FORM OF COMMSCOPE, INC. EMPLOYEE RESTRICTED STOCK UNIT AGREEMENT (WITH RELATED DIVIDEND EQUIVALENT RIGHTS)
Exhibit
10.3
FORM
OF
COMMSCOPE,
INC.
2006
LONG TERM INCENTIVE PLAN
EMPLOYEE
RESTRICTED STOCK UNIT AGREEMENT
(WITH
RELATED DIVIDEND EQUIVALENT RIGHTS)
THIS
AGREEMENT, made as of the ____ day of _______, 2008 (the “Date of
Grant”), between CommScope, Inc., a Delaware corporation (the
“Company”), and
_________ (the “Grantee”).
WHEREAS,
the Company has adopted the CommScope, Inc. 2006 Long Term Incentive Plan
(the
“Plan”) in order to provide an additional incentive to certain employees
and directors of the Company and its Subsidiaries; and
WHEREAS,
the Committee responsible for the administration of the Plan has determined
to
grant restricted stock units to the Grantee as provided herein;
NOW,
THEREFORE, the parties hereto agree as follows:
1. Grant.
1.1 The
Company hereby grants to the Grantee an award (the “Award”) of ___
restricted stock units (the “Restricted Stock Units”) and ____ dividend
equivalent rights (the “Dividend Equivalent Rights”), each Restricted
Stock Unit to be accompanied by one (1) related Dividend Equivalent
Right. The Restricted Stock Units and Dividend Equivalent Rights
granted pursuant to the Award shall be subject to the execution and return
of
this Agreement by the Grantee (or the Grantee’s estate, if applicable) to the
Company. Subject to the terms of this Agreement, each Restricted
Stock Unit represents the right to receive one (1) Share at the time and
in the
manner set forth in Section 7 hereof.
1.2
Each Dividend Equivalent Right represents the right to receive all of the
cash
dividends that are or would be payable with respect to the Shares represented
by
the Restricted Stock Unit to which the Dividend Equivalent Right
relates. With respect to each Dividend Equivalent Right, any such
cash dividends shall be paid on the Vesting Date. The Dividend
Equivalent Rights shall be subject to the same terms and conditions applicable
to the Restricted Stock Units, including, without limitation, the forfeiture
and
vesting provisions contained in Sections 2 through 4, inclusive, of this
Agreement. In the event that the Restricted Stock Units are forfeited
pursuant to Section 3 hereof, the related Dividend Equivalent Right shall
also
be forfeited.
1.3 This
Agreement shall be construed in accordance and consistent with, and subject
to,
the provisions of the Plan (the provisions of which are hereby incorporated
by
reference) and, except as otherwise expressly set forth herein, the capitalized
terms used in this Agreement shall have the same definitions as set forth
in the
Plan.
2. Vesting.
Except
as
provided in Sections 3 and 4 hereof, 100% of the Restricted Stock Units granted
hereunder will vest on the third anniversary of the Date of Grant (the
“Vesting Date”) provided the Grantee has remained in continuous
employment from the Date of Grant to the Vesting Date.
3. Termination
of Employment.
3.1 Death
or Disability. In the event of the Grantee’s death or Disability
prior to the Vesting Date, 100% of the Award shall become immediately
vested.
3.2 Retirement. In
the event that (i) the Grantee has completed 10 years of service for the
Company, a Subsidiary or a Division, and the Grantee’s employment is terminated
prior to the Vesting Date as a result of the Grantee’s voluntary retirement
after attainment of age 55, or (ii) the Grantee’s employment is terminated prior
to the Vesting Date as a result of the Grantee’s voluntary retirement after
attainment of age 65, the “Pro Rata Portion” (as defined below) of the Award
shall remain outstanding and shall be eligible to vest on the Vesting Date
if
the Grantee complies with the post-employment covenants described in Exhibit
A, and the remainder of the Award shall immediately be
forfeited. In the event of a breach by the Grantee of any of the
post-employment covenants described in Exhibit A hereto, the entire Award
shall immediately be forfeited. The “Pro Rata Portion” shall be equal to a
fraction (not to exceed one), the numerator of which is the number of whole
calendar months between the Date of Grant and the Grantee’s date of retirement
and the denominator of which is 36.
3.3 Cause. In
the event the Grantee’s employment is terminated for Cause prior to the Vesting
Date, the Award shall immediately be forfeited. For purposes of this
Agreement, “Cause” shall mean (i) in the case of a Grantee whose employment with
the Company, a Subsidiary or a Division is subject to the terms of an employment
agreement which includes a definition of “Cause,” the meaning set forth in such
employment agreement during the period that such employment agreement remains
in
effect; and (ii) in all other cases, (a) the Grantee’s failure or refusal to
perform such Grantee’s substantive duties or to follow the lawful directives of
the Board or the board of directors of a Subsidiary, as applicable (or of
any
superior officer of the Company, a Subsidiary or a Division having direct
supervisory authority over such Grantee); (b) the commission of an act of
fraud, theft, breach of fiduciary obligation with respect to the Company,
a
Subsidiary or a Division or a violation of any material policies of the Company,
a Subsidiary or a Division, as applicable, of which the Grantee has had prior
notice; (c) dishonesty, willful misconduct, or gross negligence in the
performance of any substantive duties; or (d) the indictment for, or
conviction of or plea of guilty or nolo contendere to any felony (whether
or not
involving the Company, a Subsidiary or a Division).
3.4 Other
Termination of Employment. If the employment of the Grantee is
terminated (including the Grantee’s ceasing to be employed by a Subsidiary or a
Division as a result of the sale of such Subsidiary or Division or an interest
in such Subsidiary or Division) prior to the Vesting Date under any circumstance
other than those set forth in Section 3.1, Section 3.2 and Section 3.3, the
Award shall immediately be forfeited.
4.
Effect of Change in Control.
Notwithstanding
anything contained in this Agreement to the contrary, in the event of a Change
in Control at any time prior to the Vesting Date the Award shall become
immediately vested.
5.
Non-transferability.
The
Award
may not be sold, transferred or otherwise disposed of and may not be pledged
or
otherwise hypothecated.
6.
No Right to Continued Employment.
Nothing
in this Agreement or the Plan shall be interpreted or construed to confer
upon
the Grantee any right with respect to continuance of employment by the Company,
any Subsidiary or any Division, nor shall this Agreement or the Plan interfere
in any way with the right of the Company, any Subsidiary or any Division
to
terminate the Grantee’s employment therewith at any time.
7.
Issuance of Shares.
Except
as
provided in the following sentence, on the Vesting Date, or as soon thereafter
as administratively practicable (but in no event later than 2 ½ months after the
Vesting Date occurs), the Company shall issue Shares to the Grantee (or,
if
applicable, the Grantee’s estate) with respect to the Restricted Stock Units
that becomes vested (A) on the Vesting Date, (B) pursuant to Section 3.1
by
reason of the Grantee’s Disability that does not constitute a Section 409A
Disability (as defined below) or (C) pursuant to Section 4 by reason of a
Change
in Control that does not constitute a Section 409A Change in Control (as
defined
below). Shares with respect to Restricted Stock Units that become
vested (A) pursuant to Section 3.1 by reason of the Grantee’s death, (B)
pursuant to Section 3.1 by reason of the Grantee’s Disability that constitutes a
“disability” within the meaning of Section 409A of the Code and the regulations
and interpretive guidance issued thereunder (a “Section 409A Disability”) or (C)
pursuant to Section 4 by reason of a Change in Control which also constitutes
a
change in control or effective control of the Company or a change in the
ownership of a substantial portion of its assets, in each case within the
meaning of Section 409A of the Code and the regulations and interpretive
guidance issued thereunder (a “Section 409A Change in Control”), shall be
issued upon the date such Restricted Stock Units become vested, or as soon
thereafter as administratively practicable (but in no event later than 2
½
months after the date the Restricted Stock Units become
vested). Notwithstanding anything to the contrary contained herein,
no Shares may be transferred to any person other than the Grantee unless
such
other person presents documentation to the Committee, which proves to the
Committee to its reasonable satisfaction such person’s right to the
transfer.
8.
Withholding of Taxes.
Prior
to the delivery to the Grantee
(or the Grantee’s estate, if applicable) of Shares pursuant to Sections 1 and 7
hereof, the Grantee (or the Grantee’s estate) shall pay to the Company the
federal, state and local income taxes and other amounts as may be required
by
law to be withheld by the Company (the “Withholding Taxes”) with respect
to such Shares. The Grantee may make a written election (the “Tax
Election”) by completing and delivering a form of Tax Election in the manner
specified in the form of Tax Election, which will be provided to the Grantee
prior to the Vesting Date. Pursuant to the form of Tax Election,
Grantee may pay the applicable Withholding Taxes in any one or any combination
of (i) cash, (ii) unrestricted Shares owned by the Grantee prior to the vesting
of the Award and valued at its Fair Market Value on the business date
immediately preceding the Vesting Date, or (iii) by having withheld a portion
of
the Shares issuable to him or her upon vesting of the Award and valued at
its
Fair Market Value on the date preceding the date of vesting. For
purposes of this Section 8, if the Grantee fails to make a Tax Election,
the
Withholding Tax obligation will be satisfied by alternative (iii).
“Fair
Market Value” shall mean (i) if
the Shares are listed for trading on the New York Stock Exchange, the closing
price at the close of the primary trading session of the Shares on such date
on
the New York Stock Exchange, or if there has been no such closing price of
the
Shares on such date, on the next preceding date on which there was such a
closing price, (ii) if the Shares are not so listed, but are listed on another
national securities exchange, the closing price at the close of the primary
trading session of the Shares on such date on such exchange, or if there
has
been no such closing price of the Shares on such date, on the next preceding
date on which there was such a closing price, (iii) if the Shares are not
listed
for trading on the New York Stock Exchange or on another national securities
exchange, the last sale price at the end of normal market hours of the Shares
on
such date as quoted on the National Association of Securities Dealers Automated
Quotation System (“NASDAQ”) or, if no price shall have been so quoted for such
date, on the next preceding date for which such price was so quoted, or (iv)
if
the Shares are not listed for trading on a national securities exchange or
are
not authorized for quotation on NASDAQ, the fair market value of the Shares
as
determined in good faith by the Committee.
9.
Grantee Bound by the Plan.
The
Grantee hereby acknowledges receipt of a copy of the Plan and agrees to be
bound
by all the terms and provisions thereof.
10. Modification
of Agreement.
This
Agreement may be modified, amended, suspended or terminated, and any terms
or
conditions may be waived, but only by a written instrument executed by the
parties hereto.
11. Severability.
Should
any provision of this Agreement be held by a court of competent jurisdiction
to
be unenforceable or invalid for any reason, the remaining provisions of this
Agreement shall not be affected by such holding and shall continue in full
force
in accordance with their terms.
12. Governing
Law.
The
validity, interpretation, construction and performance of this Agreement
shall
be governed by the laws of the State of Delaware without giving effect to
the
conflicts of laws principles thereof.
13. Successors
in Interest.
This
Agreement shall inure to the benefit of and be binding upon any successor
to the
Company. This Agreement shall inure to the benefit of the Grantee’s
legal representatives. All obligations imposed upon the Grantee and
all rights granted to the Company under this Agreement shall be binding upon
the
Grantee’s heirs, executors, administrators and successors.
14. Resolution
of Disputes.
Any
dispute or disagreement which may arise under, or as a result of, or in any
way
relate to, the interpretation, construction or application of this Agreement
shall be determined by the Committee. Any determination made
hereunder shall be final, binding and conclusive on the Grantee, the Grantee’s
heirs, executors, administrators and successors, and the Company and its
Subsidiaries for all purposes.
15. Consent
to Jurisdiction.
Each
of
the parties hereby (a) agrees to personal jurisdiction in any suit, proceeding
or action at law or in equity (hereinafter referred to as an “Action”) arising
out of or relating to the Plan or this Agreement brought in any state or
federal
court in the State of North Carolina having subject matter jurisdiction,
(b)
agrees that such jurisdiction shall be exclusive and that no Action arising
out
of or relating to the Plan or this Agreement shall be brought in any state
or
federal court other than that in the State of North Carolina, (c) waives
any
objection which the party may have now or hereafter to the laying of the
venue
of any such Action and (d) waives any claim or defense of inconvenient
forum.
[Signature
page follows]
| COMMSCOPE, INC. | |||
| By: | |||
| Name: | |||
| Title: | |||
| GRANTEE | |||
Exhibit
A
Non-Competition
and Confidentiality Covenants
By
execution of the restricted stock unit agreement to which this Exhibit A
is
attached (the “Restricted Stock Unit Agreement”), the Grantee hereby agrees as
follows:
1. Non-competition. The
Grantee agrees that the Grantee will not, for a period of two years following
his termination of employment as described in Section 3.2 of the Restricted
Stock Unit Agreement (the “Non-Competition Period”), directly or indirectly own,
manage, operate, join, control, be employed by, or participate in the ownership,
management, operation or control of, or be connected in any manner, including
but not limited to holding, the positions of shareholder, director, officer,
consultant, independent contractor, employee, partner, or investor, with
any
Competing Enterprise. For purposes of this paragraph, the term
“Competing Enterprise” shall mean any person, corporation, partnership or other
entity engaged in a business in the United States or any other geographic
area
in which the Company does business which is in competition with any of the
businesses of the Company or any of its Affiliates as of the date of the
termination of the Grantee’s employment with the Company and its
Affiliates. Upon request at any time during the Non-Competition
Period, the Grantee shall notify the Company of the Grantee’s then current
employment status. As used herein, “Affiliate” shall mean the
Company’s affiliated companies, divisions, subsidiaries, successors,
predecessors and assigns.
2. Non-solicitation. During
the Non-Competition Period, the Grantee shall not interfere with the Company’s
and any of its Affiliate’s relationship with, or endeavor to entice away from
the Company and any of its Affiliates, any person who at any time, during
the
period that the Grantee was employed by the Company or its Affiliates, was
an
employee or customer of the Company or any of its Affiliates or otherwise
had a
material business relationship with the Company or any of its
Affiliates.
3. Proprietary Rights. The
Grantee represents, warrants and covenants that all patents, patent
applications, rights to inventions, copyright registrations and other license,
trademark and trade name rights heretofore owned by the Grantee and relating
to
the business of the Company or any of its Affiliates have been or will be
duly
transferred to the Company on or prior to the date of termination of employment
with the Company and its Affiliates.
4. Confidentiality;
Return of Company Property. The Grantee agrees and understands
that in the Grantee’s position with the Company and/or its Affiliates and
performance of his or her responsibilities, duties and services for the Company
and/or its Affiliates, as the case may be, the Grantee has been exposed to,
and
information relating to, the confidential affairs of the Company and/or its
Affiliates, including but not limited to technical information, intellectual
property, business and marketing plans, strategies, customer information,
other
information concerning the products, promotions, development, financing,
expansion plans, business policies and practices of the Company and/or its
Affiliates, and other forms of confidential information, trade secrets and/or
confidential information in the nature of trade secrets of the Company and/or
its Affiliates (“Confidential Information”). The Grantee
acknowledges and represents that as of the time of execution of this
Non-Competition and Confidentiality Agreement the Grantee has not disclosed,
and
agrees that at any time thereafter the Grantee will not disclose, Confidential
Information, either directly or indirectly, to any third person or entity
without the prior written consent of the Company and/or its Affiliates, as
appropriate. This confidentiality covenant has no temporal,
geographical or territorial restriction. Except as otherwise
expressly agreed to by the Company or its Affiliates, as appropriate, on
or
promptly following the date of termination of the Grantee’s employment with the
Company and its Affiliates, the Grantee will supply to the Company and/or
its
Affiliates, as appropriate, all property, keys, mobile phones, computer
equipment, software data files, notes, memoranda, writings, lists, files,
reports, customer lists, correspondence, tapes, disks, cards, surveys, maps,
logs, machines, technical data or any other tangible product or document
which
has been produced by, received by or otherwise submitted to the Grantee: (i) during his or
her
employment with the Company and/or its Affiliates; and (ii) in the case of
a
Grantee who was employed by Avaya, Inc. (“Avaya”), during his or her employment
with Avaya (but only with respect to employment that related to the Connectivity
Solutions business that was acquired by the Company and its Affiliates pursuant
to the Asset Purchase Agreement by and among Avaya, the Company and CommScope
Solutions Holdings, LLC (formerly SS Holdings, LLC) dated October 23,
2003). Any such data
or property (including copies thereof) stored on computer, software data
files
or other equipment belonging to the Grantee (or to which the Grantee otherwise
has lawful access after the date hereof) shall be deleted by the Grantee
immediately following the termination of the Grantee’s employment with the
Company and its Affiliates.
5. Non-Disparagement. The
Grantee agrees not to make any written or oral statement which could disparage
the goods, products, services of, employees, officers, directors or reputation
of, the Company and its Affiliates.
6. Remedies. The
Grantee agrees that any breach of the terms of this Exhibit A would result
in
irreparable injury and damage to the Company and/or its Affiliates for which
the
Company and/or its Affiliates would have no adequate remedy at law; the Grantee
therefore also agrees that in the event of said breach or any threat of breach,
the Company and/or its Affiliates shall be entitled to an immediate injunction
and restraining order to prevent such breach and/or threatened breach and/or
continued breach by the Grantee and/or any and all persons and/or entities
acting for and/or with the Grantee, without having to prove damages, and
to all
costs and expenses, including reasonable attorneys’ fees and costs, in addition
to any other remedies to which the Company and/or its Affiliates may be entitled
at law or in equity. The terms of this paragraph shall not prevent
the Company and/or its Affiliates from pursuing any other available remedies
for
any breach or threatened breach hereof, including but not limited to the
recovery of damages from the Grantee. The Grantee further agrees that
the provisions of the covenant not to compete are reasonable. Should
a court or arbitrator determine, however, that any provision of the covenant
not
to compete is unreasonable, either in period of time, geographical area,
or
otherwise, the parties hereto agree that the covenant should be interpreted
and
enforced to the maximum extent which such court or arbitrator deems
reasonable.
The
existence of any claim or cause of action by the Grantee against the Company
and/or its Affiliates shall not constitute a defense to the enforcement by
the
Company and/or its Affiliates of the covenants and agreements of this Exhibit
A.
7. Miscellaneous. This
Exhibit A sets forth the entire understanding of the parties hereto with
respect
to the subject matter hereof and supersedes all prior agreements, written
or
oral, between them as to such subject matter, other than any confidentiality
agreement, any agreement dealing with the assignment to the Company of patents,
copyrights or other intellectual property or any other similar
agreements.
