Exhibit 10.1

 

 

COMMSCOPE HOLDING COMPANY, INC.

ANNUAL INCENTIVE PLAN

AS AMENDED FEBRUARY 17, 2016

 

 

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COMMSCOPE HOLDING COMPANY, INC.

ANNUAL INCENTIVE PLAN

ARTICLE 1

ESTABLISHMENT OF PLAN

1.1. PURPOSE. The purpose of this Plan is to enhance the Company’s ability to
attract, motivate, reward and retain employees, to strengthen their commitment
to the success of the Company and to align their interests with those of the
Company’s stockholders by providing additional compensation to designated
employees of the Company based on the achievement of performance objectives. To
this end, the Plan provides for the payment of annual cash incentive awards to
eligible employees of the Company, the payment of which will be based on the
achievement of one or more Performance Objectives during a Plan Year. The Plan
shall remain in effect for successive Plan Years unless and until terminated by
the Committee pursuant to Article 6. Unless otherwise specified by the Committee
or the CEO, as applicable, the Performance Objectives include Company
Performance Objectives and Individual Performance Objectives. Company
Performance Objectives are designed to focus on overall corporate or business
unit financial or operational results that drive stockholder value. Individual
Performance Objectives are intended to measure individual goals and competencies
and to motivate and reward outstanding individual performance.

1.2 QUALIFIED PERFORMANCE-BASED AWARDS. To the extent that the Committee
designates any Annual Incentive Award awarded under this Plan as a Qualified
Performance-Based Award under the LTIP, then in relation to such Annual
Incentive Award, the Plan shall be considered to be and shall be operated as a
subplan of the LTIP, such that Section 5.4 and Article 11 of the LTIP shall
apply to such Annual Incentive Awards.

1.2. EFFECTIVE DATE. This Plan was approved by the Committee and the Board on
October 4, 2013, to be effective as of October 24, 2013. The Plan was amended by
the Committee on February 17, 2016.

ARTICLE 2

DEFINITIONS

2.1. DEFINITIONS. The following terms shall have the following meanings for
purposes of this Plan, unless the context in which they are used clearly
indicates that some other meaning is intended.

(a) “Affiliate” means (i) any Subsidiary or Parent, or (ii) an entity that
directly or through one or more intermediaries controls, is controlled by or is
under common control with, the Company, as determined by the Committee.

(b) “Annual Incentive Award” means the cash incentive award payable to a
Participant under this Plan calculated by reference to the achievement of
applicable Performance Objectives, as determined in accordance with Article 5.

(c) “Base Salary” means a Participant’s annual base salary actually paid by the
Company and received by the Participant during the applicable performance
period, based on salary earnings before reductions for such items as
contributions under Section 401(k) of the Code. Base Salary does not include
(i) Annual Incentive Awards under the Plan, (ii) long-term incentive awards,
(iii) signing bonuses or any similar bonuses, (iv) cash payments received
pursuant to the CommScope, Inc. Retirement Savings Plan, (v) imputed income from
such programs as executive life insurance, or (vi) nonrecurring earnings such as
moving expenses.

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(d) “Beneficial Owner” shall have the meaning given such term in Rule 13d-3 of
the General Rules and Regulations under the 1934 Act.

(e) “Board” means the Board of Directors of the Company.

(f) “CEO” means the Chief Executive Officer of the Company.

(g) “Change in Control” means and includes the occurrence of any one of the
following events but shall specifically exclude a Public Offering:

(i) during any consecutive 12-month period, individuals who, at the beginning of
such period, constitute the Board (the “Incumbent Directors”) cease for any
reason to constitute at least a majority of such Board, provided that any person
becoming a director after the beginning of such 12-month period and whose
election or nomination for election was approved by a vote of at least a
majority of the Incumbent Directors then on the Board shall be an Incumbent
Director; provided, however, that no individual initially elected or nominated
as a director of the Company as a result of an actual or threatened election
contest with respect to the election or removal of directors (“Election
Contest”) or other actual or threatened solicitation of proxies or consents by
or on behalf of any Person other than the Board (“Proxy Contest”), including by
reason of any agreement intended to avoid or settle any Election Contest or
Proxy Contest, shall be deemed an Incumbent Director; or

(ii) any Person, other than a Principal Stockholder or an Underwriter, becomes a
Beneficial Owner, directly or indirectly, of either (A) 35% or more of the
then-outstanding shares of common stock of the Company (“Company Common Stock”)
or (B) securities of the Company representing 35% or more of the combined voting
power of the Company’s then outstanding securities eligible to vote for the
election of directors (the “Company Voting Securities”); provided, however, that
for purposes of this subsection (ii), the following acquisitions of Company
Common Stock or Company Voting Securities shall not constitute a Change in
Control: (w) an acquisition directly (or indirectly from Underwriters) from the
Company, (x) an acquisition by the Company or a Subsidiary, (y) an acquisition
by any employee benefit plan (or related trust) sponsored or maintained by the
Company or any Subsidiary, or (z) an acquisition pursuant to a Non-Qualifying
Transaction (as defined in subsection (iii) below); or

(iii) the consummation of a reorganization, merger, consolidation, statutory
share exchange or similar form of corporate transaction involving the Company or
a Subsidiary (a “Reorganization”), or the sale or other disposition of all or
substantially all of the Company’s assets (a “Sale”) or the acquisition of
assets or stock of another corporation or other entity (an “Acquisition”),
unless immediately following such Reorganization, Sale or Acquisition: (A) all
or substantially all of the individuals and entities who were the Beneficial
Owners, respectively, of the outstanding Company Common Stock and outstanding
Company Voting Securities immediately prior to such Reorganization, Sale or
Acquisition beneficially own, directly or indirectly, more than 35% of,
respectively, the then outstanding shares of common stock and the combined
voting power of the then outstanding voting securities entitled to vote
generally in the election of directors, as the case may be, of the entity
resulting from such Reorganization, Sale or Acquisition (including, without
limitation, an entity which as a result of such

 

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transaction owns the Company or all or substantially all of the Company’s assets
or stock either directly or through one or more subsidiaries, the “Surviving
Entity”) in substantially the same proportions as their ownership, immediately
prior to such Reorganization, Sale or Acquisition, of the outstanding Company
Common Stock and the outstanding Company Voting Securities, as the case may be,
and (B) no person (other than (x) the Company or any Subsidiary, (y) the
Surviving Entity or its ultimate parent entity, or (z) any employee benefit plan
(or related trust) sponsored or maintained by any of the foregoing) is the
Beneficial Owner, directly or indirectly, of 35% or more of the total common
stock or 35% or more of the total voting power of the outstanding voting
securities eligible to elect directors of the Surviving Entity, and (C) at least
a majority of the members of the board of directors of the Surviving Entity were
Incumbent Directors at the time of the Board’s approval of the execution of the
initial agreement providing for such Reorganization, Sale or Acquisition (any
Reorganization, Sale or Acquisition which satisfies all of the criteria
specified in (A), (B) and (C) above shall be deemed to be a “Non-Qualifying
Transaction”); or

(iv) approval by the stockholders of the Company of a complete liquidation or
dissolution of the Company.

(h) “Code” means the Internal Revenue Code of 1986, as amended.

(i) “Committee” means the Compensation Committee of the Board.

(j) “Company” means CommScope Holding Company, Inc., a Delaware corporation, or
any successor corporation

(k) “Company Performance Objectives” means the Company Performance Objectives
established by the Committee or the CEO, as applicable, for a Plan Year, as
provided in Article 5.

(l) “Disability” shall mean permanent disability, as provided in the Company’s
long-term disability plan.

(m) “Effective Date” means October 24, 2013.

(n) “Individual Performance Objectives” means the Individual Performance
Objectives established for a Participant by the Committee or the CEO, as
applicable, for a Plan Year, as provided in Article 5.

(o) “LTIP” means the CommScope Holding Company, Inc. 2013 Long-Term Incentive
Plan, and any subsequent equity compensation plan approved by the stockholders
and designated by the Board as the LTIP for purposes of this Plan.

(p) “Parent” means a corporation, limited liability company, partnership or
other entity which owns or beneficially owns a majority of the outstanding
voting stock or voting power of the Company.

(q) “Participant” means a person who, as an employee of the Company or any
Affiliate, has been granted an Annual Incentive Award opportunity under the
Plan; provided that in the case of the death of a Participant, the term
“Participant” refers to a beneficiary designated by the Participant or the legal
guardian or other legal representative acting in a fiduciary capacity on behalf
of the Participant under applicable state law and court supervision.

 

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(r) “Performance Objectives” means collectively, with respect to a Participant,
any Company Performance Objectives and Individual Performance Objectives
applicable to the Participant, as provided in Article 5.

(s) “Person” means any individual, entity or group, within the meaning of
Section 3(a)(9) of the 1934 Act and as used in Section 13(d)(3) or 14(d)(2) of
the 1934 Act.

(t) “Plan” means this CommScope Holding Company, Inc. Annual Incentive Plan, as
amended from time to time.

(u) “Plan Year” means January 1 to December 31 of each year.

(v) “Principal Stockholder” means Carlyle-CommScope Holdings, L.P. (the “LP”), a
Delaware limited partnership, or any subsidiary or parent thereof, or any entity
that directly or through one or more intermediaries controls, is controlled by
or is under common control with, the LP.

(w) “Public Offering” means a public offering of any class or series of the
Company’s equity securities pursuant to a registration statement filed by the
Company under the 1933 Act.

(x) “Qualified Performance-Based Award” means an Annual Incentive Award that is
intended to qualify for the Section 162(m) Exemption and is made subject to
performance goals based on Qualified Business Criteria as set forth in
Section 11.2 of the LTIP.

(y) “Retirement” shall mean (i) retirement at or after age 55 and the completion
of 10 years of service with the Company or any of its Subsidiaries,
(ii) retirement at or after age 65 or (iii) early retirement with the prior
written approval of the Company.

(z) “Section 16 Officer” means a Participant who, as of the beginning of the
applicable performance period, is an officer subject to Section 16 of the 1934
Act.

(aa) “Section 162(m) Exemption” means the exemption from the limitation on
deductibility imposed by Section 162(m) of the Code that is set forth in
Section 162(m)(4)(C) of the Code or any successor provision thereto.

(bb) “Subsidiary” means any corporation, limited liability company, partnership
or other entity of which a majority of the outstanding voting stock or voting
power is beneficially owned directly or indirectly by the Company.

(cc) “Target Award” has the meaning described in Section 5.2.

(dd) “Underwriter” means a broker, underwriter or financial institution that
acquires such shares as part of a firm commitment or similar underwriting or
distribution process pursuant to which the subject shares of stock are being
held for further distribution.

(ee) “1933 Act” means the Securities Act of 1933, as amended from time to time.

(ff) “1934 Act” means the Securities Exchange Act of 1934, as amended from time
to time.

 

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ARTICLE 3

ADMINISTRATION

3.1. COMMITTEE. This Plan shall be administered by the Committee.

3.2. AUTHORITY OF COMMITTEE. The Committee has the exclusive power, authority
and discretion to:

(a) designate Participants for each Plan Year (by individual or employee class);

(b) establish and review Individual Performance Objectives and weightings for
different Individual Performance Objectives for each Plan Year;

(c) establish and review Company Performance Objectives and weightings for
different Company Performance Objectives for each Plan Year;

(d) establish Target Awards for Participants for each Plan Year;

(e) determine whether and to what extent Performance Objectives were achieved
for each Plan Year;

(f) increase or decrease the Annual Incentive Award otherwise payable to any
Participant resulting from the achievement of Company Performance Objectives and
Individual Performance Objectives in any Plan Year, based on such objective or
subjective factors as the Committee shall deem relevant;

(g) establish, adopt or revise any rules and regulations as it may deem
necessary or advisable to administer this Plan;

(h) make all other decisions and determinations that may be required under this
Plan or as the Committee deems necessary or advisable to administer this Plan;

(i) amend this Plan as provided herein; and

(j) delegate to the CEO any authority or responsibility to administer the Plan
with respect to Participants who are not Section 16 Officers.

3.3. DECISIONS BINDING. The interpretation of this Plan by, and all decisions
and determinations by, the Committee or the CEO, as applicable, with respect to
this Plan are final, binding, and conclusive on all parties.

 

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ARTICLE 4

ELIGIBILITY

4.1. DESIGNATION OF PARTICIPANTS. Before the 90th day of each Plan Year, the
Committee shall review and approve (individually, in the case of Section 16
Officers, or by group, in the case of other Participants) the Participants and
their Target Awards for that Plan Year. Inclusion as a Participant in the Plan
in any Plan Year does not guarantee that such Participant will receive any
amount in payment of an Annual Incentive Award.

4.2. PARTIAL YEAR PARTICIPATION. Unless otherwise determined by the Committee or
the CEO (with respect to individuals who are not Section 16 Officers) (i) if a
Participant begins employment or is promoted to an eligible position after the
beginning of a Plan Year but before October 1 of such Plan Year, such
Participant will be eligible to receive an Annual Incentive Award for such Plan
Year, which will be prorated based on the number of days such person
participated in the Plan during the Plan Year; and (ii) if a Participant begins
employment or is promoted to an eligible position after October 1 of a Plan
Year, the Participant will not be eligible to receive an Annual Incentive Award
for such Plan Year. If a Participant takes a leave of absence during the Plan
Year for any reason, the Committee or the CEO (with respect to individuals who
are not Section 16 Officers) in their discretion, may determine whether such
employee may participate in this Plan and the terms of such participation, if
any.

4.3. CHANGE IN ELIGIBLE POSITION. Unless otherwise determined by the Committee
or the CEO (with respect to individuals who are not Section 16 Officers), if a
Participant changes from one eligible position to another during a Plan Year,
the Participant’s Annual Incentive Award for such Plan Year will be prorated
based on the number of days such person participated in the Plan during the Plan
year in each respective position and shall be determined with respect to the
Target Award and Performance Objectives relevant to such respective positions.

4.4. DEMOTIONS; TERMINATIONS. Unless otherwise determined by the Committee or
the CEO (with respect to individuals who are not Section 16 Officers) if a
Participant resigns, is terminated, or is demoted to a non-eligible position
during the Plan Year, the Participant’s Plan participation shall end at that
time. Notwithstanding the foregoing, in the event of a Participant’s death or
Disability, the Committee or the CEO (with respect to individuals who are not
Section 16 Officers) in their discretion, may determine whether such employee
may participate in this Plan and if so, the terms of such participation pursuant
to Section 5.6 hereof.

ARTICLE 5

OPERATION OF THE PLAN

5.1. PLAN STRUCTURE. Subject to the terms and conditions described herein, each
Participant shall be eligible to receive an Annual Incentive Award for the Plan
Year if certain Performance Objectives are met or exceeded by the Company and,
if applicable, the Participant. Each Plan Year, Performance Objectives and their
respective weightings and Target Awards shall be established as provided in
Sections 5.2, 5.3 and 5.4 hereof.

5.2. ESTABLISHMENT OF TARGET AWARDS. Each Participant shall have a target award,
reflected as a specified amount or a percentage of his or her Base Salary, that
will be awarded to the Participant for the designated Plan Year if the
established Performance Objectives are achieved at the target level (the “Target
Award”). Before the 90th day of each Plan Year, (i) the Committee shall approve
the Target Award for each Participant that is a Section 16 Officer, (ii) the CEO
shall approve the Target Award for all Participants other than Section 16
Officers, and (iii) the Committee shall approve the aggregate cost of Target
Awards for all Participants other than Section 16 Officers. Each Participant’s

 

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Target Award percentage will be communicated in writing to the Participant upon
such Participant’s initial participation in the Plan, and shall remain in effect
until any change thereto is communicated to the Participant in writing. The
actual Annual Incentive Award to a Participant may be greater or less than his
or her Target Award, depending on the level of achievement of applicable
Performance Objectives and such other objective or subjective factors as the
Committee with respect to Section 16 Officers or the CEO with respect to
individuals who are not Section 16 Officers, as applicable, shall deem relevant.

5.3. COMPANY PERFORMANCE OBJECTIVES. Before the 90th day of each Plan Year,
(i) the Committee shall approve Company Performance Objectives for that Plan
Year for the Section 16 Officers, and (ii) the CEO shall approve Company
Performance Objectives for that Plan Year for other Participants. The Company
Performance Objectives will be communicated in writing to the Participants. In
establishing Company Performance Objectives, the Committee or the CEO, as
applicable, may take into account such factors as it deems appropriate,
including, without limitation, prior year results, planned business results,
anticipated business trends, performance relative to peer companies and
macroeconomic conditions.

5.4. INDIVIDUAL PERFORMANCE OBJECTIVES. Before the 90th day of each Plan Year,
(i) the Committee shall approve any Individual Performance Objectives for that
Plan Year for the Section 16 Officers, and (ii) the CEO shall approve Individual
Performance Objectives for that Plan Year for other Participants. Any such
Individual Performance Objectives will be communicated in writing to the
Participants. In addition, whether or not written Individual Performance
Objectives are established for a Plan Year, the Committee with respect to
Section 16 Officers or the CEO with respect to individuals who are not
Section 16 Officers, as applicable, reserves the right to increase or decrease a
Participant’s Annual Incentive Award based on a subjective assessment of the
Participant’s overall performance during the Plan Year.

5.5. PAYOUT FORM AND TIMING. Annual Incentive Awards will be paid in a lump sum
in cash as soon as administratively practicable after the Committee or the CEO
(in the case of Participants that are not Section 16 Officers) determines
whether and to what extent Performance Objectives were achieved, but no later
than March 15 following the end of the Plan Year for which the Annual Incentive
Awards, if any, were earned; provided that any Annual Incentive Award which is
properly deferred by a Participant under a deferred compensation plan or
arrangement adopted or approved by the Company shall be paid pursuant to the
terms and conditions of such deferral.

5.6. TERMINATION OF EMPLOYMENT. Unless otherwise determined by (i) the Committee
in its discretion or (ii) the CEO in his or her discretion with respect to a
Participant who is not a Section 16 Officer, and subject to any contrary
provision in an individual employment, key position, severance or similar
agreement with a Participant, a Participant must be actively employed and in
good standing or on approved leave of absence as of the date of payment in order
to be eligible to receive an Annual Incentive Award for such Plan Year, and a
Participant whose employment terminates for any reason prior to the date of
payment shall forfeit his or her right to receive an Annual Incentive Award for
such Plan Year. Notwithstanding the foregoing, pursuant to Section 4.4, the
Committee or the CEO (with respect to individuals who are not Section 16
Officers) may determine, in their discretion and on a case-by-case basis, that a
Participant whose employment is terminated on account of death, Disability or
Retirement shall remain eligible to receive a portion of his or her Annual
Incentive Award, based on actual achievement of applicable Performance
Objectives and prorated based on the number of days that the Participant was
actively employed and performed services during the applicable performance
period. Any amounts paid on behalf of a deceased Participant will be paid to the
Participant’s beneficiary.

5.7. CHANGE IN CONTROL. In the event a Change in Control occurs during a Plan
Year, unless otherwise determined by the Committee, a pro rata portion of the
Target Award amounts for that

 

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Plan Year (based on the number of days in the Plan Year preceding the Change in
Control, divided by 365) shall be deemed earned, notwithstanding the level of
achievement of Performance Objectives. Such prorata Target Awards shall be paid
to Participants no later than thirty (30) days after the effective date of the
Change in Control and, unless other determined by the Company in its sole
discretion, such payments shall be in full satisfaction of any awards under the
Plan for such Plan Year and no additional amounts shall be payable to
Participants under the Plan with respect to such Plan Year.

ARTICLE 6

AMENDMENT, MODIFICATION AND TERMINATION

6.1. AMENDMENT, MODIFICATION AND TERMINATION. The Committee may, at any time and
from time to time, amend, modify or terminate this Plan. The Committee may
condition any amendment or modification on the approval of stockholders of the
Company if such approval is necessary or deemed advisable with respect to tax,
securities or other applicable laws, policies or regulations.

6.2. TERMINATION DURING PLAN YEAR. Termination or amendment of this Plan during
a Plan Year may be retroactive to the beginning of the Plan Year, at the
discretion of the Committee. If a Change in Control occurs, no amendment or
termination may adversely affect amounts payable to a Participant without the
consent of the Participant.

ARTICLE 7

GENERAL PROVISIONS

7.1. NO RIGHT TO PARTICIPATE. No employee shall have any right to be selected to
participate in this Plan.

7.2. NO RIGHT TO EMPLOYMENT. Nothing in this Plan shall interfere with or limit
in any way the right of the Company or any Affiliate to terminate any
Participant’s employment at any time, nor confer upon any Participant any right
to continue in the employ of the Company or any Affiliate.

7.3. WITHHOLDING. The Company or any Affiliate shall have the authority and the
right to deduct or withhold, or require a Participant to remit to the Company,
an amount sufficient to satisfy federal, state, and local taxes (including the
Participant’s FICA obligation) required by law to be withheld with respect to
any taxable event arising as a result of this Plan.

7.4. FUNDING. Benefits payable under this Plan to a Participant or to a
beneficiary will be paid by the Company from its general assets. The Company is
not required to segregate on its books or otherwise establish any funding
procedure for any amount to be used for the payment of benefits under this Plan.
The Company may, however, in its sole discretion, set funds aside in investments
to meet its anticipated obligations under this Plan. Any such action or
set-aside may not be deemed to create a trust of any kind between the Company
and any Participant or beneficiary or to constitute the funding of any Plan
benefits. Consequently, any person entitled to a payment under this Plan will
have no rights greater than the rights of any other unsecured creditor of the
Company.

7.5. EXPENSES. The expenses of administering this Plan shall be borne by the
Company and its Subsidiaries.

7.6. TITLES AND HEADINGS. The titles and headings of the Sections in this Plan
are for convenience of reference only, and in the event of any conflict, the
text of this Plan, rather than such titles or headings, shall control.

 

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7.7. GENDER AND NUMBER. Except where otherwise indicated by the context, any
masculine term used herein also shall include the feminine; the plural shall
include the singular and the singular shall include the plural.

7.8. GOVERNING LAW. To the extent not governed by federal law, this Plan shall
be construed in accordance with and governed by the laws of the State of
Delaware.

7.9. COMPENSATION RECOUPMENT POLICY. Annual Incentive Awards granted under this
Plan shall be subject to any compensation recoupment policy that the Company may
adopt from time to time that is applicable by its terms to the recipient of such
award.

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The foregoing is hereby acknowledged as being the CommScope Holding Company,
Inc. Annual Incentive Plan as adopted by the Board to be effective as of
October 24, 2013, and as amended February 17, 2016.

 

COMMSCOPE HOLDING COMPANY, INC. By:  

/s/ Frank B. Wyatt, II

Its:     Senior Vice President