3COM CORPORATION 2003 STOCK PLAN, AS AMENDED INDEPENDENT DIRECTOR RESTRICTED STOCK UNIT GRANT AWARD AGREEMENT
Exhibit 10.1
3COM CORPORATION
2003 STOCK PLAN, AS AMENDED
INDEPENDENT DIRECTOR
RESTRICTED STOCK UNIT GRANT AWARD AGREEMENT
2003 STOCK PLAN, AS AMENDED
INDEPENDENT DIRECTOR
RESTRICTED STOCK UNIT GRANT AWARD AGREEMENT
THIS RESTRICTED STOCK UNIT GRANT AWARD AGREEMENT is made by and between 3Com Corporation (the
“Company”) and the recipient hereof (“Participant”), whose name is set forth in the accompanying
3Com Corporation Notice of Grant of Independent Director Restricted Stock Unit (“Notice of Grant”).
The Company desires to issue and the Participant desires to acquire Restricted Stock Units as
herein described, pursuant to the Company’s 2003 Stock Plan, as amended (the “Plan”), on the terms
and conditions set forth in this Independent Director Restricted Stock Unit Grant Award Agreement,
including any country-specific terms and conditions set forth in any addendum hereto (collectively,
the “Award Agreement”), and the Plan, the terms and conditions of which are incorporated herein by
reference. Unless otherwise defined herein, capitalized terms shall have the meaning given to them
in the Plan.
IT IS AGREED between the parties as follows:
1. Issuance of Restricted Stock Units. On the date of the grant specified in the
Notice of Grant (“Grant Date”), the Company shall issue to the Participant, subject to the
provisions hereof and the Plan, the total number of Restricted Stock Units specified in the Notice
of Grant (the “RSUs”). Each RSU shall be the equivalent of one share of Common Stock. No Shares
shall be issued upon execution of this Award Agreement. Unless and until the RSUs have vested in
accordance with this Award Agreement, the Participant shall have no right to receive any Shares.
2. Administration. All questions of interpretation concerning this Award Agreement
shall be determined by the Administrator in its sole discretion. All determinations by the
Administrator shall be final and binding upon all persons having an interest in this Award
Agreement.
3. Vesting Schedule and Conversion of RSUs.
(a) Vesting. Subject to the terms and conditions of this Award Agreement and the
Plan, and provided that the Participant remains a member of the Board through the vesting date, the
RSUs shall become vested in full in one installment on the first anniversary of the Grant Date, and
upon vesting shall be converted into an equivalent number of Shares of Common Stock that will be
distributed to the Participant. In the event that the vesting date occurs on a weekend, holiday or
other non-trading day on the applicable NASDAQ market, the applicable RSUs shall become vested on
the first trading day thereafter.
(b) Issuance of Common Stock. Upon vesting of the RSUs, except as set forth in this
Award Agreement or the Plan, the Company shall issue one or more certificates registered in the
name of the Participant for the appropriate number of Shares or use other appropriate means of
distributing the vested Shares of Common Stock, at its discretion, free of any restrictions on
transferability or forfeiture except for restrictions required by applicable laws and/or
regulations. Such Shares will be issued to the Participant as soon as practicable after the
vesting of the RSUs, but in any event, within the period ending on the later to occur of the date
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that is 2 1/2 months from the end of (i) the Participant’s tax year that includes the applicable
vesting date, or (ii) the Company’s tax year that includes the applicable vesting date (which
payment schedule is intended to comply with the “short-term deferral” exemption from the
application of Section 409A of the U.S. Internal Revenue Code (“Section 409A”). As a condition to
the issuance and delivery of the Shares, the Company may require the Participant to satisfy any
qualifications that may be necessary or appropriate, in the Company’s sole discretion, to evidence
compliance with any applicable law or regulation and to make any representation or warranty with
respect thereto as may be requested by the Company.
4. Rights as a Stockholder. The Participant shall have no rights as a stockholder
with respect to the Shares until such time the Shares are issued to the Participant. Except as
provided in Section 14(a) of the Plan, no adjustment shall be made for dividends or distributions
or other rights for which the record date is prior to the date such Shares are issued.
5. Cessation of Board Service. In the event that the Participant’s service as a
Director is terminated by removal for cause, the Participant’s rights under this Award Agreement or
the Plan in any unvested RSUs shall immediately and irrevocably terminate and the Participant shall
immediately and irrevocably forfeit all RSUs that are unvested as of the date of such termination.
In the event that the Participant’s service as a Director is terminated for any reason other than
removal for cause, or for no reason, including, without limitation, voluntary resignation or death
or Disability, the unvested RSUs shall upon such termination immediately accelerate as to six
month’s additional vesting, provided that in the event of a Qualifying Board Retirement, as such
term is defined in the 2003 Stock Plan, 100% of the unvested RSUs shall immediately accelerate.
6. Change of Control. In the event of a Change of Control in which the Participant is
terminated or asked to resign either upon the Change of Control or within one year following the
Change of Control, the Participant’s unvested RSUs will vest 100% immediately prior to such Change
of Control. In the event of a Change of Control in which the Participant is not terminated or
asked to resign, the unvested RSUs will be treated the same as Restricted Stock awards under
Section 14(c)(ii) of the Plan (which section concerns the assumption, substitution or immediate
vesting of unvested Restricted Stock in the event of a Change of Control).
7. Withholding. Regardless of any action the Company takes with respect to any and
all income tax (including U.S. federal, state or local taxes or non-U.S. taxes), social insurance
contributions, payroll tax, payment on account or other tax-related items related to the
Participant’s participation in the Plan and legally applicable to the Participant (“Tax-Related
Items”), the Participant acknowledges that the ultimate liability for all Tax-Related Items is and
remains the Participant’s responsibility and may exceed the amount, if any, actually withheld by
the Company. The Participant further acknowledges that the Company (i) makes no representations or
undertakings regarding any Tax-Related Items in connection with any aspect of the RSUs, including
the grant of the RSUs, the vesting of RSUs, the issuance of Shares upon vesting, the subsequent
sale of any Shares acquired at vesting and/or the receipt of any dividends; and (ii) does not
commit to and is under no obligation to structure the terms of the Award or any aspect of the RSUs
to reduce or eliminate the Participant’s liability for Tax-Related Items or to achieve any
particular tax result. Furthermore, if the Participant has become subject to tax in more than one
jurisdiction between the Grant Date and the date of any relevant taxable event, the Participant
acknowledges that the Company may be required to withhold or account for Tax-Related Items in more
than one jurisdiction.
Prior to any relevant taxable or tax withholding event, as applicable, the Participant will
pay or make adequate arrangements satisfactory to the Company to satisfy all Tax-Related Items.
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In this regard, the Participant authorizes the Company or its agents, at its discretion, to satisfy
the obligation with respect to all Tax-Related Items by one or a combination of the following: (a)
withholding from the Participant’s cash compensation paid by the Company; or (b) withholding from
proceeds of the sale of Shares acquired upon vesting of the RSUs, either through a voluntary sale
or through a mandatory sale arranged by the Company (on the Participant’s behalf pursuant to this
authorization); or (c) withholding in Shares to be issued upon vesting of the RSUs.
To avoid negative accounting treatment, the Company may withhold or account for Tax-Related
Items by considering applicable minimum statutory withholding amounts or other applicable
withholding rates. If the obligation for Tax-Related Items is satisfied by withholding in Shares,
the Participant is deemed, for tax purposes, to have been issued the full number of Shares subject
to the vested RSUs, notwithstanding that a number of the Shares is held back solely for the purpose
of paying the Tax-Related Items due as a result of any aspect of the Participant’s participation in
the Plan.
Finally, the Participant shall pay to the Company any amount of Tax-Related Items that the
Company may be required to withhold or account for as a result of the Participant’s participation
in the Plan that cannot be satisfied by the means previously described. The Company may refuse to
issue or deliver the Shares, or the proceeds of the sale of the Shares, if the Participant fails to
comply with his or her obligations in connection with the Tax-Related Items.
8. Non-Transferability of RSUs. The Participant’s right and interest in the RSUs
awarded under this Award Agreement may not be sold, pledged, assigned, transferred or disposed of
in any manner, prior to the distribution of Common Stock in respect of vested RSUs.
9. No Compensation Deferral. Neither the Plan nor this Agreement is intended to
provide for a deferral of compensation that would be subject to Section 409A. Instead, as stated
above, it is the intent of this Agreement to satisfy the “short-term deferral” exemption described
in U.S. Treasury Regulation §1.409A-1(b)(4). The Company reserves the right, to the extent the
Company deems necessary or advisable in its sole discretion, to unilaterally amend or modify the
Plan and/or this Agreement to ensure that no Awards (including, without limitation, the RSUs)
become subject to the requirements of Section 409A, provided however that the Company makes no
representation that the RSUs are not subject to Section 409A nor makes any undertaking to preclude
Section 409A from applying to the RSUs.
10. Broker. The Shares acquired by the Participant under the Plan may be deposited
directly into the Participant’s brokerage account with the Company’s approved broker when vested
and the applicable obligations for Tax-Related Items have been satisfied.
11. Nature of the Grant. In accepting the grant of RSUs, the Participant acknowledges
that:
(a) the Plan is established voluntarily by the Company, is discretionary in nature and may be
modified, amended, suspended or terminated by the Company at any time;
(b) the grant of RSUs is voluntary and occasional and does not create any contractual or other
right to receive future awards of RSUs, or benefits in lieu of RSUs even if RSUs have been awarded
repeatedly in the past;
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(c) all decisions with respect to future grants of RSUs, if any, will be at the sole
discretion of the Company;
(d) the Participant’s participation in the Plan is voluntary;
(e) RSUs and the Shares subject to the RSUs are an extraordinary item that do not constitute
regular compensation for services of any kind rendered to the Company;
(f) RSUs and the Shares subject to the RSUs are not intended to replace any pension rights or
compensation;
(g) RSUs and the Shares subject to the RSUs are not part of normal or expected compensation or
salary for any purpose, including, but not limited to, calculation of any severance, resignation,
termination, redundancy, dismissal, end-of-service payments, bonuses, long-service awards, pension
or retirement benefits or similar payments and in no event should be considered as compensation
for, or relating in any way to, past services for the Company or any Subsidiary;
(h) the award of RSUs and the Participant’s participation in the Plan will not be interpreted
to form an employment contract or relationship with the Company or any Subsidiary;
(i) the future value of the Shares is unknown and cannot be predicted with certainty;
(j) in consideration of the grant of RSUs, no claim or entitlement to compensation or damages
arises from forfeiture of the RSUs resulting from termination of the Participant’s
service-providing relationship with the Company (for any reason whatsoever and whether or not in
breach of any applicable law) and the Participant irrevocably releases the Company from any such
claim that may arise; if, notwithstanding the foregoing, any such claim is found by a court of
competent jurisdiction to have arisen, the Participant shall be deemed irrevocably to have waived
his/her entitlement to pursue such claim; and
(k) RSUs and the benefits under the Plan, if any, will not automatically transfer to another
company in the case of a merger, takeover or transfer of liability.
12. No Advice Regarding Award. The Company is not providing any tax, legal or
financial advice, nor is the Company making any recommendations regarding the Participant’s
participation in the Plan, or the Participant’s acquisition or sale of the Shares. The Participant
is hereby advised to consult his or her own personal tax, legal and financial advisors regarding
his or her participation in the Plan before taking any action related to the Plan.
13. Registration. Any Shares acquired pursuant to this Award Agreement shall be
registered and/or deposited in the name of the Participant.
14. Imposition of Other Requirements. The Company reserves the right to impose other
requirements on the Participant’s participation in the Plan, on the RSUs and on any Shares acquired
under the Plan, to the extent the Company determines it is necessary or advisable in order to
comply with local law or facilitate the administration of the Plan. Furthermore, the parties
hereto agree to execute such further instruments and to take such further action as may reasonably
be necessary to carry out the intent of this Award Agreement.
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15. Notice. Any notice required or permitted hereunder shall be given in writing and
shall be deemed effectively given upon personal delivery or upon electronic delivery, or upon
delivery by certified mail, addressed to the Company at the address below and addressed to the
Participant at his/her home address on file with the Company or at such other address as either
party may designate by ten (10) days’ advance written notice to the other party.
Restricted Stock Administrator
3Com Corporation
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16. Binding Effect. This Award Agreement shall inure to the benefit of the successors
and assigns of the Company and, subject to the restrictions on transfer herein set forth, be
binding upon the Participant and the Participant’s heirs, executors, administrators, successors and
assigns.
17. Integrated Agreement. This Award Agreement and the Plan, including any sub-plan
to the Plan, constitute the entire understanding and agreement of the Participant and the Company
with respect to the subject matter contained herein, and there are no agreements, understandings,
restrictions, representations, or warranties among the Participant and the Company other than those
set forth or provided for herein or therein. The terms of this Award Agreement shall be subject to
the terms of the Plan, and this Award Agreement is subject to all Plan interpretations, amendments,
and rules approved by the Company.
18. Severability. The provisions of this Award Agreement are severable and if one or
more provisions of this Award Agreement are held invalid, illegal and/or unenforceable in any
respect, the validity, legality and enforceability of the remaining provisions shall not in any way
be affected or impaired thereby and the invalid, illegal or unenforceable provision(s) shall be
deemed null and void; provided, however, to the extent permissible under applicable law, that any
such provision(s) shall be first construed, interpreted and/or revised to permit this Award
Agreement to be construed so as to ▇▇▇▇▇▇ the intent of this Award Agreement and the Plan.
19. Governing Law. This Award Agreement is governed by the laws of the Commonwealth
of Massachusetts, without reference to conflicts of law provisions. The parties hereby understand
and agree that any action to enforce or interpret or otherwise regarding this Award Agreement shall
be filed in the state or federal courts in the Commonwealth of Massachusetts, and no other courts,
where this grant is made and/or to be performed.
20. Data Privacy. The Participant hereby explicitly and unambiguously consents to the
collection, use and transfer, in electronic or other form, of his/her personal data as described in
this Award Agreement by and among, as applicable, the Company and its Subsidiaries for the
exclusive purpose of implementing, administering and managing the Participant’s participation in
the Plan.
The Participant understands that the Company and its Subsidiaries hold certain personal
information about the Participant including, but not limited to, the Participant’s name, home
address and telephone number, date of birth, social security number or equivalent tax
identification number, salary, nationality, job title, residency status, any shares of stock or
directorships held in the Company, details of all Shares or other entitlements to Shares awarded,
cancelled, exercised, vested, unvested or outstanding in the Participant’s favor, for the purpose
of managing and administering the Plan (“Data”).
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The Participant further understands that the Data will be transferred to E*Trade Financial
Services, Inc., or such other stock plan service provider as may be selected by the Company in the
future, which is assisting the Company with the implementation, administration and management of
the Plan. The Participant understands that the recipients of the Data may be located in the United
States or elsewhere, and that the recipient’s country (e.g., the United States) may have different
data privacy laws and protections than the Participant’s country. The Participant understands that
he or she may request a list of the names and addresses of any potential recipients of the Data by
contacting the Company’s Stock Administration Department. The Participant authorizes the Company,
E*Trade Financial Services, Inc. and any other possible recipients which may assist the Company
(presently or in the future) with implementing, administering and managing the Plan to receive,
possess, use, retain and transfer the Data, in electronic or other form, for the purposes of
implementing, administering and managing the Participant’s participation in the Plan. The
Participants understands that he or she may, at any time, view Data, request additional information
about the storage and processing of Data, require any necessary amendments to Data or refuse or
withdraw the consents herein, in any case without cost, by contacting in writing the Company’s
Stock Administration Department. The Participant understands, however, that refusing or
withdrawing consent may affect his or her ability to participate in the Plan. For more information
on the consequences of the Participant’s refusal to consent or withdrawal of consent, the
Participant understands that he or she may contact the Company’s Stock Administration Department.
21. Language. If the Participant has received this Award Agreement or any other
document related to the Plan translated into a language other than English and the meaning of the
translated version differs from the English version, the English version will control.
22. Electronic Delivery. The Company may, in its sole discretion, decide to deliver
any documents related to current or future participation in the Plan by electronic means. The
Participant hereby consents to receive such documents by electronic delivery and agrees to
participate in the Plan through an on-line or electronic system established and maintained by the
Company or a third party designated by the Company.
23. Addendum. Notwithstanding any provision in this Award Agreement, the RSUs and the
Shares acquired under the Plan shall be subject to any country-specific terms and conditions set
forth in the addendum to this Agreement, if any. Moreover, if the Participant relocates his or her
residence to one of the countries included in such addendum, the terms and conditions for such
country will apply to the Participant, to the extent the Company determines that the application of
such terms and conditions is necessary or advisable in order to comply with local law or facilitate
the administration of the Plan. The addendum constitutes part of this Award Agreement.
24. Amendment or Termination. The Company reserves the right to impose other
requirements on the Participant’s participation in the Plan or on this Award, to the extent the
Company determines it is necessary or advisable in order to comply with local law or facilitate the
administration of the Plan. Furthermore, the parties hereto agree to execute such further
instruments and to take such further action as may reasonably be necessary to carry out the intent
of this Award Agreement. Finally, the Administrator may at any time amend or terminate the Plan
and/or the Award provided, however, that no such amendment or termination may adversely affect the
Award without the consent of the Participant.
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IN WITNESS WHEREOF, the parties hereto have executed this Award Agreement effective as of
the Grant Date. By electronically accepting this Award Agreement, signing below, or signing the
Notice of Grant, as applicable, the Participant acknowledges that he/she has read, understood and
accepted all of the terms, conditions and restrictions of this Award Agreement and the Plan.
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CHINA ADDENDUM
This Addendum includes special terms and conditions that govern the grant of RSUs under the Plan if
the Participant is subject to the laws of the People’s Republic of China. Unless otherwise defined
herein, capitalized terms shall have the meaning given to them in the Plan or the applicable RSU
Award Agreement.
Compliance with Exchange Control Requirements / Immediate Sale of Shares at Vesting
This provision supplements Section 3(b) of the RSU Award Agreement:
Due to local legal requirements, the Participant understands and agrees that the Participant must
maintain any shares of Common Stock issued upon vesting of the RSUs pursuant to Section 3(b) of the
Award Agreement in an account established for the Participant by the Company with E*Trade Financial
Services, Inc. or any successor broker designated by the Company, in its sole discretion (the
“Designated Broker”) until the shares are sold through the Designated Broker. The Participant
agrees that this requirement shall continue to apply after the Participant’s Service Provider
relationship ceases.
Further, the Participant agrees to comply with exchange control regulations in China and to
immediately repatriate the proceeds from the sale of Shares and any dividends paid to the
Participant in relation to the Shares to China. The Participant understands that such repatriation
of funds may be effectuated through a special foreign exchange account established by the Company
or a Subsidiary, and the Participant hereby consents and agrees that the proceeds from the sale of
Shares and any dividends received may be transferred to such special account prior to being
delivered to the Participant.
Furthermore, to facilitate compliance with any applicable laws or regulations in China, the Company
reserves the right to (i) mandate the immediate sale of Shares issued to a Participant as a result
of the vesting of the RSUs, or (ii) mandate the sale of Shares held by a Participant in the event
that the Participant’s Service Provider relationship ceases (in each case, on the Participant’s
behalf pursuant to this authorization). In either case, the proceeds of the sale of such Shares,
less any Tax-Related Items (if applicable) and broker’s fees or commissions, will be remitted to
the Participant in accordance with applicable exchange control laws and regulations.
The Participant agrees to comply with any other requirements that may be imposed by the Company in
the future in order to facilitate compliance with exchange control requirements in China.
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