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 _______, 2006 (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.
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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.
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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.
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3.1 Death or Disability. In the event the Grantee's
employment is terminated by reason 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 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 of Control.
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Notwithstanding anything contained in this Agreement to the
contrary, in the event of a Change of 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, at any time prior to the Vesting Date
the Award shall become immediately vested.
5. Non-transferability.
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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.
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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.
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On the Vesting Date, or as soon thereafter as
administratively practicable (but in no event later than 2 1/2 months after
the calendar year in which 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 on the Vesting
Date. Shares with respect to Restricted Stock Units that become vested
pursuant to Section 3.1 or Section 4 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 1/2 months after
the calendar year in which the Restricted Stock Units become vested);
provided, however, that if the Grantee is a "specified employee" within the
meaning of Section 409A of the Code as of the date of the Grantee's
termination of employment, any Shares with respect to Restricted Stock
Units which have become vested pursuant to Section 3.1 due to the
termination of the Grantee's employment as a result of the Grantee's
Disability (other than a Disability which constitutes a disability within
the meaning of Section 409A of the Code) shall be issued as soon as
administratively practicable after the first day of the calendar month
following the date which is six (6) months after the date of the Grantee's
termination of employment.
8. Withholding of Taxes.
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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.
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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.
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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.
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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.
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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.
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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.
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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.
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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:
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Name:
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Title:
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GRANTEE
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EXHIBIT A
Non-Competition and Confidentiality Covenants
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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 and warrants 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 duly transferred to the Company.
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 hereof, 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 execution of this
Non-Competition and Confidentiality Agreement.
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.
