Exhibit 10.4


 


CPI INTERNATIONAL, INC.

RESTRICTED STOCK UNIT AWARD AGREEMENT




 


 


THIS RESTRICTED STOCK
UNIT AWARD AGREEMENT (the “Agreement”) is
made and entered into as of the date of grant set forth on Exhibit A
hereto by and between CPI International, Inc., a Delaware corporation (the
“Company”), and the individual (the “Grantee”) set forth on Exhibit A.


 


A.            The Grantee is an employee or consultant of the Company
or a Subsidiary, and the Company has determined that it is appropriate,
desirable and in the best interests of the Company to issue Restricted Stock
Units (as defined below) to the Grantee.


 


B.            Accordingly, pursuant to the CPI International, Inc.
2006 Equity and Performance Incentive Plan (the “Plan”),
the Company is hereby issuing to the Grantee the number of Restricted Stock
Units as set forth on Exhibit A hereto, and in all respects subject
to the terms, definitions and provisions of the Plan, which is incorporated
herein by reference.


 


C.            Unless otherwise defined herein, capitalized terms used in
this Agreement shall have the meanings set forth in the Plan.


 


NOW, THEREFORE, in
consideration of the mutual agreements contained herein, the Grantee and the
Company hereby agree as follows:


 


1.                                      Restricted Stock Units.


 


1.1          Issuance
of Restricted Stock Units.  In
consideration of the Grantee’s service as an employee or consultant of the
Company or a Subsidiary, the Company is hereby issuing to the Grantee the
Restricted Stock Units.  Each “Restricted Stock Unit” represents the contingent right to
receive in the future one share of common stock of the Company, $.01 par value
(“Common Stock”), and is subject to the
conditions and restrictions on transferability set forth below and in the Plan.
The Restricted Stock Units will be credited to the Grantee in an unfunded
bookkeeping account established for the Grantee and will not be represented by
certificates.


 


1.2          Restrictions
on Transfer of Restricted Stock Units.  The Restricted Stock Units may not be sold,
assigned, transferred, conveyed, pledged, exchanged or otherwise encumbered or
disposed of (each, a “Transfer”) by
the Grantee, except to the Company.   
Any purported Transfer in violation of the provisions of this Section 1.2
shall be void AB INITIO, and the other party to any such purported transaction shall
not obtain any rights to or interest in the Restricted Stock Units.  In addition, the Grantee may not Transfer
Common Stock received upon the vesting of Restricted Stock Units unless such
shares of Common Stock are registered pursuant to the Securities Act of 1933
(the “Securities Act”) or are transferred
under Rule 144 promulgated under the Securities Act or unless the Company
and its counsel agree with the Grantee that such Transfer is not required to be
registered under the Securities Act.


 


 

















 


1.3          Vesting;
Forfeiture of Restricted Stock Units. 
Upon vesting of a Restricted Stock Unit, such Restricted Stock Unit will
be converted into one share of Common Stock, and the Grantee will be issued one
share of Common Stock for each such Restricted Stock Unit that has vested,
which shares of Common Stock shall be free of any restrictions other than those
imposed pursuant to applicable securities laws. 
Subject to the provisions of the Plan and the other provisions of this
Agreement, the Restricted Stock Units shall vest in accordance with the
schedule set forth on Exhibit A. 
Notwithstanding the foregoing, in the event of termination of the
Grantee’s Continuous Status as an Employee, Director or Consultant for any
reason, the Restricted Stock Units shall immediately cease vesting as of the
date of termination; provided, however, if such termination
occurs as a result of either death or Disability, the vesting of the Restricted
Stock Units shall be partially accelerated as set forth on Exhibit A
hereto.  Any Restricted Stock Units that
are not vested on the date of termination shall be forfeited by the Grantee and
shall be cancelled.


 


1.4          Tax
Withholding Obligations.  If the
Company shall be required to withhold any federal, provincial, state, local or
foreign tax in connection with any issuance or vesting of Restricted Stock
Units or the issuance of Common Stock or other securities or property pursuant
to this Agreement, and the amounts available to the Company for such
withholding are insufficient, then the Grantee shall pay the tax or make
provisions that are satisfactory to the Company for the payment thereof.  Provided the approval of the Committee is
obtained, the Grantee may elect to satisfy all or any part of any such
withholding obligation by surrendering to the Company a portion of the Common
Stock issued upon the vesting of Restricted Stock Units hereunder, and the
Common Stock so surrendered by the Grantee shall be credited against any such
withholding obligation based on the then Fair Market Value per share of such
Common Stock on the date of such surrender.


 


2.                                      Rights as a Stockholder. 
The Grantee will have no rights as a stockholder with regard to any
Restricted Stock Unit until it vests and converts into a share of Common
Stock.  However, in the event that the
Company pays a cash dividend with respect to its Common Stock, the Company will
pay to the Grantee a cash amount equal to the per-share cash dividend
multiplied by the number of unvested Restricted Stock Units held by Grantee, at
the same time as dividends are paid on the Company’s outstanding shares of
Common Stock.


 


3.                                      Adjustments. 
In the event of any merger, reorganization, consolidation,
recapitalization, stock dividend, stock split, reverse stock split, spin-off,
distribution with respect to the Common Stock (other than a cash dividend) or a
similar transaction or other change in corporate structure affecting the Common
Stock, the Company shall make equitable and proportionate adjustments to the
number of Restricted Stock Units as well as the type of securities or property
to be delivered upon vesting thereof. 
All such adjustments and substitutions shall be made by the Committee in
its sole discretion.


 


4.                                      General.


 


4.1          Governing
Law.  This Agreement shall be
governed by and construed under the laws of the state of Delaware applicable to
agreements made and to be performed entirely in Delaware, without regard to the
conflicts of law provisions of Delaware or any other jurisdiction.


 


 


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4.2          Notices.  Any notice required or permitted under this
Agreement shall be given in writing by overnight courier or by postage prepaid,
United States registered or certified mail, return receipt requested, to the
address set forth below or to such other address for a party as that party may
designate by ten (10) days advance written notice to the other
parties.  Notice shall be effective upon
the earlier of receipt or three (3) days after the date on which such
notice is deposited in the mails or with the overnight courier.


 


	
  If to the Company:

  	
  CPI International, Inc.

  
	
   

  	
  811 Hansen Way

  
	
   

  	
  Palo Alto, California 94303-1110

  
	
   

  	
  Attention: Chief Financial Officer

  



 


If to the Grantee, at the address set forth on Exhibit A.


 


4.3          Community
Property.  Without prejudice to the
actual rights of the spouses as between each other, for all purposes of this
Agreement, the Grantee shall be treated as agent and attorney-in-fact for that
interest held or claimed by his or her spouse with respect to the Restricted
Stock Units, and the parties hereto shall act in all matters as if the Grantee
was the sole owner of the Restricted Stock Units.  This appointment is coupled with an interest
and is irrevocable.


 


4.4          Modifications.  This Agreement may be amended, altered or
modified only by a writing signed by each of the parties hereto.


 


4.5          Additional
Documents.  Each party agrees to
execute any and all further documents and writings, and to perform such other
actions, which may be or become reasonably necessary or expedient to be made
effective and carry out this Agreement.


 


4.6          No
Third-Party Benefits.  Except as
otherwise expressly provided in this Agreement, none of the provisions of this
Agreement shall be for the benefit of, or enforceable by, any third-party
beneficiary.


 


4.7          Successors
and Assigns.  Except as provided
herein to the contrary, this Agreement shall be binding upon and inure to the
benefit of the parties, their respective successors and permitted assigns.


 


4.8          No
Assignment.  Except as otherwise
provided in this Agreement, the Grantee may not assign any of his, her or its
rights under this Agreement without the prior written consent of the Company,
which consent may be withheld in its sole discretion.  The Company shall be permitted to assign its
rights or obligations under this Agreement, but no such assignment shall release
the Company of any obligations pursuant to this Agreement.


 


4.9          Severability.  The validity, legality or enforceability of
the remainder of this Agreement shall not be affected even if one or more of
the provisions of this Agreement shall be held to be invalid, illegal or
unenforceable in any respect.


 


4.10        Equitable
Relief.  The Grantee acknowledges
that, in the event of a threatened or actual breach of any of the provisions of
this Agreement, damages alone will be an inadequate remedy, and such breach
will cause the Company great, immediate and 


 


 


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irreparable injury and damage.  Accordingly, the Grantee agrees that the
Company shall be entitled to injunctive and other equitable relief, and that
such relief shall be in addition to, and not in lieu of, any remedies it may
have at law or under this Agreement.


 


4.11                        Arbitration.


 


4.11.1     General.  Any controversy, dispute, or claim between
the parties to this Agreement, including any claim arising out of, in
connection with, or in relation to the formation, interpretation, performance
or breach of this Agreement shall be settled exclusively by arbitration, before
a single arbitrator, in accordance with this Section 4.11 and the then
most applicable rules of the American Arbitration Association.  Judgment upon any award rendered by the
arbitrator may be entered by any state or federal court having jurisdiction
thereof.  Such arbitration shall be
administered by the American Arbitration Association.  Arbitration shall be the exclusive remedy for
determining any such dispute, regardless of its nature.  Notwithstanding the foregoing, either party
may in an appropriate matter apply to a court for provisional relief, including
a temporary restraining order or a preliminary injunction, on the ground that
the award to which the applicant may be entitled in arbitration may be rendered
ineffectual without provisional relief. 
Unless mutually agreed by the parties otherwise, any arbitration shall
take place in the City of Palo Alto, California.


 


4.11.2     Selection
of Arbitrator.  In the event the
parties are unable to agree upon an arbitrator, the parties shall select a
single arbitrator from a list of nine arbitrators (which shall be retired
judges or corporate or litigation attorneys experienced in executive compensation
and stock options) provided by the office of the American Arbitration
Association having jurisdiction over Palo Alto, California.  If the parties are unable to agree upon an
arbitrator from the list so drawn, then the parties shall each strike names alternately
from the list, with the first to strike being determined by lot.  After each party has used four (4) strikes,
the remaining name on the list shall be the arbitrator.  If such person is unable to serve for any
reason, then the parties shall repeat this process until an arbitrator is
selected.


 


4.11.3     Applicability
of Arbitration; Remedial Authority. 
This agreement to resolve any disputes by binding arbitration shall
extend to claims against any parent, subsidiary or affiliate of each party,
and, when acting within such capacity, any officer, director, shareholder,
employee or agent of each party, or of any of the above, and shall apply as
well to claims arising out of state and federal statutes and local ordinances
as well as to claims arising under the common law.  In the event of a dispute subject to this
paragraph the parties shall be entitled to reasonable discovery subject to the
discretion of the arbitrator.  The remedial
authority of the arbitrator (which shall include the right to grant injunctive
or other equitable relief) shall be the same as, but no greater than, would be
the remedial power of a court having jurisdiction over the parties and their
dispute.  The arbitrator shall, upon an
appropriate motion, dismiss any claim without an evidentiary hearing if the
party bringing the motion establishes that he or it would be entitled to
summary judgment if the matter had been pursued in court litigation.  In the event of a conflict between the
applicable rules of the American Arbitration Association and these
procedures, the provisions of these procedures shall govern.


 


 


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4.11.4     Fees
and Costs.  Any filing or
administrative fees shall be borne initially by the party requesting
arbitration.  The Company shall be
responsible for the costs and fees of the arbitration, unless the Grantee
wishes to contribute (up to 50%) of the costs and fees of the arbitration.  Notwithstanding the foregoing, the prevailing
party in such arbitration, as determined by the arbitrator, and in any
enforcement or other court proceedings, shall be entitled, to the extent
permitted by law, to reimbursement from the other party for all of the
prevailing party’s costs (including but not limited to the arbitrator’s
compensation), expenses, and attorneys’ fees.


 


4.11.5     Award
Final and Binding.  The arbitrator
shall render an award and written opinion, and the award shall be final and
binding upon the parties.  If any of the
provisions of this paragraph, or of this Agreement, are determined to be
unlawful or otherwise unenforceable, in whole or in part, such determination
shall not affect the validity of the remainder of this Agreement, and this
Agreement shall be reformed to the extent necessary to carry out its provisions
to the greatest extent possible and to insure that the resolution of all
conflicts between the parties, including those arising out of statutory claims,
shall be resolved by neutral, binding arbitration.  If a court should find that the arbitration
provisions of this Agreement are not absolutely binding, then the parties
intend any arbitration decision and award to be fully admissible in evidence in
any subsequent action, given great weight by any finder of fact, and treated as
determinative to the maximum extent permitted by law.


 


4.12                        Headings.  The section
headings in this Agreement are inserted only as a matter of convenience, and in
no way define, limit, extend or interpret the scope of this Agreement or of any
particular section.


 


4.13                        Number and Gender. 
Throughout this Agreement, as the context may require, (a) the
masculine gender includes the feminine and the neuter gender includes the
masculine and the feminine; (b) the singular tense and number includes the
plural, and the plural tense and number includes the singular; (c) the
past tense includes the present, and the present tense includes the past; (d) references
to parties, sections, paragraphs and exhibits mean the parties, sections,
paragraphs and exhibits of and to this Agreement; and (e) periods of days,
weeks or months mean calendar days, weeks or months.


 


4.14                        Counterparts.  This
Agreement may be executed simultaneously in two or more counterparts, each of
which shall be deemed an original, but all of which together shall constitute
one and the same instrument.


 


 


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4.15        Complete
Agreement.  This Agreement and the
Plan constitute the parties’ entire agreement with respect to the subject
matter hereof and supersede all agreements, representations, warranties,
statements, promises and understandings, whether oral or written, with respect
to the subject matter hereof.


 


	
   

  	
  CPI
  INTERNATIONAL, INC.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By: 

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Its: 

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  GRANTEE

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Name: 

  
				



 


 


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EXHIBIT A

DETAILS OF RESTRICTED STOCK UNIT AWARD GRANT


 


 


 


	
  Grantee
  Name:

  	
   

  
	
  Date
  of Grant:

  	
   

  
	
  Effective
  Date:

  	
   

  
	
  Number
  of Restricted Stock Units:

  	
   

  



 


Vesting Schedule:  Subject to the restrictions and limitations of
the Agreement and the Plan, the Restricted Stock Units shall vest as follows:


 


1/4 of
the Restricted Stock Units will vest on the first anniversary of the Effective
Date.


 


1/4 of
the Restricted Stock Units will vest on the second anniversary of the Effective
Date.


 


1/4 of
the Restricted Stock Units will vest on the third anniversary of the Effective
Date.


 


1/4 of
the Restricted Stock Units will vest on the fourth anniversary of the Effective
Date.


 


If the
Grantee’s Continuous Status as an Employee, Director or Consultant terminates
as result of death or Disability and the date of termination does not occur on
a date on which any Restricted Stock Units vest, then for purposes of
determining the extent to which the Restricted Stock Units have vested, the
Grantee’s Continuous Status as an Employee, Director or Consultant shall be
deemed to have terminated on the next occurring vesting date.  For example, if the Grantee’s Continuous
Status as an Employee, Director or Consultant terminates as result of death or
Disability 25 months after the Effective Date, then 75% of the Restricted Stock
Units shall be deemed to be vested as of the date of termination (and no
further vesting shall occur).


 


	
  Grantee Address: