Exhibit 10.1


 


CPI INTERNATIONAL, INC.

RESTRICTED STOCK AGREEMENT

(Senior Executives)


 


 


THIS RESTRICTED STOCK
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 the Restricted
Shares (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 shares of
the Common Stock of the Company (the “Restricted Shares”)
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
Shares.


 


1.1           Issuance
of Restricted Shares.  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 Shares.  The Restricted Shares
shall be represented by a certificate or certificates issued in the name of the
Grantee and endorsed with an appropriate legend referring to the restrictions
hereinafter set forth.


 


1.2           Restrictions
on Transfer of Shares. The Restricted Shares 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, until they have become vested as provided in Section 1.3.
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 Shares.  In addition, the Grantee may not Transfer
Restricted Shares that have become vested unless such Restricted Shares are
registered pursuant to the Securities Act of 1933 (the “Securities
Act”) or 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 Shares.  Subject to the
provisions of the Plan and the other provisions of this Agreement, the
Restricted Shares shall vest in accordance with the schedule set forth on Exhibit A.  Notwithstanding the foregoing, (a) in
the event of termination of the Grantee’s employment by the Company (or a
Subsidiary, as applicable)


 





















 


for Cause or the termination of the Grantee’s Continuous Status as an
Employee, Director or Consultant by the Grantee for any reason other than
death, Disability or Good Reason (as defined in the Grantee’s employment
agreement), the Restricted Shares shall immediately cease vesting as of the
date of termination, and (b) in the event of termination of the Grantee’s
Continuous Status as an Employee, Director or Consultant by the Company (or a
Subsidiary, as applicable) without Cause, as a result of death or Disability,
or by the Grantee for Good Reason, the Restricted Shares shall become fully
vested as of the date of termination. 
Any Restricted Shares that are not vested on the date of termination
shall be forfeited by the Grantee, and the certificate(s) representing the
non-vested portion of the Restricted Shares so forfeited shall be canceled.


 


                In addition, if, in connection
with a merger, consolidation, reorganization, recapitalization or similar
transaction in which the Company is not the surviving entity, either (i) all
obligations under this Agreement are not fully assumed by the surviving or
resulting entity, or (ii) the Company fails to provide the Grantee with
cash or property with a fair market value equal to the Fair Market Value of the
non-vested portion of the Restricted Shares, then the Restricted Shares shall
become fully vested prior to the effectiveness of such transaction.


 


1.4           Tax
Withholding Obligations.  If the
Company shall be required to withhold any federal, state, local or foreign tax
in connection with any issuance or vesting of Restricted Shares or other
securities 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
Restricted Shares that become vested hereunder, and the Restricted Shares so
surrendered by the Grantee shall be credited against any such withholding
obligation based on the then Fair Market Value per share of such Restricted
Shares on the date of such surrender.


 


2.             Dividend, Voting
and Other Rights.  Except as
otherwise provided in this Agreement, from and after the Date of Grant, the Grantee
shall have all of the rights of a stockholder with respect to the Restricted
Shares, including the right to vote the Restricted Shares and receive any
dividends that may be paid thereto, provided, however, that any additional
Common Stock or other securities that the Grantee may become entitled to
receive pursuant to a stock dividend, stock split, recapitalization,
combination of shares, merger, consolidation, separation or reorganization or
any other change in the capital structure of the Company shall be subject to
the same risk of forfeiture and restrictions on transfer as the forfeitable
Restricted Shares in respect of which they are issued or transferred and shall
become Restricted Shares for the purposes of this Agreement.


 


3.             Retention of
Stock Certificate(s) by the Company.  The certificate(s) representing the
Restricted Shares shall be held in custody by the Company, together with a
stock power that shall be endorsed in blank by the Grantee and delivered to the
Company within ten (10) days of the date hereof, until such shares have
become vested in accordance with Section 1.3.


 


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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.


 


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 Shares, and
the parties hereto shall act in all matters as if the Grantee was the sole
owner of the Restricted Shares.  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.


 


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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 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 


 


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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.


 


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 GRANT


 


 


	
  Grantee
  Name:

  	
   

  
	
  Date
  of Grant:

  	
   

  
	
  Number
  of Shares of Common Stock:

  	
   

  



 


 


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


 


1/4 of
the Restricted Shares will vest on the first anniversary of the Date of Grant.


 


1/4 of
the Restricted Shares will vest on the second anniversary of the Date of Grant.


 


1/4 of
the Restricted Shares will vest on the third anniversary of the Date of Grant.


 


1/4 of
the Restricted Shares will vest on the fourth anniversary of the Date of Grant.


 


 


	
  Grantee
  Address: