Document:

exv10w17

 

Exhibit 10.17

FOUNDRY NETWORKS, INC.

2006 STOCK INCENTIVE PLAN

NOTICE OF STOCK OPTION GRANT

Optionee:

	 	 	 
	 

	 	 
	 
	 	 
	 

	 	 
	 
	 	 
	 

	 	 

     You have been granted an option (the “Option”) to purchase Common Stock of Foundry Networks,
Inc. (the “Company”), as follows:

	 	 	 	 	 	 	 	 	 
	 

	 	Date of Grant:	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	Exercise Price Per Share:	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	Total Number of Shares:	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	Total Exercise Price:	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	Type of Option:	 	 	 	Incentive Stock Option
	 

	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	Nonstatutory Stock Option
	 

	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	Expiration Date:	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	Vesting Commencement Date:	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	Vesting Schedule:	 	So long as your Service continues, the Shares underlying this Option shall
vest and become exercisable in accordance with the following schedule: 12.5% of the
Total Number of Shares subject to this Option shall vest and become exercisable on the
6-month anniversary of the Vesting Commencement Date and 1/48th of the Total Number of
Shares subject to this Option shall vest and become exercisable on each monthly
anniversary thereafter.

 

 

	 	 	 	 	 	 	 	 	 
	 	 	Termination Period:	 	You may exercise this Option for 3 months after termination of your
Service except as set forth in Section 4 of the Stock Option Agreement (but in no event
later than the Expiration Date). You are responsible for keeping track of these
exercise periods following the termination your Service for any reason. The Company
will not provide further notice of such periods.

     Unless otherwise defined in this Notice of Stock Option Grant, the terms used herein shall
have the meanings assigned to them in the Plan.

     By your signature and the signature of the Company’s representative below, you and the Company
agree that this Option is granted under and governed by the terms and conditions of the Foundry
Networks, Inc. 2006 Stock Incentive Plan and the Stock Option Agreement, all of which are attached
to, and made a part of, this document.

     In addition, you agree and acknowledge that your rights to any Shares underlying this Option
will be earned only as you provide Service over time, that this Option is not being granted to you
as consideration for services you rendered to the Company (or any Parent, Subsidiary, or Affiliate)
prior to your Vesting Commencement Date, and that nothing in this Notice of Stock Option Grant or
the attached documents confers upon you any right to continue your employment or consulting
relationship with the Company (or any Parent, Subsidiary, or Affiliate) for any period of time, nor
does it interfere in any way with your right or the Company’s (or any Parent’s, Subsidiary’s, or
Affiliate’s) right to terminate that relationship at any time, for any reason, with or without
cause.

	 	 	 	 	 	 	 	 	 
	OPTIONEE:	 	 	 	FOUNDRY NETWORKS, INC.  
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	By:	 	 	 	 
	 

Signature

	 	 	 	 	 	 

	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	Title:	 	 	 	 
	 

Print Name

	 	 	 	 	 	 

	 	 

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FOUNDRY NETWORKS, INC.

2006 STOCK INCENTIVE PLAN

STOCK OPTION AGREEMENT

     1. Grant of Option. Foundry Networks, Inc., a Delaware corporation (the “Company”),
hereby grants to the Optionee named in the Notice of Stock Option Grant attached to this Stock
Option Agreement (the “Optionee”), an option (the “Option”) to purchase the total number of shares
of Common Stock (the “Shares”) set forth in the Notice of Stock Option Grant (the “Notice”), at the
exercise price per Share set forth in the Notice (the “Exercise Price”) subject to the terms,
definitions and provisions of the 2006 Stock Incentive Plan (the “Plan”), which is incorporated in
this Stock Option Agreement (the “Agreement”) by reference. Unless otherwise defined in this
Agreement, the terms used in this Agreement shall have the meanings defined in the Plan.

     This Option is intended to be an Incentive Stock Option as defined in Section 422 of the Code
only to the extent so designated in the Notice, and to the extent it is not so designated or to the
extent this Option does not qualify as an Incentive Stock Option, it is intended to be a
Nonstatutory Stock Option. Notwithstanding the foregoing, even if designated as an Incentive Stock
Option, if the Shares subject to this Option (and all other incentive stock options granted to
Optionee by the Company or any Parent or Subsidiary, including under other plans of the Company)
that first become exercisable in any calendar year have an aggregate fair market value (determined
for each Share as of the date of grant of the option covering such Share) in excess of $100,000,
the Shares in excess of $100,000 shall be treated as subject to a Nonstatutory Stock Option in
accordance with applicable law.

     2. Exercise of Option. This Option shall be exercisable during its term in accordance
with the Vesting Schedule set forth in the Notice and with the applicable provisions of the Plan as
follows:

          (a) Right to Exercise.

               (i) This Option may not be exercised for a fraction of a share.

               (ii) In the event of Optionee’s termination of Service, the exercisability of this Option
shall be governed by Section 4 below, subject to the limitations contained in paragraph (iii)
below.

               (iii) In no event may this Option be exercised after the Expiration Date set forth in the
Notice.

          (b) Method of Exercise.

               (i) This Option shall be exercisable by execution and delivery of the Notice of Exercise
attached hereto as Exhibit A or of any other form of written

 

 

notice approved for such purpose by the Company which shall state Optionee’s election to
exercise this Option, the number of Shares in respect of which this Option is being exercised, and
such other representations and agreements as to the holder’s investment intent with respect to such
Shares as may be required by the Company pursuant to the provisions of the Plan. Such written
notice shall be signed by Optionee and shall be delivered to the Company by such means as are
determined by the Committee in its discretion to constitute adequate delivery. The written notice
shall be accompanied by payment of the aggregate Exercise Price for the purchased Shares.

               (ii) As a condition to the exercise of this Option and as further set forth in Section 13 of
the Plan, Optionee agrees to make adequate provision for federal, state or other tax withholding
obligations, if any, which arise upon the grant, vesting or exercise of this Option, or disposition
of Shares, whether by withholding, direct payment to the Company, or otherwise.

               (iii) The Company is not obligated, and will have no liability for failure, to issue or
deliver any Shares upon exercise of this Option unless such issuance or delivery would comply with
all applicable laws, rules and regulations, with such compliance determined by the Company in
consultation with its legal counsel. This Option may not be exercised until such time as the Plan
has been approved by the Company’s stockholders, or if the issuance of such Shares upon such
exercise or the method of payment of consideration for such Shares would constitute a violation of
any applicable laws, rules or regulations, including any applicable U.S. federal or state
securities laws or any other law or regulation, including any rule under Part 221 of Title 12 of
the Code of Federal Regulations as promulgated by the Federal Reserve Board. As a condition to the
exercise of this Option, the Company may require Optionee to make any representation and warranty
to the Company as may be required by applicable laws, rules or regulations. Assuming such
compliance, for income tax purposes the Shares shall be considered transferred to Optionee on the
date on which this Option is exercised with respect to such Shares.

               (iv) Subject to compliance with all applicable laws, rules and regulations, this Option shall
be deemed to be exercised upon receipt by the Company of the appropriate written notice of exercise
accompanied by the Exercise Price and the satisfaction of any applicable withholding obligations.

     3. Method of Payment. Payment of the Exercise Price shall be by any of the following,
or a combination of the following, at the election of Optionee: (a) cash, (b) check, or (c)
Cashless Exercise.

     4. Termination of Relationship. Following the date of termination of Optionee’s
Service for any reason (the “Termination Date”), Optionee may exercise this Option only as set
forth in the Notice and this Section 4. To the extent that Optionee is not entitled to exercise
this Option as of the Termination Date, or if Optionee does not exercise this Option within the
Termination Period set forth in the Notice or the termination periods set forth below, this Option
shall terminate in its entirety. In no

2

 

event, may this Option be exercised after the Expiration Date set forth in the Notice. In the
event of termination of Optionee’s Service other than as a result of Optionee’s Disability, death
or for Cause, Optionee may, to the extent Optionee is vested in the Option Shares at the
Termination Date, exercise this Option during the Termination Period set forth in the Notice. In
the event of any other termination, Optionee may exercise this Option only as described below:

          (a) Termination upon Disability of Optionee. In the event of termination of
Optionee’s Service as a result of Optionee’s Disability, Optionee may, but only within 12 months
from the Termination Date, exercise this Option to the extent Optionee was vested in the Option
Shares as of such Termination Date.

          (b) Death of Optionee. In the event of the death of Optionee while in Service or
within 30-days following the termination of Optionee’s Service, this Option may be exercised at any
time within 12 months following the date of death by Optionee’s estate or by a person who acquired
the right to exercise this Option by bequest or inheritance, but only to the extent Optionee was
vested in the Option Shares as of the Termination Date.

          (c) Termination for Cause. In the event Optionee’s Service is terminated for Cause,
this Option shall terminate immediately upon such termination for Cause. In the event Optionee’s
employment or consulting relationship with the Company is suspended pending investigation of
whether such relationship shall be terminated for Cause, all Optionee’s rights under this Option,
including the right to exercise this Option, shall be suspended during the investigation period.

     5. Non-Transferability of Option. This Option may not be transferred in any manner
otherwise than by will or by the laws of descent or distribution. The designation of a beneficiary
does not constitute a transfer. This Option may be exercised during the lifetime of Optionee only
by Optionee. The terms of this Option shall be binding upon the executors, administrators, heirs,
successors and assigns of Optionee.

     6. No Employment Rights. Optionee understands and agrees that the vesting of Shares
pursuant to the Vesting Schedule is earned only by continuing Service at the will of the Company
(or any Parent, Subsidiary, or Affiliate) and not through the act of being hired, being granted
this Option or acquiring Shares under this Agreement. Optionee further acknowledges and agrees
that nothing in this Agreement, nor in the Plan which is incorporated in this Agreement by
reference, shall confer upon Optionee any right with respect to continuation as an Employee or
Consultant with the Company (or any Parent, Subsidiary, or Affiliate), nor shall it interfere in
any way with his or her right or the Company’s (or any Parent’s, Subsidiary’s, or Affiliate’s)
right to terminate his or her employment or consulting relationship at any time, with or without
cause.

     7. Effect of Agreement. Optionee acknowledges receipt of a copy of the Plan and
represents that he or she is familiar with the terms and provisions thereof (and has had an
opportunity to consult counsel regarding the Option terms), and hereby

3

 

accepts this Option and agrees to be bound by its contractual terms as set forth herein and in the
Plan. Optionee hereby agrees to accept as binding, conclusive and final all decisions and
interpretations of the Committee regarding any questions relating to this Option. In the event of
a conflict between the terms and provisions of the Plan and the terms and provisions of the Notice
and this Agreement, the Plan terms and provisions shall prevail.

8. Miscellaneous.

          (a) Governing Law. This Agreement and all acts and transactions pursuant hereto and
the rights and obligations of the parties hereto shall be governed, construed and interpreted in
accordance with the laws of the State of California, without giving effect to principles of
conflicts of law.

          (b) Entire Agreement; Enforcement of Rights. This Agreement, together with the Notice
and the Plan, sets forth the entire agreement and understanding of the parties relating to the
subject matter herein and therein and merges all prior discussions between the parties. Except as
contemplated under the Plan, no modification of or amendment to this Agreement, nor any waiver of
any rights under this Agreement, shall be effective unless in writing signed by the parties to this
Agreement. The failure by either party to enforce any rights under this Agreement shall not be
construed as a waiver of any rights of such party.

          (c) Severability. If one or more provisions of this Agreement are held to be
unenforceable under applicable law, the parties agree to renegotiate such provision in good faith.
In the event that the parties cannot reach a mutually agreeable and enforceable replacement for
such provision, then (i) such provision shall be excluded from this Agreement, (ii) the balance of
this Agreement shall be interpreted as if such provision were so excluded and (iii) the balance of
this Agreement shall be enforceable in accordance with its terms.

          (d) Notices. Any notice required or permitted by this Agreement shall be in writing
and shall be deemed sufficient when delivered personally or sent by telegram or fax or 48 hours
after being deposited in the U.S. mail, as certified or registered mail, with postage prepaid, and
addressed to the Company at its principal corporate offices and to Optionee at the address
maintained for Optionee in the Company’s records.

          (e) Successors and Assigns. The rights and benefits of this Agreement shall inure to
the benefit of, and be enforceable by the Company’s successors and assigns. The rights and
obligations of Optionee under this Agreement may not be assigned without the prior written consent
of the Company.

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EXHIBIT A

NOTICE OF EXERCISE

	 	 	 
	To:

	 	Foundry Networks, Inc.
	Attn:

	 	Administrator of the 2006 Stock Incentive Plan
	Subject:

	 	Notice of Intention to Exercise Stock Option

     This Notice of Exercise constitutes official notice that the undersigned intends to exercise
Optionee’s option to purchase _______ shares of Foundry Networks, Inc. Common Stock, under and
pursuant to the Company’s 2006 Stock Incentive Plan (the “Plan”) and the Notice of Stock Option
and Stock Option Agreement (the “Agreement”) dated _______, as follows:

	 	 	 	 	 	 
	 	Number of Shares:
	 	 	 	 
	 	 

	 	 

	 	 
	 	 
	 	 	 	 
	 	Exercise Price per Share:
	 	 	 	 
	 	 

	 	 

	 	 
	 	 
	 	 	 	 
	 	Total Exercise Price:
	 	 	 	 
	 	 

	 	 

	 	 
	 	 
	 	 	 	 
	 	Method of Payment
	 	 	 	 
	 	of Exercise Price:
	 	 	 	 
	 	 

	 	 

	 	 

     The shares should be registered in the name (s) of:

	 	 	 
	 

	 	and
	 
	 	 

	 	 	 
	 

	 	.1
	 
	 	 

     By signing below, I hereby agree to be bound by all of the terms and conditions set forth
in the Plan and the Agreement. If applicable, proof of my right to purchase the shares pursuant to
the Plan and the Agreement is enclosed. 2

Dated: ____________________________

	 	 	 
	 
	 

	 	 
	(Signature)

	 	(Signature)3
	 
	 	 
	 

	 	 
	(Please Print Name)

	 	(Please Print Name)
	 
	 	 
	 

	 	 
	 
	 	 
	 
	 

	 	 
	(Full Address)

	 	(Full Address)

 

			
	1	 	If more than one name is listed, please
specify whether the owners will hold the shares as community property or as
joint tenants with the right of survivorship.
	 
	2	 	Applicable if someone other than the Optionee
(e.g., a death beneficiary) is exercising the stock option.
	 
	3	 	Each person in whose name shares are to be
registered must sign this Notice of Exercise.exv10w18

 

Exhibit 10.18

FOUNDRY NETWORKS, INC.

2006 STOCK INCENTIVE PLAN

STOCK UNIT AGREEMENT

     This Stock Unit Agreement (the “Agreement”) is made and entered into as of _________,
200___ by and between Foundry Networks, Inc., a Delaware corporation (the “Company”), and
_________ pursuant to the Foundry Networks, Inc. 2006 Stock Incentive Plan (the
“Plan”). To the extent any capitalized terms used in this Agreement are not defined, they shall
have the meaning ascribed to them in the Plan, which is attached to, and made a part of, this
Agreement. In the event of a conflict between the terms and provisions of the Plan and the terms
and provisions of this Agreement, the Plan terms and provisions shall prevail.

     In consideration of the mutual agreements herein contained and intending to be legally bound
hereby, the parties agree as follows:

     1. Restricted Stock Units. Pursuant to the Plan, the Company hereby grants to you,
and you hereby accept from the Company, ____________ stock units, each of which is a bookkeeping
entry representing the equivalent in value of one (1) Share (the “Restricted Stock Units”), on the
terms and conditions set forth herein and in the Plan.

     2. Vesting of Restricted Stock Units. So long as your Service continues, the
Restricted Stock Units shall vest in accordance with the following schedule: 12.5% of the total
number of Restricted Stock Units shall vest on _________, 200___ (the 6-month anniversary of
the vesting commencement date) and 1/48th of the total number of Restricted Stock Units shall vest
on each monthly anniversary thereafter.

     3. Termination of Service. In the event of the termination of your Service for any
reason, all unvested Restricted Stock Units shall be immediately forfeited without consideration.

     4. Settlement of Restricted Stock Units. Restricted Stock Units shall be
automatically settled in Shares upon vesting of such Restricted Stock Units, provided that the
Company shall have no obligation to issue Shares pursuant to this Agreement unless and until you
have satisfied any applicable tax withholding obligations pursuant to Section 5 below and such
issuance otherwise complies with all applicable law. Prior to the time the Restricted Stock Units
are settled upon vesting, you will have no rights other than those of a general creditor of the
Company. Restricted Stock Units represent an unfunded and unsecured obligation of the Company.

     5. Withholding Taxes. You agree to make arrangements satisfactory to the Company for
the satisfaction of any applicable withholding tax obligations that arise in connection with the
Restricted Stock Units which, at the sole discretion of the Committee, may include (i) having the
Company withhold Shares from the settlement of the Restricted Stock Units, or (ii) any other
arrangement approved by the Company, in either case, equal in value to the amount necessary to
satisfy any such withholding tax obligations. The Company shall not be required to issue Shares
pursuant to this Agreement unless and until such obligations are satisfied.

 

 

     6. Tax Advice. You represent, warrant and acknowledge that the Company has made no
warranties or representations to you with respect to the income tax consequences of the
transactions contemplated by this Agreement, and you are in no manner relying on the Company or the
Company’s representatives for an assessment of such tax consequences. YOU UNDERSTAND THAT THE TAX
LAWS AND REGULATIONS ARE SUBJECT TO CHANGE. YOU SHOULD CONSULT YOUR OWN TAX ADVISOR REGARDING ANY
RESTRICTED STOCK UNITS. NOTHING STATED HEREIN IS INTENDED OR WRITTEN TO BE USED, AND CANNOT BE
USED, FOR THE PURPOSE OF AVOIDING TAXPAYER PENALTIES.

     7. Non-Transferability of Restricted Stock Units. The Restricted Stock Units shall
not be transferable other than by will or the laws of descent and distribution. The designation of
a beneficiary does not constitute a transfer. The terms of this Agreement shall be binding upon
your executors, administrators, heirs, successors and assigns.

     8. Restriction on Transfer. Regardless of whether the transfer or issuance of the
Shares to be issued pursuant to the Restricted Stock Units have been registered under the
Securities Act or have been registered or qualified under the securities laws of any state, the
Company may impose additional restrictions upon the sale, pledge, or other transfer of the Shares
(including the placement of appropriate legends on stock certificates and the issuance of
stop-transfer instructions to the Company’s transfer agent) if, in the judgment of the Company and
the Company’s counsel, such restrictions are necessary in order to achieve compliance with the
provisions of the Securities Act, the securities laws of any state, or any other law.

     9. Stock Certificate Restrictive Legends. Stock certificates evidencing the Shares
issued pursuant to the Restricted Stock Units may bear such restrictive legends as the Company and
the Company’s counsel deem necessary under applicable law or pursuant to this Agreement.

     10. Representations, Warranties, Covenants, and Acknowledgments. You hereby agree
that in the event the Company and the Company’s counsel deem it necessary or advisable in the
exercise of their discretion, the transfer or issuance of the Shares issued pursuant to the
Restricted Stock Units may be conditioned upon you making certain representations, warranties, and
acknowledgments relating to compliance with applicable securities laws.

     11. Voting and Other Rights. Subject to the terms of this Agreement, you shall not
have any voting rights or any other rights and privileges of a stockholder of the Company unless
and until the Restricted Stock Units are settled upon vesting.

     12. No Employment Rights. Neither the Plan nor this Stock Unit Award shall be deemed
to give you a right to remain an Employee, Consultant or director of the Company, a Parent, a
Subsidiary or an Affiliate. The Company and its Parents and Subsidiaries and Affiliates reserve
the right to terminate your Service at any time, with or without cause, and for any reason, subject
to applicable laws.

     13. Notices. Any notice required or permitted by this Agreement shall be in writing
and shall be deemed sufficient when delivered personally or sent by telegram or fax or 48 hours
after being deposited in the U.S. mail, as certified or registered mail, with postage prepaid, and

2

 

addressed to the Company at its principal corporate offices and to you at the address maintained
for you in the Company’s records.

     14. Entire Agreement; Enforcement of Rights. This Agreement, together with the Plan,
sets forth the entire agreement and understanding of the parties relating to the subject matter
herein and therein and merges all prior discussions between the parties. Except as contemplated
under the Plan, no modification of or amendment to this Agreement, nor any waiver of any rights
under this Agreement, shall be effective unless in writing signed by the parties to this Agreement.
The failure by either party to enforce any rights under this Agreement shall not be construed as a
waiver of any rights of such party.

     15. Governing Law. This Agreement and all acts and transactions pursuant hereto and
the rights and obligations of the parties hereto shall be governed, construed and interpreted in
accordance with the laws of the State of California, without giving effect to principles of
conflicts of law.

     16. Severability. If one or more provisions of this Agreement are held to be
unenforceable under applicable law, the parties agree to renegotiate such provision in good faith.
In the event that the parties cannot reach a mutually agreeable and enforceable replacement for
such provision, then (i) such provision shall be excluded from this Agreement, (ii) the balance of
this Agreement shall be interpreted as if such provision were so excluded and (iii) the balance of
this Agreement shall be enforceable in accordance with its terms.

     17. Successors and Assigns. The rights and benefits of this Agreement shall inure to
the benefit of, and be enforceable by the Company’s successors and assigns. The rights and
obligations of you under this Agreement may not be assigned without the prior written consent of
the Company.

     18. Counterparts. This Agreement may be executed in two or more counterparts, each of
which shall be deemed an original and all of which together shall constitute one instrument.

*  
*   *   *

(Signature Page Follows)

3

 

     IN WITNESS WHEREOF, the parties hereto have executed this Agreement on this ___ day of
                    , 200_.

FOUNDRY NETWORKS, INC.

	 	 	 	 	 	 	 	 	 
	By:
	 	 	 	 	 	 	 	 
	 	 	 	 	 
	 	 	(Signature)
	 	 
	 
	 	 	 	 	 	 	 	 
	Name:
	 	 	 	 	 	 	 	 
	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	Title:
	 	 	 	 	 	 	 	 
	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	RECIPIENT:
	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	 
	 
	 	 	 	 	 	 	 	 
	By:
	 	 	 	 	 	 	 	 
	 	 	 	 	 
	 	 	(Signature)
	 	 
	 
	 	 	 	 	 	 	 	 
	Address:
	 	 	 	 	 	 	 	 
	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	 
	 
	 	 	 	 	 	 	 	 
	Telephone Number:	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	Email Address:	 	 	 	 	 	 
	 	 	 	 	 	 	 

I,                                         , spouse of                     , have read and hereby approve the foregoing
Agreement. In consideration of the Company’s granting my spouse the right to the Restricted Stock
Units as set forth in the Agreement, I hereby agree to be bound irrevocably by the Agreement and
further agree that any community property or other such interest that I may have in the Restricted
Stock Units and the underlying Shares shall hereby be similarly bound by the Agreement. I hereby
appoint my spouse as my attorney-in-fact with respect to any amendment or exercise of any rights
under the Agreement.

	 	 	 
	 
	 

Spouse of Recipient

	 	 

4

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