Attached files
| file | filename |
|---|---|
| 8-K - Sonus, Inc. | mm05-2010_8k.htm |
| EX-99.1 - EX.99.1 - PRESS RELEASE MAY 20, 2010 - Sonus, Inc. | mm05-2010_8ke991.htm |
Exhibit
10.1
Dr.
Richard N. Nottenburg
c/o Sonus
Networks, Inc.
7
Technology Park Drive
Westford,
MA 01886
May 18,
2010
The Board
of Directors (the “Board”) of Sonus Networks, Inc. (the “Company”) greatly
appreciates the contributions you have made to the Company and offers you the
following in consideration for your agreement to stay with the Company while,
together, we provide for an orderly transition of your duties and
responsibilities. Reference is made to your employment letter dated
May 13, 2008 (the “Employment Letter”); capitalized terms not defined in this
letter (the “Retention Letter”) will have the meanings ascribed to them in the
Employment Letter.
1. Role and
Responsibilities. You will remain in your current role as
President and Chief Executive Officer of the Company until the earlier of (i)
the date the Board relieves you of such duties or (ii) March 31,
2011.
2. Base
Salary. You will receive your current Base Salary through
March 31, 2011. If the Board relieves you of your duties as President
or Chief Executive Officer of the Company other than for Cause prior to March
31, 2011, your employment will terminate and the Company will pay the balance of
your Base Salary through March 31, 2011 in a single lump sum.
3. 2010 Target
Bonus. As previously confirmed to you, your Target Bonus will
be 100% of your current base salary. If the Board relieves you of
your duties as President or Chief Executive Officer of the Company other than
for Cause prior to December 31, 2010, (i) you will receive your full Target
Bonus in a lump sum upon termination of your employment and (ii) if, after the
Company’s financial results for 2010 are announced, it is determined that your
actual bonus would have been greater than your Target Bonus, the Company will
pay you the difference; such subsequent payment will be made when bonus payments
are made to other executives of the Company.
4. Restricted
Stock. You will be granted 750,000 Restricted Shares (the
“Retention Shares”) under the Company’s 2007 Stock Incentive Plan (the “Plan”),
subject to the terms of the Plan and the Company’s restricted stock agreement,
which will reflect the terms of this letter. The grant date will be on the first
15th day
of the month following your acceptance of the terms of this letter, or the first
business day thereafter if that day is not a business day. The
Retention Shares will vest as follows:
(A) 250,000
Retention Shares will vest on the earlier of (i) the date the Board relieves you
of your duties as President or Chief Executive Officer of the Company other than
for Cause or (ii) March 31, 2011;
(B) 125,000
Retention Shares will vest upon achievement of the financial metrics in the
Company’s 2010 operating plan, as previously approved by the Board;
(C)
125,000 Retention Shares will vest upon achievement of the target for bookings
from new products, as reflected in the Company’s 2010 Incentive Compensation
Program Base Plan; and
(D) 250,000
Retention Shares will vest on the earlier of (i) sixty (60) days after the first
day of employment of your successor as President or Chief Executive Officer of
the Company (unless your employment has been terminated by the Board for Cause
prior to such date), provided that you assist with the transition as reasonably
requested during such sixty-day period, (ii) the date the Board relieves you of
your duties as President or Chief Executive Officer of the Company other than
for Cause, if no successor has been appointed by such date, or (iii) March 31,
2011.
This
confirms that, (i) in the event of an Acquisition, all of the Retention Shares
will be treated as described in Section 3(f) of the Employment Letter and (ii)
in the event of your death or disability, all of the Retention Shares will be
treated as described in Section 8(a)(vi) of the Employment Letter.
You may
elect a Section 83(b) Election in connection with the Retention
Shares. A Section 83(b) Election must be filed with the
Internal Revenue Service within thirty (30) days of the grant
date. If you do not make a Section 83(b) Election, then you
will be obligated to pay to the Company the amount of any Federal, state, local
or other taxes of any kind required by law to be withheld with respect to the
vesting of the Restricted Shares. You will satisfy such tax
withholding obligations by delivery to the Company, on each date on which
Restricted Shares vest, such number of shares that vest on such date as have a
fair market value (calculated using the last reported sale price of the common
stock of the Company on the NASDAQ Global Select Market on the trading date
immediately prior to such vesting date) equal to the amount of the Company’s
withholding obligation; provided, however, that the total tax withholding cannot
exceed the Company’s minimum statutory withholding obligations (based on minimum
statutory withholding rates for Federal and state tax purposes, including
payroll taxes, that are applicable to such supplemental taxable
income). Such delivery of shares to the Company will be deemed to
happen automatically, without any action required on your part, and the Company
is hereby authorized to take such actions as are necessary to effect such
delivery of shares to the Company.
You will
relinquish all rights you have or may have in the future to the two performance
stock grants referenced in Section 3(e) of the Employment Letter, each in the
amount of 250,000 Restricted Shares, which are tied to the Company’s achievement
of certain performance metrics and certain incremental performance metrics
between January 1, 2010 and December 31, 2012.
5. Good
Reason.
(A) Upon
the earlier of (i) the day the Board relieves you of your duties as President or
Chief Executive Officer of the Company other than for Cause or (ii) March 31,
2011, you will be entitled to terminate your employment with the Company for
Good Reason pursuant to Section 8 of the Employment Letter. Amounts
paid pursuant to Section 8 of the Employment Letter will be in addition to the
amount(s) described in Sections 2, 3 and 4 of this Retention
Letter.
(B) If
you terminate your employment with the Company for Good Reason as defined in
Section 8(b)(ii)(A) or 8(b)(ii)(C) of the Employment Letter, the Retention
Shares will accelerate, become fully vested, and any and all restrictions will
be terminated and any and all legends will be removed.
6. Miscellaneous.
Upon
termination of employment, you will receive a standard form separation
letter. If such termination has occurred other than for Cause, you
will be eligible to receive the benefits described in this Retention Letter and
in the Employment Letter. In order to accept such benefits, you will
be required to execute and deliver to the Company a standard general release, in
the form attached hereto as Attachment A and incorporated herein by reference
(the “General Release”), no later than the expiration of the period set forth in
such general release. All payments or benefits provided pursuant to
Section 8 of the Employment Letter and Sections 2, 3, 4 and 5 of this Retention
Letter will be subject to Sections 8(c) and 9 of the Employment
Letter. All lump sum payments will be made within seven (7) days
after the effective date of the General Release.
Except as
expressly modified by this Retention Letter, the terms of the Employment Letter
remain in full force and effect. In the event of a conflict between
the terms of this Retention Letter and the Employment Letter, the terms of this
Retention Letter will govern.
If you agree to the terms of this Retention
Letter, please sign and date below and return a copy
of this letter to me.
|
Sincerely,
Sonus Networks, Inc.
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By:
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/s/ Howard E. Janzen | |||
| Duly Authorized | |||||
| Accepted and agreed: | |||||
| /s/ Richard N. Nottenburg | 05/18/10 | ||||
| Richard N. Nottenburg | Date | ||||
Attachment
A
General Release of
Claims
1. In
consideration of the benefits offered to you in your employment letter dated May
13, 2008 (the “Employment Letter”) and in your letter agreement dated May 18,
2010 (the “Retention Letter”), the receipt and sufficiency of which are hereby
acknowledged, you hereby agree to remise, release and forever discharge the
Company and its subsidiaries, and their respective officers, directors,
shareholders and employees (collectively, the “Releasees”) from any and all
claims, losses, liabilities, obligations and causes of action, known or unknown,
arising out of, in any way connected with or relating to your employment or
termination of employment with the Company, including, but not limited to, (a)
claims for compensation, wages, bonuses and benefits, breach of contract,
impairment of economic opportunity, negligent and intentional infliction of
emotional distress, wrongful discharge, defamation, or any other tort or
personal injury, and (b) claims arising under any municipal, state or federal
statute, regulation or ordinance relating to employment or the foregoing,
including, without limitation, Title VII of the Civil Rights Act, the Equal Pay
Act, 42 U.S.C. § 1981, the Americans with Disabilities Act, the Age
Discrimination in Employment Act, Mass. G.L. c. 151B, the Family and Medical
Leave Act, the Employee Retirement Income Security Act, and the Worker
Adjustment and Retraining Notification Act (all as amended).
2. Except
as provided in Section 8 of the Employment Letter, Sections 2, 3, 4 and 5 of the
Retention Letter, and Section 6 of this General Release, you acknowledge and
agree that the Releasees have fully satisfied any and all obligations owed to
you arising out of your employment with and termination from the Company, and no
further sums or benefits are owed to you by the Releasees at any
time.
3. You
represent that you have made no assignment, and will make no assignment, of any
claim, right of action or any right of any kind whatsoever, embodied in any of
the claims released by you herein, and that no other person or entity of any
kind had or has any interest in any of the respective claims, demands,
obligations, actions, causes of action, debts, liabilities, rights, contracts,
damages, attorneys' fees, costs, expenses or losses released by you
herein.
4. You
acknowledge that you desire the foregoing release to be a full and complete
resolution of any and all claims, complaints or grievances you have, may have or
ever had against the Releasees, whether known or unknown, relating to your
employment with and termination from the Company.
5. Nothing
in this General Release is to be construed as an admission by you or the
Releasees of any liability or unlawful conduct whatsoever.
6. You
agree not to take any action or make any statement, written or oral, which
disparages or criticizes the Company, its management, directors, or
investors. Members of the Board will not take any action or make any
statement, written or oral, which disparages or criticizes you.
7. If
one or more of the provisions contained in this General Release is held to be
excessively broad as to scope, activity, subject or otherwise so as to be
unenforceable at law, such provision or provisions will be construed by the
appropriate judicial body by limiting or reducing it or them, so as to be
enforceable to the maximum extent compatible with applicable law.
8. You
agree that you have entered into this General Release voluntarily and that you
have had the opportunity to review this General Release with an independent
lawyer of your choosing.
You have
twenty-one (21) days after your last day of employment by the Company within
which to accept the terms of the offer made to you in the Employment Letter and
the Retention Letter by signing this General Release. You also will
have a period of seven (7) days from the date that you sign this General Release
within which to revoke your signature, and this General Release will not become
effective or enforceable until the expiration of that seven (7) day revocation
period. If you intend to revoke this General Release within such
seven day period, you must send a written letter of revocation to General
Counsel, Sonus Networks, Inc., 7 Technology Park Drive, Westford,
MA 01886.
YOU
REPRESENT THAT YOU HAVE READ THE FOREGOING GENERAL RELEASE, THAT YOU FULLY
UNDERSTAND THE TERMS AND CONDITIONS CONTAINED HEREIN, AND THAT YOU ARE
VOLUNTARILY EXECUTING THE SAME. IN ENTERING INTO THIS GENERAL
RELEASE, YOU DO NOT RELY ON ANY REPRESENTATION, PROMISE OR INDUCEMENT MADE BY
THE RELEASEES WITH THE EXCEPTION OF THE CONSIDERATION DESCRIBED IN THIS
DOCUMENT.
| Richard N. Nottenburg | Date |