Exhibit 10.1
FORM OF
AMENDED AND RESTATED
COMMSCOPE, INC.
1997 LONG-TERM INCENTIVE PLAN
NONQUALIFIED STOCK OPTION AGREEMENT (ANNUAL)
THIS AGREEMENT, made as of the __________ day of _____________, 2005
(the "Grant Date"), between CommScope, Inc., a Delaware corporation (the
"Company"), and _______________ (the "Grantee").
WHEREAS, the Company has adopted the Amended and Restated CommScope,
Inc. 1997 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 administration of the Plan has
determined to grant an option to the Grantee as provided herein;
NOW, THEREFORE, the parties hereto agree as follows:
1. Grant of Option.
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1.1 The Company hereby grants to the Grantee the right and
option (the "Option") to purchase all or any part of an aggregate of
_____________ whole shares of Stock subject to, and in accordance with, the
terms and conditions set forth in this Agreement.
1.2 The Option is not intended to qualify as an Incentive
Stock Option.
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 incorporated herein 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. Purchase Price.
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The price at which the Grantee shall be entitled to purchase
shares of Stock upon the exercise of the Option shall be $__________ per
share of Stock.
3. Duration of Option.
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The Option shall be exercisable to the extent and in the manner
provided herein for a period of ten (10) years from the Grant Date (the
"Exercise Term"); provided, however, that the Option may be earlier
terminated as provided in Section 6 hereof.
4. Vesting and Exercisability of Option.
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Unless otherwise provided in this Agreement or the Plan, the
Option shall entitle the Grantee to purchase, in whole at any time or in
part from time to time, thirty-three and one-third percent (33-1/3%) of the
total number of shares of Stock covered by the Option after the expiration
of one (1) year from the Grant Date, an additional thirty-three and
one-third percent (33-1/3%) of the total number of shares of Stock covered
by the Option after the second anniversary of the Grant Date, and the
remainder of the number of shares of Stock subject to the Option after the
third anniversary of the Grant Date, and each such right of purchase shall
be cumulative and shall continue, unless sooner exercised as herein
provided, during the remaining period of the Exercise Term. Any fractional
number of shares of Stock resulting from the application of the percentages
set forth in this Section 4 shall be rounded to the next higher whole
number of shares of Stock.
5. Manner of Exercise and Payment.
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5.1 Subject to the terms and conditions of this Agreement
and the Plan, the Option may be exercised by delivery of written notice to
the Company, at its principal executive office. Such notice shall state
that the Grantee is electing to exercise the Option and the number of
shares of Stock in respect of which the Option is being exercised and shall
be signed by the person or persons exercising the Option. If requested by
the Committee, such person or persons shall (i) deliver this Agreement to
the Secretary of the Company who shall endorse on this Agreement a notation
of such exercise and (ii) provide satisfactory proof as to the right of
such person or persons to exercise the Option.
5.2 The notice of exercise described in Section 5.1 shall be
accompanied by the full purchase price for the shares of Stock in respect
of which the Option is being exercised, in cash or by check or, if
indicated in the notice, such payment shall follow by check from a
registered broker acting as agent on behalf of the Grantee. However, at the
discretion of the Committee appointed to administer the Plan, the Grantee
may pay the exercise price in part or in full by transferring to the
Company shares of restricted or unrestricted Stock owned by the Grantee
prior to the exercise of the Option having a Fair Market Value on the day
preceding the date of exercise equal to the cash amount for which such
shares are substituted. "Fair Market Value" shall mean (i) if the shares of
Stock 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.
5.3 Upon receipt of notice of exercise and full payment for
the shares of Stock in respect of which the Option is being exercised, the
Company shall, subject to this Agreement and the Plan, take such action as
may be necessary to effect the transfer to the Grantee of the number of
shares of Stock as to which such exercise was effective.
5.4 The Grantee shall not be deemed to be the holder of, or
to have any of the rights of a holder with respect to any shares of Stock
subject to the Option until (i) the Option shall have been exercised
pursuant to the terms of this Agreement and the Grantee shall have paid the
full purchase price for the number of shares of Stock in respect of which
the Option was exercised, (ii) the Company shall have issued and delivered
the shares of Stock to the Grantee, and (iii) the Grantee's name shall have
been entered as a stockholder of record on the books of the Company,
whereupon the Grantee shall have full voting and other ownership rights
with respect to such shares of Stock.
6. Termination of Employment.
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6.1 Death or Disability. In the event the Grantee's
employment is terminated by reason of the Grantee's death or Disability,
any portion of the Option that is not yet vested and exercisable on the
Termination Date (as defined below) shall become immediately vested and
fully exercisable on such date, and shall remain exercisable for a period
of five (5) years following the Termination Date, by the Grantee or by the
Grantee's legatee or legatees under his will, or by his personal
representatives or distributees, as applicable. For purposes of this
Agreement, "Termination Date" shall mean the last day on which the Grantee
works for the Company, a Subsidiary or an operating division or unit of the
Company or Subsidiary (a"Division").
6.2 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 as a result of the Grantee's
voluntary retirement after attainment of age 55, or (ii) the Grantee's
employment is terminated as a result of the Grantee's voluntary retirement
after attainment of age 65, any portion of the Option that is not yet
vested and exercisable on the Termination Date shall remain outstanding and
shall be eligible to vest in accordance with the schedule set forth Section
4 if the Grantee complies with the post-employment covenants described in
Appendix A attached hereto. In the event of a breach by the Grantee of the
post-employment covenants described in Appendix A, the Option shall
immediately be forfeited. Options that vest pursuant to this Section 6.2
shall, once vested, remain exercisable for a period of five (5) years
following the Termination Date, by the Grantee or by the Grantee's legatee
or legatees under his will, or by his personal representatives or
distributees, as applicable.
6.3 Cause. In the event the Grantee's employment is
terminated for Cause, the Option shall immediately expire in its entirety
whether or not vested and exercisable. 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).
6.4 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) under any
circumstance other than those set forth in Section 6.1, Section 6.2 and
Section 6.3, any portion of the Option that is not vested and exercisable
on the Termination Date shall expire and the Grantee may, at any time
within thirty (30) days after the Termination Date, exercise the Option to
the extent, but only to the extent, that the Option or portion thereof was
vested and exercisable on the Termination Date.
6.5 No Extension of Exercise Term. Notwithstanding the terms
of Section 6.1, 6.2 and 6.4, in no event may the Option be exercised by
anyone after the expiration of the Exercise Term.
7. 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 the Option shall become
immediately vested and fully exercisable.
8. Non-transferability.
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The Option shall not be assignable or transferable other than by
will or the laws of descent and distribution or pursuant to a qualified
domestic relations order (within the meaning of Rule 16a-12 promulgated
under the Exchange Act). During the lifetime of the Grantee, the Option
shall be exercisable only by the Grantee, his or her legal guardian or
legal representatives or a bankruptcy trustee. Notwithstanding the
foregoing and unless prohibited by applicable law, the Option may be
transferred to members of the Grantee's immediate family, to trusts solely
for the benefit of such immediate family members and to partnerships in
which such family members and/or trusts are the only partners, and for
purposes of this Agreement and the Plan, a transferee of an Option shall be
deemed to be the Grantee. For this purpose, immediate family means the
Grantee's spouse, parents, children, stepchildren and grandchildren and the
spouses of such parents, children, stepchildren and grandchildren.
9. 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.
10. Adjustments.
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In the event of a Change in Capitalization, the Committee may
make appropriate adjustments to the number and class of shares of Stock or
other stock or securities subject to the Option and the purchase price for
such shares or other stock or securities. The Committee's adjustment shall
be made in accordance with the provisions of Article 19 of the Plan and
shall be final, binding and conclusive for all purposes of the Plan and
this Agreement.
11. Effect of Certain Transactions.
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Subject to Section 7 hereof, upon the effective date of the
liquidation, dissolution, merger or consolidation of the Company (in each
case, a "Transaction"), the Option shall continue in effect in accordance
with its terms, except that following a Transaction either (a) the Option
shall be treated as provided for in the plan or agreement entered into in
connection with the Transaction (the "Transaction Agreement") or (b) if not
so provided in the Transaction Agreement, the Grantee shall be entitled to
receive in respect of all shares of Stock subject to the Option, upon
exercise of the Option, the same number and kind of stock, securities,
cash, property or other consideration that each holder of shares of Stock
was entitled to receive in the Transaction.
12. Withholding of Taxes.
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The Company shall have the right to deduct from any distribution
of cash to any Grantee, an amount equal to the federal, state and local
income taxes and other amounts as may be required by law to be withheld
(the "Withholding Taxes") with respect to the Option. If a Grantee is
entitled to receive shares of Stock upon exercise of the Option, the
Grantee shall pay the Withholding Taxes to the Company prior to the
issuance of such shares of Stock.
Payment of the applicable Withholding Taxes may be made in any
one or any combination of: (i) cash, (ii) shares of restricted or
unrestricted Stock owned by the Grantee prior to the exercise of the Option
and valued at its Fair Market Value on the business day immediately
preceding the date of exercise, or (iii) by making a Tax Election (as
described below). For purposes of this Article 12, a Grantee may make a
written election (the "Tax Election"), which may be accepted or rejected at
the discretion of the Committee, to have withheld a portion of the shares
of Stock issuable to him or her upon exercise of the Option and valued at
its Fair Market Value on the date preceding the date of exercise, equal to
the Withholding Taxes.
13. 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.
14. 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. No waiver by either party hereto of any
breach by the other party hereto of any provision of this Agreement to be
performed by such other party shall be deemed a waiver of similar or
dissimilar provisions at the time or at any prior or subsequent time.
15. 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.
16. 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.
17. 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
final, binding and conclusive upon the Grantee's beneficiaries, heirs,
executors, administrators and successors.
18. 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 and the Company for all purposes.
19. 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.
COMMSCOPE, INC.
Date: By:
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Print Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇, ▇▇
Title: Senior Vice President, General
Counsel and Secretary
GRANTEE
Date: By:
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Print Name:
APPENDIX A
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Non-Competition and Confidentiality Covenants
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By execution of the stock option agreement to which this Appendix
A is attached (the "Stock Option 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 6.2 of the Stock Option 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 (and any copies, in whatever medium, thereof) 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 Appendix 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 Appendix A.
7. Miscellaneous. This Appendix 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.