Exhibit 10.2

EXECUTIVE AGREEMENT

This Agreement is made as of this xx of xxx, 200x, by and between Tellabs, Inc.,
a Delaware corporation (the “Corporation”) and (the “Executive”).

WITNESSETH:

WHEREAS, the Corporation wishes to attract and retain well-qualified executive
and key personnel and to assure both itself and the Executive of continuity of
management in the event of any actual or threatened Change in Control (as
defined in Paragraph 2) or Change in Management (as defined in Paragraph 3) of
the Corporation; and

WHEREAS, to achieve this purpose, the Board of Directors of the Corporation
considered and approved this agreement to be entered into with the Executive as
being in the best interests of the Corporation and its shareholders;

NOW, THEREFORE, in consideration of the premises and mutual covenants set forth
herein, the parties hereto agree as follows:

1.   Operation of Agreement       The “effective date of this Agreement” shall
be the date on which the first to occur of a Change in Control or Change in
Management occurs, and this Agreement shall not have any force or effect
whatsoever prior to that date. This Agreement shall supersede, in its entirety,
any previously existing Change in Control Employment Agreement between Executive
and the Corporation.   2.   Change in Control   For the purposes of this
Agreement, a “Change in Control” means the first of the following events to
occur:

  (d)   Any “person” (as defined in Section 13(d) and 14(d) of the Securities
Exchange Act of 1934, as amended (the “Exchange Act”)), excluding for this
purpose, the Corporation or any subsidiary of the Corporation, or any employee
benefit plan of the Corporation or any subsidiary of the Corporation, or any
person or entity organized, appointed or established by the Corporation for or
pursuant to the terms of any such plan which acquires beneficial ownership of
voting securities of the Corporation, is or becomes the “beneficial owner” (as
defined in Rule 13d-3 under the Exchange Act), directly or indirectly of
securities of the Corporation representing 20% or more of the combined voting
power of the Corporation’s then outstanding securities; provided, however, that
no Change in Control will be deemed to have occurred as a result of a change in
ownership percentage resulting solely from an acquisition of securities by the
Corporation; and provided further that no Change in Control will be deemed to
have occurred if a person inadvertently acquires an ownership interest of 20% or
more but then promptly reduces that ownership interest below 20%;     (b)  
During any two consecutive years, individuals who at the beginning of such
two-year period constitute the Board and any new director (except for a director
designated by a person who has entered into an agreement with the Corporation to
effect a transaction described elsewhere in this definition of Change in
Control) whose election by the Board or nomination for election by the
Corporation’s stockholders was approved by a vote of at least two-thirds of the
directors then still in office who either were directors at the beginning of the
period or whose election or nomination for election was previously so approved
(such individuals and any such new director, the “Incumbent Board”) cease for
any reason to constitute at least a majority of the Board;     (c)  
Consummation of a reorganization, merger or consolidation or sale or other
disposition of all or substantially all of the assets of the Corporation (a
“Business Combination”), in each case, unless, following such Business
Combination,

      (i)   all or substantially all of the individuals and entities who were
the beneficial owners of outstanding voting securities of the Corporation
immediately prior to such Business Combination beneficially own, directly or
indirectly, more than 50% of the combined voting power of the then outstanding
voting securities entitled to vote generally in the election of directors, as
the case may be, of the corporation resulting from such Business Combination
(including, without limitation, a corporation which as a result of such
transaction owns the Corporation or all or substantially all of the
Corporation’s assets either directly or through one or

 

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          more subsidiaries) (the “Resulting Corporation”) in substantially the
same proportions as their ownership, immediately prior to such Business
Combination of the outstanding voting securities of the Corporation;       (ii)
  no person (as defined in Section 13(d) and 14(d) of the Exchange Act)(other
than the Corporation, the Resulting Corporation or any employee benefit plan (or
related trust) of the Corporation or such Resulting Corporation) beneficially
owns, directly or indirectly, 20% or more of, respectively, the then combined
voting power of the then outstanding voting securities of the Resulting
Corporation, except to the extent that such ownership resulted solely from
ownership of securities of the Corporation prior to the Business Combination;
and       (iii)   at least a majority of the members of the board of directors
of the Resulting Corporation were members of the Incumbent Board at the time of
the execution of the initial agreement, or of the action of the Board, providing
for such Business Combination;

  (d)   Approval by the stockholders of the Corporation of a complete
liquidation or dissolution of the Corporation; or     (e)   A tender offer (for
which a filing has been made with the Securities and Exchange Commission “SEC”)
which purports to comply with the requirements of Section 14(d) of the
Securities Exchange Act of 1934 and the corresponding SEC rules) is made for the
stock of the Corporation, and then the first to occur of:

              (i)   Any time during the offer when the person making the offer
owns or has accepted for payment stock of the Corporation with 25% or more of
the total voting power of the Corporation’s securities, or               (ii)  
Three business days before the offer is to terminate unless the offer is
withdrawn first if the person making the offer could own, by the terms of the
offer plus any shares owned by the person, stock with 50% or more of total
voting power of the Corporation’s securities when the offer terminates.

3. Change in Management

For purposes of this Agreement, a “Change in Management” shall occur in the
event that (a) Michael J. Birck is not for any reason the Chief Executive
Officer of the Corporation, or (b) if a Business Combination which is not a
Change in Control shall occur, Michael J. Birck is not for any reason the Chief
Executive Officer of the Resulting Corporation.

4. Employment

The Corporation hereby agrees to continue the Executive in its employ and/or the
employ of one or more of its subsidiaries and the Executive hereby agrees to
remain in the employ of the Corporation and/or such subsidiaries, for the period
commencing on the effective date of this Agreement and ending on the third
anniversary of such date (the “employment period”), to exercise such authority
and perform such executive duties as are commensurate with the authority being
exercised and duties being performed by the Executive immediately prior to the
effective date of this Agreement, which services shall be performed at a
location within the metropolitan area in which the Executive was employed
immediately prior to the effective date of this Agreement or such other location
as the Corporation may reasonably request. The Executive agrees that during the
employment period he/she shall devote his/her full business time exclusively to
his/her executive duties and shall perform such duties faithfully and
efficiently.

5.   Compensation, Compensation Plans, Benefits and Perquisites       During the
employment period, the Executive shall be compensated as follows:

  (a)   He/she shall receive an annual salary at a rate which is not less than
his/her rate of annual salary immediately prior to the effective date of this
Agreement, with the opportunity for increases from time to time thereafter which
are in accordance with the Corporation’s regular practices; provided, however,
that such annual salary shall be subject to reduction to the extent there is a
general reduction in the base salaries of executives with comparable duties.    
(b)   He/she shall be eligible to participate on a reasonable basis in the
Corporation’s stock option plans, the annual incentive bonus program and any
other bonus and incentive compensation plans (whether now or hereinafter in

 

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      effect) in which executives with comparable duties are eligible to
participate, which plans must provide opportunities to receive compensation
which are at least as great as the opportunities under the plans in which the
Executive was participating immediately prior to the effective date of this
Agreement.     (c)   He/she shall be entitled to receive employee benefits and
perquisites which are the greater of the employee benefits and perquisites
provided by the Corporation to executives with comparable duties or the employee
benefits and perquisites to which he/she was entitled immediately prior to the
effective date of this Agreement. Such benefits and perquisites shall include,
but not be limited to, the benefits and perquisites included under the Tellabs
Advantage Program, and the Tellabs, Inc. Employee Welfare Benefits Plan.

6.   Termination Following Change in Control or Change in Management

  (a)   For purposes of this Agreement, the term “termination” shall mean
(i) termination by the Corporation of the employment of the Executive with the
Corporation and all of its subsidiaries for any reason other than death,
disability or “cause” (as defined below), or (ii) resignation of the Executive
for “good reason” (as defined below).     (b)   The term “good reason” shall
mean:

          (i) the material reduction or material adverse modification of
Executive’s authority or duties, such as a substantial diminution or adverse
modification in Executive’s title, status, or responsibilities;           (ii)
any reduction in Executive’s Base Salary (other than as may be permitted under
Paragraph 5(a));           (iii) any failure to provide to Executive the
opportunities to receive compensation as required to be provided under
Paragraph 5(b);           (iv) any failure to pay or provide the benefits and
perquisites required to be provided under Paragraph 5(c);           (v) any
requirement that Executive relocate his principal place of employment by more
than a 50-mile radius from its location immediately prior to the effective date
of this Agreement, excluding, if a Change in Control has not occurred, a move to
the Corporation’s headquarters, or if the Executive’s position is that of a
functional head for a region or a division, the headquarters of such region or
division;           (vi) any material breach of this Agreement by the
Corporation; or           (vii) if a Change in Control has occurred, a
reasonable determination by the Executive that, as a result of a Change in
Control and a change in circumstances thereafter significantly affecting his/her
position, he/she is unable to exercise the authorities, powers, function or
duties attached to his/her position and contemplated by Paragraph 4 of the
Agreement.           Notwithstanding the foregoing, any of the circumstances
described in this Paragraph 6(b) may not serve as a basis for resignation for
“good reason” by Executive unless the Executive has provided written notice to
the Corporation that such circumstance exists and the Corporation has failed to
cure such circumstance within 15 days following such notice.

  (c)   The term “cause” means (i) the willful and continued failure by the
Executive to substantially perform his/her duties with the Corporation and/or,
if applicable, one or more of its subsidiaries (other than any such failure
resulting from his/her incapacity due to physical or mental illness) after a
demand for substantial performance is delivered to him/her by the Board of
Directors of the Corporation which specifically identifies the manner in which
the Board believes the Executive has not substantially performed his/her duties,
(ii) the willful engaging by the Executive in gross misconduct materially and
demonstrably injurious to the property or business of the Corporation or any of
its subsidiaries, or (iii) fraud, misappropriation or commission of a felony.
For purposes of this paragraph, no act or failure to act on the Executive’s part
will be considered “willful” unless done, or omitted to be done, by him/her in
bad faith and without reasonable belief that his/her action or omission was in
the interests of the Corporation or not opposed to the interests of the
Corporation.

7.   Confidentiality       The Executive agrees that during and after the
employment period, he/she shall retain in confidence any confidential
information known to him/her concerning the Corporation and its subsidiaries and
their respective businesses for as long as such information is not publicly
disclosed.

 

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8.   No Obligation to Mitigate Damages       The Executive shall not be
obligated to seek other employment in mitigation of amounts payable or
arrangements made under the provisions of this Agreement and the obtaining of
any such other employment shall in no event effect any reduction of the
Corporation’s obligations under this Agreement.   9.   Severance Allowance

  (a)   In the event of termination of the Executive during the employment
period, the Executive shall be entitled to receive a lump sum severance
allowance within five days of such termination, in an amount which is equal to
the sum of the following:

        (i) The amount equivalent to salary payments for 36 (24, if a Change in
Control has not occurred) calendar months, at the rate required by
Paragraph 5(a) and in effect immediately prior to termination (or, if greater,
at the highest rate in effect under Paragraph 5(a) at any time during the period
commencing on the effective date of this Agreement and ending on the termination
date), plus a pro rata share of the estimated amount of any bonus which would
have been payable for the bonus period which includes the termination date; and
        (ii) In the event of a Change in Control the amount equivalent to 36
calendar months of bonus at the target rate for the year which includes his/her
termination date.

  (e)   In addition to such amount under Paragraph 9(a) above, the Executive
shall also receive in cash the value of the incentive compensation (including,
but not limited to, employer contributions to the Tellabs Advantage Program and
the right to receive stock awards and to exercise stock options and other bonus
and similar incentive compensation benefits) to which he/she would have been
entitled under all incentive compensation plans maintained by the Corporation if
he/she had remained in the employ of the Corporation for 36 (24, if a Change in
Control has not occurred) months after such termination. The amount of such
payment shall be determined as of the date of termination and shall be paid as
promptly as practicable and in no event later than 30 days after such
termination.     (f)   The Corporation shall maintain in full force and effect
for the Executive’s continued benefit (and, to the extent applicable, the
continued benefit of his dependents) all of the employee benefits (including,
but not limited to, coverage under any medical and insurance plans, programs or
arrangements) to which he/she would have been entitled under all employee
benefit plans, programs or arrangements maintained by the Corporation if he/she
had remained in the employ of the Corporation for 36 (24, if a Change in Control
has not occurred) calendar months after his/her termination, or if such
continuation is not possible under the terms and provisions of such plans,
programs or arrangements, the Corporation shall arrange to provide benefits
substantially similar to those which the Executive (and, to the extent
applicable, his/her dependents) would have been entitled to receive if the
Executive had remained a participant in such plans, programs or arrangements for
such 36-month (or, if applicable, 24-month) period, as the case may be.

10.   Adjustments in Case of “Excess Parachute Payments”       If any payments
or benefits received or to be received by the Executive in connection with the
Executive’s employment (whether pursuant to the terms of this Agreement or any
other plan, arrangement or agreement with the Corporation, or any person
affiliated with the Corporation) (the “Payments”), will be subject to the tax
(the “Excise Tax”) imposed by Section 4999 of the Internal Revenue Code of 1986,
as amended (the “Code”) (or any similar tax that may hereafter be imposed), the
Corporation shall pay at the time specified below, an additional amount (the
“Gross-Up Payment”) such that the net amount retained by the Executive, after
deduction of any Excise Tax on the Payments and any federal, state and local
income or other applicable tax and Excise Tax upon the payment provided for by
this paragraph, shall be equal to the Payments. For purposes of determining the
amount of the Gross-Up Payment, the Executive shall be deemed to pay federal
income taxes at the Executive’s highest marginal rate of federal income taxation
in the calendar year in which the Gross-Up Payment is to be made and state and
local income taxes at the Executive’s highest marginal rate of taxation in the
state and locality of the Executive’s residence on the date on which the Excise
Tax is determined, net of the maximum reduction in federal income

 

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    taxes which could be obtained from deduction of such state and local taxes.
The computations required by this paragraph shall be made by the independent
public accountants not then regularly retained by the Corporation, in
consultation with tax counsel selected by them and acceptable to the Executive.
The Corporation shall provide the Executive with sufficient tax and compensation
data to enable the Executive or his/her tax advisor to verify such computations
and shall reimburse the Executive for reasonable fees and expenses incurred with
respect thereto. In the event that the Excise Tax is subsequently determined to
be less than the amount taken into account hereunder, the Executive shall repay
to the Corporation at the time that the amount of such reduction in Excise Tax
is finally determined the portion of the Gross-Up Payment attributable to such
reduction (plus the portion of the Gross-Up Payment attributable to the Excise
Tax and federal and state and local income tax imposed on the Gross-Up Payment
being repaid by the Executive) plus interest on the amount of such repayment
from the date the Gross-Up Payment was initially made to the date of repayment
at the rate provided in Section 1274(b)(2)(B) of the Code (the “Applicable
Rate”). In the event that the Excise Tax is determined by the Internal Revenue
Service or by such independent public accountants to exceed the amount taken
into account hereunder (including by reason of any payment the existence or
amount of which cannot be determined at the time of the Gross-Up Payment), the
Corporation shall make an additional Gross-Up Payment in respect of such excess
(plus any interest, penalties, fines or additions to tax payable with respect to
such excess) at the time that the amount of such excess if finally determined.
Any payment to be made under this paragraph shall be payable within five
(5) days of the determination of the accountants that such a payment is required
hereunder and, if applicable, within five (5) days of such determination that
the Excise Tax is greater or less than initially calculated but, in no event,
later than thirty (30) days after the Executive’s receipt of the Payments
resulting in such Excise Tax.   11.   Interest; Indemnification

  (c)   In the event any payment to Executive under this Agreement is not paid
within five business days after it is due, such payment shall thereafter bear
interest at the prime rate from time to time as published in The Wall Street
Journal, Midwest Edition.     (d)   The Corporation hereby indemnifies the
Executive for all legal fees and expenses incurred by Executive in contesting
any action of the Corporation with respect to this Agreement, including the
termination of Executive’s employment hereunder, or incurred by Executive in
seeking to obtain or enforce any right or benefit provided by this Agreement.

12.   Notices

Any notices, requests, demands and other communications provided for by this
Agreement shall be sufficient if in writing and if sent by registered or
certified mail to the Executive at the last address he/she has filed in writing
with the Corporation or, in the case of the Corporation, at its principal
executive offices.

 

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13.   Arbitration of Disputes and Reimbursements of Legal Costs       Any
controversy or claim arising out of or relating to this Agreement (or the breach
thereof) shall be settled by final, binding and non-appealable arbitration in
Chicago, Illinois by three arbitrators. Subject to the following provisions, the
arbitration shall be conducted in accordance with the rules of the American
Arbitration Association (the “Association”) then in effect. One of the
arbitrators shall be appointed by the Corporation, one shall be appointed by the
Executive, and the third shall be appointed by the first two arbitrators. If the
first two arbitrators cannot agree on the third arbitrator within 30 days of the
appointment of the second arbitrator, then the third arbitrator shall be
appointed by the Association and shall be experienced in the resolution of
disputes under employment agreements for executives of major corporations. Any
award entered by the arbitrators shall be final, binding and non-appealable and
judgment may be entered thereon by either party in accordance with applicable
law in any court of competent jurisdiction. This arbitration provision shall be
specifically enforceable. The arbitrators shall have no authority to modify any
provision of this Agreement or to award a remedy for a dispute involving this
Agreement other than a benefit specifically provided under or by virtue of the
Agreement. If the Executive prevails on any material issue which is the subject
of such arbitration or lawsuit, the Corporation shall be responsible for all of
the fees of the American Arbitration Association and the arbitrators and any
expenses relating to the conduct of the arbitration (including the Corporation’s
and the Executives’ reasonable attorneys’ fees and expenses). Otherwise, each
party shall be responsible for its own expenses relating to the conduct of the
arbitration (including reasonable attorneys’ fees and expenses) and shall share
the fees of the American Arbitration Association equally.   14.   Non-Alienation
      The Executive shall not have any right to pledge, hypothecate, anticipate
or in any way create a lien upon any amounts provided under this Agreement; and
no benefits payable hereunder shall be assignable in anticipation of payment
either by voluntary or involuntary acts, or by operation of law, except by will
or the laws of descent and distribution.   15.   Governing Law       The
provisions of this Agreement shall be construed in accordance with the laws of
the State of Illinois.   16.   Amendment       This Agreement may be amended or
canceled by mutual agreement of the parties in writing without the consent of
any other person and, so long as the Executive lives, no person, other than the
parties hereto, shall have any rights under or interest in this Agreement or the
subject matter hereof.   17.   Successor to the Corporation       This Agreement
shall be binding upon and inure to the benefit of the Corporation and the
Executive and their respective successors, heirs (in the case of the Executive)
and assigns (subject, in the case of the Executive, to Paragraph 14 above) and
any successor of the Corporation. The Corporation shall require any successor to
expressly assume the liabilities, obligations and duties of the Corporation
hereunder.   18.   Severability

In the event that any provision or portion of this Agreement shall be determined
to be invalid or unenforceable for any reason, the remaining provisions of this
Agreement shall be unaffected thereby and shall remain in full force and effect.

 

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IN WITNESS WHEREOF, the Executive has hereunto set his hand and, pursuant to the
authorization from its Board of Directors, the Corporation has caused this
Agreement to be executed in its name on its behalf, and its corporate seal to be
hereunto affixed and attested by its Secretary, all as of the day and year first
above written.

       

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Executive         TELLABS, INC.,
a Delaware corporation         By:      

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  Chief Executive Officer

ATTEST:

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Secretary

(Seal)