EXHIBIT 10.4

                                     TEKELEC
                              STOCK AWARD AGREEMENT

     This Stock Award  Agreement  (this  "Agreement")  is made as of February 1,
2001 (the "Effective  Date") by and between  Tekelec,  a California  corporation
(the "Company"), and Frederick M. Lax ("Fred").

     WHEREAS,  in  consideration  of  Fred's  acceptance  of  employment  as the
Executive  Vice  President  and Chief  Operating  Officer of the Company and his
future  service as an employee of the Company and as  incentive  to motivate and
retain Fred as an employee of the Company,  the Company's Board of Directors has
awarded to Fred as of the  Effective  Date 30,000  shares (the  "Shares") of the
Company's Common Stock, subject to the terms and conditions set forth herein and
on the condition that Fred enter into this Agreement with the Company;

     NOW, THEREFORE, IT IS AGREED between the parties as follows:

     1. Acceptance and Value of Shares. Fred hereby accepts the Shares effective
as of the  Effective  Date as  additional  consideration  for his  acceptance of
employment as the Executive  Vice President and Chief  Operating  Officer of the
Company and his future  service to the Company and as an  incentive  to motivate
and retain him as an  employee  of the  Company.  The value of the Shares on the
Effective  Date for tax,  accounting  and all other purposes shall be $27.56 per
Share (i.e., the closing sales price of the Company's Common Stock on The Nasdaq
Stock Market on February 1, 2001).

     2.  Vesting of Shares.  Subject to Section 3 hereof,  the Shares shall vest
cumulatively  as to 7,500 Shares on each of the vesting dates specified below so
long as Fred continues to serve as an employee of the Company:

                                          Number of
                                         Vesting Date        Shares Vesting
                                         ------------        --------------
                                           02/01/02               7,500
                                           02/01/03               7,500
                                           02/01/04               7,500
                                           02/01/05               7,500
                                                                 ------
                                                                 30,000

     3.  Forfeiture  of Shares.  If at any time prior to February 1, 2005,  Fred
ceases to serve as an  employee  of the Company  under any  circumstances,  Fred
shall forfeit any Shares which are not then vested,  which  forfeiture  shall be
effective  on the date on which Fred ceases to be an  employee  of the  Company.
Upon any forfeiture of any of the Shares in accordance with this Section 3, Fred
shall assign and transfer such forfeited Shares to the Company or its assignee.

     4.  Issuance  and Escrow of Shares.  The Shares  shall be evidenced by four
stock  certificates  (the "Stock  Certificates"),  each of which shall represent
7,500 Shares. The Stock
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                                                                    EXHIBIT 10.4

Certificates  shall be  issued  in the name of Fred as soon as  administratively
practicable following the Effective Date and shall be delivered by the Company's
transfer  agent directly to the Secretary of the Company (the  "Secretary").  As
security for Fred's  faithful  performance of the terms of this Agreement and to
ensure the availability for delivery of the Shares upon any forfeiture of any of
the Shares pursuant to Section 3 hereof, Fred also agrees upon execution of this
Agreement to deliver to and deposit with the Secretary four Assignments Separate
from Certificate (the "Assignments") duly endorsed (with date left blank) in the
form attached  hereto as  Attachment A. The Secretary  shall hold the Shares and
the  Assignments in an escrow and, within seven days after the date on which any
of the Shares  vest  hereunder,  the  Secretary  shall  release  from escrow and
deliver to Fred the Stock  Certificate(s)  evidencing  such  Shares.  The escrow
shall  terminate upon the first to occur of (i) Fred's  forfeiture of any Shares
not then  vested  pursuant  to Section 3 hereof or (ii) the date on which all of
the Shares are vested (i.e.,  February 1, 2005).  If the escrow  terminates upon
any  forfeiture  of Shares  pursuant to Section 3 hereof,  the  Secretary  shall
within seven days thereafter  release from escrow and deliver to the Company all
Stock  Certificates  representing  the forfeited Shares and all Assignments then
held in escrow.

     5. Rights as Shareholder. Subject to the provisions of this Agreement, Fred
shall be entitled to exercise all rights and  privileges of a shareholder of the
Company (including voting rights) with respect to the Shares.

     6. Continuation as an Employee or Officer.  Neither the award of the Shares
to Fred nor this  Agreement  shall  confer upon Fred any right to continue as an
employee  or officer of the Company or any of its  subsidiaries  or limit in any
respect the right of the Company to terminate Fred's employment with the Company
at any time for any reason.

     7. Withholding.  The Company reserves the right to withhold,  in accordance
with any  applicable  laws,  from any  consideration  payable  to Fred any taxes
required  to be  withheld  by  federal,  state or local  law as a result  of the
issuance of the Shares to Fred.

     8.  Nontransferability  Prior to Vesting. Fred may not at any time transfer
any  Shares  which  are  not  then  vested  or any  interest  therein  by  sale,
assignment,  hypothecation,  pledge,  donation,  operation of law or  otherwise,
including without limitation pursuant to the laws of descent and distribution.

     9. Miscellaneous.

          (a) This  Agreement  shall inure to the benefit of the  successors and
assigns of the Company.

          (b) This Agreement  shall be governed by and construed  under the laws
of the State of California and constitutes  the entire  agreement of the parties
with respect to the subject matter hereof. This Agreement may only be amended by
a writing signed by the parties hereto.

          (c) If any provision of this Agreement is held by a court of competent
jurisdiction  to be invalid,  void or  unenforceable,  the remaining  provisions
shall  nevertheless  continue in full force and effect without being impaired or
invalidated in any way.
<PAGE>

     IN WITNESS  WHEREOF,  the parties hereto have executed this Agreement as of
the Effective Date.

                        COMPANY:        TEKELEC

                                        By: /s/ Michael L. Margolis
                                            -----------------------
                                            Michael L. Margolis
                                            Chief Executive Officer

                        FRED:               /s/ Frederick M. Lax
                                        ---------------------------
                                        Frederick M. Lax
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                                                                    EXHIBIT 10.4

                                  ATTACHMENT A

                      ASSIGNMENT SEPARATE FROM CERTIFICATE

FOR VALUE  RECEIVED,  the undersigned  hereby sells,  assigns and transfers unto
______________________________________         _________________________________
_____________________(____________)  shares of the Common  Stock of  Tekelec,  a
California corporation (the "Company"),  standing in the name of the undersigned
on the books of the Company  represented by Certificate  No. ______ herewith and
does        hereby        irrevocably        constitute        and       appoint
___________________________________________  attorney to transfer  said stock on
the books of the Company with full power of substitution in the premises.

Signature:
          -----------------------------------------

Printed Name:         Frederick M. Lax
             --------------------------------------

Dated:
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