Exhibit 10.1
ADTRAN, INC.
PERFORMANCE SHARES AGREEMENT
This Performance Shares Agreement (this “Agreement”) sets forth the specified
terms of ADTRAN, Inc.’s grant of Restricted Stock Units (“Performance Shares”)
pursuant to the ADTRAN, Inc. 2006 Employee Stock Incentive Plan (the “Plan”).
All capitalized terms used but not defined herein shall have the meanings
ascribed to such terms in the Plan.
Name of Participant:
 
Date of Grant:
 
Number of Performance Shares Granted:
 
Performance Period: The three (3) year period beginning on the Date of Grant of
the Performance Shares.
Vesting and Delivery of Performance Shares: The number of granted Performance
Shares that are vested and earned pursuant to this Agreement will be based on
the total shareholder return (“TSR”) of ADTRAN, Inc. (the “Company”) during the
Performance Period relative to all companies in the NASDAQ Telecommunications
Index. Granted Performance Shares will be vested and earned in accordance with
the following schedule:

      The Company’s TSR   Granted Performance Performance relative to its  
Shares Earned Peer Group (expressed in   (expressed as a a percentile)  
percentage) Less than 20th Percentile   0% 20th Percentile   25% 25th Percentile
  38% 30th Percentile   50% 35th Percentile   63% 40th Percentile   75% 45th
Percentile   88% 50th Percentile   100% 55th Percentile   108% 60th Percentile  
117% 65th Percentile   125% 70th Percentile   133% 75th Percentile   142% 80th
or more Percentile   150%

One share of the Company’s Common Stock shall be issued to the Participant for
every “Earned Performance Share.” The Company will issue shares of Common Stock
to the Participant as soon as administratively practicable following the date
the Performance Shares have been vested and earned; provided, however, if any
law or regulation requires the Company to take any action (including, but not
limited to, the filing of a registration statement under the 1933 Act and
causing such registration statement to become effective) with respect to such
shares of Common Stock before the issuance thereof, then the date of delivery of
the shares shall be extended for the period necessary to take such action, to
the maximum extent permitted by Section 409A of the Internal Revenue Code.

 

 

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Accelerated Vesting and Delivery: In the event of (1) the Participant’s death,
(2) the Participant’s Disability, or (3) a Change of Control of the Company, a
portion of the granted Performance Shares shall become immediately vested and
earned by the Participant. The number of such vested and nonforfeitable shares
shall be equal to (x) the number of Performance Shares that is 25% of the total
Performance Shares granted under this Agreement multiplied by (y) a fraction,
the numerator of which shall equal the number of days elapsed from the Date of
Grant to the date of the applicable acceleration event and the denominator of
which shall equal the days in the Performance Period.
Dividend Credits: The Participant shall receive dividend credits upon the
Company’s payment of cash dividends for its Common Stock during the Performance
Period as follows:
(1) The Participant shall receive dividend credits on the unvested portion of
the original number of Performance Shares awarded on the Date of Grant
(“Original Performance Shares”), with the amount of such dividend credits
credited to the Participant in the form of additional unvested Performance
Shares, as calculated pursuant to the Plan.
(2) The Participant’s Performance Shares attributable to any dividend credits
will be vested and earned in accordance with the same schedule as the Original
Performance Shares (as described above).
(3) The distribution of Performance Shares attributable to dividend credits
shall be made in a cash payment on the same date as the issuance of the Common
Stock for the “Earned Performance Shares.”
Designation of Beneficiary: The Participant hereby designates the following
individual as the Beneficiary (as defined in the Plan) of this Agreement:

         
Name:
       
 
     
Address:
       
 
     
 
       
 
     
Relationship:  
       
 
     

The Participant may modify this designation of Beneficiary only in accordance
with the terms and provisions of the Plan.

 

 

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The Performance Shares granted above are subject to all restrictions, terms and
conditions set forth in the ADTRAN, Inc. 2006 Employee Stock Incentive Plan. In
the event of any inconsistency between this Agreement and the Plan, the
provisions of the Plan shall govern. The Participant has received a copy of the
Plan’s prospectus, including a copy of the Plan. The Participant agrees to the
terms of this Performance Shares Agreement, which may be amended only upon a
written agreement signed by the parties hereto.

 
This                       day of                                         ,
20     .

              ADTRAN, INC.   PARTICIPANT:    
 
           
 
           
 
     
Thomas R. Stanton
  Name:        
 
     
 
   
Title: Chief Executive Officer
  Title: