8-K

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT
Pursuant to Section 13 or 15(d) of The Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): April 7, 2005

TEKELEC

(Exact name of registrant as specified in its charter)

California	0-15135	95-2746131
(State or other jurisdiction	(Commission	(IRS Employer
of incorporation)	File Number)	Identification No.)

26580 W. Agoura Road, Calabasas, California		91302
(Address of principal executive offices)	(Zip Code)

Registrant’s telephone number, including area code: (818) 880-5656

(Former name or former address, if changed since last report.)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2 below):

o   Written Communication pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o   Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o   Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o   Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

TABLE OF CONTENTS

Item 1.01	Entry into a Material Definitive Agreement	1
Item 5.02	Departure of Directors or Principal Officers; Election of Directors; Appointment of Principal Officers	2
Item 5.03	Amendments to Articles of Incorporation or Bylaws; Change in Fiscal Year	3
Item 9.01	Financial Statements and Exhibits	4
Exhibit 3.1
Exhibit 10.1
Exhibit 10.2

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Item 1.01  Entry into a Material Definitive Agreement

     Employment Offer Letter Agreement with William Everett

     On April 7, 2005, Tekelec (the “Company”) entered into an employment offer letter agreement with William Everett in connection with Mr. Everett’s appointment as Senior Vice President and Chief Financial Officer of the Company as of that date. Mr. Everett’s appointment is discussed below in Item 5.02 of this Current Report on Form 8-K. The letter agreement supplements the employment offer letter agreement, effective as of October 14, 2004, which was entered into between the Company and Mr. Everett in connection with the commencement of his employment with the Company in October 2004.

     Pursuant to the letter agreement, Mr. Everett will receive an annual base salary of $300,000 and will participate in the Company’s 2005 Officer Bonus Plan under which he will be eligible to receive, in accordance with the terms of the Plan, (i) maximum quarterly cash bonuses of from 56.0% to 67.2% of his quarterly base salary during 2005 based on the Company’s achievement of certain pre-established financial performance goals and (ii) an additional cash bonus equal to 14% of his annual base salary if he achieves certain pre-established individual objectives. As contemplated by the letter agreement, Mr. Everett was also granted restricted stock units (“RSUs”) under the Company’s Amended and Restated 2003 Stock Option Plan covering a total of 50,000 shares of the Company’s Common Stock. The RSUs will vest, and the shares of Common Stock as to which the RSUs vest will automatically be issued, to the extent of 12,500 shares on April 7, 2006 and as to the remaining 37,500 shares in 12 equal quarterly installments as long as Mr. Everett remains an employee of the Company. Tekelec has also agreed to reimburse Mr. Everett for certain relocation and related expenses in the maximum aggregate amount of $60,000 and to arrange for the purchase of his current residence by a third party buyer that assists in employee relocations.

     The foregoing description of the employment offer letter agreement between the Company and Mr. Everett is qualified in its entirely by reference to the copy of the agreement which is filed as Exhibit 10.1 to this Current Report on Form 8-K.

     Indemnification Agreements with Directors and Executive Officers

     On April 7, 2005, the Company adopted a form of indemnification agreement which has been or is expected to be entered into between the Company and each of its current directors and executive officers (each an “Indemnitee”).

     The indemnification agreement provides, among other terms, that (i) the Company will indemnify the Indemnitee to the fullest extent permitted by California law against any and all indemnifiable amounts (including, among other amounts, expenses, damages, judgments, fines, penalties and amounts paid in settlement) arising out of or resulting from any threatened, pending or completed legal action or proceeding, whether initiated by a third party or by or in the right of the Company, arising out of or relating to the Indemnitee’s service as a director, officer, employee or other agent of the Company or any other corporation or enterprise for which such person serves at the Company’s request, (ii) the Company will advance expenses to the Indemnitee in advance of the settlement of or final judgment in any such action or proceeding, (iii) the Indemnitee will repay such

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advanced expenses only if a court shall ultimately determine that the Indemnitee is not entitled to be indemnified by the Company and (iv) the indemnification provided by the indemnification agreement is not exclusive of any other rights to which the Indemnitee may be entitled under the Company’s Restated Articles of Incorporation, Bylaws, any agreement, any vote of shareholders or disinterested directors, the California General Corporation Law or otherwise. The indemnification agreement also sets forth the terms and conditions that apply in determining whether or not an Indemnitee is entitled to indemnification in any given instance. The indemnification agreements entered into by the Company’s current directors replace and supersede the indemnification agreements that had previously been entered into between the Company and each of its directors.

     The Company’s directors and executive officers who have entered into or are expected to enter into such indemnification agreements effective as of April 7, 2005 are listed below:

Name	Position(s) with the Company
Jean-Claude Asscher	Chairman of the Board
Robert V. Adams	Director
Daniel L. Brenner	Director
Mark A. Floyd	Director
Martin A. Kaplan	Director
Frederick M. Lax	Director, Chief Executive Officer and President
Jon F. Rager	Director
William H. Everett	Senior Vice President and Chief Financial Officer
Richard E. Mace	Executive Vice President, Global Business Group Operations
Lori A. Craven	Executive Vice President, Global Sales, Marketing and Customer Service
Eric Gehl	President and General Manager, Communications Software Solutions Group
Patricia W. Hosek	President and General Manager, Switching Solutions Group
James M. Johnson, Jr.	President and General Manager, Network Signaling Group
Debra May	President and General Manager, IEX Corporation
Ronald W. Buckly	Senior Vice President, Corporate Affairs and General Counsel
David Frankie	Senior Vice President, Operations
Danny L. Parker	Senior Vice President, Corporate Development
Teresa A. Pippin	Senior Vice President, Human Resources
Scott Weidenfeller	Senior Vice President, Global Marketing

     The foregoing description of the indemnification agreements is qualified in its entirely by reference to the copy of the form of the indemnification agreement which is filed as Exhibit 10.2 to this Current Report on Form 8-K.

Item 5.02  Departure of Directors or Principal Officers; Election of Directors; Appointment of Principal Officers.

     On April 7, 2005, the Board of Directors of the Company appointed William Everett as the Senior Vice President and Chief Financial Officer of the Company. In that role, Mr. Everett serves

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as the principal financial and accounting officer of the Company. Mr. Everett originally joined the Company as Vice President, Product Marketing of the Communications Software Solutions Group when the Company acquired Steleus Group Inc. (“Steleus Group”) in October 2004. From October 2001 until October 2004, Mr. Everett served as Executive Vice President and Chief Financial Officer of Steleus Group and from time to time held senior management positions with certain of its operating subsidiaries. From 1999 until October 2001, Mr. Everett served as Chief Executive Officer of Maps a la Carte, Inc., a digital mapping photograph company he co-founded. Mr. Everett is 54 years old.

     The employment offer letter agreement entered into between Mr. Everett and the Company is described in Item 1.01 of this Current Report on Form 8-K. There were no other arrangements or understandings between Mr. Everett and any other persons pursuant to which Mr. Everett was appointed as an executive officer of the Company, and there are no related party transactions between the Company and Mr. Everett that are required to be disclosed under Item 404(a) of Regulation S-K.

     On April 7, 2005, the Board of Directors of the Company appointed Lori Craven as the Company’s Executive Vice President, Global Sales, Marketing and Customer Service. At that time, Mr. Craven ceased to serve as the Company’s Executive Vice President and Chief Operating Officer, a position she had held from March 2004 until April 2005.

Item 5.03  Amendments to Articles of Incorporation or Bylaws; Change in Fiscal Year.

          On April 7, 2005 and pursuant to the authority provided by the Company’s Restated Articles of Incorporation, the Company’s Board of Directors amended Section 6.4 of Article VI of the Company’s Bylaws to require the Company to indemnify the Company’s directors and executive officers to the maximum extent permitted under California law against certain liabilities that may arise as a result of their serving as a director, officer, employee or other agent of the Company or any other corporation or enterprise for which such person serves at the Company’s request. The amended Bylaws also require that the Company advance related expenses to such persons prior to the final disposition of any such matter, subject to a repayment obligation in the event that a court ultimately determines that they are not entitled to be paid such expenses. Prior to the amendment, the Bylaws required the Company to provide indemnification and to advance related expenses to the Company’s directors, but not the Company’s executive officers, to the maximum extent and in the manner permitted under California law, subject to certain exceptions. Prior to the amendment, the Company was permitted, but not required, to provide indemnification and to advance related expenses to the Company’s executive officers to the maximum extent and in the manner permitted under California law.

          Section 6.4 of the Bylaws also provides that the indemnification rights under the Bylaws are not exclusive of any other rights that an individual may have under any agreement, vote of shareholders or disinterested directors or otherwise, to the extent that such additional rights to indemnification are authorized in the Company’s Restated Articles of Incorporation. Article V of the Company’s Restated Articles of Incorporation currently authorizes the Company to provide for indemnification of its directors, executive officers, employees and other agents for breach of duty to

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the Company and its shareholders, through bylaw provisions or through agreements with such individuals, or both, in excess of the indemnification otherwise permitted by the California General Corporation Law, subject to certain limits on such excess indemnification which are imposed by the California General Corporation Law. Pursuant to the authority provided by the Company’s Restated Articles of Incorporation, on April 7, 2005 the Board of Directors also approved a form of indemnification agreement to be entered into between the Company and each of its current directors and executive officers. The indemnification agreement is described above in Item 1.01 of this Current Report on Form 8-K.

     The foregoing description of Section 6.4 of the Company’s Bylaws, as amended, is qualified in its entirety by reference to the copy of the amendment to the Bylaws which is filed as Exhibit 3.1 to this Current Report on Form 8-K.

Item 9.01.  Financial Statements and Exhibits

     (c) Exhibits

           The following exhibit is furnished as a part of this Current Report on Form 8-K:

Exhibit No.	Description
3.1	Amendment to the Company’s Bylaws effective April 7, 2005
10.1	Employment Offer Letter Agreement dated April 7, 2005 between the Company and William Everett, together with employment offer letter agreement effective as of October 14, 2004 between the Company and Mr. Everett
10.2	Form of Indemnification Agreement between the Company and each of its directors and executive officers

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SIGNATURES

     Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	Tekelec
Dated: April 13, 2005	By:	/s/ Frederick M. Lax
		Frederick M. Lax
		Chief Executive Officer and        President

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EXHIBIT INDEX

Exhibit No.	Description
3.1	Amendment to the Company’s Bylaws effective April 7, 2005
10.1	Employment Offer Letter Agreement dated April 7, 2005 between the Company and William Everett, together with employment offer letter agreement effective as of October 14, 2004 between the Company and Mr. Everett
10.2	Form of Indemnification Agreement between the Company and each of its directors and executive officers

EX-3.1

Exhibit 3.1

TEKELEC

CERTIFICATE OF SECRETARY

     I hereby certify that I am the duly elected, qualified and acting Secretary of Tekelec, a California corporation (the “Company”), and that, pursuant to resolutions of the Board of Directors of the Company at a meeting duly held on April 7, 2005, the following amendment to the Bylaws of the Company was adopted:

     Section 6.4. of Article VI was amended to read in its entirety as follows:

“Section 6.4. Indemnification and Insurance.

          (a) The corporation shall, to the maximum extent and in the manner permitted by the California General Corporation Law, but subject to any limitations set forth in any applicable indemnification agreement between the Company and any director or officer of the Company, indemnify each of its directors and officers against expenses (as defined in Section 317(a) of the California General Corporation Law), judgments, fines, settlements, and other amounts actually and reasonably incurred in connection with any proceeding (as defined in Section 317(a) of the California General Corporation Law), arising by reason of the fact that such person is or was an agent of the corporation. For purposes of this Section 6.4, a “director” or “officer” of the corporation includes any person (i) who is or was a director or executive officer of the corporation, (ii) who is or was serving at the request of the corporation as a director or executive officer of another corporation, partnership, joint venture, trust or other enterprise, or (iii) who was a director or executive officer of a corporation which was a predecessor corporation of the corporation or of another enterprise at the request of such predecessor corporation.

          (b) The corporation shall have the power, to the extent and in the manner permitted by the California General Corporation Law, to indemnify each of its employees and agents (other than directors and officers) against expenses (as defined in Section 317(a) of the California General Corporation Law), judgments, fines, settlements, and other amounts actually and reasonably incurred in connection with any proceeding (as defined in Section 317(a) of the California General Corporation Law), arising by reason of the fact that such person is or was an agent of the corporation. For purposes of this Section 6.4 an “employee” or “agent” of the corporation (other than a director or officer) includes any person (i) who is or was an employee or agent of the corporation, (ii) who is or was serving at

the request of the corporation as an employee or agent of another corporation, partnership, joint venture, trust or other enterprise, or (iii) who was an employee or agent of a corporation which was a predecessor corporation of the corporation or of another enterprise at the request of such predecessor corporation.

          (c) Expenses incurred in defending any civil or criminal action or proceeding for which indemnification is required pursuant to Section 6.4(a), or for which indemnification is permitted pursuant to Section 6.4(b) following authorization thereof by the Board of Directors, shall be paid by the corporation in advance of the final disposition of such action or proceeding upon receipt of an undertaking by or on behalf of the indemnified party to repay such amount if it shall ultimately be determined that the indemnified party is not entitled to be indemnified as authorized in this Section 6.4. Notwithstanding the foregoing, the corporation shall not be required to advance expenses to a director or officer with respect to proceedings or claims initiated or brought voluntarily by such director or officer and not by way of defense, except with respect to proceedings or claims initiated or brought to enforce any indemnification agreement or a right to indemnification under Section 317 of the California General Corporations Law or under any other statute or law, but such advancement of expenses may be provided by the corporation in specific cases if the Board of Directors has approved the initiation or bringing of such suit.

          (d) The indemnification provided by this Section 6.4 shall not be deemed exclusive of any other rights to which those seeking indemnification may be entitled under any bylaw, agreement, vote of shareholders or disinterested directors or otherwise, both as to action in an official capacity and as to action in another capacity while holding such office, to the extent that such additional rights to indemnification are authorized in the Articles of Incorporation.

          (e) The corporation shall have the power to purchase and maintain insurance on behalf of any person who is or was an agent of the corporation against any liability asserted against or incurred by such person in such capacity or arising out of such person’s status as such, whether or not the corporation would have the power to indemnify him or her against such liability under the provisions of this Section 6.4.

          (f) No indemnification or advance shall be made under this Section 6.4, except where such indemnification or advance is

mandated by law or the order, judgment or decree of any court of competent jurisdiction, in any circumstance where it appears:

          (i) That is would be inconsistent with a provision of the Articles of Incorporation, these bylaws, a resolution of the shareholders or an agreement in effect at the time of the accrual of the alleged cause of action asserted in the proceeding in which the expenses were incurred or other amounts were paid, which prohibits or otherwise limits indemnification; or

          (ii) That it would be inconsistent with any condition expressly imposed by a court in approving a settlement.”

     IN WITNESS WHEREOF, I have hereunto set my hand and affixed the corporate seal as of the 7th day of April, 2005.

/s/ Ronald W. Buckly

Ronald W. Buckly, Secretary

EX-10.1

Exhibit 10.1

[ON TEKELEC LETTERHEAD]

April 7, 2005

William Everett	PERSONAL AND CONFIDENTIAL
6 Arrowwood Lane
Andover, MA 01810

Dear Bill:

On behalf of Tekelec, this letter confirms our offer to employ you in the position of Senior Vice President and Chief Financial Officer for Tekelec based in Tekelec’s facility in North Carolina. With your agreement, and effective as of April 7, 2005 this letter will amend the numbered paragraphs of your employment offer letter dated August 6, 2004 (“August 6, 2004 letter”) as follows.

1. Title & Duties. As Senior Vice President and Chief Financial Officer of Tekelec, you will report directly to Tekelec’s President and Chief Executive Officer. You will be principally responsible for Tekelec’s financial matters and will have such other duties and responsibilities as may be delegated to you from time to time by the President and Chief Executive Officer and/or the Board of Directors.

2. Compensation. As Senior Vice President and Chief Financial Officer, your starting annual base salary will be $300,000 (i.e., $11,538.46 per bi-weekly period). You will be eligible to participate in Tekelec’s 2005 Officer Bonus Plan, under which you will be eligible to receive, in accordance with the terms of such Plan as approved by the Company’s Board of Directors, up to 56% of your annual base salary as a cash bonus based on certain company financial milestones in 2005 and an annual bonus equal to 14% of your annual base salary if you achieve certain individual objectives during 2005. The terms of your participation in any officer bonus plans after 2005 will be subject to change and the approval of the Board of Directors of Tekelec.

3. Stock Options. In addition to the provisions of paragraph 3 of the August 6, 2004 letter, the Compensation Committee of Tekelec will grant to you 50,000 restricted stock units (RSUs) under Tekelec’s 2003 Stock Option Plan (the “Plan”), effective as of the later of the effective date set forth in paragraph 1 above, or the date of the Compensation Committee’s action granting such options (the “grant date”). Your RSUs will vest to the extent of 12,500 shares on the one-year anniversary of the Effective Date as defined in the first paragraph of this letter. The remaining 37,500 shares will vest and be issued automatically in 12 equal quarterly installments of 3,125 shares each, with the first installment vesting on the last day of the first full calendar quarter following your one-year anniversary of the Effective Date and one additional installment vesting on the last day of each calendar quarter thereafter as long as you remain an employee of Tekelec. The RSUs will in all respects be subject to the terms and provisions of the Plan and the agreement evidencing the grant of the RSUs.

4. Employee Benefits. As Senior Vice President and Chief Financial Officer, you will receive benefits as are generally provided to Tekelec’s executive officers.

William Everett
April 7, 2005
Page 2

5. Relocation. Tekelec will pay you up to a maximum of $60,000 to reimburse you for your accountable costs incurred in relocating from Massachusetts to North Carolina, including actual out-of-pocket travel, moving, rental and other expenses relating to your relocation, the costs of temporary housing in North Carolina pending your relocation and the associated income taxes payable by you with respect to your receipt of such reimbursement. Pending your relocation to North Carolina, therefore outside the $60,000 allowance, you will be reimbursed for air fare for two personal trips per month for you or your spouse to visit each other in Massachusetts or other location where you are engaged on Tekelec business. Tekelec will make arrangements through Cendant Mobility (or other vendor determined by Tekelec) to purchase your residence in Massachusetts for its fair market value as determined by independent appraisal. Costs of the sale including brokerage, closing costs attributable to the seller, and Cendant’s Mobility’s fees will be paid by Tekelec and will not be treated as accountable costs subject to the $60,000 maximum relocation allowance described above.

6. Severance. The references to the Tekelec Severance Plan in paragraph 5 of the August 6, 2004 letter are revised to refer to the Tekelec Officer Severance Plan.

Except as modified herein, all terms and provisions of the August 6, 2004 letter shall remain in effect. This letter together with the August 6, 2004 letter contains our entire understanding with respect to your employment.

Bill, I look forward to working with you in your new role, and to your mutually fulfilling and rewarding relationship with Tekelec.

If this offer is acceptable to you, then please acknowledge your acceptance by signing and dating the enclosed copy of this letter where indicated below and returning such signed copy to me for receipt no later than April 7, 2005.

Sincerely,

/s/ Fred Lax

Fred Lax
President and Chief Executive Officer

cc:Teresa Pippin

Acknowledged and Accepted:

/s/ William Everett	Date:	April 7, 2005
William Everett

[ON TEKELEC LETTERHEAD]

August 6, 2004

William Everett
68 Tadmuck Road
Westford, MA 01886

Re: Your Employment with Steleus, Inc. (the “Company”).

Dear Bill:

This letter is being extended to you in conjunction with Tekelec’s potential acquisition of all or substantially all of the outstanding capital stock of the Company (referred to herein as the “Transaction”), in order to confirm the terms of your continued employment after the Closing of the Transaction as defined in the Merger Agreement (“Effective Date”). This letter will supersede and replace the provisions of your Steleus offer letter dated October 4, 2001. (See Entire Agreement; Modifications).

1. Title and Duties. Immediately following the Effective Date, your title will be VP Americas & Product Marketing, reporting to Richard Mace. In this capacity, or in such other position as you may be assigned by Tekelec, you agree to perform such duties and responsibilities as are assigned or delegated to you from time to time. You agree to devote your full-time attention and best efforts to the performance and discharge of such duties and responsibilities and to perform and discharge such duties and responsibilities faithfully, diligently and to the best of your abilities.

2. Compensation. Your annual base salary will be $200,000 payable in accordance with Tekelec’s payroll policies as in effect and subject to change from time to time (which may differ from Steleus’ policies in effect prior to the Effective Date), less legally required or authorized deductions and withholdings. Commencing with respect to the first full quarter of your employment following the Closing of the Transaction, you will also be eligible to participate in a Bonus Plan, under which you may earn a bonus of up to forty percent (40%) of your actual base salary earnings, earned and calculated quarterly in accordance with the terms and conditions of the Plan, if certain objectives are achieved and you satisfy the conditions for eligibility specified in the Plan. For purposes of transition and assuming you are eligible to participate for the fourth quarter of 2004, your bonus opportunity will be 30% of the annualized bonus payable under the Tekelec 2004 Bonus Plan.

3. Stock Options.

(a) Steleus Stock Options. In connection with Tekelec’s acquisition of Steleus, you acknowledge and agree that as a condition of the Closing of the Transaction and as of the Effective Date, all outstanding unexercised options to purchase shares of Steleus stock, and all outstanding warrants to purchase shares of Steleus stock, and all other rights to purchase common stock shall be cancelled and terminated without any payment to the holder in respect thereof being required.

(b) As part of your compensation package, under the Tekelec 2004 Equity Incentive Plan for New Employees (the “Plan”), I will recommend that the Compensation Committee of the Tekelec Board of Directors grant you (i) a non-statutory stock option (the “Option”) to purchase 75,000 shares of Tekelec Common Stock, at an exercise price to be equal to the market value of a share of Tekelec Common Stock on the date granted, and (ii) award you a number of Restricted Stock

William Everett
August 6, 2004
Page 2

Units (the “Award”) covering shares of Tekelec Common Stock having a value equal to $289,000. The number of shares subject to the Restricted Stock Units shall be determined by dividing the dollar value of the Award by the Closing Stock Price as defined in Section 1.4(b) of the Merger Agreement, i.e., the average per share closing sales price of Telelec Common Stock, as quoted on the Nasdaq National Market (and as reported by The Wall Street Journal) for the ten trading days ending on the second trading day preceding the Effective Date. Your Option will vest and become exercisable cumulatively in 16 equal quarterly installments as long as you remain an employee of the Company with the first installment vesting on the last day of the first full quarter following the Effective Date, and will otherwise be subject to the terms and provisions of the Plan and the agreement evidencing your Option. Your RSUs will vest in their entirety on the date that is exactly one year from the Effective Date hereof provided you remain an employee of the Company on that date subject only to the acceleration provisions contained in Paragraph 5 (Severance below), and will otherwise be subject to the terms and provisions of the Plan and the agreement evidencing your RSUs. Upon vesting of RSUs, the underlying shares of Common Stock as to which the RSUs have vested, subject to withholding any applicable taxes, will be issued to you.

4. Employee Benefits. After the Effective Date and as soon as administratively feasible, you will be transitioned from the Steleus employee benefits plans into the Tekelec employee benefits plans of general application, including medical, dental, vision, life, AD&D, short-term disability, long-term disability, employee stock purchase plan, 401(k) plan, and educational assistance program. The Steleus medical, dental, vision, and spending account plans will continue through 2004. Effective January 1, 2005, you will eligible to participate in Tekelec’s medical, dental, vision and spending account plans. Your participation in these plans is subject to the terms, conditions and limitations in the applicable plan documents and/or policies. To the extent permitted by Tekelec’s 401(k) plan and applicable laws, you will receive credit for your employment with Steleus prior to the Effective Date for purposes of Tekelec’s 401(k) plan and all other benefit plans where vesting may apply.

You will receive such other benefits as are generally provided to employees of Tekelec holding similar positions to yours. These benefits include accrued paid time off ranging from 20 to 25 days per year, depending on length of service, which may be used for vacation, illness or personal reasons. Your paid time off will accrue from the Effective Date, and for purposes of accrual you will receive service credit from your most recent date of hire with Steleus. Your 2004 unused and accrued vacation under the Steleus plans as of the Effective Date will be credited for use as paid time off under Tekelec’s policy. You will receive holidays in accordance with the Tekelec holiday schedule. This letter is not intended to limit Tekelec’s rights to establish, change or terminate employee benefit plans, policies and programs at its sole discretion from time to time.

5. Severance. In the event that within one year after the Effective Date, your employment is terminated by Tekelec other than “for cause” (as defined in Attachment 1 hereto), and provided that upon such termination of employment you enter into a Severance agreement and General Release in a form acceptable to Tekelec, you will receive the greater of (a) a continuation of your base compensation from your termination date through the remainder of the one-year period (“the severance benefit period”), and reimbursement of premiums you pay to continue your group health coverage under COBRA for the remainder of the severance benefit period, or (b) severance benefits in accordance with the Tekelec Severance Plan. In addition to the foregoing, in the event your employment is terminated by Tekelec other than “for Cause” (as defined in Attachment 1 hereto) or due to your death at any time prior to the vesting of all RSUs granted under paragraph 3(b) above, all unvested RSUs (but not any unvested

William Everett
August 6, 2004
Page 3

options) will accelerate and vest on your Termination Date. Your severance benefits under subparagraph (a) or (b) above shall terminate in the event you become gainfully employed or engaged as a consultant or in any other capacity for compensation during the severance benefit period. To effectuate the foregoing provision, you agree to notify the Chief Executive Officer of Tekelec in writing within five (5) days of your acceptance of any employment or other engagement for compensation during the severance benefit period. In the event your employment is terminated more than one-year from the Effective Date, your eligibility for severance benefits will be in accordance with the terms and conditions of the Tekelec Severance Plan.

6. Inventions, Non-Disclosure, Non-Solicitation and Non-Competition. You acknowledge that (a) Steleus and Tekelec have spent substantial money, time and effort over the years in developing and solidifying their relationships with customers and in developing their confidential and proprietary information; (b) such relationships and information represent significant and important assets of their combined businesses and of the Transaction; (c) the combined businesses of Steleus and Tekelec will include without limitation supplying network-related intelligence including real-time performance monitoring and management to customers worldwide (the “Company Business”); (d) as a key employee of Steleus, you are currently party to a non-compete agreement; (e) in connection with the Transaction, you are receiving this offer of employment which includes valuable consideration including equity interests in Tekelec; (f) the Merger Agreement between Steleus and Tekelec provides that on and after the Effective Date you shall be bound by a non-compete agreement; and (g) in connection with your ongoing employment, you will have access to confidential and proprietary information developed by Tekelec and its affiliated companies to which you previously did not have access, and you will be compensated to, among other things, develop and preserve goodwill and relationships with customers and employees on behalf of Tekelec and to develop and maintain as confidential Tekelec’s confidential, proprietary information for the exclusive ownership and use by Tekelec and its affiliates including the Company. Accordingly, Tekelec has requested, and you have agreed to enter into the following restrictions that are intended to protect the Company and Tekelec against the potential use or appropriation of confidential information or competitive value, or any other actions which could result in a loss of goodwill, and more generally, to prevent you and others from having an unfair competitive advantage over Tekelec. You further acknowledge and agree that the scope of the following agreements is reasonable and necessary to protect the confidential information, business relationships and interests of Tekelec:

     (i) No-Solicitation. So long as you are an employee of the Company, Tekelec or any parent, affiliated or related entity of Tekelec (“Tekelec company”) and for a period of one (1) year thereafter (except that such period shall be two (2) years if you are involuntarily terminated “for Cause“ as defined in Attachment 1 hereto), you shall not, directly or indirectly, either for yourself or for any other person or entity, directly or indirectly: (A) hire or solicit, induce or attempt to induce any employee or consultant of any Tekelec company to leave his or her employment or consulting relationship with any such entity; or (B) solicit or attempt to solicit the business of any customer or prospective customer of the Company or Tekelec with whom you had contact or with respect to whom you had access to any confidential information during the period of your employment.

William Everett
August 6, 2004
Page 4

     (ii) No-Competition. So long as you are an employee of any Tekelec Company, and for the longer period of: (A) one (1) year after the date you last cease to be employed by any Tekelec company for any reason (except that such period shall be two (2) years if you are involuntarily terminated “for Cause” as defined in Attachment 1 hereto); or (B) two (2) years after the Effective Date, you shall not become employed by, or render any executive, sales, engineering, application or customer related services, whether or not for compensation, to a business competitive with the Company Business conducted at any time during your employment relationship with Tekelec. You acknowledge that this provision contains no territorial limitation because Tekelec is a global company that competes for business throughout the world. This subparagraph (ii) shall not prevent you from owning a passive investment of not more than five percent (5%) of the outstanding equity securities of a corporation whose stock is listed on a national stock exchange.

     (iii) Proprietary Rights. You agree to enter into and comply with the Tekelec Confidentiality and Non-Disclosure Agreement attached hereto as Attachment 2, and such revisions thereto as may be reasonably required by Tekelec from time to time.

     (iv) Employee’s Representations. You hereby represent and warrant that (a) the execution, delivery and performance of this Paragraph 6 of this offer letter (and each of its subparagraphs) do not and shall not conflict with, breach, violate or cause a default under any contract, agreement, instrument, order, judgment or decree to which you are a party or by which you are bound, and (b) as of the date this offer letter is signed, you are not a party to or bound by any employment agreement, non-compete agreement, or confidentiality agreement with any person or entity other than Steleus.

7. At-Will Employment. Your employment will be “at-will.” This means that you reserve the right to terminate your employment at any time, and the Company reserves the right in its discretion to terminate your employment or alter your position or terms and conditions of employment, for any reason or no reason, and without any liability for compensation or damages except as expressly provided in this letter. While the terms of your employment including your compensation will be subject to review, typically annually, and will change from time to time, the at-will nature of all employment with the Company will not and cannot change except by an express written agreement which must be signed by the Chief Executive Officer of Tekelec.

8. Entire Agreement; Modifications. This letter sets forth our entire understanding with respect to your employment with the Company and supersedes in its entirety your offer letter dated October 4, 2001 and any and all prior or contemporaneous representations, promises, discussions or agreements with respect to your employment, whether written or oral, and whether made to you or with you by any employee, director or officer of, or any other person affiliated with Tekelec, Steleus or any actual or perceived agent thereof. Tekelec reserves the right to make reasonable changes to the terms and conditions of employment of employees; such changes shall be notified by way of a general notice to all employees and shall take effect from the date of the notice (unless such other effective date is specified in the notice). Subject thereto, the provisions of this letter may be amended, modified, supplemented or waived only by a writing specifically identifying this letter and signed by each party hereto.

William Everett
August 6, 2004
Page 5

9. Governing Law. This letter and the rights and obligations of the parties hereto shall be governed and construed under the laws of the State of Massachusetts. Our respective rights and obligations under Attachment 2 shall be governed and construed as specified therein.

We look forward to working with you and believe that you can make a very significant, positive contribution to our success.

Please acknowledge your agreement to the terms of this letter by signing and dating the enclosed copy where indicated below and returning to me on or before August 12, 2004. Please note that if the Transaction has not closed on or before November 1, 2004 (or such later date as may hereafter be agreed in writing between Tekelec and you), this letter will no longer be effective.

Sincerely,

/s/ Frederick Lax

Frederick Lax
President and Chief Executive Officer

I accept this offer and agree to the terms set forth above.

/s/ William Everett	Dated:	August 11	, 2004
Signature

ATTACHMENT 1

For purposes of the obligations specified in Paragraph 5 (Severance) and Paragraph 6 (Non-Solicitation and Non-Competition), your employment will be deemed terminated “for cause” if termination is a result of:

(1) your failure or inability to perform your assigned duties and responsibilities to the reasonable satisfaction of your manager or the Chief Executive Officer of Tekelec, provided, however, that you shall receive notice of your deficiencies and an opportunity to correct them which need not exceed thirty (30) days;

(2) your act or omission that is materially harmful to the Company, Tekelec or any affiliated entity;

(3) your violation of your obligations under the Confidentiality and Non-Disclosure Agreement or the terms of this offer letter including the non-solicitation and non-competition provisions hereof;

(4) your violation of Tekelec’s policy on Business Ethics or other published policy applicable generally to all employees;

(5) your use or possession of illegal drugs; or reporting to work or working under the influence of illegal drugs or alcohol;

(6) your fraudulent conduct; misappropriation of funds; or any other breach of fiduciary duty owed to the Company, Tekelec or any affiliated entity;

(7) your commission of a felony or any crime of moral turpitude;

(8) your absence (excluding vacations, injury, illness or other protected leave) from work for more than three consecutive work days, all of which are neither authorized, justified or excused; or

(9) unless otherwise agreed in writing by Tekelec, your failure to perform the essential functions of your position, with or without reasonable accommodation, due to a mental or physical disability, which failure continues for more than four consecutive weeks.

* * *

ATTACHMENT 2

[Form of Tekelec Confidentiality and Non-Disclosure Agreement]

EX-10.2

EXHIBIT 10.2

TEKELEC
INDEMNIFICATION AGREEMENT

     This Indemnification Agreement (“Agreement”) is made as of April 7, 2005 by and between Tekelec, a California corporation (the “Company”), and                                          (“Indemnitee”).

RECITALS

     A. The Company desires to attract and retain the services of highly qualified individuals to serve as executive officers, directors and agents of the Company.

     B. The Company and Indemnitee recognize the increased risk of litigation and other claims being asserted against directors, executive officers and other agents of the Company.

     C. The Company desires to provide indemnification and other rights to Indemnitee in consideration for Indemnitee’s service to the Company.

     In consideration of the covenants and promises set forth herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties agree as follows:

     1. Indemnification.

          (a) Third Party Proceedings. The Company shall indemnify Indemnitee if Indemnitee was or is a party or is threatened to be made a party to any threatened, pending or completed action or proceeding, whether civil, criminal, administrative or investigative (a “Proceeding”) (other than an action by or in the right of the Company to procure a judgment in its favor) by reason of the fact that Indemnitee is or was a director, officer, employee or other agent of the Company or by reason of the fact that Indemnitee is or was serving at the request of the Company as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise, against expenses (including reasonable attorneys’ fees), judgments, fines, settlements (if such settlement is approved in advance by the Company, which approval shall not be unreasonably withheld) and other amounts actually and reasonably incurred by Indemnitee in connection with the Proceeding if Indemnitee acted in good faith and in a manner Indemnitee reasonably believed to be in the best interests of the Company, and, in the case of any criminal Proceeding, had no reasonable cause to believe Indemnitee’s conduct was unlawful. The termination of any Proceeding by judgment, order, settlement or conviction, or upon a plea of nolo contendere or its equivalent, shall not, of itself, create a presumption that (i) Indemnitee did not act in good faith and in a manner that Indemnitee reasonably believed to be in the best interests of the Company or (ii) Indemnitee had reasonable cause to believe that Indemnitee’s conduct was unlawful.

          (b) Proceedings by or in the Right of the Company. The Company shall indemnify Indemnitee if Indemnitee was or is a party or is threatened to be made a party to any threatened, pending or completed action by or in the right of the Company to procure a judgment in its favor by reason of the fact that Indemnitee is or was a director, officer, employee or other agent of the Company or by reason of the fact that Indemnitee is or was serving at the request of the Company as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise, against expenses (including reasonable attorneys’ fees) actually and reasonably incurred by Indemnitee in connection with the defense or settlement of such action if Indemnitee acted in good faith, in a manner Indemnitee believed to be in the best interests of the Company and its shareholders, except that no indemnification shall be made (i) in respect of any claim, issue or matter as to which Indemnitee shall have been adjudged to be liable to the Company in the performance of

Indemnitee’s duty to the Company and its shareholders, unless and only to the extent that the court in which such Proceeding is or was pending shall determine upon application that, in view of all the circumstances of the case, Indemnitee is fairly and reasonably entitled to indemnity for expenses and then only to the extent that the court shall determine, (ii) of amounts paid in settling or otherwise disposing of a pending action without court approval or (iii) of expenses incurred in defending a pending action that is settled or otherwise disposed of without court approval.

     2. Expenses; Indemnification Procedure.

          (a) Advancement of Expenses. The Company shall advance all expenses incurred by Indemnitee in defending any Proceeding referenced in Section 1(a) or (b) hereof prior to the final disposition of the Proceeding (but not amounts actually paid in settlement of any such Proceeding). Indemnitee hereby undertakes to repay such amounts advanced if a court shall ultimately determine that Indemnitee is not entitled to be indemnified by the Company as authorized hereby or by Section 317 of the California General Corporation Law. The advances to be made hereunder shall be paid by the Company to Indemnitee within twenty (20) days following delivery of a written request therefor by Indemnitee to the Company.

          (b) Notice; Cooperation by Indemnitee. Indemnitee shall, as soon as practicable and as a condition precedent to Indemnitee’s right to be indemnified or to receive any advancement of expenses under this Agreement, give the Company written notice of any claim made against Indemnitee for which indemnification or advancement of expenses will or could be sought under this Agreement, specifying the nature of such claim in reasonable detail. Notice to the Company shall be directed to the Chief Executive Officer of the Company, or the Chief Financial Officer if Indemnitee is the Chief Executive Officer, in accordance with Section 14 hereof. Any delay in providing notice will not relieve the Company from its obligations under this Agreement, except to the extent such failure is prejudicial. Indemnitee shall give the Company such information and cooperation as it may reasonably require and as shall be within Indemnitee’s power.

          (c) Procedure. Any indemnification provided for in Section 1 hereof shall be made after the final disposition (by judgment, settlement, dismissal or otherwise) of the Proceeding with respect to which indemnification is sought and no later than forty five (45) days after written notice by Indemnitee requesting payment. If a claim under this Agreement, under any statute or under any provision of the Company’s Articles of Incorporation or Bylaws providing for indemnification is not paid in full by the Company within forty-five (45) days after such written notice, Indemnitee may, but need not, at any time thereafter bring an action against the Company to recover the unpaid amount of the claim and, subject to Section 13 hereof, Indemnitee shall also be entitled to be paid for the expenses (including reasonable attorneys’ fees) of bringing such action. It shall be a defense to any such action (other than an action brought to enforce a claim for expenses incurred in connection with any Proceeding in advance of its final disposition) that Indemnitee has not met the standards of conduct which make it permissible under this Agreement or applicable law for the Company to indemnify Indemnitee for the amount claimed, and Indemnitee shall be entitled to receive interim payments of expenses pursuant to Subsection 2(a) hereof unless and until such defense may be finally adjudicated by court order or judgment from which no further right of appeal exists. It is the parties’ intention that if the Company contests Indemnitee’s right to indemnification, the question of Indemnitee’s right to indemnification shall be for the court to decide, and neither the failure of the Company (including its Board of Directors, any committee or subgroup of the Board of Directors, independent legal counsel or its shareholders) to have made a determination that indemnification of Indemnitee is proper in the circumstances because Indemnitee has met the applicable standard of conduct required by applicable law, nor an actual determination by the Company (including its Board of Directors, any committee or subgroup of the Board of Directors, independent legal

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counsel or its shareholders) that Indemnitee has not met such applicable standard of conduct, shall create a presumption that Indemnitee has or has not met the applicable standard of conduct.

          (d) Notice to Insurers. If, at the time of the receipt of a notice of a claim pursuant to Section 2(b) hereof, the Company has directors’ and officers’ liability insurance in effect, the Company shall give prompt notice of the commencement of the Proceeding to the insurers in accordance with the procedures set forth in the respective policies. The Company shall thereafter take all commercially reasonable action to cause such insurers to pay, on behalf of the Indemnitee, all amounts payable as a result of such Proceeding in accordance with the terms of such policies.

          (e) Selection of Counsel. In the event the Company shall be obligated under Section 2(a) hereof to pay the expenses of any Proceeding against Indemnitee, the Company, if appropriate, shall be entitled to assume the defense of such Proceeding, with counsel approved by Indemnitee, which approval shall not be unreasonably withheld, upon giving written notice to Indemnitee of its election so to do. After giving such notice, approval of such counsel by Indemnitee and the retention of such counsel by the Company, the Company will not be liable to Indemnitee under this Agreement for any fees or expenses of counsel subsequently incurred by Indemnitee with respect to the same Proceeding, provided that (i) Indemnitee shall have the right to employ Indemnitee’s counsel in any such Proceeding at Indemnitee’s expense; and (ii) if (A) the Company has expressly authorized (and continues to authorize) the employment of counsel by Indemnitee at the Company’s expense, (B) the use of counsel chosen by the Company to represent Indemnitee would present such counsel with a conflict of interest or (C) the Company shall not, in fact, have employed counsel reasonably satisfactory to Indemnitee within a reasonable time after notice of the institution of such Proceeding, then Indemnitee shall have the right to employ counsel, and the reasonable fees and expenses of such counsel shall be at the expense of the Company in accordance herewith.

     3. Additional Indemnification Rights; Nonexclusivity.

          (a) Scope. Subject to Section 8 hereof and any other provision of this Agreement that prohibits, limits or conditions indemnification by the Company, the Company hereby agrees to indemnify Indemnitee to the fullest extent permitted by law for any acts, omissions or transactions while acting in the capacity of, or that are otherwise related to the fact that Indemnitee was or is serving as, a director, officer, employee or other agent of the Company or, to the extent Indemnitee is or was serving at the request of the Company as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise, such other corporation, partnership, joint venture, trust or other enterprise. In the event of any change, after the date of this Agreement, in any applicable law, statute or rule that expands the right of a California corporation to indemnify a member of its Board of Directors, an officer or other corporate agent, such changes shall be, ipso facto, within the purview of Indemnitee’s rights and Company’s obligations, under this Agreement. In the event of any change in any applicable law, statute or rule that narrows the right of a California corporation to indemnify a member of its Board of Directors, an officer or other corporate agent, such changes, to the extent required by such law, statute or rule to be applied to this Agreement, shall have the effect on this Agreement and the parties’ rights and obligations hereunder as is required by such law, statute or rule.

          (b) Nonexclusivity. The indemnification provided by this Agreement shall not be deemed exclusive of any rights to which Indemnitee may be entitled under the Company’s Articles of Incorporation, its Bylaws, any agreement, any vote of shareholders or disinterested directors, the California General Corporation Law or otherwise, both as to action in Indemnitee’s official capacity and as to action in another capacity while holding such office. The indemnification provided under this Agreement shall continue as to Indemnitee for

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any action taken or not taken while serving in an indemnified capacity even though Indemnitee may have ceased to serve in such capacity at the time of any covered Proceeding.

     4. Partial Indemnification. If Indemnitee is entitled under any provision of this Agreement to indemnification by the Company for some or a portion of the expenses, judgments, fines, settlements or other amounts actually and reasonably incurred by Indemnitee in connection with any Proceeding, but not, however, for the total amount thereof, the Company shall nevertheless indemnify Indemnitee for the portion of such expenses, judgments, fines, settlements or other amounts to which Indemnitee is entitled.

     5. Mutual Acknowledgement. Both the Company and Indemnitee acknowledge that in certain instances, Federal law or applicable public policy may prohibit the Company from indemnifying its directors, officers and other corporate agents under this Agreement or otherwise. Indemnitee understands and acknowledges that the Company has undertaken or may be required in the future to undertake with the Securities and Exchange Commission to submit the question of indemnification to a court in certain circumstances for a determination of the Company’s right under public policy to indemnify Indemnitee.

     6. Directors’ and Officers’ Liability Insurance. The Company shall, from time to time, make the good faith determination whether or not it is practicable for the Company to obtain and maintain a policy or policies of insurance with reputable insurance companies providing the officers and directors of the Company with coverage for losses from wrongful acts, or to insure the Company’s performance of its indemnification obligations under this Agreement. Among other considerations, the Company will weigh the costs of obtaining such insurance coverage against the protection afforded by such coverage. To the extent the Company maintains an insurance policy or policies providing directors’ and officers’ liability insurance, Indemnitee shall be named as an insured in such a manner as to provide Indemnitee the same rights and benefits as are accorded to the most favorably insured of the Company’s directors under such policy or policies, if Indemnitee is a director; or of the Company’s officers under such policy or policies, if Indemnitee is not a director of the Company but is an officer; or of the Company’s key employees under such policy or policies, if Indemnitee is not an officer or director but is a key employee. Notwithstanding the foregoing, the Company shall have no obligation to obtain or maintain any insurance if the Company determines in good faith that such insurance is not reasonably available, if the premium costs for such insurance are disproportionate to the amount of coverage provided, if the coverage provided by such insurance is limited by exclusions so as to provide an insufficient benefit, or if Indemnitee is covered by similar insurance maintained by a subsidiary or parent of the Company. In the event the Company decides not to obtain or maintain any directors’ and officers’ liability insurance, the Company will notify Indemnitee of such decision in writing within thirty (30) days after such decision.

     7. Severability. Nothing in this Agreement is intended to require or shall be construed as requiring the Company to do or fail to do any act in violation of applicable law. The Company’s inability, pursuant to court order or other applicable law, to perform its obligations under this Agreement shall not constitute a breach of this Agreement. The provisions of this Agreement shall be severable as provided in this Section 7. If this Agreement or any portion hereof shall be invalidated on any ground by any court of competent jurisdiction, then the Company shall nevertheless indemnify Indemnitee to the full extent permitted by any applicable portion of this Agreement that shall not have been invalidated, and the balance of this Agreement not so invalidated shall be enforceable in accordance with its terms.

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     8. Exceptions. Any other provision herein to the contrary notwithstanding, the Company shall not be obligated pursuant to the terms of this Agreement:

          (a) Excluded Acts. To indemnify Indemnitee (i) for any acts or omissions or transactions from which a director may not be relieved of liability under the California General Corporation Law or other applicable law or (ii) for breach of duty to the Company or its shareholders as to circumstances in which indemnity is expressly prohibited by Section 317 of the California General Corporation Law; or

          (b) Claims Initiated by Indemnitee. To indemnify or advance expenses to Indemnitee with respect to proceedings or claims initiated or brought voluntarily by Indemnitee and not by way of defense, except with respect to proceedings or claims initiated or brought to enforce this Agreement or a right to indemnification under Section 317 of the California General Corporation Law or under any other statute or law, but such indemnification or advancement of expenses may be provided by the Company in specific cases if the Board of Directors has approved the initiation or bringing of such suit; or

          (c) Lack of Good Faith. To indemnify Indemnitee for any expenses incurred by Indemnitee with respect to proceedings or claims initiated or brought to enforce this Agreement or a right to indemnification under Section 317 of the California General Corporation Law or under any other statute or law, if a court of competent jurisdiction determines that each of the material assertions made by the Indemnitee in such proceeding was not made in good faith or was frivolous; or

          (d) Duplicate Payments. To indemnify Indemnitee for expenses or liabilities of any type whatsoever (including, but not limited to, judgments, fines, ERISA excise taxes or penalties, and amounts paid in settlement) to the extent Indemnitee has otherwise received payment of amounts otherwise indemnifiable under this Agreement pursuant to (i) a policy of directors’ and officers’ liability insurance maintained by the Company, (ii) the Company’s Articles of Incorporation or Bylaws, (iii) Section 317 or any other applicable provisions of the California General Corporation Law or (iv) any other agreement; or

          (e) Claims Under Section 16(b). To indemnify Indemnitee for expenses and the payment of profits arising from the purchase and sale by Indemnitee of securities in violation of Section 16(b) of the Securities Exchange Act of 1934, as amended, or any similar successor statute.

     9. Effectiveness of Agreement. This Agreement shall be effective as of the date set forth on the first page of this Agreement and shall apply to acts or omissions of Indemnitee that occurred prior to such date if Indemnitee was a director, officer, employee or other agent of the Company, or was serving at the request of the Company as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise, at the time such act or omission occurred. This Agreement shall continue in effect regardless of whether Indemnitee continues to serve as a director, officer, employee, agent or fiduciary (as applicable) of the Company or of any other enterprise at the Company’s request for so long thereafter as Indemnitee shall be subject to any possible claim or threatened, pending or completed action, suit or proceeding, whether civil, criminal or investigative, by reason of the fact that Indemnitee was serving in any such capacity.

     10. Construction of Certain Phrases.

          (a) For purposes of this Agreement, references to the “Company” shall also include, in addition to the resulting or surviving corporation, any constituent corporation (including any constituent of a constituent) absorbed in a consolidation or merger that, if its separate existence had continued, would have had power and authority to indemnify its directors, officers, employees or agents, so that if Indemnitee is or was a director, officer, employee or agent of such constituent corporation, or is or was serving at the request of such

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constituent corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise, Indemnitee shall stand in the same position under the provisions of this Agreement with respect to the resulting or surviving corporation as Indemnitee would have with respect to such constituent corporation if its separate existence had continued.

          (b) For purposes of this Agreement, references to “other enterprise” shall include employee benefit plans; references to “fines” shall include any excise taxes assessed on Indemnitee with respect to an employee benefit plan; and references to “serving at the request of the Company” shall include any service as a director, officer, employee or agent of the Company that imposes duties on, or involves services by, such director, officer, employee or agent with respect to an employee benefit plan, its participants or beneficiaries.

     11. Counterparts. This Agreement may be executed in counterparts, each of which shall constitute an original.

     12. Successors and Assigns. This Agreement shall be binding upon the Company and its successors and assigns, and shall inure to the benefit of Indemnitee and Indemnitee’s estate, heirs, executors, administrators and similar legal representatives.

     13. Attorneys’ Fees. In the event that any action is instituted by Indemnitee under this Agreement to enforce or interpret any of the terms hereof, Indemnitee shall be entitled to be paid all costs and expenses, including reasonable attorneys’ fees, incurred by Indemnitee with respect to such action, unless as a part of such action, a court of competent jurisdiction determines that each of the material assertions made by Indemnitee as a basis for such action was not made in good faith or was frivolous. In the event of an action instituted by or in the name of the Company under this Agreement or to enforce or interpret any of the terms of this Agreement, Indemnitee shall be entitled to be paid all costs and expenses, including reasonable attorneys’ fees, incurred by Indemnitee in defense of such action (including with respect to Indemnitee’s counterclaims and cross-claims made in such action), unless as a part of such action the court determines that each of Indemnitee’s material defenses to such action were made in bad faith or were frivolous.

     14. Notice. All notices, requests, demands and other communications under this Agreement shall be in writing and shall be deemed duly given (i) if delivered by hand and receipted for by the party addressee or an agent thereof, on the date of such receipt, (ii) if mailed by domestic certified or registered mail with postage prepaid, on the third business day after the date postmarked or (iii) if sent by other means, on the date such notice is actually received by the relevant party. Addresses for notice to either party are as shown on the signature page of this Agreement, or as subsequently modified by written notice in accordance herewith. Notice to the Company shall be sent with a copy to the Company’s General Counsel and to its outside legal counsel at the addresses set forth below or as subsequently modified by written notice to the Indemnitee:

Tekelec
26580 W. Agoura Road
Calabasas, CA 91302
Fax: (818) 880-0176
Attn: General Counsel

Bryan Cave LLP
120 Broadway, Suite 300
Santa Monica, CA 90401
Fax: (310) 576-2200
Attention: Katherine F. Ashton, Esq.

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     15. Consent to Jurisdiction. The Company and Indemnitee each hereby irrevocably consent to the jurisdiction of the courts of the State of California in the County of Los Angeles for all purposes in connection with any action or proceeding which arises out of or relates to this Agreement and agree that any action or proceeding instituted under this Agreement shall be brought only in the County of Los Angeles in the state courts of the State of California.

     16. Choice of Law. This Agreement shall be governed by and its provisions construed in accordance with the laws of the State of California as applied to contracts between California residents entered into and to be performed entirely within California.

     17. Subrogation. In the event of payment under this Agreement, the Company shall be subrogated to the extent of such payment to all of the rights of recovery of Indemnitee, who shall execute all documents required and shall do all acts that may be necessary to secure such rights and to enable the Company effectively to bring suit to enforce such rights.

     18. Amendment and Termination. No amendment, modification, termination or cancellation of this Agreement shall be effective unless in writing signed by both parties hereto.

     19. Integration and Entire Agreement. This Agreement (i) sets forth the entire understanding between the parties with respect to the subject matter hereof, (ii) supersedes all previous written or oral negotiations, commitments, understandings and agreements relating to the subject matter hereof and (iii) merges all prior and contemporaneous discussions between the parties.

     IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date first above written.

	TEKELEC
	By:
	Name:
	Title:
	Address:	26580 W. Agoura Road
		Calabasas, CA 91302
Agreed to and accepted:
INDEMNITEE:
Address:

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