EXHIBIT 10.2
May 22, 2000
PERSONAL AND CONFIDENTIAL VIA HAND
Paul J. Pucino
3654 Barham Blvd.
Los Angeles, CA 90068
Dear Paul:
On behalf of Tekelec, I am pleased to offer you employment as Vice
President and Chief Financial Officer, on the terms and conditions set forth in
this letter. As Vice President and Chief Financial Officer you will report
directly to Tekelec's Chief Executive Officer, will be principally responsible
for Tekelec's financial matters and will have such other duties and
responsibilities as may be delegated to you from time to time by the Chief
Executive Officer and/or the Board of Directors. You may choose your employment
start date so long as it is on or before June 5, 2000.
Your compensation and benefits will be as follows:
1. Your starting annual base salary will be $230,000 (i.e., $8,846.15
per bi-weekly period).
2. You will be eligible to participate in Tekelec's 2000 Officer Bonus
Plan, under which you will be eligible to receive up to 70% of your
annual base salary earned during 2000 as a cash bonus if Tekelec
achieves certain financial milestones in 2000. For 2000, you will be
guaranteed a minimum bonus of $50,000 which will be paid during the
first quarter of 2001. This represents half of the bonus for which
you would be eligible based on your participation in the Plan for
seven months of 2000.
3. You will be entitled to a $20,000 report to work bonus payable on
your first check.
4. You will be entitled to take four weeks personal time annually.
EXHIBIT 10.2
5. You will receive applicable benefits, including health, dental,
vision, long-term disability and life insurance, as are generally
provided to Tekelec's executive officers.
6. You will be offered the opportunity to participate in Tekelec's
Employee Stock Purchase Plan and 401(k) Plan upon your satisfaction
of the eligibility requirements for such plans.
7. You will be covered by Tekelec's Officer Severance Plan (a copy of
which is enclosed).
8. The Compensation Committee of Tekelec will grant to you stock
options (incentive stock options to the maximum extent permitted
under law, with the balance being nonstatutory stock options) under
Tekelec's 1994 Stock Option Plan (the "Plan") to purchase 225,000
shares of Tekelec Common Stock ("Options"), effective as of the
later of your start date or the date of the Compensation Committee's
action granting such options (the "grant date"). The exercise price
of your Options will be equal to the closing price of Tekelec's
Common Stock on the grant date (as reported in THE WALL STREET
JOURNAL on the first business day following the grant date). Your
Options will vest to the extent of 56,250 shares on the one-year
anniversary of your start date. The remaining 168,750 shares will
vest and become exercisable cumulatively in 12 equal quarterly
installments of 14,062.5 shares each, with the first installment
vesting on September 30, 2001 and one additional installment vesting
on the last day of each calendar quarter thereafter as long as you
remain an employee of Tekelec. Your Options will expire, to the
extent previously unexercised, upon the earlier of ten years from
the date of grant or a date not less than three months after you
cease to be a Tekelec employee as determined in accordance with the
terms of the Plan. The Options will in all respects be subject to
the terms and provisions of the Plan and the stock option agreement
evidencing the grant of the Options. In addition to the foregoing
grant, it is anticipated that the Compensation Committee will
periodically, typically annually, consider whether additional
options should be granted to you while you remain an officer of the
Company.
You are aware that Tekelec prohibits employees from unlawfully using
confidential or proprietary information belonging to any other person or entity.
By signing the enclosed copy of this letter, you agree not to disclose or use or
induce Tekelec or any of its employees to use any trade secrets or confidential
or proprietary information belonging to any of your former employers.
As a condition of commencing your employment with Tekelec, you will be
required to sign Tekelec's standard "Confidentiality and Non-Disclosure
Agreement and Assignment of Rights" (a copy of which is enclosed). As with every
Tekelec employee, you
EXHIBIT 10.2
reserve the right to terminate your employment at any time for any reason, and
we similarly reserve the right to terminate your employment at any time, with or
without cause. We hope and expect, however, that this will be a long and
mutually beneficial relationship.
This letter agreement contains our entire understanding with respect to
your employment with Tekelec and supercedes and replaces in its entirety that
certain employment offer letter dated May 9, 2000 previously sent to you. The
provisions of this letter may be amended only by a writing signed by you and
Tekelec. If you have any questions about the meaning of any of the terms or
provisions included herein, please let me know at your earliest convenience.
This letter agreement shall be construed under the laws of California.
Paul, we believe that Tekelec can provide you with opportunities for
professional growth and financial return. We look forward to working with you
and to a mutually fulfilling and rewarding relationship.
If this letter agreement is acceptable to you, then please acknowledge
your acceptance by signing and dating the enclosed copy of this letter agreement
where indicated below and then faxing (fax number: 818.880.0176) and returning
such signed copy to me for receipt no later than May 24, 2000.
Sincerely,
Michael L. Margolis
Chief Executive Officer and President
Acknowledged and Accepted:
____________________________________ Date: May ___, 2000
Paul Pucino