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EXHIBIT 10.31
April 9, 1999
Stephen M. Tennis
Vice President, General Counsel
Verilink Corporation
145 Baytech Drive
San Jose, CA 95134
Dear Steve:
This letter will set forth the terms and conditions applicable to the
termination of your employment with Verilink Corporation.
1. You shall remain employed by Verilink until June 30, 1999. While employed,
your current salary and benefits shall continue.
2. Upon termination of your employment, you will receive a lump sum payment
equal to six months' then existing salary, less applicable withholdings.
In addition, you will receive the sum of $20,000, which approximates the
amount which would be paid to you for automobile allowance, miscellaneous
benefits and reimbursement of automobile expenses, health club and fitness
expenses, and unreimbursed medical expenses for six months.
3. Upon termination of your employment, you will receive a payment intended
to reimburse you for COBRA premiums for a period of six months. You will
be responsible for payment of your own COBRA premiums.
4. At the termination of your employment with Verilink, you shall continue to
provide services to Verilink as an independent contractor for a period of
one year. On the date of this letter, you shall receive a non-refundable
payment of $85,000. During that one-year period you agree to provide
Verilink a minimum of one-half of your normal billable hours, or
approximately 200 hours per quarter. Such services shall be provided at
such times and places as shall be determined by you. In addition to the
retainer, Verilink shall pay you the sum of $100,000 for such services,
payable quarterly in advance commencing on the date of your termination of
employment. You shall provide Verilink with a quarterly accounting of the
services rendered to Verilink, including a description of services and the
number of hours worked by you. If you render services for less than 180
hours during a quarter, the sum of
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Stephen M. Tennis
April 9, 1999
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$125.00 per hour of such deficiency shall be deducted from the payment due
for the next quarter. If you render services in excess of 200 hours during
a quarter, you shall be compensated for such services at a rate per hour
which represents a 20% discount from the hourly rate you charge third
parties for your services; provided, however, that if you render between
180 and 200 hours for any prior quarter, hours in excess of 200 hours
shall first be offset against such deficiency. Such excess hours shall be
accounted for quarterly and shall be paid by Verilink upon receipt of a
statement. At the end of one year, Verilink may continue the consulting
arrangement on such terms and conditions as are mutually agreeable to you
and Verilink. Verilink may terminate your services at any time after the
first quarter; provided, however, that in the event of any such
termination, Verilink shall pay you a sum equal to one-half of the
quarterly payments due for the remainder of the twelve-month period.
5. Upon termination of your employment, you shall be entitled to retain your
cellular telephone, Palm Pilot, other miscellaneous equipment and office
furniture currently used by you.
6. Your existing options to acquire 100,000 shares of Verilink common stock
(granted December 2, 1997, December 18, 1997, January 4, 1999, and April
13, 1999) shall be immediately vested and exercisable in full for a period
commencing on the date of this letter and ending twelve months from the
date of your termination of employment.
Please indicate your agreement with the foregoing by signing and returning this
letter.
Very truly yours,
VERILINK CORPORATION
/s/ HOWARD ORINGER
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Howard Oringer
Chairman of the Board
Agreed:
/s/ STEPHEN M. TENNIS
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Stephen M. Tennis
Date: 4/13/99
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