Document:

exv10w1

 

Exhibit 10.1

CIENA CORPORATION

DIRECTORS RESTRICTED STOCK DEFERRAL PLAN

ARTICLE I

PURPOSE

     1.1 Purpose. The purpose of this plan, which shall be known as Ciena Corporation
Directors Restricted Stock Deferral Plan (the “Plan”) is to provide directors of the Company who
are not employees of the Company or its subsidiaries with an opportunity to defer the receipt of
Shares with respect to Eligible Awards.

ARTICLE II

DEFINITIONS

     2.1 Definitions. For purposes of this Plan, the following terms shall have the
following meanings:

     “Board” means the Board of Directors of the Company.

     “Committee” means the Compensation Committee of the Board.

     “Company” means Ciena Corporation, a Delaware corporation, or any successor corporation.

     “Corporate Transaction” means a “Corporate Transaction” or a similarly defined change of
control transaction within the meaning of the Equity Plan.

     “Deferral Election” means an election, filed with the Company, pursuant to which a Participant
elects to defer delivery and receipt of all or a portion of an Eligible Award.

     “Designated Deferral Period” shall mean the deferral period selected by the Participant with
respect to an Eligible Award, which deferral period shall specify the date on which delivery of
Shares with respect to such Eligible Award shall be made or begin. In lieu of a specific date,
Participant may provide for the Designated Deferral Period to expire upon Participant’s termination
of service from the Board.

     “Dividend Equivalent Amount” means the amount of dividends or other distributions to
shareholders of the Company that a Participant would have received had the Participant’s Restricted
Stock been actual Shares as of the date of a dividend or other distribution by the Company.

 

 

     “Eligible Award” means an award of Restricted Stock made, or to be made, under the Equity
Plan.

     “Equity Plan” means the Ciena Corporation 2000 Equity Incentive Plan or any other equity
compensation plan (as amended from time to time) under which Participants receive Eligible Awards.

     “Participant” means any director of the Company who is not an employee of the Company or its
subsidiaries and who participates in this Plan by timely completing a Deferral Election.

     “Plan Year” means each calendar year during the term of this Plan.

     “Restricted Stock” means an equity award for Shares granted by the Company to Participant that
is subject to vesting conditions or other restrictions, including equity awards in the form of
units or a similar arrangement, providing the holder a right to receive Shares pursuant to the
terms of an Eligible Award under the Equity Plan.

     “Shares” means the common stock, $0.01 par value per share, of the Company.

     “Stock Account” means an individual account established for each Participant pursuant to
Section 4.3 hereof, with respect to Shares credited to the Participant.

ARTICLE III

PARTICIPATION

     3.1 Eligibility and Participation. Directors who shall be eligible to participate in
this Plan shall be any director of the Company who is not an employee of the Company or its
subsidiaries and who participates in this Plan by timely completing a Deferral Election.

ARTICLE IV

DEFERRAL ELECTIONS

     4.1 Deferral Elections. A director who elects to participate in this Plan for any
Plan Year shall file a Deferral Election with the Company before the beginning of such Plan Year,
provided that any director who was not a director during the previous Plan Year may file a Deferral
Election with the Company (i) within thirty days after election to the Board; and (ii) prior to the
grant of Restricted Stock which is the subject of such Deferral Election. The Deferral Election
shall be in the form prescribed by the Committee, and in accordance with such rules and procedures
as may be established by
the Committee in its sole discretion. Except as otherwise provided in the Plan, a Participant’s
Deferral Election shall be irrevocable. A Deferral Election shall be deemed to have been made when
the completed and executed election form is received and accepted by the Company or its designated
agent. Unless it specifies otherwise, a Deferral Election shall be deemed to apply to all
subsequent Eligible Awards, provided that a director may file a new Deferral Election and that
Deferral Election shall apply to any Eligible Awards in the subsequent Plan Year.

 

 

     4.2 Effect of Deferral Election. Provided the Participant has timely filed a Deferral
Election with the Company with respect to an Eligible Award, the Company will defer the delivery to
the Participant of the Shares subject thereto until the end of the Participant’s Designated
Deferral Period or such other time as this Plan may specify for distribution to be made or begin.

     4.3 Stock Accounts. The Committee shall establish and maintain a separate account in
the name of each Participant who makes a Deferral Election during the course of his or her
participation in the Plan. Each Participant’s Stock Account shall consist of the sum of the Shares
credited to such Participant’s Stock Account. Each Participant’s Stock Account shall be adjusted as
follows:

     (a) As of the date of vesting of an Eligible Award to which a Participant’s Deferral
Election is applicable, the Participant’s Stock Account shall be credited with that number
of Shares to which the Deferral Election relates;

     (b) As of the date on which Shares are distributed to the Participant in accordance
with Section 4.5, the Participant’s Stock Account shall be reduced by an equal number of
Shares, and fractions thereof, if applicable.

     4.4 Dividend Equivalent Amount and Adjustments. As of the date on which a dividend is
paid on (or any other distribution is made on account of) Shares, Participant’s Stock Account shall
be credited with such number of additional Shares and/or fractions thereof equal to the number of
Shares and/or fraction thereof that the Dividend Equivalent Amount would have purchased on that
date based on the average of the high and low trading prices of the Shares on that date. Any Shares
credited to Participant’s Stock Account pursuant to this provision shall become subject to the
Deferral Election applicable to the Restricted Stock to which the Dividend Equivalent Amount
relates. In the event of any stock split, reverse split, combination or other changes that impact
the Company’s capital structure, or Share status, each Participant’s Stock Account and the number
of Shares credited thereto shall be equitably adjusted by the Committee in its sole discretion in a
manner consistent with the treatment of outstanding equity awards pursuant to the Equity Plan.

     4.5 Distribution of Shares from Stock Accounts. Subject to any limitation set forth
in this Plan or any other limitations as may be established by the Committee in its sole
discretion, a Deferral Election shall specify the manner of distribution with respect to the
Eligible Awards that are the subject of such Deferral Election. A
Participant may elect to have any Eligible Award that is subject to a Deferral Election distributed
in any of the installments options set forth below following the earlier of (i) termination of
Participant’s service as a director of the Company, or (ii) expiration of the Participant’s
Designated Deferral Period with respect to such Eligible Award:

	 	(1)	 	a single lump sum, or
	 
	 	(2)	 	three equal or substantially equal annual installments.

 

 

Distribution of any fractional Shares shall be satisfied in cash, based on the average of the high
and low trading prices of Shares on the business day immediately preceding such distribution.
Notwithstanding the foregoing, if a Corporate Transaction occurs or a Participant dies, becomes
disabled or otherwise terminates his or her service as a director, a distribution with respect to
all the Shares held in Participant’s Stock Account shall be made to Participant or Participant’s
beneficiaries in a single lump sum within thirty days of such event.

ARTICLE V

MISCELLANEOUS

     5.1 Beneficiaries. A Participant may designate in writing one or more beneficiaries
to receive distributions in the event of the Participant’s death by filing with the Company a
beneficiary designation on a form provided by the Committee. A Participant may change the
designated beneficiary or beneficiaries at any time prior to his or her death by delivering to the
Company a new beneficiary designation form; provided, however, any beneficiary designation form
received by the Company after the designating Participant’s death will be disregarded. If a
Participant has not designated a beneficiary, or if no designated beneficiary survives the
Participant, distribution shall be made to the Participant’s estate.

     5.2 Administration. Except for those powers and duties expressly reserved for the
Board hereunder, the Committee will have full power to administer the Plan, including the
authority:

     (a) To make and enforce such rules and regulations as it deems necessary or proper for the
efficient administration of Plan;

     (b) To interpret the Plan and to decide all matters arising thereunder, including the right to
resolve or remedy any ambiguities, errors, inconsistencies or omissions. All such interpretations
shall be final and binding on all parties;

     (c) To determine the amount of distributions to be made to each Participant and beneficiary or
other person in accordance with the provisions of the Plan;

     (d) To authorize distributions under the Plan;

 

 

     (e) To keep such records and submit such filings, elections, applications, returns or other
documents or forms as may be required under applicable law;

     (f) To appoint such agents, counsel, accountants and consultants as may be desirable in
administering the Plan;

     (g) To exercise the other powers that are expressly granted to it herein, or that are
impliedly necessary for it to carry out any of its responsibilities hereunder; and

     (h) By written instrument to delegate any of the foregoing powers
to one or more designated officers or employees of the Company or other persons.

     All decisions of the Committee or its designees shall be binding upon all Participants and
their respective legal representatives, successors and assigns, and any and all persons claiming
under or through any of them. No member of the Committee or any of its designees shall be liable to
any Participant or to the Company for any determination made within the scope of the administrative
and interpretive functions provided in this Plan. No member of the Committee shall participate in
any discussion or determination involving his or her own rights, benefits or obligations under this
Plan.

     5.3 Reports. Until a Participant’s entire Stock Account has been distributed in full,
the Company will furnish or make available to the Participant, upon request, a report setting forth
the status and activity relating to the Stock Account.

     5.4 Assignment and Alienation of Benefits. The right of each Participant to any
account, benefit, right or distribution hereunder shall not, to the extent permitted by law, be
subject in any manner to attachment or other legal process for the debts of such Participant, and
no account, benefit, right or distribution shall be subject to anticipation, alienation, sale,
pledge, transfer, assignment or encumbrance; provided, however, the Company shall have the
unrestricted right to set off against or recover out of any distributions due a Participant,
beneficiary or other person at the time such distributions would otherwise have been made
hereunder, any amounts owed the Company or any subsidiary of the Company by such Participant,
beneficiary or other person.

     5.5 Director and Shareholder Status. Nothing in the Plan shall interfere with or
limit in any way the right of the Company or its shareholders to terminate any Participant’s
service as a director, at any time, nor confer upon any Participant any right to continue as a
director of the Company or to be nominated for election to the Board at any time. The Plan will
not give any person any right or claim to any benefits under the Plan unless such right or claim
has specifically accrued under the terms of the Plan. Participation in the Plan shall not create
any rights in a Participant (or any other person)
as a shareholder of the Company until Shares are registered in the name of and distributed to, the
Participant (or such other person).

 

 

     5.6 Assets. No assets shall be segregated or earmarked in respect of any Shares,
Dividend Equivalent Payments or Stock Accounts. The Plan and the crediting of Stock Accounts
hereunder shall not constitute a trust and shall be structured solely for the purpose of recording
an unsecured contractual obligation. All amounts payable pursuant to the terms of this Plan shall
be paid from the general assets of the Company and in no event shall any Participant or beneficiary
have any claims or rights to any payment hereunder that are superior to any claims or rights of any
general creditor of the Company.

     5.7 Taxes. The Company shall not be responsible for the tax consequences under
federal, state or local law of any election made by any Participant under the Plan. The Company
shall have the right to make required information reporting and/or to withhold or deduct from any
distribution to be made pursuant to this Plan, or to otherwise require prior to the distribution of
any amount hereunder, payment by the Participant of any federal, state or local taxes required by
law to be withheld with respect to any such distribution to the Participant. In addition, to the
extent the Company shall be required, prior to the date on which distributions are to be made to a
Participant under this Plan, to withhold any taxes in connection with any Shares or Dividend
Equivalent Amounts credited to a Participant’s accounts under this Plan, the Participant agrees
that the Company shall have the right to make such withholding or to require direct payment of such
withholding taxes by the Participant to the Company.

     5.8 Amendment. Notwithstanding any other provision of this Plan, the Board may amend
this Plan at any time for any reason without liability to any Participant, beneficiary or other
person for any such amendment or for any other action taken pursuant to this Section 5.8, provided
that no such amendment shall be made retroactively in a manner that would deprive any Participant
of any rights or benefits which have accrued to his or her benefit under the Plan as of the date
such amendment is proposed to be effective, unless such amendment is necessary to comply with
applicable law.

     5.9 Termination. Notwithstanding any other provision of this Plan, the Board may
terminate this Plan at any time for any reason without any liability to any Participant,
beneficiary or other person for any such termination or for any other action taken pursuant to this
Section 5.9. Following termination of this Plan, and notwithstanding the provisions of any Deferral
Election entered into prior to such termination, no additional deferrals may be made hereunder, but
all existing Stock Accounts shall be administered in accordance with the Plan, as in effect
immediately prior to termination, and shall be distributed in accordance with the terms of this
Plan and the applicable Deferral Elections, unless and until the Board elects to accelerate
distributions as provided below. At any time on or after the effective date of termination of this
Plan, the Board, in its sole discretion, may elect to accelerate the distribution with respect to
all Shares in all Stock Accounts. Such distributions shall be made in a lump sum. Upon completion
of distributions to all Participants, or beneficiaries, as the case
may be, no Participant, beneficiary or person claiming under or through them, will have any claims
in respect of this Plan.

 

 

     5.10 Notices to Committee. The Committee shall designate one or more addresses to
which notices and other communications to the Committee or the Company shall be sent with respect
to this Plan. No notice or other communication shall be considered to have been given to or
received by the Committee or the Company until it has been delivered to ‘such designated addresses.

     5.11 No Liability. Participation in the Plan is entirely at the risk of each
Participant. Neither the Company, the Committee, the Board nor any other person associated with
this Plan shall have any liability for any loss or diminution in the value of Stock Accounts, or
for any failure of this Plan to effectively defer recognition of income or to achieve any
Participant’s desired tax treatment or financial results.

     5.12 Facility of Payment. If the Committee determines that a Participant or
beneficiary entitled to receive a payment under this Plan is (at the time such payment is to be
made) a minor or physically, mentally or legally incompetent to receive such payment and that
another person or any institution has legal custody of such minor or incompetent individual, the
Committee may cause payment to be made to such person or institution having custody of such
Participant or beneficiary. Such payment, to the extent made, shall operate as a complete discharge
of obligation by the Committee, the Company and the Board.

     5.13 Effective Date. This Plan was adopted by the Board effective as of August 29,
2007 and shall remain in effect until terminated pursuant to Section 5.9.

     5.14 Applicable Law. This Plan shall be interpreted under the laws of the State of
Delaware.

     IN WITNESS WHEREOF, the Company has caused this instrument to be executed by its duly
authorized officer as of the 29th day of August, 2007.

	 	 	 	 	 
	 	Ciena Corporation

 	 
	 	By:  	/S/ Russell B. Stevenson, Jr.
 	 
	 	Russell B. Stevenson, Jr. 	 
	 	Sr. Vice President, General Counsel & Secretaryexv10w2

 

Exhibit 10.2

AMENDMENT 1

TO

AMENDED AND RESTATED CHANGE IN CONTROL SEVERANCE AGREEMENT

          This Amendment 1 to Amended and Restated Change in Control Severance Agreement (the
“Amendment”) is dated as of August 30, 2007, between Ciena Corporation (the “Corporation”), and
Gary B. Smith (the “Executive”).

          WHEREAS, the Executive and the Corporation have previously entered into an Amended and
Restated Change in Control Severance Agreement dated as of January 25, 2007 (the “Agreement”);
and

          WHEREAS, the parties desire to enter into this Amendment to incorporate certain terms
that are required or advisable pursuant to Section 409A of the Internal Revenue Code of 1986,
as amended (the “Code”), and to make a clarifying amendment relating to the conversion of
performance-based equity awards upon a Triggering Event;

          NOW, THEREFORE, in consideration of the foregoing, the mutual covenants and agreements of the
parties contained herein and other good and valuable consideration, the receipt of which is hereby
acknowledged, the parties hereto agree as follows:

          1. Section 1.8 of the Agreement is hereby deleted in its entirety and replaced with the
following new Section 1.8:

               “‘Good
Reason’ means:

     (i) removal from, or failure to be reappointed or reelected to the Executive’s
principal positions immediately prior to the Effective Date (other than as a result of a
promotion);

     (ii) material diminution in the Executive’s position, duties or responsibilities, or
the assignment to the Executive of duties that are inconsistent, in a material respect, with
the scope of duties and responsibilities associated with the Executive’s position
immediately prior to the Effective Date;

     (iii) material reduction in base salary or award opportunity under any corporate
incentive plan (or any successor to any such plan), or a material reduction in the level of
participation in long-term incentive, benefit and other plans for senior executives as in
effect immediately preceding the Effective Date, or their equivalents;

     (iv) relocation of the Executive’s principal workplace without the Executive’s consent
to a location which is more than 50 miles from the Executive’s principal workplace on the
Effective Date; or

     (v) any failure by the Corporation to comply with and satisfy the requirements of
Section 7.5, provided that the successor shall have received at least ten days’ prior
written notice from the Corporation or the Executive of the requirements of Section 7.5;

     provided, however that (A) the Executive has provided notice to the
Corporation of any of the foregoing conditions within 90 days of the initial existence of
the condition; (B) the Corporation has been given at least 30 days to cure such condition;
and (C) the Executive actually terminates employment within two years following the initial
existence of the condition.”

 

 

          2. Sections 3.4(a) and (b) are hereby deleted in their entirety and replaced with the
following:

	 	(a)	 	upon the Effective Date, (i) the Executive’s Options that are
subject to performance-based vesting, to the extent unvested, shall immediately
be converted into Options with time-based vesting conditions, and (ii) the
Executive’s Performance-Based Restricted Stock, Performance-Adjusted Restricted
Stock and any other similar instruments of equity-based compensation that are
subject to performance-based vesting, to the extent unvested, shall immediately
be converted into Time-Based Restricted Stock; in each case, with vesting as to
the equity awards converted above being deemed to have commenced on the date of
grant and vesting as to 1/16th of the grant at the end of each
three-month period following the date of grant;
	 
	 	(b)	 	upon a Triggering Event, all of the Executive’s Options and
Time-Based Restricted Stock (including any performance-based equity awards
converted pursuant to Section 3.4(a) above), to the extent unvested, shall
become immediately vested and exercisable in full; and

          3. A new Section 3.4 will be added to the Agreement as follows:

          “3.4 Savings Clause. Anything in this Agreement to the contrary notwithstanding,
if on the date of termination of Executive’s employment with the Corporation, as a result of
such termination, Executive would receive any payment that, absent the application of this
Section 3.4 would be subject to interest and additional tax imposed pursuant to Section
409A(a) of the Code as a result of the application of Section 409A(a)(2)(B)(i) of the Code,
then no such payment shall be made prior to the date that is the earliest of (1) six months
after the date of termination of Executive’s employment, (2) the Executive’s death, or (3)
such other date as will cause such payment not to be subject to such interest and additional
tax.”

IN WITNESS WHEREOF, the parties have executed and delivered this Amendment.

	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	CIENA CORPORATION	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	Date:

	 	August 30, 2007	 	 	 	By:	 	/s/ Russell B. Stevenson, Jr.	 	 
	 

	 	 

	 	 	 	Name:
	 	 
Russell B. Stevenson, Jr.
	 	 
	 

	 	 	 	 	 	Title:	 	Sr. Vice President and General
Counsel	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	EXECUTIVE	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	Date:	 	August 30, 2007	 	 	 	/s/ Gary B. Smith	 	 
	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	Name: Gary B. Smith	 	 
	 	 	 	 	 	 	Title: President and Chief Executive Officer	 	 

2

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