EX-4.1 2008 INCENTIVE PLAN






EXHIBIT 4.1




ARRIS GROUP, INC.

2008 STOCK INCENTIVE PLAN




     1. PURPOSE AND EFFECTIVE DATE. ARRIS Group, Inc. (the “Company”) has established this 2008
Stock Incentive Plan (the “Plan”) to facilitate the retention and continued motivation of key
employees, consultants and directors and to align more closely their interests with those of the
Company and its stockholders. The effective date of the Plan shall be the date it is approved by
the stockholders of the Company (the “Effective Date”). No grants shall be made under this Plan
subsequent to ten (10) years after the Effective Date. This Plan will have no impact on the
Company’s existing stock incentive plans or the awards outstanding thereunder.



     2. ADMINISTRATION. The Plan shall be administered by the Compensation Committee of the
Company’s Board of Directors or such other Board committee consisting solely of independent
directors (as determined by the Board or a committee thereof) as the Board may designate (the
“Committee”). The Committee has the authority and responsibility for the interpretation,
administration and application of the provisions of the Plan, and the Committee’s interpretations
of the Plan, and all actions taken by it and determinations made by it, shall be binding on all
persons. The Committee may authorize one or more officers to grant awards to the extent permitted
by Section 157(c) of the Delaware General Corporation Law. No Board or Committee member shall be
liable for any determination, decision or action made in good faith with respect to the Plan.



     3. SHARES SUBJECT TO PLAN. A total of 12,300,000 shares of Common Stock, or rights with
respect to Common Stock, of the Company (“Shares”) may be issued pursuant to the Plan. The Shares
may be authorized but unissued Shares or Shares reacquired by the Company and held in its treasury.
In determining the number of shares available for awards:




	 	(a)	 	Grants of awards under the Plan will reduce the number of Shares
available thereunder by the maximum number of Shares obtainable under such grants.
	 
	 	(b)	 	Awards of stock, stock units, restricted stock, performance shares and
units, and dividend equivalent rights will reduce the number of shares available
thereunder at the rate of 1.58 shares per interest granted.
	 
	 	(c)	 	The aggregate number of Shares with respect to which incentive stock
options may be issued under the Plan shall not exceed 4,000,000.
	 
	 	(d)	 	If all or any portion of the Shares otherwise subject to an award under
the Plan are not delivered or do not vest for any reason including, but not limited
to, the cancellation, expiration or termination of any option right or unit, the
settlement of any award in cash, the forfeiture of any restricted stock, or the
repurchase of any Shares by the Company from a participant for the cost of the
participant’s investment in the Shares, such number of Shares shall be available
again for issuance under the Plan.
	 
	 	(e)	 	Shares tendered (either actually or through attestation) to pay the
option exercise price, shares withheld for the payment of withholding taxes and
shares and other awards repurchased by the Company from a person using proceeds
from the exercise of awards by that person shall not return to the share reserve,
and the determination of the number of Shares used in connection with stock-settled
stock appreciation rights shall be based upon the number of Shares with respect to
which the rights were based and not just the number of Shares delivered upon
settlement.
	 
	 	(f)	 	Shares issued in connection with awards that are assumed, converted or
substituted pursuant to a merger or an acquisition shall not reduce the share
reserve.




The number of Shares covered by or specified in the Plan and the number of Shares and the purchase
price for Shares under any outstanding awards, may be adjusted proportionately by the Committee for
any increase or




 









 







decrease in the number of issued Shares or any change in the value of the Shares resulting from a
subdivision or consolidation of Shares, reorganization, recapitalization, spin-off, payment of
stock dividends on the Shares, any other increase or decrease in the number of issued Shares made
without receipt of consideration by the Company, or the payment of an extraordinary cash dividend.




     4. ELIGIBILITY. All key employees, active consultants and directors of the Company and its
subsidiaries are eligible to be selected to receive a grant under the Plan by the Committee. The
Committee may condition eligibility under the Plan, and any grant or exercise of an award under the
Plan, on such conditions, limitations or restrictions as the Committee determines to be appropriate
for any reason. No person may be granted in any period of two consecutive calendar years, awards
covering more than 1,500,000 Shares. The maximum amount to be granted to any one person pursuant to
performance units, in any calendar year, shall not exceed $2,000,000.



     5. AWARDS. The Committee may grant awards under the Plan to eligible persons in the form of
stock options (including incentive stock options within the meaning of section 422 of the Code),
stock grants, stock units, restricted stock, stock appreciation rights, performance shares and
units and dividend equivalent rights, and shall establish the number of Shares subject to each such
grant and the terms thereof, including any adjustments for reorganizations and dividends, subject
to the following:




	 	(a)	 	All awards granted under the Plan shall be evidenced by written
documents in such form and containing such terms and conditions not inconsistent
with the Plan as the Committee shall prescribe.
	 
	 	(b)	 	The exercise price of any option or stock appreciation right shall not
be less than the fair market value of a corresponding number of Shares as of the
date of grant, except options or stock appreciation rights being granted to replace
options or rights not initially granted by the Company or its predecessors may be
granted with exercise prices that in the judgment of the Committee result in
options or rights having comparable value to the options or rights being replaced.
The maximum term on options and stock appreciation rights shall not exceed ten (10)
years.
	 
	 	(c)	 	Options and stock appreciation rights shall vest over a minimum of
three years (and shall vest no more quickly than ratably), and all other awards
shall have a minimum vesting or holding period of three years, provided
that (i) awards that are issued in connection with mergers and acquisitions may
have vesting and holding periods that are the same as any awards that they are
replacing or otherwise as deemed appropriate by the Committee, and (ii) a vesting
or holding period may be reduced as a result of death, disability, retirement, a
merger or sale, termination of employment, change in control or other extraordinary
event. In the absence of an extraordinary event, the vesting and holding
restrictions applicable to an award shall not be reduced or otherwise waived.
	 
	 	(d)	 	Awards granted under this Plan shall not be transferred, assigned,
pledged or hypothecated or otherwise transferred by the grantee except by will or
the laws of descent and distribution to the extent permitted in the award itself.
	 
	 	(e)	 	No option may be repriced by amendment, substitution or cancellation
and regrant, unless authorized by the stockholders. Adjustments pursuant to Section
3 above shall not be considered repricing.
	 
	 	(f)	 	When issuing performance shares or units performance criteria may
include: revenue; earnings before interest, taxes, depreciation and amortization
(EBITDA); cash earnings (earnings before amortization of intangibles); operating
income; pre- or after-tax income; earnings per share, net cash flow; net cash flow
per share; net earnings; return on equity; return on total capital; return on
sales, return on net assets employed, return on assets; economic value added (or an
equivalent metric); share price performance; total shareholder return; improvement
in or attainment of expense levels; and improvement in or attainment of working
capital levels. Performance criteria may be related to a specific customer or
group of customers or geographic region. Performance criteria may be measured
solely on a corporate, subsidiary or division basis, or a combination thereof.
Performance criteria may reflect absolute entity performance or a relative
comparison of




 









 






	 	 	 	entity performance to the performance of a peer group of entities or other external
measure of the selected performance criteria. Profit, earnings and revenues used
for any performance goal measurement may exclude any extraordinary or nonrecurring
items.
	 
	 	(g)	 	All awards may be settled in cash, shares or deferred delivery, as
authorized by the Committee.
	 
	 	(h)	 	Shares granted from the plan may be used as form of payment for
compensation, grants or rights earned or due under other Company plans or
arrangements.





     6. AMENDMENT OF THE PLAN. The Board of Directors or the Committee may from time to time
suspend, terminate, revise or amend the Plan or the terms of any grant in any respect whatsoever,
provided that, without the approval of the stockholders of the Company, no such revision or
amendment may increase the number of Shares subject to the Plan, change the provisions of Section 5
above, or expand those eligible for grants under the Plan.



     7. GENERAL. The laws of the State of Delaware shall apply to the Plan. Nothing herein shall
restrict the Board from exercising the authority granted hereunder to the Committee or otherwise
from exercising its fiduciary duties.