NOTICE TO
U.S. TAX RESIDENTS:
VESTING OF THIS PERFORMANCE CASH
UNIT AWARD WILL BE A TAXABLE EVENT AND WILL RESULT IN THE
RECOGNITION BY YOU OF ORDINARY INCOME IN AN AMOUNT EQUAL TO THE
FAIR MARKET VALUE OF THE UNITS THAT BECOME VESTED. ON SUCH DATE
WHEN VESTING OCCURS AND AS A CONDITION TO THE CASH PAID TO YOU, THE
COMPANY MUST COLLECT ALL REQUIRED INCOME, SOCIAL AND OTHER PAYROLL
TAX WITHHOLDING FROM YOU BASED UPON SUCH FAIR MARKET
VALUE.
NOTICE TO
NON-U.S. RESIDENTS:
YOU MAY HAVE ADDITIONAL TERMS AND
CONDITIONS FOR YOUR AWARD, WHICH ARE DESCRIBED IN EXHIBIT B TO THIS
AGREEMENT. IN ADDITION, IF YOU ARE A TAX RESIDENT OF A COUNTRY
OUTSIDE THE U.S., YOUR TAX CONSEQUENCES MAY BE DIFFERENT THAN
DESCRIBED ABOVE. AS A CONDITION TO THE CASH PAID TO YOU, THE
COMPANY MUST COLLECT ALL REQUIRED INCOME, SOCIAL AND OTHER PAYROLL
TAX WITHHOLDING THAT MAY BE DUE BY REASON OF THE GRANT OR VESTING
OF THIS AWARD.
ADC TELECOMMUNICATIONS,
INC.
THREE-YEAR PERFORMANCE-BASED
CASH UNIT AWARD AGREEMENT
To encourage
your continued employment with ADC Telecommunications, Inc. (the
“Company”) or its Affiliates, you have been granted
this restricted cash unit award (the “Award”) pursuant
to the Company’s 2008 Global Stock Incentive Plan (the
“Plan”). The Award represents the right to receive a
cash award subject to the fulfillment of the vesting conditions set
forth in this agreement and in Exhibit A to this agreement
(collectively, this “Agreement”).
The terms of
the Award are as set forth in this Agreement and in the Plan. The
Plan is incorporated into this Agreement by reference, which means
that this Agreement is limited by and subject to the express terms
and provisions of the Plan. In the event of a conflict between the
terms of this Agreement and the terms of the Plan, the terms of the
Plan shall control. Capitalized terms that are not defined in this
Agreement have the meanings given to them in the Plan. The terms of
the Award are:
1. Grant
Date:
(the “Grant
Date”)
2. Number of
Restricted Cash Units Subject to this Award:
(the “Target Award
Number”).
3. Vesting
Schedule: Subject to the
other terms and conditions of this Agreement and the Plan, the
Award will vest, in accordance with, and to the extent provided in,
Exhibit A, on
provided you have been continuously employed since the Grant Date
by the Company or its Affiliates. The day on which your Award is
scheduled to vest pursuant to this Section 3 is referred to in
this Agreement as the “Scheduled Vest Date.”
4.
Conversion of Restricted Cash Units and Payment.
Subject to the other terms of the
Award, upon the Scheduled Vest Date, you shall receive, in
accordance with the terms and provisions of the Plan and this
Agreement, a cash payment in U.S. dollars converted to your local
currency at the then current exchange ratio (if applicable) as
published on the Scheduled Vesting Date in the Wall
Version
Effective November 1, 2008
Street Journal
(U.S. Midwest Edition) and equivalent to the number of units
provided in Exhibit A. The Company will pay that cash (rounded
down to the nearest whole USD or foreign equivalent) to you as soon
as administratively feasible following any vesting of the Award and
your agreement to satisfy any required tax withholding obligations.
No fractional amounts shall be issued under this Agreement. No Cash
shall be paid upon vesting of the Award unless such issuance
complies with all relevant provisions of law. You understand that
your participation in the Plan is conditioned on the Company
obtaining all necessary orders, decisions, rulings and approvals
from the relevant governmental regulatory authorities. The Company
reserves the right to determine the manner in which the cash is
delivered to you, including but not limited to payment through
local or corporate payroll entities as designated by the
Company.
5.
Termination of Employment.
(a) For
all purposes of this Agreement, the term “Employment
Termination Date” shall mean the earlier of:
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(i)
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the
date, as determined by the Company, that you are no longer actively
employed by the Company or an Affiliate of the Company, and in the
case of an involuntarily termination, such date shall not be
extended by any notice period mandated under local law (e.g.,
active employment would not include a period of “garden
leave” or similar period pursuant to local law);
or
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(ii)
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the
date, as determined by the Company, that your employer is no longer
an Affiliate of the Company.
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(b) Except
as provided in Sections 10(a), (b), (c) and
(d) below, if your Employment Termination Date occurs before
the Scheduled Vest Date, the entire Award as of your Employment
Termination Date shall be forfeited and immediately
cancelled.
(c) The
Compensation Committee of the Company’s Board of Directors
(the “Committee”) shall have the exclusive discretion
to determine the Employment Termination Date.
6. Workforce
Protection. You
understand that the Company has an important business interest in
preserving and retaining its relationships with its employees. In
consideration of your employment with the Company as well as the
entry by the Company into this Agreement, during the term of your
employment and for one year thereafter, you promise that you will
not directly or indirectly or in cooperation with
others:
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(a)
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Seek, encourage, solicit, or attempt
to solicit any employee of the Company to leave the Company for any
reason or in any way interfere with the relationship between any
such employee and the Company;
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(b)
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Induce or attempt to induce any
employee of the Company to accept employment with, work for, render
services or provide advice to or supply confidential business
information or trade secrets of the Company to any person or entity
other than the Company; or
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(c)
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Employ, or otherwise pay for
services rendered by, any employee of the Company in any other
business enterprise.
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As part of your
obligations to the Company and without limiting the foregoing, you
specifically agree that for the one year period after your
employment with the Company terminates, you will not interview,
recommend for hire, identify or provide any input to any third
party in which you have an interest as an employee, officer,
consultant, director or owner about a Company employee where the
purpose or outcome of such action by you is to recruit, provide a
reference or otherwise assist a Company employee to leave the
Company and join the third party in which you have an interest as
described herein. You also acknowledge that your promises as
contained herein are not excused in circumstances where the Company
employee initiates a discussion of this nature with you. In that
event, you agree to advise the Company employee of your obligations
hereunder. You further agree that during the one year period after
you leave the Company, you will inform any new employer you may
have of your obligations under this Agreement.
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Version
Effective November 1, 2008
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2
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7. Right to
Units. You shall not have
any right in, to or with respect to any payment of cash under the
Award until the Award is settled by the payment of cash to
you.
(a) Regardless of any action the Company or
your employer (the “Employer”) takes with respect to
any or all income tax, social insurance, payroll tax or other
tax-related withholding (“Tax-Related Items”), you
acknowledge that the ultimate liability for all Tax-Related Items
legally due by you is and remains your responsibility and that
Company and/or your Employer: (1) make no representations or
undertakings regarding the treatment of any Tax-Related Items in
connection with any aspect of the Award, including the grant,
vesting or payment of cash; and (2) do not commit to structure
the terms of the Award or any aspect of the Award to reduce or
eliminate your liability for Tax-Related Items.
(b) You
authorize the Company to withhold any Tax-Related Items in
accordance with this Agreement from any cash payment made to you as
a result of vesting of the Award. If the withholding obligations
relating to Tax-Related Items are not satisfied by such
withholding, you authorize your Employer to withhold all such
obligations from your wages or other cash compensation that may be
payable to you by your Employer.
9. Transfer of Award.
Your rights under the Award may only
be transferred in accordance with the terms of the Plan.
10.
Acceleration of Scheduled Vest Date.
(a) In the
event of a “Change in Control” of the Company both
prior to the Scheduled Vest Date and while you remain employed by
the Company or any of its Affiliates, then the Award shall become
immediately vested with respect to the number of units equal to the
Target Award Number on the effective date of such Change in
Control. For purposes of this Agreement, the following terms shall
have the following meanings:
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(1)
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“Change in Control”
shall mean:
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(i)
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a
change in control of the Company of a nature that would be required
to be reported in response to Item 6(e) of Schedule 14A of
Regulation 14A promulgated under the U.S. Securities Exchange Act
of 1934, as amended (the “Exchange Act”), whether or
not the Company is then subject to such reporting
requirement;
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(ii)
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the
public announcement (which, for purposes of this definition, shall
include, without limitation, a report filed pursuant to Section
13(d) of the Exchange Act) by the Company or any
“person” (as such term is used in Sections 13(d) and
14(d) of the Exchange Act) that such person has become the
“beneficial owner” (as defined in Rule 13d-3
promulgated under the Exchange Act), directly or indirectly, of
securities of the Company representing twenty percent (20%) or more
of the combined voting power of the Company’s then
outstanding securities, determined in accordance with Rule 13d-3,
excluding, however, any securities acquired directly from the
Company (other than an acquisition by virtue of the exercise of a
conversion privilege unless the security being so converted was
itself acquired directly from the Company); however, that for
purposes of this clause the term “person” shall not
include the Company, any subsidiary of the Company or any employee
benefit plan of the Company or of any subsidiary of the Company or
any entity holding shares of Common Stock organized, appointed or
established for, or pursuant to the terms of, any such
plan;
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Version
Effective November 1, 2008
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3
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(iii)
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the
Continuing Directors cease to constitute a majority of the
Company’s Board of Directors;
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(iv)
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consummation of a reorganization,
merger or consolidation of, or a sale or other disposition of all
or substantially all of the assets of, the Company (a
“Business Combination”), in each case, unless,
following such Business Combination, (A) all or substantially
all of the persons who were the beneficial owners of the
Company’s outstanding voting securities immediately prior to
such Business Combination beneficially own voting securities of the
corporation resulting from such Business Combination having more
than fifty percent (50%) of the
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