Document:

Exhibit
10.1

EMPLOYMENT AGREEMENT

This Agreement, dated January 30, 2003 is between JDS
Uniphase Corporation (the “Company”) and Ronald C. Foster (“Employee”).

PREMISES

WHEREFORE,

1.             Employee has been offered and
desires to accept employment by Company; and

2.             Company
and Employee wish to memorialize the terms of Employee’s employment
relationship with a written Employment Agreement intended to supersede all
other written and oral representations regarding Employee’s employment with
Company;

AGREEMENT

NOW, THEREFORE, based on the foregoing premises and in
consideration of the commitments set forth below, Employee and Company agree as
follows:

1.             Definitions.

As used herein, the following terms are defined as
follows:

a.             “Cause”
means:

(i)            willful malfeasance by Employee,
which has a material adverse effect on the Company;

(ii)           substantial and continuing willful
refusal by Employee to perform duties ordinarily performed by an employee in
the same position and having similar duties as Employee;

(iii)          conviction of Employee for a felony or
misdemeanor which would have a material adverse effect on the Company’s
goodwill if Employee is retained as an employee of the Company;

(i)            willful failure by Employee to
comply with material policies and procedures of the Company including but not
limited to the JDS Uniphase Corporation Ethics Policy and Policy Regarding
Inside Information and Securities Transactions.

b.             “Good
Reason” means the occurrence of any of the events or conditions described in
subsections (i) through (iv) below, provided however, that Employee
provides the Company with thirty (30) days notice of termination for “Good
Reason” pursuant to the provisions of Section 7 below, during which time the
Company shall have an opportunity to cure

 

 

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the occurrence or condition claimed to constitute “Good Reason”; and provided
further, that such notice of resignation is submitted by Employee no later
than sixty (60) days after the occurrence of the event or condition that
Employee claims as the basis for termination for “Good Reason”:

 

(i)            a material reduction in Employee’s
base salary without Employee’s prior written consent; or

(ii)           a material adverse change in
Employee’s position, duties or responsibilities without Employee’s prior
written consent (for purposes of this subsection, a change in Employee’s
reporting structure or of the organizational structure of the finance functions
of the Company shall not, in and of itself, constitute a material adverse
change in Employee’s position, duties or responsibilities); or

(iii)          an actual change in Employee’s
principal work location by more than 50 kilometers without Employee’s prior
written consent;

(iv)          a resignation by Employee occurring
any time within 6 months of a Change of Control; or

(v)           failure by the Company to obtain from
any successor company the assumption of the Company’s obligations under this
Agreement.

c.             “Change
of Control” means:

(i)            the acquisition by
any person (or related group of persons), whether by tender or exchange offer
made directly to the Company’s stockholders, open market purchases or any other
transaction or series of transactions, of Common Stock possessing sufficient
voting power in the aggregate to elect an absolute majority of the members of
the Company’s Board of Directors;

(ii)           a merger or consolidation in which
the Company is not the surviving entity, except for a transaction in which
securities representing more than fifty percent (50%) of the total combined
voting power of the surviving entity are held by persons who held Common Stock
immediately prior to such merger or consolidation and those members of the
Existing Board immediately prior to such merger or consolidation constitute a
majority of the Board of Directors immediately after such merger or
consolidation;

(iii)          any reverse merger
in which the Company is the surviving entity but in which either securities
representing more than fifty percent (50%) of the total combined voting power
of the Company’s outstanding securities are transferred to holders different
from those who held such securities immediately prior to such merger or those
members of the Existing Board immediately prior to such merger or consolidation
do not constitute a majority of the Board of Directors immediately after such
merger; or

(iv)          the sale, transfer
or other disposition of all or substantially all of the assets of the Company
(whether such assets are owned directly by the Company or indirectly through
one or more operating subsidiaries).

 

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d.             “Disabled”
means a mental or physical disability, illness or injury, evidence by medical
reports from a duly qualified medical practitioner, which renders the Employee
unable to perform the essential duties of his or her position, and “Disability”
has a corresponding meaning.

e.             “Effective
Date” means:

(i)            in the event the Company terminates
the employment of Employee, the date designated by the Company as the last day
of Employee’s employment;

(ii)           in the event the Employee resigns his
or her employment with the Company, the date designated by the Company as the
effective date of resignation;

(iii)          in the event the Employee dies, the
date of death;

(iv)          in
the event the Employee becomes Disabled, the date designated by the Company as
the last day of Employee’s employment.

 

f.          “New Hire Options” means those certain option rights to
purchase an aggregate of 500,000 shares of the Company’s Common Stock to be
issued by the Company to Employee pursuant to Section 3 below.

2.             Position, Duties, Responsibilities

a.             Position:  Employee is employed by Company to render
services to Company in the position of Executive Vice President and Chief
Financial Officer, subject to the provisions of paragraph 3 below and
commencing upon the date first written above. 
Employee shall perform such duties as are customarily required by such
position and other such duties and responsibilities as may be assigned by the
Chief Executive Officer from time to time.

b.             Other Activities:  Except upon the prior written consent of the Company, Employee
will not (i) accept any other employment, or (ii) engage, directly or
indirectly, in any other business activity (whether or not pursued for
pecuniary advantage) that is or may be in conflict with, or that might place
Employee in a conflicting position to that of, the Company.

3.                                       Compensation

 

In consideration of the services to be rendered under
this Agreement, and subject to the approval of the Compensation Committee of
the Company’s Board of Directors at its February 6, 2003 meeting:

 

a.             Company
shall pay Employee a base annual salary of $350,000, payable in accordance with
the Company’s payroll practices. Employee’s salary will be reviewed from time
to time in accordance with Company’s established procedures for adjusting
salaries for similarly situated employees.

 

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b.             Employee
shall be entitled to participate in the Company’s established incentive plan(s)
for senior executives with a target bonus of 60% of Employee’s base salary and
a maximum bonus of up to 200% of Employee’s target bonus.  Employee shall be eligible to participate in
Company’s benefit plans and to receive prerequisites of employment as
established by Company, and as may be amended from time to time in Company’s
sole discretion.

c.             The
Company shall issue to Employee the New Hire Options pursuant to the terms and
conditions of the Company’s 1993 Amended and Restated Flexible Stock Incentive
Plan (the “Plan”) with a grant date as of the date of commencement of
employment specified in Section 2(a) above and priced at the closing price of
JDS Uniphase on NASDAQ on the date of the grant. The rights and obligations of
the Company and Employee with respect to the New Hire Options shall be governed
by the terms of the Plan and the Grant Agreement for the New Hire Options, and
shall vest 25% on the first anniversary of the grant and in equal quarterly
installments thereafter such that the entire New Hire Option grant shall be
fully vested in four years, subject to the possible acceleration of the
exercisability of such options as provided in Sections 5.a., 5.e. and 5.g.
below.

d.             The
Company shall pay Employee a one-time new hire bonus of $30,000 (gross), which
bonus shall be earned and payable with Employee’s first paycheck following
commencement of employment.

4.                                       Term

The term (the “Term”) of
this Agreement shall commence on February 17, 2003 and shall expire on July 31,
2007 unless sooner terminated as provided herein (the date of termination of
this Agreement, the “Expiration Date”). 
Notwithstanding the foregoing, on July 31 2007, and on the anniversary
date of each one year period thereafter (a “Renewal Date”) the Term will be
automatically extended for an additional one-year period unless, not later than
180 days prior to such a Renewal Date, the Company provides written notice to
Employee that it has elected not to extend the Term of this Agreement.

5.                                       Termination.

 

a.             Termination
Benefits Under Certain Circumstances. 
If the Employee’s employment is terminated, prior to the expiration of
the Term, by the Company (other than for Cause) other than by the Company
following a Change of Control, as the result of the Death or Disability of the
Employee, or by the Employee for Good Reason other than Good Reason as that
term is defined in Section 1(b)(iv) above, conditioned upon the Employee’s
executing and delivering to the Company a release of claims, reasonably
acceptable to the Company, Employee will be entitled to the following benefits
in full satisfaction of any statutory, contractual or common law entitlements
which Employee has or could have as a result of the termination of the Term:

(i)            the Company shall pay to the
Employee, in one lump sum, an amount equal to (A) any accrued but unpaid wages,
(B) two years’ salary, at the Employee’s annual salary in effect on the
Effective Date, plus (C) two years’ bonus (calculated based on the

 

 

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average of the bonus awarded to Employee in each of the previous two
years of employment by the Company or, if termination occurs prior to the
completion of two years of employment, each such “missing” year calculated as
60% of Employee’s base salary), minus any amounts to which Employee is
otherwise entitled under any statutory or Company long or short term disability
plan and minus any required withholdings or deductions;

 

(ii)           Employee’s right, title and
entitlement to any unvested options or any other securities or similar
incentives which have been granted or issued to Employee as of the Effective
Date, which would have vested in the two year period immediately following the
Effective Date, shall immediately vest, free from any restrictions (other than
those imposed by applicable state and federal securities laws), provided that
all such securities shall continue to be exercisable (if applicable) for 90
days from the Effective Date or until the term such securities would have
otherwise expired (if applicable), whichever is earlier.  Such payments and other consideration
payable by the Company pursuant to this Section 5(a) shall be accepted by
Employee, or his heirs as the case may be, in exchange for a full and complete
release by Employee of all causes of action, claims or other rights that he may
have against the Company arising in connection with his employment or pursuant
to this Agreement. The Company shall have no obligations under this paragraph
with respect to any termination of the Term for any reason other than as
specified in the first sentence of this paragraph; and

(iii)          should Employee elect COBRA benefits
continuation following termination of employment the Company shall pay the full
cost to Employee for the full 18 month COBRA period and the Company shall
thereafter provide Employee, in one lump sum, an amount equal to the cost of
reasonably comparable health insurance benefits for Employee and Employee
dependents for a period of six (6) months.  
All amounts payable pursuant to this Section 5(a)(iii) shall be grossed-
up to the extent such amounts are determined to be a taxable benefit.

 

b.             Termination
For Cause:  This Agreement shall
terminate immediately upon the termination of Employee for Cause.  Thereafter, all obligations of Company under
this Agreement shall cease.

c.             By
Death:  Employee’s employment shall
terminate automatically upon the death of Employee.  Company shall pay to Employee’s beneficiaries or estate, as
appropriate, the compensation set forth in Section 5.a.  Thereafter, all obligations of Company under
this Agreement shall cease.  Nothing in
this Section shall affect any entitlement of Employee’s heirs to the benefits
of any life insurance plan or other applicable benefits.

d.             By
Disability:  If Employee suffers
from a Disability, then, to the extent permitted by law, Company may terminate
Employee’s employment.  Company shall
pay to Employee the compensation set forth in Section 5.a.  Thereafter, all of Company’s obligations
under this Agreement shall cease. 
Nothing in this Section shall affect Employee’s rights under any
disability plan in which he is a participant.

e.             Benefits
in the Event of Employee’s Termination following a Change of Control.  If the Employee’s employment is
terminated, prior to the expiration of the Term, by the

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Company
following a Change of Control, or by Employee for Good Reason as that term is
defined in Section 1(b)(iv) above (i.e., Employee’s resignation within six (6)
months of a Change of Control), conditioned upon the Employee’s executing and
delivering to the Company a release of claims, reasonably acceptable to the
Company, Employee will be entitled to the following benefits in full
satisfaction of any statutory, contractual or common law entitlements which
Employee has or could have as a result of the termination of the Term:

 

(i)            the
Company shall pay to the Employee, in one lump sum, an amount equal to (A) any
accrued but unpaid wages, (B) three years’ salary, at the Employee’s annual
salary in effect on the Effective Date, plus (C) three years’ bonus (calculated
based on the average of the bonus awarded to Employee in each of the previous
two years of employment by the Company or, if termination occurs prior to the
completion of three years of employment, each such “missing” year calculated as
60% of Employee’s base salary), minus any amounts to which Employee is
otherwise entitled under any statutory or Company long or short term disability
plan and minus any required withholdings or deductions;

 

(ii)           Employee’s right, title and
entitlement to any unvested options or any other securities or similar
incentives which have been granted or issued to Employee as of the Effective
Date, which would have vested in the three year period immediately following
the Effective Date, shall immediately vest, free from any restrictions (other
than those imposed by applicable state and federal securities laws), provided
that all such securities shall continue to be exercisable (if applicable) for
90 days from the Effective Date or until the term such securities would have otherwise
expired (if applicable), whichever is earlier. 
Such payments and other consideration payable by the Company pursuant to
this Section 5(e) shall be accepted by Employee, or his heirs as the case may
be, in exchange for a full and complete release by Employee of all causes of
action, claims or other rights that he may have against the Company arising in
connection with his employment or pursuant to this Agreement. The Company shall
have no obligations under this paragraph with respect to any termination of the
Term for any reason other than as specified in the first sentence of this
paragraph; and

(iii)          should Employee elect COBRA benefits
continuation following termination of employment the Company shall pay the full
cost to Employee for the full 18 month COBRA period and the Company shall
thereafter provide Employee, in one lump sum, an amount equal to the cost of
reasonably comparable health insurance benefits for Employee and Employee
dependents for a period of six (6) months.  
All amounts payable pursuant to this Section 5.a.(iii) shall be grossed-
up to the extent such amounts are determined to be a taxable benefit.

 

f.              Certain
Additional Payments by Company: 
Notwithstanding anything in this Agreement to the contrary, in the event
that Employee becomes entitled to any of the payments or benefits provided
under this Section 5 as a result of Employee’s resignation for Good Reason
pursuant to Section 1(b)(iv) hereinabove or Employee’s termination without
cause following a Change of Control and such payments or benefits result in
Employee being subject to the golden parachute excise tax imposed by Section
4999 of the Internal Revenue Code, the Company shall make such additional
payment as will make executive whole for such tax obligation, as set forth in
Appendix A, which is incorporated herein by reference.

 

 

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g.             Benefits
in the Event of Nonrenewal of the Term: 
In the event that the Company provides notice in accordance with the
provisions of Section 4 above of its intent not to renew the Term for an
additional one year period, and conditioned upon the Employee’s executing and
delivering to the Company a release of claims, reasonably acceptable to the
Company, Employee will be entitled to the following benefits as of the
Effective Date, together with such other amounts as the Compensation Committee
may determine, in full satisfaction of any statutory, contractual or common law
entitlements which Employee has or could have as a result of the termination of
the Term:

(i)            the Company shall pay to the
Employee, in one lump sum, an amount equal to (A) one year’s salary, at the
Employee’s annual salary in effect on the Effective Date, plus (B) one
year’s bonus (calculated based on the average of the actual bonus awarded to
Employee in each of the previous three years of employment by the Company)
minus any required withholdings or deductions;

 

(ii)           Employee’s right, title and
entitlement to any unvested options or any other securities or similar
incentives which have been granted or issued to Employee as of the Effective
Date and which would otherwise have vested according to their terms within 12
months of the Effective Date shall immediately vest, free from any restrictions
(other than those imposed by applicable state and federal securities laws), and
all such securities shall continue to be exercisable (if applicable) until the earlier
of (1) as provided in the applicable plan or grant agreements (but in no event
less than 90 days)  following the
Effective Date; or (2) until such term of such options or other such securities
would have otherwise expired (if applicable). 
; and

 

(iii)          should
Employee elect COBRA benefits continuation following termination of employment
the Company shall pay the full cost to Employee for the full 18 month COBRA
period and the Company shall thereafter provide Employee, in one lump sum, an
amount equal to the cost of reasonably comparable health insurance benefits for
Employee and Employee dependents for a period of six (6) months.  All amounts payable pursuant to this Section
5(g)(iii) shall be grossed-up to the extent such amounts are determined to be a
taxable benefit.

 

6.         Termination
Obligations

a.             Return
of Company’s Property:  Employee
hereby acknowledges and agrees that all personal property, including, without
limitation, all books, manuals, records, reports, notes, contracts, lists,
blueprints, and other documents, or materials, or copies thereof, and equipment
furnished to or prepared by Employee in the course of or incident to Employee’s
employment, belong to Company and shall be promptly returned to Company upon
termination of Employee’s employment.

b.             Cooperation
in Pending Work:  Following any
termination of Employee’s employment, Employee shall fully cooperate with Company
in all matters relating to the winding up of pending work on behalf of Company
and the orderly transfer of work to other employees of Company.  Employee shall also cooperate in the defense
of any action brought by any third party

 

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against Company that relates in any way to Employee’s acts or omissions
while employed by Company.

 

7.             Notices

All notices or other communications required or
permitted hereunder shall be made in writing and shall be deemed to have been
duly given if delivered by hand or mailed, postage prepaid, by certified or
registered mail, return receipt requested, and addressed to Company:

JDS Uniphase
Corporation

1768 Automation
Parkway

San Jose,
California 94131

Attention: Office
of the General Counsel

 

and to Employee at:

 

Mr. Ronald Foster

(Home address
deleted)

 

Employee and the
Company shall provide written notice to the other (which, notwithstanding any
other provision within this section, may be provided by hand delivery, first
class mail or electronic mail) of any changes to the addresses above.

8.             Entire
Agreement

Subject to the last sentence of this paragraph, the
terms of this Agreement are intended by the parties to be the final and
exclusive expression of their agreement with respect to the employment of
Employee by Company and may not be contradicted by evidence of any prior or
contemporaneous statements or agreements. 
Subject to the last sentence of this paragraph, the parties further
intend that this Agreement shall constitute the complete and exclusive
statement of its terms and that no extrinsic evidence whatsoever may be
introduced in any judicial, administrative, or other legal proceeding involving
this Agreement.  To the extent that the
practices, policies, or procedures of Company, now or in the future, apply to
Employee and are inconsistent with the terms of this Agreement, the provisions
of this Agreement shall control. 
Notwithstanding the foregoing, nothing in this agreement shall limit or
modify, in any manner, any existing or future agreement between the Employee
and the Company relating to proprietary information, inventions, treatment of
confidential information, non-competition or employee benefits or incentive
plans.

9.             Amendments,
Waivers

This Agreement may not be modified, amended, or
terminated except by an instrument in writing, signed by Employee and by a duly
authorized representative of Company other than Employee.  No failure to exercise and no delay in
exercising any right, remedy, or power under this Agreement shall operate as a
waiver thereof, nor shall any single or partial

 

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exercise of any right,
remedy, or power under this Agreement preclude any other or further exercise
thereof, or the exercise of any other right, remedy, or power provided herein.

Employee and the Company each specifically agree and
acknowledge that they each waive recourse to any remedies in tort, and further
agree and acknowledge their intent that all rights and liabilities pertaining
to the cessation of the employment relationship between them, where such
cessation occurs on or before the Expiration Date, be as set out in this
Agreement (or in any subsequent modification of this Agreement, provided that
the modification is in writing and signed by both parties).

10.           Assignment;
Successors and Assigns

Employee agrees that Employee will not assign, sell,
transfer, delegate or otherwise dispose of, whether voluntarily or
involuntarily, or by operation of law, any rights or obligations under this
Agreement, nor shall Employee’s rights be subject to encumbrance or the claims
of creditors.  Any purported assignment,
transfer, or delegation shall be null and void.  Nothing in this Agreement shall prevent the consolidation of the
Company with, or its merger into, any other corporation, or the sale by the
Company of all or substantially all of its properties or assets, or the
assignment by the Company of this Agreement and the performance of its
obligations hereunder to any successor in interest.  Subject to the foregoing, this Agreement shall be binding upon
and shall inure to the benefit of the parties and their respective heirs, legal
representatives, successors, and permitted assigns, and shall not benefit any
person or entity other than those enumerated above.

11.           Severability;
Enforcement

If any provision of this Agreement, or the application
thereof to any person, place, or circumstance, shall be held by a court of
competent jurisdiction to be invalid, unenforceable, or void, the remainder of
this Agreement and such provisions as applied to other persons, places, and
circumstances shall remain in full force and effect.

12.           Governing Law

The validity, interpretation, enforceability, and
performance of this Agreement, other than Section 4, shall be governed by and
construed in accordance with the law of the State of California.

13.           Employee Acknowledgment

The parties acknowledge (a) that they have
consulted with or have had the opportunity to consult with independent counsel
of their own choice concerning this Agreement, and (b) that they have read
and understand the Agreement, are fully aware of its legal effect, and have
entered into it freely based on their own judgment and not on any
representations or promises other than those contained in this Agreement.

 

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14.           Date of Agreement

The parties have duly executed this Agreement as of
the date first written above.

 

 

	
  JDS UNIPHASE CORPORATION

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  By:

  	
  /s/

  	
   

  	
  JOZEF STRAUS

  	
   

  	
  /s/  RONALD
  C. FOSTER

  
	
  Name:

  	
   

  	
   

  	
  Jozef Straus, Ph.D.

  	
   

  	
  Name:  Ronald
  C. Foster

  
	
  Its:

  	
   

  	
   

  	
  Chief Executive Officer

  	
   

  	
   

  	
   

  	
   

  	
   

  
										

 

 

 

 

 

 

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APPENDIX
A

 

A.                                   Certain
Additional Payments by the Company

(a)   Subject to and as provided by Section 5(f) of
this Agreement, in the event it shall be determined that any payment, award,
benefit or distribution (or any acceleration of any payment, award, benefit or
distribution) by the Company (or any of its affiliated entities) or any entity
which effectuates a Change of Control (or any of its affiliated entities) to or
for the benefit of Employee (whether pursuant to the terms of this Agreement or
otherwise, but determined without regard to any additional payments required
under this Appendix A) (the “Payments”) would be subject to the excise tax
imposed by Section 4999 of the Internal Revenue Code of 1986, as amended (the
“Code”), or any interest or penalties are incurred by Employee with respect to
such excise tax (such excise tax, together with any such interest and
penalties, are hereinafter collectively referred to as the “Excise Tax”), then
the Company shall pay to Employee an additional payment (a “Gross-Up Payment”)
in an amount such that after payment by Employee of all taxes (including any
Excise Tax) imposed upon the Gross-Up Payment, Employee retains an amount of
the Gross-Up Payment equal to the sum of (x) the Excise Tax imposed upon the
Payments and (y) the product of any deductions disallowed because of the
inclusion of the Gross-up Payment in Employee’s adjusted gross income and the
highest applicable marginal rate of federal income taxation for the calendar
year in which the Gross-up Payment is to be made.  For purposes of determining the amount of the Gross-up Payment, the
Employee shall be deemed to (i) pay federal income taxes at the highest
marginal rates of federal income taxation for the calendar year in which the
Gross-up Payment is to be made, (ii) pay applicable state and local income
taxes at the highest marginal rate of taxation for the calendar year in which
the Gross-up Payment is to be made, net of the maximum reduction in federal
income taxes which could be obtained from deduction of such state and local
taxes and (iii) have otherwise allowable deductions for federal income tax
purposes at least equal to those which could be disallowed because of the
inclusion of the Gross-up Payment in the Employee’s adjusted gross income.  The reduction of the amounts payable hereunder,
if applicable, shall be made by reducing any cash payments, unless an
alternative method of reduction is elected by Employee.  For purposes of reducing the Payments to the
Safe Harbor Cap, only amounts payable under this Agreement (and no other
Payments) shall be reduced.  If the
reduction of the amounts payable hereunder would not result in a reduction of
the Payments to the Safe Harbor Cap, no amounts payable under this Agreement
shall be reduced pursuant to this provision.

(b)   Subject to the provisions of this Appendix A
(a), all determinations required to be made under this Appendix A, including
whether and when a Gross-Up Payment is required, the amount of such Gross-Up
Payment, the reduction of the Payments to the Safe Harbor Cap and the
assumptions to be utilized in arriving at such determinations, shall be made by
the public accounting firm that is retained by the Company as of the date
immediately prior to the Change of Control (the “Accounting Firm”) which shall
provide detailed supporting calculations both to the Company and Employee within
thirty (30) days of the receipt of notice from the Company or the Employee that
there has been a Payment, or such earlier time as is requested by the Company
(collectively, the “Determination”).  In
the event that the Accounting Firm is serving as accountant or auditor for the
individual, entity or group effecting the Change of Control, Employee may
appoint another nationally recognized public accounting firm to make the

 

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determinations required hereunder (which
accounting firm shall then be referred to as the Accounting Firm
hereunder).  All fees and expenses of
the Accounting Firm shall be borne solely by the Company and the Company shall
enter into any reasonable agreement requested by the Accounting Firm in
connection with the performance of the services hereunder.  The Gross-up Payment under this Appendix A
with respect to any Payments shall be made no later than sixty (60) days
following such Payment.  If the
Accounting Firm determines that no Excise Tax is payable by Employee, it shall
furnish Employee with a written opinion to such effect, and to the effect that
failure to report the Excise Tax, if any, on Employee’s applicable federal
income tax return will not result in the imposition of a negligence or similar
penalty.  In the event the Accounting
Firm determines that the Payments shall be reduced to the Safe Harbor Cap, it
shall furnish Employee with a written opinion to such effect.  The Determination by the Accounting Firm
shall be binding upon the Company and Employee.  As a result of the uncertainty in the application of Section 4999
of the Code at the time of the Determination, it is possible that Gross-Up
Payments which will not have been made by the Company should have been made
(“Underpayment”) or Gross-up Payments are made by the Company which should not
have been made (“Overpayment”), consistent with the calculations required to be
made hereunder.  In the event that the
Employee thereafter is required to make payment of any Excise Tax or additional
Excise Tax, the Accounting Firm shall determine the amount of the Underpayment
that has occurred and any such Underpayment (together with interest, to the
extent not already within the Excise Tax, at the rate provided in Section
1274(b)(2)(B) of the Code) shall be promptly paid by the Company to or for the
benefit of Employee.  In the event the
amount of the Gross-up Payment exceeds the amount necessary to reimburse the
Employee for his Excise Tax, the Accounting Firm shall determine the amount of
the Overpayment that has been made and any such Overpayment (together with
interest at the rate provided in Section 1274(b)(2) of the Code) shall be
promptly paid by Employee (to the extent he has received a refund if the
applicable Excise Tax has been paid to the Internal Revenue Service) to or for
the benefit of the Company.  Employee
shall cooperate, with any reasonable requests by the Company in connection with
any contests or disputes with the Internal Revenue Service in connection with
the Excise Tax.

 

 

 

 

 

12Exhibit 10.2

 

 

January 8, 2003

 

 

 

Re:  Retirement
from JDS Uniphase Corporation - Donald R. Scifres, Ph.D.

 

Dear Don:

 

This letter agreement
(“Agreement”) shall confirm the terms of your retirement from your employment
with JDS Uniphase Corporation and its subsidiaries and affiliated entities
(“the Company” or “JDSU”) effective February 1, 2003 (the “Retirement
Date).  The Effective Date of this
Agreement shall be the 8th day following your signature below.

 

Between now and the
Retirement Date, you will continue to perform your regular job duties and
responsibilities, though it is acknowledged that during this period you will be
transitioning your responsibilities to others in the organization and using a
significant portion of your accrued vacation time.

 

On the Retirement Date, you
will receive the following payments:

 

1.     All accrued but unpaid base salary as of the Retirement Date;

2.     All accrued but unused vacation pay; and

3.     All accrued but unused ESPP contributions.

 

The Company and you are
parties to several agreements pertaining to the terms of your employment and
the termination thereof, including an Employment Agreement dated July 17, 1992,
as amended (the “Employment Agreement”), a Change of Control Agreement dated
February 10, 2002 (the “Change of Control Agreement”), and a Transition
Agreement dated July 9, 2002 (the “Transition Agreement”), collectively
referred to hereinafter as the “Employment Agreements.”  Your retirement from employment at JDS
Uniphase is agreed to be as a result of your retirement on or after age 55
under Section 6(d) of the Transition Agreement, though you and the Company
acknowledge that you have raised for discussion the effect of certain
management changes that have occurred during the preceding 12-18 months
relative to the provisions of the Employment Agreements.

 

Pursuant to the terms of the
Employment Agreements, upon the occurrence of certain events described therein,
you are entitled to certain payments and benefits upon termination of your
employment.  In full satisfaction of any
and all obligations of the Company under the Employment Agreements, other than
(i) any obligations from the Company to you specified herein, (ii) any
obligations due or that become due to you under Section 8(b) of the Transition
Agreement (which Section 8(b) shall remain in full force and effect), and (iii)
any obligations due to you under the Company’s 401(k) and non-qualified
deferred compensation plans (together, the foregoing clauses (i)-(iii) are
referred to herein as the “Protected Benefits”), on the Retirement Date the
Company shall

 

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take the following actions and provide the
following benefits (collectively the “Retirement Benefits”); (a) cause all
stock options previously granted to you by SDL, Inc., and JDS Uniphase to be
fully accelerated, vested and exercisable for the full remaining original terms
of each such stock option grant (i.e., 10 years or 8 years from the date of
grant, as applicable) notwithstanding any provision in any stock option grant
agreement or plan to the contrary; (b) should you elect COBRA benefits
continuation following the termination of your employment, the Company will pay
the premiums for such coverage for a period of eighteen (18) months (i.e.,
through August 31, 2004); and (c) for six months following your Retirement Date
the Company will continue to provide you with office space at a Company
facility in San Jose, and computer, administrative and related IT support.

 

For clarity only, you and the
Company agree that you shall forego any cash severance payments to which you
may otherwise be entitled under certain circumstances as a result of
termination of your employment.  You
also agree that you shall be solely responsible for any employee-side tax
obligations that may arise as a result of the Retirement Benefits; provided,
however, that the Company shall remain liable for any obligations arising under
section 8(b) of the Transition Agreement. 
The Company agrees that it shall discharge its obligations to you with
respect to the Protected Benefits.

 

You shall continue to be
indemnified for your activities as an officer or director of the Company or any
of its subsidiaries prior to the Retirement Date to the full extent provided in
the Articles of Incorporation and By-Laws of the Company (or its successor)
against all expense liability and loss (including attorneys’ fees and
settlement payments) arising from or relating to your service as an officer or
director of the Company or any of its subsidiaries.

 

To the extent required, this
Agreement shall constitute Notice of Termination under the Employment
Agreements and you and the Company agree that, notwithstanding any provision of
the Employment Agreements to the contrary, no further specification of the
reasons or facts supporting the termination of employment pursuant to Section
3(a)(ii) of the Change of Control Agreement is required.

 

You agree that you will
remain subject to all the provisions of the Company’s Policy Regarding Inside
Information and Securities Transactions until the opening of the trading window
following release of the Company’s Q3 FY2003 earnings at the end of April,
2003.  Further, you will continue to
observe all provisions of this Policy other than the trading window between the
opening of the window at the end of April 2003 and the cessation of your use of
office space at the Company’s headquarters in San Jose.  You will also observe the provisions of the
Company’s Ethics Policy through the Retirement Date.

 

Upon the Retirement Date,
you will be deemed to have reassigned all positions you hold within JDS
Uniphase Corporation and its subsidiaries, though you agree to execute such
other documents as may be required to effectuate your departure from such
position(s).  You will also resign from
the Company’s Board of Directors effective upon your Retirement Date.

 

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You agree that for a period of one (1) year from
your Retirement Date you will not, for yourself or any third party, directly or
indirectly, solicit for employment, recommend for employment, or employ (except to the
extent, if any, that this employment restriction is prohibited by applicable
law) any person who was employed
by the Company as of the Retirement Date without the Company’s prior written
consent, which consent shall not be unreasonably withheld.  Further, the Company hereby consents
to your solicitation and hire of your administrative assistant, Viola daSilva.

 

Your obligation to maintain
the confidentiality of all Company proprietary and confidential information,
and any written agreements between you and the Company pertaining thereto,
shall survive the termination of your employment.  Except with respect to the Company’s obligations arising from the
Protected Benefits, any further rights under the Employment Agreements shall be
terminated as of the Effective Date of this Agreement, including without
limitation, any right to severance benefits, payments, profit sharing, bonuses,
stock options, or other benefits.  This
Agreement shall represent the entire understanding between you and the Company
regarding the terms of your employment and termination of your employment, will
supersede any previous discussions and understanding and may not be modified
except in writing signed by you and the Company.

 

In consideration of the
terms of this Agreement, you agree to release the Company, its subsidiaries and
affiliated corporations and its past and present officers, directors, employees
and assigns from any claims you may now have, whether known or unknown,
including but not limited to, claims arising from your employment, the
Employment Agreements or other claims for compensation (including profit
sharing, bonus and severance payments), stock options, claims arising out of
contract or tort and any claims arising under the Title VII of the Civil Rights
Act of 1964, the Age Discrimination in Employment Act (ADEA), the Americans
with Disabilities Act, the California Fair Employment and Housing Act, and any
other claims for violation of any federal, state, or local law; provided,
however, that this release shall not apply to claims arising from the Protected
Benefits.

 

You agree that this release
specifically covers known and unknown claims and you waive any rights you may
have under Section 1542 of the California Civil Code or under any comparable
law of any other jurisdiction.  Section
1542 states:  “A general release does not extend to claims which the creditor does
not know or suspect to exist in his favor at the time of executing the release,
which if known by him must have materially affected his settlement with the
debtor.”

 

You agree that you have been
advised that you have twenty-one (21) days to consider the terms of this
Agreement (but may sign it any time beforehand if you so desire), and that you
can consult an attorney in doing so. 
You also understand that you can revoke your acceptance of the terms of
this Agreement within seven (7) days of signing it by sending a certified
letter to that effect to the undersigned. 
Notwithstanding the foregoing, you agree that the portion of this
Agreement that pertains to the release of claims under the ADEA shall not
become effective or enforceable until the seven (7) day revocation period has
expired, but that all other terms of this Agreement will become effective upon
your signature below.

 

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Please confirm your
acceptance of the foregoing by signing below.

 

Don, on behalf of all of us
at JDS Uniphase, I want to thank you for your contributions to the Company, not
to mention your many critical contributions to our industry.  We wish you the best in your well-earned
retirement, but hope that we may continue to count on your advice and counsel
in the future.

 

	
   

  	
  Very truly yours,

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  /s/ Jozef Straus, Ph.D.

  	
   

  
	
   

  	
  Jozef Straus, Ph.D.

  
	
   

  	
  Chief Executive Officer

  
	
   

  	
   

  
	
  Agreed and Accepted:

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  /s/ Donald R. Scifres,
  Ph.D.

  	
   

  	
  Date: 

  	
  January 9, 2003

  	
   

  
	
  Donald R. Scifres, Ph.D.

  	
   

  
					

 

 

 

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