EXHIBIT
10.18
October 8, 2002
Paul Negus
1709 Milton Street
Redwood City, CA 94061
OFFER OF EMPLOYMENT
Dear Paul:
I am pleased to offer you a position with Avanex
(the “Company”) as its Vice President, Operations. This
is a full-time, regular, exempt position of considerable
responsibility, integral to our continued business development and
success. In this position you will be expected to devote your full
business time, attention and energies to the performance of your
duties with the Company.
The specifics of this offer are as
follows:
Base Salary: You will be compensated at a bi-weekly rate of
$7,500.00, paid every other Friday, in accordance with the
Company’s normal payroll procedures. (This represents an
equivalent annual rate of pay of $195,000.00). The first and last
payment by the Company to you will be adjusted, if necessary, to
reflect a commencement or termination date other than the first or
last working day of a pay period.
Incentive Bonus: For fiscal year 2003, there is no formal
incentive bonus program for senior executives. To the extent that
any such bonuses are awarded for FY2003 and subsequent years, it
will be at the discretion of the Board of Directors and you will be
considered along with the other senior executive for any such
discretionary bonuses based on the criteria established by the
Board.
Stock Options: On your first day of employment, you will be
granted a stock option under the Company’s 1998 Stock Plan
(the “Plan”) to purchase 250,000 shares of the
Company’s Common Stock at an exercise price equal to the then
current fair market value on the date of grant, as determined under
the Plan (the “ Option ”). The shares subject to
the Option shall vest as follows:
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1.
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12/48
th
of the shares subject
to the Option shall vest twelve (12) months after the date of
commencement of employment and 1/48 th of the shares subject to the Option
shall vest monthly thereafter, so that the Option shall be fully
vested and exercisable four (4) years from the date of
commencement of employment, subject to your continued service to
the Company on the relevant vesting dates.
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2.
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If Avanex
terminates your employment for any reason except good cause during
the first twelve (12) months after your employment begins,
your options will be treated as having vested beginning with the
first full month of employment at the rate of 1/48
th
per month, and
ending on the day of your termination. For this purpose,
“good cause” is defined as (1) any act of personal
dishonesty taken by you in connection with your responsibilities as
an employee and intended to result in your substantial personal
enrichment, (2) your conviction of a felony that is injurious
to Avanex, or (3) a willful act by you that constitutes gross
misconduct and which is injurious to Avanex.
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3.
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If you
terminate your employment with Avanex for any reason during the
first twelve (12) months after your employment begins, no
shares subject to your Option will have vested and you will not be
entitled to exercise any portion of the shares of your
Option.
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4.
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The
acceleration of vesting and post-termination periods of
exercisability of your Option will be substantially comparable to
those that are contained in the standard form of option agreement
generally applicable to Avanex’s other senior
executives.
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5.
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In all other
respects, the Option shall be subject to the terms, definitions and
provisions of the Plan and the stock option agreement by and
between you and the Company, both of which documents are
incorporated herein by reference.
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Start Date: Your start date will be October 8, 2002.
However, we shall provide you with an amount equal to an additional
five days of wages as though you had worked from October 1,
2002, payable at your base salary rate on the next pay date
following your commencement of employment.
Work Location:
Your place of work will be our
offices in Fremont, California.
Reporting:
You will report to Paul Engle,
President and CEO.
Benefits: As a fulltime, regular Company employee, you
will be eligible to participate in employee benefits plans
currently and hereafter maintained by the Company of general
applicability to other employees of the Company, including, without
limitation, the Company’s group med
