis, from any Excise Tax or income tax
(including interest or penalties with respect thereto) imposed with respect to
such advance or with respect to any imputed income with respect to such advance;
and further provided that any extension of the statute of limitations relating
to payment of taxes for the taxable year of the Employee with respect to which
such contested amount is claimed to be due is limited solely to such contested
amount.
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(d) If, after the receipt by the Employee of a Gross-Up Payment or an
amount advanced by the Company pursuant to Section 4.6(c), the Employee becomes
entitled to receive any refund with respect thereto, the Employee shall promptly
pay to the Company the amount of such refund (together with any interest paid or
credited thereon after taxes applicable thereto).
(e) Notwithstanding any other provision of this Section, the Company
may withhold and pay over to the Internal Revenue Service for the benefit of the
Employee all or any portion of the Gross-Up Payment that it determines in good
faith that it is or may be in the future required to withhold, and the Employee
hereby consents to such withholding.
(f) For purposes of this Section 4.6, the portion of the Excise Tax
attributable or applicable to the Accelerated Shares shall be deemed to be equal
to the product of (i) the aggregate Excise Tax payable in connection with the
relevant Corporate Transaction times (ii) a fraction, the numerator of which is
the "parachute payment" attributable to the Accelerated Shares under Section
280G(b)(2) of the Code and the denominator of which is the aggregate amount of
all payments that constitute "parachute payments" under Section 280G(b)(2) of
the Code with respect to such Corporate Transaction, as determined in each case
by the Accounting Firm.
(g) Definitions. For the purposes of this Section 4.6, the term
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"Excise Tax" shall mean the excise tax imposed by Section 4999 of the Code,
together with any interest or penalties imposed with respect to such excise tax.
V. [INTENTIONALLY OMITTED]
VI. ESCROW
6.1 Deposit. Upon issuance, the certificates for the Shares shall be
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deposited in escrow with the Secretary of the Company to be held in accordance
with the provisions of this Article VI. Each deposited certificate shall be
accompanied by a duly executed Assignment Separate from Certificate in the form
of Exhibit C. The deposited certificates, together with any other assets or
securities from time to time deposited with the Company pursuant to the
requirements of this Agreement, shall remain in escrow until such time or times
as the certificates (or other assets and securities) are to be released or
otherwise surrendered for cancellation in accordance with Section 6.3 below.
Upon delivery of the certificates (or other assets and securities) to the
Company, the Owner shall be issued an instrument of deposit acknowledging the
number of Shares (or other assets and securities) delivered in escrow to the
Secretary of the Company.
6.2 Recapitalization. All regular cash dividends on the Shares (or
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regular cash dividends on any other securities at the time held in escrow) shall
be paid directly to the Owner and shall not be held in escrow. However, in the
event of any stock dividend, stock split, recapitalization or other change
affecting the Company's outstanding Common Stock as a class effected without
receipt of consideration or in the event of a Corporate Transaction, any new,
substituted or additional securities or other property which is by reason of
such transaction distributed with respect to the Shares shall be immediately
delivered to the Secretary of the Company to be held in escrow under this
Article VI, but only to the extent the Shares are at the time subject to the
escrow requirements of Section 6.1 above.
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6.3 Release/Surrender. The Shares, together with any other assets or
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securities held in escrow hereunder, shall be subject to the following terms and
conditions relating to their release from escrow or their surrender to the
Company for repurchase and cancellation:
(a) Should the Company elect to exercise the Repurchase Right
under Article IV hereof with respect to any Unvested Shares, then the escrowed
certificates for such Unvested Shares (together with any other assets or
securities issued with respect thereto) shall be delivered to the Company for
cancellation, concurrently with the payment to the Owner, in cash or cash
equivalent (including the cancellation of any purchase-money indebtedness), of
an amount equal to the aggregate Purchase Price for such Unvested Shares, and
the Owner shall cease to have any further rights or claims with respect to such
Unvested Shares (or other assets or securities).
(b) As the interest of the Owner in the Shares (or any other
assets or securities issued with respect thereto) vests in accordance with the
provisions of Article IV hereof, the certificates for such vested shares (as
well as all other vested assets and securities) shall be released from escrow
and delivered to the Owner in accordance with the following schedule:
(i) Releases of the Performance Shares (or other vested
assets and securities) shall occur promptly after such shares vest in
accordance with the Vesting Schedule.
(ii) Upon any earlier termination of the Company's
Repurchase Right in accordance with the applicable provisions of Article IV
hereof, the Shares (or other assets or securities) at the time vested in
Owner and held in escrow hereunder shall promptly be released to the Owner
as fully vested shares (or other property).
(c) Notwithstanding anything to the contrary contained in this
Section 6.3, all Shares (or other assets or securities) released from escrow in
accordance with the provisions of Section 6.3(b) hereof shall nevertheless
remain subject to the market stand-off provisions of Section 2.3 above until
such provisions terminate in accordance therewith.
VII. GENERAL PROVISIONS
7.1 Assignment. The Company may assign its Repurchase Right under
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Articles IV to any person or entity selected by the Company's Board of
Directors, including (without limitation) one or more stockholders, officers or
directors of the Company.
7.2 No Right to Continued Employment. Nothing in this Agreement
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shall be interpreted or construed to confer any right with respect to
continuance of employment by the Company, nor shall this Agreement interfere in
any way with the right of the Company to terminate Employee's employment at any
time.
7.3 Notices. Any notice required in connection with (i) the
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Repurchase Right or (ii) the disposition of any Shares covered thereby shall be
given in writing and shall be deemed effective upon personal delivery or upon
deposit in the United States mail, registered or certified, postage prepaid and
addressed to the party entitled to such notice at the address indicated above or
at such other address
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as such party may designate by ten (10) days' advance written notice under this
Section 7.3 to all other parties to this Agreement.
7.4 No Waiver. The failure of the Company (or its assignees) in any
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instance to exercise the Repurchase Right granted under Article IV hereof shall
not constitute a waiver of any other repurchase rights and/or rights of first
refusal that may subsequently arise under the provisions of this Agreement or
any other agreement between the Company and the Employee. No waiver of any
breach or condition of this Agreement shall be deemed to be a waiver of any
other or subsequent breach or condition, whether of like or different nature.
7.5 Cancellation of Shares. If the Company (or its assignees) shall
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make available, at the time and place and in the amount and form provided in
this Agreement, the consideration for the Shares to be repurchased in accordance
with the Repurchase Right, then from and after such time, the person from whom
such shares are to be repurchased shall no longer have any rights as a holder of
such shares (other than the right to receive payment of such consideration in
accordance with this Agreement), and such shares shall be deemed purchased in
accordance with the applicable provisions hereof and the Company (or its
assignees) shall be deemed the owner and holder of such shares, whether or not
the certificates therefor have been delivered as required by this Agreement.
VIII. MISCELLANEOUS PROVISIONS
8.1 Employee Undertaking. Employee hereby agrees to take whatever
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additional action and execute whatever additional documents the Company may, in
its judgment, deem necessary or advisable in order to carry out or effect one or
more of the obligations or restrictions imposed on either the Employee or the
Shares pursuant to the express provisions of this Agreement.
8.2 Modification of Agreement. This Agreement may be modified,
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amended, suspended or terminated, and any terms or conditions may be waived, but
only by a written instrument executed by the parties hereto.
8.3 Severability. Should any provision of this Agreement be held by
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a court of competent jurisdiction to be unenforceable or invalid for any reason,
the remaining provisions of this Agreement shall not be affected by such holding
and shall continue in full force in accordance with their terms.
8.4 Governing Law. The validity, interpretation, construction and
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performance of this Agreement shall be governed by the laws of the State of New
Jersey without giving effect to the conflicts of laws principles thereof.
8.5 Successors in Interest. This Agreement shall inure to the
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benefit of and be binding upon any successor to the Company. This Agreement
shall inure to the benefit of Employee's legal representatives. All obligations
imposed upon Employee and all rights granted to the Company under this Agreement
shall be final, binding and conclusive upon Employee's heirs, executors,
administrators and successors.
* * *
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IN WITNESS WHEREOF, the Parties have executed this Agreement on the
day and year first indicated above.
THE COMPANY:
TELLIUM, INC.
By: /s/ Xxxxxxx X. Xxxxx
-----------------------------
Name: Xxxxxxx X. Xxxxx
Title: Secretary
THE EMPLOYEE:
/s/ Xxxxx X. Xxxx
--------------------------------
Xxxxx X. Xxxx
11
AMENDMENT NUMBER 1
TO THE RESTRICTED STOCK AGREEMENT (PERFORMANCE SHARES)
This Amendment Number 1 (this "Amendment") is made by and between Tellium,
Inc., a Delaware corporation (the "Company"), having an address at 0 Xxxxxxxx
Xxxxx, Xxxxxxxxx, Xxx Xxxxxx 00000, and Xxxxx X. Xxxx, having an address at 0
Xxxxx Xxxxx, Xxxxxxxxxx, Xxx Xxxxxx ("Employee").
WHEREAS, the Company and the Employee entered into the Restricted Stock
Agreement (Performance Shares) dated as of the 4th day of April, 2000 (the
"Stock Agreement");
WHEREAS, the Board of Directors of the Company (the "Board") approved on
April 13, 2000 the amendment (the "Change") of Section 4.3 (b) of the Stock
Agreement to terminate the Repurchase Right on the earlier of (x) the Employee
vesting in the Performance Shares and (y) April 13, 2002;
WHEREAS, on April 13, 2000 the Employee and the Company agreed to the terms
of the Change;
WHEREAS, the Board authorized the officers of the Company to execute an
amendment to the Stock Agreement setting forth the Change;
WHEREAS, the Company and the Employee desire to amend the Stock Agreement
in accord with the Board's approval and as set forth herein;
NOW, THEREFORE, based on the foregoing premises and other good and valuable
consideration, the receipt and sufficiency of which is hereby acknowledged, the
parties hereto agree as follows:
1. Unless otherwise specified, the capitalized terms used herein shall
have the meanings assigned to them in the Stock Agreement.
2. As of the date hereof, Section 4.3 (b) is amended and restated in its
entirety as follows:
The Repurchase Right shall terminate, and cease to be exercisable,
with respect to the Performance Shares on the earlier of (x) the
Employee vesting in the Performance Shares in accordance with the
Vesting Schedule set forth on Annex I and (y) April 13, 2002.
Accordingly, provided no Repurchase Events shall have taken place, the
Repurchase Right provided in Section 4.1 shall lapse with respect to
the Performance Shares on the earlier of (x) the time the Employee
shall have
acquired a vested interest in the Performance Shares in accordance
with Annex I and (y) April 13, 2002.
3. Except as specifically amended herein, the provisions of the Stock
Agreement shall continue in full force and effect as set forth therein.
IN WITNESS WHEREOF, the Parties have executed this Amendment on the date
set forth below, effective as of April 13, 2000.
TELLIUM, INC.
By: /s/ Xxxxxxx X. Xxxxx September 18, 2000
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Name: Date
Title:
/s/ Xxxxx X. Xxxx September 18, 2000
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Xxxxx X. Xxxx Date
