Document:

Exhibit 10.2

 

EQUITY AWARD AGREEMENT

 

THIS AGREEMENT (this “Agreement”)
is made by and between Cowen Group, Inc.
(the “Company”), and [NAME], (the “Grantee”), as of [DATE].

 

RECITALS

 

WHEREAS, the Company desires to grant to the Grantee the
restricted stock units described herein (the “Award”),
subject to the terms of the Cowen Group, Inc. 2010 Equity and Incentive
Plan, as amended from time to time (the “Plan”);
and

 

WHEREAS, the Award shall consist of a grant of restricted
stock units in accordance with the terms and subject to the conditions set
forth in this Agreement and the Plan; and

 

WHEREAS, the Grantee has accepted the grant of the Award
and hereby agrees to the terms and conditions hereinafter stated; and

 

WHEREAS, the capitalized terms used but not defined herein
shall have the respective meanings given to them in the Plan;

 

NOW, THEREFORE, in
consideration of the foregoing recitals and of the promises and conditions
herein contained, it is agreed as follows:

 

ARTICLE
I

GRANT OF RESTRICTED STOCK UNITS

 

Section 1.1
- Grant of Restricted Stock Units.

 

The Award granted to the Grantee by the Company as
of [DATE] (the “Grant Date”) consists of
[NUMBER] restricted stock units (“RSUs”)
pursuant to the terms and subject to the conditions and restrictions of this
Agreement and the Plan.  Each RSU
constitutes an unfunded and unsecured promise of the Company to deliver (or
cause to be delivered) to the Grantee upon settlement, subject to the terms of
this Agreement, one share of Stock. 
Until such settlement and delivery, the Grantee has only the rights of a
general unsecured creditor, and no rights as a shareholder of the Company,
provided that, whenever a normal cash dividend is paid on shares of Stock, the
Company shall credit to the Grantee an amount of cash equal to the product of
the per-share amount of the dividend paid times the number of then unsettled
RSUs.  Such credited amounts shall be
paid to the Grantee when and only to the extent the Stock underlying the RSU is
transferred to the Grantee in accordance with Section 1.2 hereof.

 

Section 1.2
- Vesting and Settlement.

 

[VESTING
AND SETTLEMENT SCHEDULE]

 

 

Section 1.3
- Forfeiture.

 

Except as set forth above
[or pursuant to the Employment Agreement, if any], if the Grantee’s [employment
or] service with the [Employer][Board] is terminated, then any unvested or
unsettled RSUs awarded herein shall immediately be forfeited to the Company
[(and in the case of a voluntary resignation, such forfeiture shall occur as of
the commencement of the Notice Period, as described below)], and neither the
Grantee nor any of the Grantee’s successors, heirs, assigns, or personal
representatives shall thereafter have any further rights or interests in such
then-unvested or unsettled RSUs. 
Additionally, if the Company reasonably determines that the Grantee has
violated any of the restrictive covenants set forth in Section 2.3 herein
or to which Grantee is otherwise subject, then any then-unsettled RSUs shall
immediately be forfeited to the Company, and neither the Grantee nor any of the
Grantee’s successors, heirs, assigns, or personal representatives shall
thereafter have any further rights or interests in such unsettled RSUs.

 

Section 1.4
- Taxes.

 

The Grantee shall pay promptly upon request, at the
time the Grantee recognizes taxable income in respect of the shares underlying
the Award, the minimum amount equal to the federal, state, and local taxes the
Company determines are required to be withheld under applicable tax laws with
respect to the Award (the “Tax Withholding Amount”).  Such payment to the Company may be effected
through (a) payment by the recipient to the Company of the aggregate
withholding taxes in cash or cash equivalents; (b) at the discretion of
the Company, the Company’s withholding from the number of shares of Stock that
would otherwise be delivered to the Grantee upon settlement of the RSUs, a
number of shares of Stock with an aggregate fair market value on the date of
settlement (as determined by the Company) equal to the aggregate amount of
withholding taxes; or (c) at the discretion of the Company, any
combination of these two methods.

 

ARTICLE
II

MISCELLANEOUS

 

Section 2.1
- Definitions.

 

(a)                                  “Affiliate” means, with respect to
any entity, any other entity that, directly or indirectly through one or more
intermediaries, controls, is controlled by, or is under common control with,
such entity.

 

(b)                                 “Cause” shall have the meaning set
forth in the Employment Agreement, provided that if the Grantee is not a party
to any such Employment Agreement or such Employment Agreement does not contain
a definition of Cause, then Cause shall mean, when the [Employer][Board], in
its sole discretion in good faith, determines that: (1) the Grantee
has breached any provisions of the Plan or this Agreement, including, but not
limited to, any of the restrictive covenants set forth in Section 2.3
below, (2) the Grantee has been convicted of any crime (whether or not
related to the Grantee’s duties for the [Company][Employer] or any Affiliate), (3) the
Grantee has committed an act of fraud, dishonesty, gross negligence, or
substantial misconduct in his performance of his duties or responsibilities, (4) the
Grantee has 

 

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violated or has failed to comply with the internal
policies of the [Company][Employer] or any Affiliate or the rules and
regulations of any regulatory or self-regulatory organization with jurisdiction
over the [Company][Employer] or any Affiliate, or (5) the Grantee has
failed to perform the material duties of his position.

 

(c)                                  “Disability” shall [have the meaning
set forth in the Employment Agreement, provided that if the Grantee is not a
party to any such Employment Agreement or such Employment Agreement does not
contain a definition of Disability, then Disability shall ]mean that the
Grantee (1) is unable to engage in any substantial gainful activity by
reason of any medically determinable physical or mental impairment which can be
expected to result in death or can be expected to last for a continuous period
of not less than twelve (12) months or (2) is, by reason of any medically
determinable physical or mental impairment that can be expected to result in
death or can be expected to last for a continuous period of not less than
twelve (12) months, receiving income replacement benefits for a period of not
less than three (3) months under an accident and health plan covering
employees of the [Company][Employer] or any Affiliate.

 

(d)                                 [“Employer” means the Company or the
Affiliate of the Company that employs the Grantee.]

 

Section 2.2
- [Notice of Termination.

 

If the Grantee has an Employment Agreement which
contains a requirement that the Grantee provide prior notice of termination,
then the terms of such Employment Agreement shall govern the requisite notice
period; provided, however, if the Grantee is not a party to any
such Employment Agreement or such Employment Agreement does not contain a
requirement that the Grantee provide prior notice of termination, then the
Grantee shall not voluntarily resign without first giving the Employer at least
one hundred eighty (180) days’ prior written notice of the effective date of
such resignation (the “Notice Period”).  Such written notice shall be sent in
accordance with Section 2.7 of this Agreement.  The Employer retains the right to waive the
notice requirement in whole or in part or to accelerate such date of
termination without changing the characterization of such termination as a
voluntary termination by the Grantee.  In
the alternative, at any time after the Grantee gives notice, the Company may,
but shall not be obligated to, provide the Grantee with work and (a) require
the Grantee to comply with such conditions as it may specify in relation to
transitioning the Grantee’s duties and responsibilities, (b) assign the
Grantee other duties, or (c) withdraw any powers vested in or duties
assigned to the Grantee, without changing the characterization of such
termination as a voluntary resignation by the Grantee.][FOR EMPLOYEES ONLY]

 

Section 2.3
- Restrictive Covenants.

 

(a)                                  [Non-Solicitation.  If the Grantee has an Employment Agreement
which contains a non-solicitation provision, then the terms of such Employment
Agreement shall govern the terms of this non-solicitation provision; provided,
however, if the Grantee is not a party to any such Employment Agreement
or such Employment Agreement does not contain a non-solicitation provision,
then the Grantee agrees that during the Grantee’s employment (including any
applicable Notice Period), and for six (6) months following any
termination thereof, the 

 

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Grantee shall not, without the Company’s prior
written consent, directly or indirectly (1) solicit or induce, or cause
others to solicit or induce, any director, officer, or employee of the Company
or any Affiliate, to leave the Company or such Affiliate or in any way modify
his relationship with the Company or such Affiliate, (2) hire or cause
others to hire any director, officer, or employee of the Company or any
Affiliate, (3) encourage or assist in the hiring process of any director,
officer, or employee of the Company or any Affiliate, or in the modification of
any such person’s relationship with the Company or such Affiliate, or cause
others to participate, encourage, or assist in the hiring process of any
director, officer, or employee of the Company or any Affiliate, (4) interfere
in any way with the rendering of professional services by or to the Company or
any Affiliate by any client, prospective client, consultant, independent
contractor, or vendor, or his or its respective individual employees, or (5) solicit
the trade or patronage of any client or customer or any prospective client or
customer of the Company or any Affiliate (for this purpose a prospective client
or customer shall only include prospective clients or customers who were
actively solicited within the six (6) month period prior to the Grantee’s
termination where the Grantee participated in or was aware of such
solicitation), for purposes of engaging in any business relationship with
respect to any products, services, trade secrets, or other matters in which the
Company or such Affiliate is active, provides or has committed plans to
provide; provided, however, if Grantee’s new employer solicits a
client or customer without Grantee’s knowledge and without Grantee’s
participation, then such client or customer shall not be deemed to be a client
or customer or prospective client or customer for purposes of this Section 2.3(a)(5).][FOR
EMPLOYEES ONLY]

 

(b)                                 Non-Disclosure
of Confidential Information.  The Grantee shall not at any time, whether
during the Grantee’s [employment][service] or following any termination
thereof, directly or indirectly, disclose or furnish to any entity, firm,
corporation, or person, except as otherwise required by applicable law, any
Confidential Information of the Company or any Affiliate; provided, however,
that in the event disclosure is required by applicable law, the Grantee shall,
as soon as reasonably practicable, provide the Company or such Affiliate, as
applicable, with prompt notice of such requirement prior to making any
disclosure, so that the Company or such Affiliate, as applicable, may, at its
sole expense, seek an appropriate protective order.  “Confidential Information”
shall mean information generally unknown to the public to which the Grantee
gains access by reason of the Grantee’s relationship with the Company or any
Affiliate, and includes, but is not limited to, information relating to all
present or potential customers, business and marketing plans, track records,
sales, trading, and financial data and strategies, salaries and employment
benefits, and operational costs. 
Confidential Information shall not include any information made
available to the public by the Company or any Affiliate or any third party
(other than acts by Grantee in violation of this Agreement), so long as such
third party is not known by Grantee to be bound by a confidentiality agreement
with the Company or any Affiliate or otherwise prohibited from transmitting the
information to Grantee by a contractual, legal or fiduciary obligation of which
Grantee is aware, nor shall it include general business or investment methods
or information that Grantee obtained prior to Grantee’s [employment with Employer][service
on the Board].

 

(c)                                  Non-Disparagement.  The Grantee shall not at any time, whether
during the Grantee’s [employment][service on the Board] or following any
termination thereof, and shall not cause or induce others to, defame or
disparage the Company or any Affiliate, or the directors, officers or employees
of the Company or any Affiliate.

 

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(d)                                 Company
Property.  All
records, files, memoranda, reports, customer information, client lists, documents,
and equipment relating to the business of the Company or any Affiliate that the
Grantee prepares or possesses, or with which the Grantee comes into contact, in
either case while the Grantee is [an employee of][providing services to] the
Company or any Affiliate, shall remain the property of the Company or such
Affiliate.  The Grantee agrees that upon
the Grantee’s termination of [employment][service] for any reason, the Grantee
shall provide to the Company and any Affiliate, as applicable, all documents,
papers, files, and other material in the Grantee’s possession and under the
Grantee’s control that are connected with or derived from the Grantee’s
services to the Company or any Affiliate. 
The Grantee agrees that the Company or the applicable Affiliate owns all
work product, patents, copyrights, and other material produced by the Grantee
during the Grantee’s [employment][service] 
with the Company and any Affiliate.

 

(e)                                  Compliance with
Company Policies.  The Grantee
agrees to comply fully with the applicable internal policies of the Company and
the Employer, as applicable, as such policies may be amended from time to time,
at any time, during the Grantee’s [service on the Board][employment by Company
or the Employer].

 

(f)                                    Cooperation.  The Grantee agrees to cooperate fully with
the Company [and the Employer] at any time, whether during the Grantee’s
[service on the Board][employment] or following any termination thereof, taking
into account the requirements of any subsequent employment by the Grantee, on
all matters relating to the Grantee’s [employment][services], which cooperation
shall be provided without additional consideration or compensation and shall
include, without limitation, being available to serve as a witness and be
interviewed and making available any books, records, and other documents within
the Grantee’s control, provided, however, that the Grantee need
not take any action hereunder that would constitute a violation of law or
obligation to any third party (except to the extent such obligation arises due
to any action taken by the Grantee with the intention to circumvent the
operation of this Section 2.3(f)) or cause a waiver of attorney-client
privilege.  Without limiting the
generality of the foregoing, the Grantee shall cooperate in connection with any
(1) past, present, or future suit, countersuit, action, arbitration,
mediation, alternative dispute resolution process, claim, counterclaim, demand,
and proceeding, (2) inquiry, proceeding, or investigation by or before any
governmental authority, and (3) arbitration or mediation tribunal, in each
case involving the Company, the Employer, or any of their controlled
Affiliates.  In connection with the
Grantee’s providing such cooperation, the Company or the Employer, as
applicable, shall reimburse the Grantee for reasonable travel, lodging, and
other expenses incurred by the Grantee, upon submission of documentation
reasonably acceptable to the Company or the Employer, as applicable.

 

Section 2.4
- Injunctive Relief.

 

In the event of a breach by the Grantee of the
Grantee’s obligations under this Agreement, the Company, in addition to being
entitled to exercise all rights granted by law, including recovery of damages,
will be entitled to specific performance of its rights under this Agreement.  The Grantee acknowledges that the Company
shall suffer irreparable harm in the event of a breach or prospective breach of
any of the restrictive covenants set forth in Section 2.3 herein, and that
monetary damages would not be adequate relief. 
Accordingly, the Company shall be entitled to seek injunctive relief in
any federal or state court of competent jurisdiction located in New York
County, or in any state in which the Grantee resides.  The Grantee further 

 

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agrees that the Company and
the Employer shall be entitled to recover all costs and expenses (including
attorneys’ fees and expenses) incurred in connection with the enforcement of
the Company’s rights hereunder.

 

Section 2.5
- Offset.

 

[In the event that the Grantee voluntarily
terminates employment or if the Grantee’s employment is terminated, for any
reason or no reason, the Company may offset, to the fullest extent permitted by
law, any amounts of money or other property due to the Company from the
Grantee, or advanced or loaned to the Grantee by the Company, from any money or
property owed to the Grantee or the Grantee’s estate by the Company as a result
of such termination of employment, except to the extent such withholding or
offset is not permitted under Section 409A of the Code (“Section 409A”), without the imposition of additional
taxes or penalties on the Grantee.][FOR EMPLOYEES ONLY]

 

Section 2.6
- Governing Law.

 

This Agreement shall be governed by and construed in
accordance with the laws of the State of New York other than its laws regarding
conflicts of law (to the extent that the application of the laws of another
jurisdiction would be required thereby). 
The Company shall have final authority to interpret and construe this
Agreement and to make any and all determinations under them, and its decision
shall be binding and conclusive upon the Grantee and the Grantee’s legal
representative in respect of any questions arising under this Agreement.

 

Section 2.7
- Notices.

 

Any notice to be given under the terms of this
Agreement shall be in writing and addressed to the Company at 599 Lexington
Avenue, New York, New York 10022, Attention: General Counsel, and to the
Grantee at the Grantee’s home address as of the date of this Agreement or at
such other address as either party may hereafter designate in writing to the
other by like notice.

 

Section 2.8
- Effect of Agreement.

 

Except as otherwise provided hereunder, this
Agreement shall be binding upon and shall inure to the benefit of any successor
or successors of the Company.

 

Section 2.9
- Amendment.

 

This Agreement may not be
amended or modified in any manner (including by waiver) except by an instrument
in writing signed by both parties hereto. 
The waiver by either party of compliance with any provision of this
Agreement shall not operate or be construed as a waiver of any other provision
of this Agreement or of any subsequent breach of such party of a provision of
this Agreement.

 

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Section 2.10
- [No Right to Continued Employment.

 

Nothing in this Agreement shall be deemed to confer
on the Grantee any right to continued employment with the Company, Employer or
any Affiliate.][FOR EMPLOYEES ONLY]

 

Section 2.11
- Section 409A.

 

This Agreement is intended to comply with the
requirements of Section 409A, and shall be interpreted accordingly.  In the event that any provision of this
Agreement would cause this Agreement to become subject to Section 409A or
cause this Agreement to fail to comply with Section 409A, such provision
may be deemed null and void, and the Company and the Grantee agree to amend or
restructure this Agreement to the extent necessary and appropriate to avoid
adverse tax consequences under Section 409A.

 

Section 2.12
- Entire Agreement.

 

Except as otherwise specified herein, this Agreement
constitutes the entire agreement of the parties with respect to the subject
matter hereof and supersedes in its entirety all prior undertakings,
agreements, correspondence, and term sheets of or between the Company and the
Grantee with respect to the subject matter hereof.

 

Section 2.13
- Arbitration.

 

(a)                                  Any and all
disputes arising out of or relating to this Agreement or to the Grantee’s
[employment with the Company, the Employer, or any of their controlled
Affiliates, including any statutory claims based on alleged
discrimination][service on the Board], shall be submitted to, and resolved
exclusively by, the American Arbitration Association (“AAA”)
pursuant to the AAA’s Employment Arbitration Rules and Mediation
Procedures.  The arbitration shall be
held in the City of New York.  In
agreeing to arbitrate these disputes, the Grantee recognizes that the Grantee
is waiving his right to a trial in court and by a jury.  The arbitration award shall be final and
binding upon both parties, and judgment upon the award may be entered in a
court of competent jurisdiction.

 

(b)                                 The arbitrators
shall not have authority to amend, alter, modify, add to, or subtract from the
provisions hereof.  The award of the
arbitrators, in addition to granting the relief prescribed above and such other
relief as the arbitrators may deem proper, may contain provisions commanding or
restraining acts or conduct of the parties or their representatives and may
further provide for the arbitrators to retain jurisdiction over this Agreement
and the enforcement thereof.  If either
party shall deliberately default in appearing before the arbitrators, the
arbitrators are empowered, nonetheless, to take the proof of the party appearing
and render an award thereon.

 

(c)                                  This Section 2.13
shall not be construed to limit the Company’s right to obtain relief under Section 2.4
(relating to equitable remedies) with respect to any matter or controversy
subject to Section 2.4, and pending a final determination by the
arbitrators with respect to any such matter or controversy, the Company shall
be entitled to obtain any such relief by direct 

 

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application to state, federal, or other applicable court,
without being required to first arbitrate such matter or controversy.

 

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IN WITNESS WHEREOF, the Company has caused
this Agreement to be executed on its behalf by a duly authorized officer, and
the Grantee has hereunto set the Grantee’s hand on the date indicated below.

 

 

	
   

  	
   

  	
  COWEN GROUP, INC.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
   

  	
  Title:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Grantee:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Date:Exhibit
10.1

 

	
  

  	
  20415 Nordhoff Street

  
	
   

  	
  Chatsworth, California 91311

  

 

SEPARATION AND RELEASE AGREEMENT

 

This SEPARATION AND RELEASE AGREEMENT (this “Agreement”)
is entered into as of the 8th day of June, 2010, by and between MRV
Communications, Inc., a Delaware corporation (“MRV”)
and Noam Lotan (the “Executive”).

 

WHEREAS, MRV and the Executive are parties to a
Key Employee Agreement dated as of March 23, 1992, as amended on August 10,
1992 and November 16, 1994 (the “Employment Agreement”);

 

WHEREAS, the Executive and MRV agree to terminate
his employment with MRV; and

 

WHEREAS, the Executive and MRV intend the terms
and conditions of this Agreement to govern all issues related to the Executive’s
employment and separation from MRV.

 

NOW, THEREFORE, in
consideration of the covenants and mutual promises contained in this Agreement,
the Executive and MRV agree as follows:

 

1.             Resignation; Termination of Employment.  The Executive hereby confirms that (a) effective
as of June 30, 2010 (the “Termination Date”),
his employment with MRV will terminate and he will resign from his position as
Chief Executive Officer of MRV and as a director of MRV and (b) he will
not be eligible for any benefits or compensation after the Termination Date,
other than as specifically provided herein. 
In addition, effective as of the Termination Date, the Executive hereby
confirms his resignation from all other offices, directorships, trusteeships,
committee memberships and fiduciary capacities held with, or on behalf of, MRV
or its subsidiaries or affiliates (collectively, “Affiliates”)
or any benefit plans of MRV or any Affiliate. 
The Executive will execute the resignations attached as Exhibit A
contemporaneously with his execution of this Agreement.  On and after the Termination Date, the
Executive acknowledges and agrees that he will not represent himself as being
an employee, officer, director, trustee, member, partner, agent or
representative of MRV or any Affiliate for any purpose and will not make any
public statements on behalf of MRV or any Affiliate.

 

2.             Severance Benefits.  Subject to the terms and conditions of this
Agreement, including the Executive’s executing (and not revoking) this
Agreement and the Supplemental General Release, the Executive acknowledges and
agrees that he will not be eligible for any compensation or benefits after the
Termination Date except for the following:

 

a.             Lump Sum
Severance Payment.  A cash
payment paid in two installments, provided that the Executive has not revoked
the execution of this Agreement or the Supplemental General Release:  the first installment of $548,537.50

 

 

will be paid on the 30th
day following the Termination Date and the second installment of $85,000 will
be paid on January 2, 2011.

 

b.             Employee
Benefits.

 

(i)            Health Benefits. 
Subject to
the Executive’s timely election of continuation coverage under the Consolidated
Budget Omnibus Reconciliation Act of 1985, as amended (“COBRA”)
and remaining eligible for COBRA coverage, continued participation in the
medical, dental and vision plans maintained by MRV for a period of up to 18
months following the Termination Date (the “Coverage
Period”) as if the Executive had continued in employment with
MRV during such period (including the Executive’s obligation to pay the
employee portion of any contribution or premium but excluding an employee’s
ability to pay premiums with pre-tax dollars). 
If the Executive continuously receives health benefits under this Section 2.b.(i) from
the Termination Date through the end of the Coverage Period, MRV shall
thereafter, for a period of up to six months, pay the Executive on the first
business day of each month, a lump sum cash amount equal to the employer
portion of the premium cost MRV would have paid on the Executive’s behalf if he
were an active employee of MRV. 
Notwithstanding the foregoing, MRV’s obligations under this Section 2.b.(i) shall
terminate if the Executive fails to pay any required contribution or premium or
if the Executive becomes eligible for health benefits of a subsequent employer
(whether or not the Executive accepts such benefits), except that MRV’s
obligation to continue to make available continuation coverage under COBRA at
the full COBRA rates shall be determined in accordance with COBRA.  The Executive will notify MRV of his
eligibility for medical, dental or vision benefits from a subsequent employer
within 30 days of such eligibility.

 

(ii)           Tax-Qualified Plans.  The Executive
shall be eligible to receive any accrued, vested benefits to which he is
otherwise entitled under the tax-qualified 401(k) plans maintained by MRV
and its Affiliates.

 

c.             Stock
Options.  Pro-rata vesting
as of the Termination Date of the outstanding unvested stock option to purchase
shares of common stock of MRV granted on October 29, 2002.  A list of the Executive’s outstanding stock
options that will be vested as of the Termination Date is attached as Exhibit B. 
Except as set forth on Exhibit B hereto, all outstanding
stock options vested as of the Termination Date will remain exercisable until
the third anniversary of the Termination Date, but in no event beyond the
actual expiration date of the stock option set forth on Exhibit B,
and will remain subject to all of the terms and conditions of, the applicable
stock option plan and stock option agreement, to the extent not contrary to the
terms of this Agreement.  Any stock
options not vested as of the Termination Date automatically shall be forfeited
as of the Termination Date.

 

d.             Outplacement
Services.  Provision of
outplacement services during the six-month period following the Termination
Date (or, if earlier, until the first acceptance by the Executive of an offer
of employment) through a reputable and experienced vendor selected by MRV, up
to a maximum cost to MRV of $7,500.

 

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e.             Other
Amounts.  A lump sum cash
payment on the date the first installment payment specified in sub-paragraph
2.a above is to be paid equal to the sum of (i) the reasonable business
and entertainment expenses incurred by the Executive prior to the date of this
Agreement and reimbursable under MRV’s expense reimbursement policy (subject to
the Executive’s presentation of appropriate documentation prior to the
Termination Date) and (ii) the Executive’s accrued but unused vacation
time through the Termination Date required to be paid under MRV’s vacation
policy.

 

3.             Return of Property.  The Executive represents to MRV that he
has destroyed or returned to MRV any and all files or other property (both
tangible and intellectual) of MRV and any Affiliate containing or relating to
Confidential Information (as defined below) and any and all other property
belonging to MRV and its Affiliates, including, but not limited to, all
rolodexes (except to the extent such rolodex does not contain information other
than name, address, telephone number and similar information), identification
cards, credit cards, computers, fax machines, cellular or other telephones,
Blackberries, beepers, PDA’s, keys, card access keys to any building of MRV or
any Affiliate, deeds, contracts, office equipment and supplies, records and
computer disks.

 

4.             Full Discharge.  The Executive agrees and acknowledges that
the payments and benefits provided in Section 2 and the other
entitlements hereunder: (a) are in full discharge of any and all
liabilities and obligations of MRV to the Executive, monetarily or with respect
to compensation (including base salary and bonus), employee benefits or
otherwise, including any and all obligations arising under any alleged written
or oral employment agreement, policy, plan or procedure of MRV or any
Affiliate, including the Employment Agreement and/or any alleged understanding
or arrangement between the Executive and MRV or any of its officers or
directors; and (b) exceed any payment, benefit, or other thing of value to
which the Executive might otherwise be entitled but for this Agreement under
any policy, plan or procedure of MRV or any prior agreement between the
Executive and MRV, except for accrued, vested amounts under any tax-qualified
401(k) plans maintained by MRV and its Affiliates, which amounts, if any,
will be paid in accordance with the terms of such plan.  Notwithstanding the foregoing, the Executive
will retain any conversion rights he may have under the key man life insurance
policy maintained by MRV covering his life.

 

5.             Future Conduct and Obligations.

 

a.             Continuing
Obligations under the Employment Agreement.  The Executive hereby agrees that the
termination of the Executive’s employment will not affect the provisions of the
Employment Agreement which impose continuing obligations on him following
termination of the Employment Agreement and specifically acknowledges the
existence and applicability of Sections 6 and 7 thereof (including the
Proprietary Information and Inventions Agreement).  Such restrictions will remain in full force
and effect following the Termination Date as provided in the Employment
Agreement.

 

b.             Confidentiality. 
The Executive agrees that, following the Termination Date, he will not,
directly or indirectly, use, make available, sell, disclose or otherwise
communicate to any person, any business and technical information or trade
secrets, 

 

3

 

nonpublic, proprietary or
confidential information, knowledge or data relating to MRV, its Affiliates or
their businesses, which the Executive obtained during his employment with MRV (“Confidential Information”).  Notwithstanding the foregoing, “Confidential
Information” will not apply to information that: (i) was known to the
public prior to its disclosure to the Executive; (ii) becomes generally
known to the public subsequent to disclosure to the Executive through no
wrongful act of the Executive or any of the Executive’s; or (iii) the
Executive is required to disclose by applicable law, regulation or legal
process (provided that the Executive provides MRV with prior notice of the
contemplated disclosure and reasonably cooperate with MRV at its expense in
seeking a protective order or other appropriate protection of such
information).

 

c.             Non-Solicitation
of Business Partners. 
Unless prior written approval is given by the Chairman of the Board of
Directors of MRV or the Chief Executive Officer of MRV, the Executive agrees
that, during the two-year period following the Termination Date (the “Restricted Period”), he will not,
either directly or indirectly, induce, influence, persuade, solicit or attempt
to induce, influence persuade, or solicit any business partner, vendor,
customer or supplier of MRV and its Affiliates to terminate the business
relationship of such person with MRV and its Affiliates, to materially reduce
the amount of business conducted with MRV and its Affiliates or in any way
interfere with the relationship between any such business partner, vendor,
customer or supplier and MRV and its Affiliates.

 

d.             Non-Solicitation
of Employees.  Unless
prior written approval is given by the Chairman of the Board of Directors of
MRV or the Chief Executive Officer of MRV, the Executive agrees that, during
the Restricted Period, he will not, either directly or indirectly, hire
employees or former employees of MRV and its Affiliates (which shall for this
purpose only include individuals employed by MRV and its Affiliates at any
point during the six months preceding such hiring) or induce, influence,
persuade, solicit or attempt to induce, influence persuade, or solicit any
employees of MRV and its Affiliates to leave the employ of MRV and its
Affiliates, nor will he help others to do so.

 

e.             Non-Disparagement. 
The Executive, for himself and for his heirs, dependents, assigns,
agents, executors, administrators, trustees and legal representatives agrees
that he will not, or encourage or induce others to, Disparage MRV, its
Affiliates or any of their past and present officers, directors, employees,
stockholders, products or services.  “Disparage” includes, without
limitation, making comments or statements to the press, MRV’s or any Affiliate’s
employees or any individual or entity with whom MRV or an Affiliate has a business
relationship (including, without limitation, any vendor, supplier, customer or
distributor of MRV or any Affiliate) that could adversely affect in any manner:
(i) the conduct of the business of MRV or any Affiliate (including,
without limitation, any products or business plans or prospects); or (ii) the
business reputation of MRV, its Affiliates, or any of their products or
services, or the business or personal reputation of MRV’s or an Affiliate’s
past or present officers, directors, employees or stockholders.  MRV agrees that it will not issue any press
release or other official written statement, and it will direct its senior
executive officers as of the Termination Date and directors of MRV as of the
Termination Date, while employed by MRV or serving as a director of MRV, to not
make any public statements that could 

 

4

 

adversely affect the
business or personal reputation of the Executive.  Nothing herein shall prohibit either party (A) from
responding truthfully to any governmental investigation, legal process or
inquiry related thereto or from fulfilling any disclosure requirements or (B) from
making statements such party in good faith believes are necessary or
appropriate to make to rebut untrue or misleading statements by the other, and
the limitations on MRV’s senior executive officers and directors shall not
prohibit statements they believe are reasonably necessary or appropriate to
make in connection with the good faith performance of their duties for MRV and
its Affiliates.

 

f.              Other Assistance. 
Upon the receipt of notice from MRV (including outside counsel), the
Executive agrees to respond and provide information with regard to matters in
which he has knowledge as a result of his employment with, or serving as a
director of, MRV and to assist and cooperate with MRV and its representatives
in the defense or prosecution of any claims that may be made or threatened by
or against MRV or any Affiliate, to the extent that such claims may relate to the
period of the Executive’s employment or service with MRV, including any
proceeding before any arbitral, administrative, judicial, legislative, or other
body or agency, including preparing for and testifying in any proceeding to the
extent such claims, investigations or proceedings relate to services performed
by the Executive, pertinent knowledge possessed by the Executive, or any act or
omission by the Executive.  The Executive
will perform such acts and execute and deliver such documents that may be reasonably
necessary to carry out the provisions of this Section 5.f.  The Executive agrees to promptly inform MRV
if he becomes aware of any lawsuits involving such claims that may be filed or
threatened against MRV or any Affiliate. 
The Executive also agrees to promptly inform MRV (to the extent he is
legally permitted to do so) if he is asked to assist in any investigation of
MRV or any Affiliate (or their actions), regardless of whether a lawsuit or
other proceeding has then been filed against MRV or an Affiliate with respect
to such investigation, and will not do so unless legally required.  Upon presentment to MRV of appropriate
documentation, MRV will reimburse the Executive for the reasonable
out-of-pocket expenses incurred as a result of such cooperation.  MRV agrees that it will coordinate any such
request for cooperation with the Executive’s other business or professional
commitments and responsibilities to minimize the degree to which such request
interferes with such commitments and responsibilities.

 

g.             Tolling.  In the event of any violation of the
provisions of this Section 5, the Executive acknowledges and agrees
that the post-termination restrictions contained in this Section 5
shall be extended by a period of time equal to the period of such violation, it
being the intention of the parties hereto that the running of the applicable
post-termination restriction period shall be tolled during any period of such
violation.

 

h.             Equitable
Relief.  Notwithstanding anything in this Agreement to
the contrary, in the event of a breach or threatened breach by either party of
the provisions of Section 5, (i) the Executive acknowledges
that MRV’s and its Affiliates’ remedies at law would be inadequate and MRV acknowledges that the
Executive’s remedies at law would be inadequate and, in recognition of this
fact, each party agrees that, in the event of such a breach or threatened
breach, in addition to any remedies at law, each party, without posting any
bond, shall be entitled to obtain equitable relief in the form of specific 

 

5

 

performance, a temporary
restraining order, a temporary or permanent injunction or any other equitable
remedy which may then be available and (ii) any controversy or claim
arising out of or relating to Section 5 will not be settled by
mediation or arbitration and the parties hereby irrevocably submit to the
exclusive jurisdiction of any state or federal court in Los Angeles, California
for any suit, action or proceeding arising out of or relating to or concerning Section 5
of this Agreement.

 

i.              Reformation.  If it is determined by any court of competent
jurisdiction that the covenants in this Section 5 are unenforceable
under the laws of any state by reason of their extending for too great a period
of time or over too great a geographical area or by reason of their being too
extensive in any other respect, they shall be interpreted to extend only over
the maximum period of time for which they may be enforceable and/or over the
maximum geographical area as to which they may be enforceable and/or to the
maximum extent in all other respects as to which they may be enforceable, all
as determined by such court in such action.

 

6.             General Release.

 

a.             For and in consideration of the
payments to be made and the promises set forth in this Agreement, the
Executive, for himself and for his heirs, dependents, assigns, agents,
executors, administrators, trustees and legal representatives (collectively,
the “Releasors”) hereby forever
releases, waives and discharges the Released Parties (as defined below) from
each and every claim, demand, cause of action, fee, liability or right of any
sort (based upon legal or equitable theory, whether contractual, common-law,
statutory, federal, state, local or otherwise), known or unknown, which
Releasors ever had, now have, or hereafter may have against the Released
Parties by reason of any actual or alleged act, omission, transaction,
practice, policy, procedure, conduct, occurrence, or other matter from the
beginning of the world up to and including the Effective Date (as defined in Section 18),
including without limitation, those in connection with, or in any way related
to or arising out of, the Executive’s employment or termination of employment
or any other agreement, understanding, relationship, arrangement, act, omission
or occurrence, with the Released Parties.

 

b.             Without limiting the generality of
the previous paragraph, this Release is intended to and shall release the Released Parties from any and all claims, whether known or
unknown, which Releasors ever had, now have, or may hereafter have against the
Released Parties including, but not limited to: 
(1) any claim of discrimination or retaliation under the Age
Discrimination in Employment Act, Title VII of the Civil Rights Act, the
Americans with Disabilities Act, the Fair Labor Standards Act, the Employee
Retirement Income Security Act of 1974, as amended (excluding claims for
accrued, vested benefits under any employee benefit or pension plan of the Released
Parties subject to the terms and conditions of such plan and applicable law)
and the Family and Medical Leave Act; (2) any claim under the Constitution
of the State of California, the California Fair Employment and Housing Act, the
California Labor Code, the California Civil Code, the Unruh and George Civil
Rights Acts, the California Family Rights Act, the California Government Code,
the California Pregnancy Disability Leave Law, the California Workers’
Compensation Act or the California Continuation Benefits 

 

6

 

Replacement Act; (3) any
other claim (whether based on federal, state or local law or ordinance,
statutory or decisional) relating to or arising out of the Executive’s
employment, the terms and conditions of such employment, the termination of
such employment and/or any of the events relating directly or indirectly to or
surrounding the termination of such employment, including, but not limited to,
breach of contract (express or implied), tort, wrongful discharge, detrimental
reliance, defamation, emotional distress or compensatory or punitive damages;
and (4) any claim for attorney’s fees, costs, disbursements and the
like.  To the maximum extent permitted by
law, the Executive also promises never directly or indirectly to bring or
participate in an action against any Released Party under California Business &
Professions Code Section 17200 or under any other unfair competition law
of any jurisdiction with respect to the Executive’s employment with MRV or the
termination thereof.

 

c.             MRV and the Executive acknowledge and agree
that the release set forth
in this Section 6 does not in any way affect: (1) the
Executive’s rights of indemnification and directors and officers liability
insurance coverage under Section 11; (2) the Executive’s
accrued, vested rights under any tax-qualified 401(k) plans maintained by MRV and its
Affiliates; and (3) the
right of the Executive to take whatever steps may be necessary to enforce the
terms of this Agreement.

 

d.             The Executive hereby expressly and
knowingly waives application of Section 1542 of the California Civil Code
and all comparable, equivalent or similar provisions of state or federal
law.  The Executive further certifies
that the Executive has read and understands the provisions of Section 1542
of the California Civil Code, which reads as follows:

 

“A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE
CREDITOR DOES NOT KNOW OR SUSPECT TO EXIST IN HIS OR HER FAVOR AT THE TIME OF
EXECUTING THE RELEASE, WHICH IF KNOWN BY HIM OR HER MUST HAVE MATERIALLY
AFFECTED HIS SETTLEMENT WITH THE DEBTOR.”

 

e.             For purposes of this Release, the “Released Parties” means MRV, all
current and former parents, subsidiaries, related companies, partnerships,
joint ventures and employee benefit programs (and the trustees, administrators,
fiduciaries and insurers of such programs), and, with respect to each of them,
their predecessors and successors, and, with respect to each such entity, all
of its past, present, and future employees, officers, directors, members,
stockholders, owners, representatives, assigns, attorneys, agents, insurers,
and any other person acting by, through, under or in concert with any of the
persons or entities listed in this paragraph, and their successors (whether
acting as agents for such entities or in their individual capacities).

 

7.             Supplemental General Release.  The Executive agrees to execute the
Supplemental General Release attached as Exhibit C after the
Termination Date and to deliver the executed Supplemental General Release to
MRV within 21 days after the Termination Date. 
The Executive agrees that all MRV covenants (including MRV’s obligation
to make or provide payments and benefits pursuant to Section 2)
that relate to its obligations beyond the Termination 

 

7

 

Date are contingent on the Executive’s execution of (and not revoking)
the Supplemental General Release.

 

8.             No Existing Suit.  The Executive represents and warrants that,
as of the Effective Date of this Agreement, he has not filed or commenced any
suit, claim, charge, complaint, action, arbitration, or legal proceeding of any
kind against MRV or any Affiliate.  The
Executive acknowledges that this Agreement does not prohibit him from filing a
charge of discrimination with the Equal Employment Opportunity Commission (“EEOC”), from enforcing this
Agreement and recovering for any breach of it, or from exercising any rights
under California Labor Code Section 2802. 
The Executive waives, however, any right to any monetary recovery or
other relief should the EEOC or any other agency pursue a claim on the
Executive’s behalf.

 

9.             Certain Forfeitures in Event of Breach or Other
Liability to MRV.  The
Executive acknowledges and agrees that, notwithstanding any other provision of
this Agreement, if the Executive materially breaches any obligation under this
Agreement, or there is a final determination by a court of competent
jurisdiction or an arbitrator, or an agreement by the Executive as part of a settlement,
that the Executive is otherwise liable to MRV or any Affiliate, MRV retains the
right to recoup any and all payments and benefits provided for in Section 2,
any damages suffered by MRV or any Affiliate, plus reasonable attorneys’ fees
incurred in connection with such recovery and, to the extent that such benefits
have not been fully disbursed to the Executive, MRV reserves its rights to stop
all future disbursements of such benefits, except to the extent that such
action is prohibited by law or would result in the invalidation of the release
provided by the Executive under this Agreement. 
The parties agree that any breach of the covenants in Section 5
or Sections 6 and 7 of the Employment Agreement (including the Proprietary
Information and Inventions Agreement) shall be deemed a material breach of an
obligation under this Agreement.

 

10.           MRV Release.

 

a.             For and in consideration of the
promises set forth in this Agreement, MRV and each of its Affiliates hereby
forever releases, waives and discharges the Executive from each and every
claim, demand, cause of action, fees, liabilities or right of any sort (based
upon legal or equitable theory, whether contractual, common-law, statutory,
federal, state, local or otherwise) which MRV and each of its Affiliates has
against the Executive that are known by any director of MRV (other than the
Executive) or the General Counsel (collectively, “Known
Company Claims”), including any Known Company Claims based on or
relating to, or arising out of, the Executive’s employment or termination of
employment; provided, however, notwithstanding the
generality of the foregoing, nothing herein will be deemed to release the
Executive from (a) any knowing violations of law, (b) any knowing acts of misconduct or negligence
engaged in by the Executive while employed as an employee of MRV or while
serving as an officer or director of MRV or any of its Affiliates, including
misappropriation, fraud
or theft, or (c) any other act or omission that would constitute grounds
for terminating the Executive’s employment for “cause” (as defined in Section 2.4
of the Employment Agreement).  In
addition, it is agreed and understood that Known Company Claims shall not
include any matter related to, or arising out of, the pending stock option class
and derivative litigation (respectively styled, Ramsey, et
al. v. MRV Communications, Inc., et al.,
Case No. 08-cv-

 

8

 

4561 GAF; In re MRV Communications, Inc. Derivative Litigation,
Case No. 08-cv-3800 GAF; and Ke v. Margalit, et al.,
Los Angeles Superior Court Case No. BC 393856).

 

b.             MRV hereby expressly and knowingly
waives application of Section 1542 of the California Civil Code and all
comparable, equivalent or similar provisions of state or federal law.  Section 1542 of the California Civil
Code reads as follows:

 

“A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE
CREDITOR DOES NOT KNOW OR SUSPECT TO EXIST IN HIS OR HER FAVOR AT THE TIME OF
EXECUTING THE RELEASE, WHICH IF KNOWN BY HIM OR HER MUST HAVE MATERIALLY
AFFECTED HIS SETTLEMENT WITH THE DEBTOR.”

 

11.           Indemnification; Liability Insurance.  The
Executive shall continue to be entitled to indemnification under the
by-laws of MRV as in effect on the Effective Date.  In addition, MRV shall continue to cover the
Executive under directors and officers liability insurance while potential
liability exists in the same amount and to the same extent as MRV covers its
officers and directors.

 

12.           Entire Agreement; Severability; Waiver; Amendments. 
This Agreement (including the Exhibits hereto) and the agreements
referenced herein contain the entire agreement of the parties relating to the
subject matter hereof, and supersede in their entirety any and all prior
agreements, understandings or representations relating to the subject matter
hereof, including the Employment Agreement (other than as specifically provided herein).  No agreements or representations, oral or
otherwise, express or implied, with respect to the subject matter hereof have
been made by either party which are not expressly set forth in this
Agreement.  The provisions of this Agreement shall be deemed
severable and, if any provision is found to be illegal, invalid or
unenforceable for any reason, (i) the provision will be amended automatically
to the minimum extent necessary to cure the illegality or invalidity and permit
enforcement and (ii) the illegality, invalidity or unenforceability will
not affect the legality, validity or enforceability of the other provisions
hereof.  No waiver by either party hereto at any time of any
breach by the other party hereto of, or compliance with, any condition or
provision of this Agreement to be performed by such other party shall be deemed
a waiver of similar or dissimilar provisions or conditions at the same or any
prior or subsequent time.  No
amendments, alterations or modifications of this Agreement will be valid unless
made in writing and signed by the Executive and a duly authorized officer or director of MRV.

 

13.           Governing Law.  This Agreement shall be governed by, and
construed under and in accordance with, the internal laws of the State of
California, without reference to rules relating to conflicts of laws.

 

14.           No Transfer by Executive. 
The Executive represents and warrants that he has not sold, assigned,
transferred, conveyed or otherwise disposed of to any third party, by operation
of law or otherwise, any action, cause of action, suit, debt, obligations,
account, contract, agreement, covenant, guarantee, controversy, judgment,
damage, claim, counterclaim, liability or demand of any nature whatsoever
relating to any matter covered by this Agreement.  

 

9

 

This Agreement is personal
to the Executive and he may not assign, pledge, delegate or otherwise transfer
any of his rights, obligations or duties under this Agreement.

 

15.           Dispute Resolution.  The parties hereto may attempt to resolve any dispute
hereunder informally via mediation or other means.  Otherwise, the parties agree that all disagreements,
disputes and controversies arising under or in connection with this Agreement
will be settled by arbitration conducted before a single arbitrator mutually
agreed to by MRV and the Executive, sitting in Los Angeles, California or such
other location agreed to by the parties, in accordance with the Commercial
Arbitration Rules of the American Arbitration Association then in effect
and in accordance with California Code of Civil Procedure Section 1281,
1282 and 1283, et. seq.; provided, however,
that if MRV and the Executive are unable to agree on a single arbitrator within
30 days of the demand by another party for arbitration, an arbitrator will be
designated by the Los Angeles Office of the American Arbitration Association.  The determination of the arbitrator will set
forth in writing findings of fact and conclusions of law upon which the
determination was based, and will be final and binding on the parties.  Each party waives right to trial by jury and
further review or appeal of the arbitrator’s ruling, except as provided in
California Code of Civil Procedure Section 1286.2.  Judgment may be entered on the award of the
arbitrator in any court having proper jurisdiction.  The costs of arbitration, including the
arbitrator’s fees and expenses, will be borne equally by the parties unless
otherwise determined by the arbitrator. 
Each party shall pay its own attorneys’ fees and expenses in connection
with any such arbitration.

 

16.           Notices.  Any notice, waiver
or other communication given hereunder (a “Notice”) will
be in writing and will be deemed to have been duly given under this Agreement
(except as set forth in Section 18  in respect
of a written notice of revocation) will be in writing and will be deemed to have been
duly given (a) on the date of delivery if delivered by hand, (b) on
the date of transmission, if delivered by confirmed facsimile (with a Notice
contemporaneously given by another method specified in this Section 16),
(c) on the first business day following the date of deposit if delivered
by guaranteed overnight delivery service, or (d) on the fourth business
day following the date delivered or mailed by United States registered or
certified mail, return receipt requested, postage prepaid, addressed as
follows:

 

If to the Executive:

 

At the address (or to the
facsimile number) shown on the records of MRV.

 

If to MRV:

 

MRV Communications, Inc.

20415 Nordhoff Street

Chatsworth, California
91311

Attention: General
Counsel

Facsimile: 818-407-5867

 

with a copy to:

 

10

 

Patrick S. Brown, Esq.

Michael A. Katz, Esq.

Sullivan &
Cromwell LLP

1888 Century Park East

Los Angeles, California
90067-1725

Facsimile: 310-407-2685

 

or to such other address
as either party may have furnished to the other in writing by like Notice, except
that notices of change of address will be effective only upon receipt.

 

17.          Nonadmissibility.  Nothing contained
in this Agreement, or the fact of its submission to the Executive, will be
admissible evidence against either party in any judicial, administrative, or
other legal proceeding (other than an action for breach of this Agreement), or
be construed as an admission of any liability or wrongdoing on the part of
either party or of any violation of federal, state, or local statutory law,
common law or regulation.

 

18.          Knowing and Voluntary Waiver. 
By signing
this Agreement, the Executive expressly acknowledges and agrees that: (a) he
has carefully read it and fully understands what it means; (b) he has
discussed this Agreement with an attorney of his choosing before signing it; (c) he
has been given at least 21 calendar days to consider this Agreement; (d) he
has agreed to this Agreement knowingly and voluntarily and was not subjected to
any undue influence or duress; (e) the consideration provided him under
this Agreement is sufficient to support the releases provided by him under this
Agreement; (f) he may revoke his execution of this Agreement within seven days after
he signs it by sending written notice of revocation as set forth below; and (g) on
the eighth day after he executes this Agreement (the “Effective
Date”),
this Agreement becomes effective and enforceable, provided that the Executive
does not revoke this Agreement during the revocation period.  Any revocation of the Executive’s execution of this Agreement must be submitted, in
writing, to MRV Communications, Inc., 20415 Nordhoff Street, Chatsworth, California 91311, to the
attention of the General Counsel, stating “I hereby revoke my execution of the Separation and Release Agreement.”  The revocation must be personally delivered
to the General Counsel or mailed to the General Counsel and postmarked within
seven days of the Executive’s execution of this Agreement.  If the last day of the revocation period is a
Saturday, Sunday or legal holiday, then the revocation period will be extended
to the following day which is not a Saturday, Sunday or legal holiday.  The Executive agrees that if he does not
execute this Agreement or, in the event of revocation, he will not be entitled
to receive any of the payments or benefits under Section 2.

 

19.          Tax Matters.

 

a.             MRV may withhold from any and all
amounts payable to the Executive under this Agreement or otherwise such
federal, state and local taxes as may be required to be withheld pursuant to
any applicable law or regulations and all other amounts or charges required to
be withheld and deducted.

 

b.             It is the parties’ intention that
the payments and benefits provided under this Agreement be exempt from or
comply with Section 409A (“Section 409A”)
of the Internal Revenue Code of 1986, as amended (the “Code”),
and the regulations and other 

 

11

 

guidance promulgated
thereunder and, accordingly, this Agreement will be interpreted to be
consistent with such intent.  To the
extent any taxable expense reimbursement or in-kind benefits under this
Agreement is subject to Section 409A, the amount thereof eligible in one
taxable year shall not affect the amount eligible for any other taxable year,
in no event shall any expenses be reimbursed after the last day of the taxable
year following the taxable year in which the Executive incurred such expenses
and in no event shall any right to reimbursement or receipt of in-kind benefits
be subject to liquidation or exchange for another benefit.  Each payment under this Agreement will be
treated as a separate payment for purposes of Section 409A.  To extent that any benefit or payment would
be subject to the additional tax of Section 409A if paid or provided
during the six months beginning on the date of the Executive’s termination of
employment, it will be accumulated and paid or provided on the first business
day of the seventh month following that date (or earlier, if permitted by Section 409A).  A termination of employment shall not be
deemed to have occurred for purposes of any provision of this Agreement
providing for the payment of any amounts or benefits upon or following a
termination of employment unless such termination also constitutes a “separation
from service” within the meaning of Section 409A.

 

20.          Third Party Beneficiaries.  The Executive acknowledges and agrees that (a) each
of MRV’s Affiliates shall be a third party beneficiary of Section 5
and (b) each Released Party shall be a third party beneficiary to the releases set forth in Section 6
and the Supplemental General Release, with full rights to enforce this
Agreement and the matters documented herein.

 

21.          Interpretation.  The parties hereto acknowledge and agree
that:  (a) each party hereto and its
counsel reviewed and negotiated the terms and provisions of the Agreement and
have contributed to their revision; and (b) the rule of construction
to the effect that any ambiguities are resolved against the drafting party will
not be employed in the interpretation of the Agreement.

 

22.          Counterparts.  This
Agreement may be executed (including by facsimile transmission confirmed promptly thereafter by actual
delivery of executed counterparts) with
counterpart signature pages or in counterparts, each of which together
constitute one and the same instrument.

 

12

 

IN WITNESS WHEREOF, the parties hereto have
executed and delivered this Agreement as of the day and year set forth at the
head of this Agreement.

 

	
   

  	
  MRV COMMUNICATIONS, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
  Dated: June 8,
  2010

  	
  /s/ Jennifer Hankes
  Painter

  
	
   

  	
  Name: Jennifer Hankes
  Painter

  
	
   

  	
  Title:   VP, General Counsel

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  EXECUTIVE

  
	
   

  	
   

  
	
   

  	
   

  
	
  Dated: June 8,
  2010

  	
  /s/ Noam Lotan

  
	
   

  	
  Noam Lotan

  

 

13

 

EXHIBIT
A

 

RESIGNATIONS

 

Effective
as of June 30, 2010, I
hereby resign from my position as Chief Executive Officer of MRV Communications, Inc.
(“MRV”), as a member of the Board of
Directors of MRV and from all other offices, directorships, trusteeships,
committee memberships and fiduciary capacities held with, or on behalf of, MRV
or its subsidiaries or affiliates.

 

I
acknowledge that such resignations are not on account of any disagreement with
MRV relating to its operations, policies or practices.

 

 

	
   

  	
   

  
	
   

  	
  Noam Lotan

  
	
   

  	
  Dated: June 30, 2010

  

 

A-1

 

EXHIBIT
B

 

STOCK OPTION SUMMARY

 

	
  Grant
  Date

  	
   

  	
  Exercise

  Price

  	
   

  	
  Option

  Shares*

  	
   

  	
  Vested

  	
   

  	
  Accelerated

  	
   

  	
  Stated

  Expiration

  Date

  	
   

  	
  Actual

  Expiration

  Date

  	
   

  
	
  10/29/01

  	
   

  	
  $

  	
  2.70

  	
   

  	
  80,000

  	
   

  	
  80,000

  	
   

  	
  —

  	
   

  	
  9/21/11

  	
   

  	
  9/21/11

  	
   

  
	
  10/29/02

  	
   

  	
  $

  	
  0.99

  	
   

  	
  100,000

  	
   

  	
  —

  	
   

  	
  76,767

  	
  **

  	
  10/29/12

  	
   

  	
  10/29/12

  	
   

  
	
  10/29/02

  	
   

  	
  $

  	
  0.99

  	
   

  	
  12,000

  	
   

  	
  12,000

  	
   

  	
  —

  	
   

  	
  10/29/12

  	
   

  	
  10/29/12

  	
   

  
	
  12/29/03

  	
   

  	
  $

  	
  3.35

  	
   

  	
  20,000

  	
   

  	
  20,000

  	
   

  	
  —

  	
   

  	
  12/29/13

  	
   

  	
  6/30/13

  	
   

  
	
  3/22/04

  	
   

  	
  $

  	
  2.80

  	
   

  	
  25,000

  	
   

  	
  25,000

  	
   

  	
  —

  	
   

  	
  3/22/14

  	
   

  	
  6/30/13

  	
   

  
	
  2/28/05

  	
   

  	
  $

  	
  3.70

  	
   

  	
  60,000

  	
   

  	
  60,000

  	
   

  	
  —

  	
   

  	
  2/28/15

  	
   

  	
  6/30/13

  	
   

  
	
  12/30/05

  	
   

  	
  $

  	
  2.05

  	
   

  	
  35,000

  	
   

  	
  35,000

  	
   

  	
  —

  	
   

  	
  12/30/15

  	
   

  	
  6/30/13

  	
   

  
	
  6/1/06

  	
   

  	
  $

  	
  3.24

  	
   

  	
  70,000

  	
   

  	
  70,000

  	
   

  	
  —

  	
   

  	
  6/1/16

  	
   

  	
  6/30/13

  	
   

  
	
  8/1/07

  	
   

  	
  $

  	
  2.63

  	
   

  	
  160,000

  	
   

  	
  80,000

  	
   

  	
  —

  	
   

  	
  8/1/17

  	
   

  	
  6/30/13

  	
   

  
	
  3/3/08

  	
   

  	
  $

  	
  1.49

  	
   

  	
  170,000

  	
   

  	
  85,000

  	
   

  	
  —

  	
   

  	
  3/3/18

  	
   

  	
  6/30/13

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  732,000

  	
   

  	
  467,000

  	
   

  	
  76,767

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

*                             Any stock options not vested as of the
Termination Date (after taking into account any acceleration provided for in
this Agreement) automatically shall be forfeited as of the Termination Date.

 

**                      The portion of the stock option that will
be vested as of the Termination Date is determined by multiplying 100,000 by a
fraction, the numerator of which is the number of days between October 29,
2002 and the Termination Date (2,802) and the denominator of which is 3,650.

 

B-1

 

EXHIBIT
C

 

Supplemental General Release

 

This
Supplemental General Release, dated as of the      day of
July, 2010, is delivered by Noam Lotan (the “Executive”)
to and for the benefit of the Released Parties (as defined below).  The Executive acknowledges that this
Supplemental General Release is being executed in accordance with Section 7
of the Separation and Release Agreement dated June     ,
2010 (the “Separation Agreement”).

 

1.             General Release.  (a)  The
Executive, for himself and for his heirs, dependents, assigns, agents,
executors, administrators, trustees and legal representatives (collectively,
the “Releasors”) hereby forever
releases, waives and discharges the Released Parties (as defined below) from
each and every claim, demand, cause of action, fee, liability or right of any sort (based upon legal
or equitable theory, whether contractual, common-law, statutory, federal,
state, local or otherwise), known or unknown, which Releasors ever had, now
have, or hereafter may have against the Released Parties by reason of any
actual or alleged act, omission, transaction, practice, policy, procedure,
conduct, occurrence, or other matter from the beginning of the world up to and
including the Effective Date (as defined below), including without limitation,
those in connection with, or in any way related to or arising out of, the
Executive’s employment or termination of employment or any other agreement,
understanding, relationship, arrangement, act, omission or occurrence, with the
Released Parties.

 

(b)           Without limiting the generality of the previous
paragraph, this Supplemental General Release is intended to and shall release the Released Parties from any and all claims, whether known
or unknown, which Releasors ever had, now have, or may hereafter have against
the Released Parties including, but not limited to:  (1) any claim of discrimination or
retaliation under the Age Discrimination in Employment Act, Title VII of the
Civil Rights Act, the Americans with Disabilities Act, the Fair Labor Standards
Act, the Employee Retirement Income Security Act of 1974, as amended (excluding
claims for accrued, vested benefits under any employee benefit or pension plan
of the Released Parties subject to the terms and conditions of such plan and
applicable law) and the Family and Medical Leave Act; (2) any claim under
the Constitution of the State of California, the California Fair Employment and
Housing Act, the California Labor Code, the California Civil Code, the Unruh
and George Civil Rights Acts, the California Family Rights Act, the California
Government Code, the California Pregnancy Disability Leave Law, the California
Workers’ Compensation Act or the California Continuation Benefits Replacement
Act; (3) any other claim (whether based on federal, state or local law or
ordinance, statutory or decisional) relating to or arising out of the Executive’s
employment, the terms and conditions of such employment, the termination of
such employment and/or any of the events relating directly or indirectly to or
surrounding the termination of such employment, including, but not limited to,
breach of contract (express or implied), tort, wrongful discharge, detrimental
reliance, defamation, emotional distress or compensatory or punitive damages;
and (4) any claim

 

C-1

 

for
attorney’s fees, costs, disbursements and the like.  To the maximum extent permitted by law, the
Executive also promises never directly or indirectly to bring or participate in
an action against any Released Party under California Business &
Professions Code Section 17200 or under any other unfair competition law
of any jurisdiction with respect to the Executive’s employment with MRV
Communications, Inc. (“MRV”) or
the termination thereof.

 

(c)           The
foregoing release does not in any way affect: (1) the Executive’s rights of indemnification and
directors and officers liability insurance coverage under Section 11 of
the Separation Agreement; (2) the Executive’s accrued, vested rights under
any tax-qualified 401(k) plans maintained by MRV and its subsidiaries and
affiliates; and (3) the
right of the Executive to take whatever steps may be necessary to enforce the
terms of the Separation Agreement.

 

(d)           The
Executive hereby expressly and knowingly waives application of Section 1542
of the California Civil Code and all comparable, equivalent or similar
provisions of state or federal law.  The
Executive further certifies that the Executive has read and understands the
provisions of Section 1542 of the California Civil Code, which reads as
follows:

 

“A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE
CREDITOR DOES NOT KNOW OR SUSPECT TO EXIST IN HIS OR HER FAVOR AT THE TIME OF
EXECUTING THE RELEASE, WHICH IF KNOWN BY HIM OR HER MUST HAVE MATERIALLY
AFFECTED HIS SETTLEMENT WITH THE DEBTOR.”

 

(e)           For purposes of this Supplemental General Release, the “Released
Parties” means MRV, all current and former parents,
subsidiaries, related companies, partnerships, joint ventures and employee
benefit programs (and the trustees, administrators, fiduciaries and insurers of
such programs), and, with respect to each of them, their predecessors and
successors, and, with respect to each such entity, all of its past, present,
and future employees, officers, directors, members, stockholders, owners,
representatives, assigns, attorneys, agents, insurers, and any other person
acting by, through, under or in concert with any of the persons or entities
listed in this paragraph, and their successors (whether acting as agents for
such entities or in their individual capacities).

 

2.             No Existing Suit. 
The Executive represents and warrants that, as of the Effective Date of
this Supplemental General Release, he has not filed or commenced any suit, claim,
charge, complaint, action, arbitration, or legal proceeding of any kind against
MRV or its subsidiaries or affiliates. 
The Executive acknowledges that this Agreement does not prohibit him
from filing a charge of discrimination with the Equal Employment Opportunity
Commission (“EEOC”), from enforcing this
Agreement and recovering for any breach of it, or from exercising any rights
under California Labor Code Section 2802. 

 

C-2

 

The
Executive waives, however, any right to any monetary recovery or other relief
should the EEOC or any other agency pursue a claim on the Executive’s behalf.

 

3.             MRV Release.

 

(a)           MRV
and each of its subsidiaries or affiliates (collectively, “Affiliates”)
hereby forever releases, waives and discharges the Executive from each and
every claim, demand, cause of action, fees, liabilities or right of any sort
(based upon legal or equitable theory, whether contractual, common-law,
statutory, federal, state, local or otherwise) which MRV and each of its
Affiliates has against the Executive that are known by any director of MRV
(other than the Executive) or the General Counsel (collectively, “Known Company Claims”), including
any Known Company Claims based on or relating to, or arising out of, the
Executive’s employment or termination of employment; provided,
however, notwithstanding the generality of the foregoing, nothing
herein will be deemed to release the Executive from (1) any knowing violations of law, (2) any knowing acts of misconduct or negligence
engaged in by the Executive while employed as an employee of MRV or while
serving as an officer or director of MRV or any of its Affiliates, including
misappropriation, fraud
or theft, or (3) any other act or omission that would constitute grounds
for terminating the Executive’s employment for “cause” (as defined in Section 2.4
of the Key Employee Agreement dated as of March 23, 1992, as amended on August 10,
1992 and November 16, 1994).  In
addition, it is agreed and understood that Known Company Claims shall not
include any matter related to, or arising out of, the pending stock option
class and derivative litigation (respectively styled, Ramsey, et
al. v. MRV Communications, Inc., et al.,
Case No. 08-cv-4561 GAF; In re MRV Communications, Inc.
Derivative Litigation, Case No. 08-cv-3800 GAF; and Ke v. Margalit, et al., Los Angeles Superior Court Case No. BC
393856).

 

(b)           MRV
hereby expressly and knowingly waives application of Section 1542 of the
California Civil Code and all comparable, equivalent or similar provisions of
state or federal law.  Section 1542
of the California Civil Code reads as follows:

 

“A GENERAL RELEASE
DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR DOES NOT KNOW OR SUSPECT TO EXIST
IN HIS OR HER FAVOR AT THE TIME OF EXECUTING THE RELEASE, WHICH IF KNOWN BY HIM
OR HER MUST HAVE MATERIALLY AFFECTED HIS SETTLEMENT WITH THE DEBTOR.”

 

4.             Knowing and
Voluntary Waiver.  By signing this Supplemental General Release, the Executive expressly acknowledges
and agrees that: (a) he has carefully read it and fully understands what
it means; (b) he has discussed this Supplemental General Release with an attorney of his choosing before
signing it; (c) he has been given at least 21 calendar days to consider
this Supplemental General Release; (d) he has agreed to this Supplemental
General Release
knowingly and voluntarily and was not subjected to any undue influence or
duress; (e) the consideration provided him under Separation
Agreement is
sufficient to support the releases provided by him under this Supplemental 

 

C-3

 

General Release; (f) he may revoke his execution of this Supplemental General Release within seven days after he signs it by
sending written notice of revocation as set forth below; and (g) on the
eighth day after he executes this Supplemental General Release
(the “Effective Date”), this Supplemental General Release becomes effective and enforceable,
provided that the Executive does not revoke this Agreement during the
revocation period.  Any revocation of the
Executive’s execution of this Supplemental General Release must be submitted, in writing, to MRV
Communications, Inc., 20415 Nordhoff Street, Chatsworth, California 91311, to the attention of the General
Counsel, stating “I hereby revoke my execution of the Supplemental General Release.” 
The revocation must be personally delivered to the General Counsel or
mailed to the General Counsel and postmarked within seven days of the Executive’s
execution of this Supplemental General Release. 
If the last day of the revocation period is a Saturday, Sunday or legal
holiday, then the revocation period will be extended to the following day which
is not a Saturday, Sunday or legal holiday. 
The Executive agrees that if he does not execute this Supplemental
General Release or,
in the event of revocation, he will not be entitled to receive any of the
payments or benefits under Section 2 of the Separation Agreement.  The Executive must execute this Supplemental General
Release on or before July 21, 2010.

 

This
Release is final and binding and may not be changed or modified.

 

	
  Date:
  July     , 2010

  	
   

  
	
   

  	
  Noam Lotan

  

 

Acknowledged and Agreed:

 

	
  MRV COMMUNICATIONS, INC.

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  Name:

  	
   

  
	
  Title:

  	
   

  
	
  Date:
  July     , 2010

  	
   

  

 

C-4

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