Document:

exv10w3

 

Exhibit 10.3

CHANGE OF CONTROL AGREEMENT

This Change of Control Agreement (the “Agreement”) is made effective as of the 1st day
of July, 2004, between Avnet, Inc., a New York corporation with its principal place of business at
2211 South 47th Street, Phoenix, Arizona 85034 Arizona (“Avnet” or “the Company”) and
Steven C. Church (the “Officer”). Avnet and the Officer are collectively referred to in this
Agreement as “the Parties.”

WHEREAS, the Officer holds the position of Senior Vice President with the Company; and

WHEREAS, the Parties wish to provide for certain payments to the Officer in the event of a Change
of Control of the Company and the subsequent termination of the Officer’s employment without cause
or the Constructive Termination of the Officer’s employment, as those capitalized terms are defined
below;

NOW, THEREFORE, the Parties agree as follows:

	1.	 	Definitions.

	 	(a)	 	“Change of Control” means the happening of any of the following events:

	 	(i)	 	the acquisition by any individual, entity or group (within the
meaning of Section 13(d)(3) or 14(d)(2) of the Exchange Act (a “Person”) of
beneficial ownership (within the meaning of Rule 13d-3 promulgated under the
Exchange Act) of 50% or more of either (A) the then outstanding shares of common
stock of the Company or (B) the combined voting power of the then outstanding
voting securities of the Company entitled to vote generally in the election of
directors; provided, however, that the following transactions shall not constitute
a Change of Control under this subsection (i): (w) any transaction that is
authorized by the Board of Directors of the Company as constituted prior to the
effective date of the transaction, (x) any acquisition directly from the Company
(excluding an acquisition by virtue of the exercise of a conversion privilege),
(y) any acquisition by the Company, or (z) any acquisition by any employee benefit
plan (or related trust) sponsored or maintained by the Company or any entity
controlled by the Company; or
	 
	 	(ii)	 	individuals who, as of the effective date hereof, constitute the
Board of Directors of the Company (the “Incumbent Board”) cease for any reason to
constitute at least a majority of the Board; provided, however, that any
individual becoming a director subsequent to the effective date hereof whose
election, or nomination for election by the Company’s stockholders, was approved
by a vote of at least a majority of the directors then comprising the Incumbent
Board shall be

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	 	 	 	considered as though such individual were a member of the Incumbent Board, but
excluding, for this purpose, any such individual whose initial assumption of
office occurs as a result of either an actual or threatened election contest
(as such terms are used in Rule 14a-11 of Regulation 14A promulgated under the
Exchange Act) or other actual or threatened solicitation of proxies or
consents by or on behalf of a Person other than the Board; or
	 
	 	(iii)	 	Approval by the stockholders of the Company of a complete
liquidation or dissolution of the Company or the sale or other disposition of all
or substantially all of the assets of the Company.

	 	(b)	 	“Constructive Termination” means the happening of any of the following
events:

	 	(i)	 	a material diminution of Officer’s responsibilities, including,
without limitation, title and reporting relationship;
	 
	 	(ii)	 	relocation of the Officer’s office greater than 50 miles from its
location as of the effective date of this Agreement without the consent of the
Officer;
	 
	 	(iii)	 	a material reduction in Officer’s compensation and benefits.

	 	(c)	 	The “Exchange Act” shall mean the 1934 Securities Exchange Act, as amended.

	2.	 	Constructive Termination or Termination after Change of Control. If, within 24
months following a Change of Control, the Company or its successor terminates Officer’s
employment without cause or by Constructive Termination, Officer will be paid, in lieu of any
other rights under any employment agreement between the Officer and the Company, in a lump sum
payment, an amount equal to 2.99 times the sum of (i) the Officer’s annual salary for the year
in which such termination occurs and (ii) the Officer’s incentive compensation equal to the
average of such incentive compensation for the highest two of the last five full fiscal years.
All unvested stock options shall accelerate and vest in accordance with the early vesting
provisions under the applicable stock option plans and all incentive stock program shares
allocated but not yet delivered will be accelerated so as to be immediately deliverable.
Officer shall receive his or her accrued and unpaid salary and any accrued and unpaid pro rata
bonus (assuming target payout) through the date of termination, and Officer will continue to
participate in the medical, dental, life, disability and automobile benefits in which Officer
is then participating for a period of two years from the date of termination.

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	3.	 	Excise Taxes. In the event that Officer is deemed to have received an excess
parachute payment (as such term is defined in Section 280G(b) of the Internal Revenue Code of
1986, as amended (the “Code”)) that is subject to excise taxes (“Excise Taxes”) imposed by
Section 4999 of the Code with respect to compensation paid to Officer pursuant to this
Agreement, the Company shall make an additional payment equal to the sum of (i) all Excise
Taxes payable by Officer plus (ii) any additional Excise Tax or federal or state income taxes
imposed with respect to such payments.
	 
	4.	 	Miscellaneous. This Agreement replaces and supercedes in its entirety that certain
Change of Control Agreement dated July 1, 2002 between Officer and Company. This Agreement
modifies any employment agreement between Officer and the Company only with respect to such
terms and conditions that are specifically addressed in this Agreement. All other provisions
of any employment agreement between the Company and Officer shall remain in full force and
effect.

AVNET, INC.

	 	 	 	 	 
	By

	 	/s/ Raymond Sadowski
 

Raymond Sadowski
	 	 

	 	 	 
	Its: Senior VP and CFO
	 	 
	 
	 	 
	Officer
	 	 
	 
	 	 
	/s/ Steve C. Church
 

Steven C. Church

	 	 

3Lexmark International, Inc., 2006-2008 LTIP Agreement

    Exhibit
      10.1

    

    

      

       

      Lexmark
        International, Inc.

      

      2006-2008
        Long-Term Incentive Plan

      

      Agreement

       

       

      This
        2006-2008 Long-Term Incentive Plan (the "2006-2008 LTIP") Agreement
        (“Agreement”) between Lexmark International, Inc., a Delaware corporation (the
        "Company"), and the person specified on the signature page (the "Participant")
        is entered into as of March 13, 2006.

      

      This
        Agreement is only a summary of the principal terms governing the 2006-2008
        LTIP.
        The 2006-2008 LTIP is subject in all respects to the terms of the Lexmark
        International, Inc. Stock Incentive Plan, as amended and restated April 30,
        2003
        (the "Plan"). In the event of any conflict between the terms of this Agreement
        and the terms of the Plan, the terms of the Plan shall control. It is important
        that the Participant read and understand the Plan and not rely solely on
        the
        brief description that follows. All capitalized terms used but not defined
        herein shall have the meaning set forth in the Plan.

       

      Overview

      

      The
        2006-2008 LTIP is designed to reward the achievement of specific performance
        objectives over a three-year period. The Compensation and Pension Committee
        of
        the Board of Directors of the Company (the "Committee") established the
        performance objectives and performance measures set forth below for the
        performance period beginning January 1, 2006 and ending December 31, 2008
        (the
        "Performance Period").

      

      Depending
        upon the Company's attainment of the performance objectives and certain
        financial performance measures of the Company's peers, the Participant may
        be
        eligible to receive a payment under the 2006-2008 LTIP, as set forth
        below.

       

      Plan
        Measurements

      

      For
        the
        Performance Period, the Committee has established the following performance
        measures based on the Company's strategic plan for the Performance
        Period:

       

      [Performance
        Measures - 2008 Operating Income and Market Share]

       

      At
        the
        end of the three-year Performance Period, if the aggregate attainment based
        upon
        the two performance measures is below the Minimum level, there is an additional
        calculation comparing the Return on Invested Capital ("ROIC") for the Company
        with that of its peer companies over the same three-year period. The calculation
        of the Company's ROIC will be based upon Net Income before Extraordinary
        Items.
        If the Company's ROIC is at or above the median average of the ROIC of the
        peer
        companies included in the S&P Technology Index or, in the event that such
        index is no longer available, such other index as determined to be appropriate
        by the Committee at the time in its sole discretion, the 2006-2008 LTIP will
        be
        funded at 15% of Target for each of the two performance measures (as specified
        below) regardless of any below-Minimum attainment for the two performance
        measures.

       

      
        
          
          

        

        
          Page
            1

          
            

          

        

        
          
          

        

      

      Target
        Opportunity

      

      The
        2006-2008 LTIP awards are denominated in cash, but in the Committee's sole
        discretion may be paid in cash, the Company’s Class A Common Stock or a
        combination of cash and the Company’s Class A Common Stock. For the Performance
        Period, your target award is _____________.

      

      The
        chart
        below and the examples in Attachment A illustrate how the 2006-2008 LTIP
        awards
        will be calculated. The level of attainment for Operating Income is not linked
        to the level of attainment for Market Share. As a result, the level of
        attainment on each performance measure may independently generate a payment
        to
        Participants based on its achievement.

       

      
        	
                 Target
                  Opportunity      

              	 	
                 Minimum

              	 	
                 Target

              	 	
                 Maximum

              
	 Operating
                Income	 	
                 15%
                  of Target

              	 	
                 50%
                  of Target

              	 	
                 100%
                  of Target

              
	 Market
                Share	 	
                 15%
                  of Target

              	 	
                 50%
                  of Target

              	 	
                 150%
                  of Target

              

      

      

      Committee
        Discretion

      

      The
        Committee may use its sole discretion in determining any payment, or no payment,
        to Participants under the 2006-2008 LTIP based on any factors that it deems
        appropriate.

       

      Payout
        Timing

      

      The
        Committee intends to review and approve the Company's business results and
        Market Share position as compared to the 2006-2008 LTIP performance measures
        and
        the Company's business results compared to the peer companies included in
        the
        index stated above following the end of the three-year Performance Period.
        These
        reviews are expected to occur in a 2009 Committee meeting. Payments will
        be
        made in 2009. Payments will be made only after the Committee approval has
        occurred. 

       

      Termination
        of Employment

      

      Except
        in
        the event of the death, long-term disability or retirement of the Participant,
        the Participant must be employed at the end of the Performance Period (December
        31, 2008) to receive a payout. If the Participant should die, become long-term
        disabled or retire during the Performance Period, the payout, if any is achieved
        based on actual performance of the Company and its peers over the Performance
        Period, will be prorated and paid out after the end of the Performance
        Period.

       

      
        
          
          

        

        
          Page
            2

          
            

          

        

        
          
          

        

      

      Forfeiture
        of the Award

      

      The
        Participant acknowledges that this opportunity for a long-term incentive
        award
        has been granted as an incentive to the Participant to remain employed by
        the
        Company or one of its Subsidiaries and to exert his or her best efforts to
        enhance the value of the Company and its Subsidiaries over the long-term.
        Accordingly, the Participant agrees that if he or she (a) within 12 months
        of
        termination of employment with the Company, or its Subsidiaries, accepts
        employment with a competitor of the Company or one of its Subsidiaries or
        otherwise engages in competition with the Company or one of its Subsidiaries,
        or
        (b) within 36 months of termination of employment with the Company, or its
        Subsidiaries, directly or indirectly, disrupts, damages, interferes or otherwise
        acts against the interests of the Company or one of its Subsidiaries, including,
        but not limited to, recruiting, soliciting or employing, or encouraging or
        assisting the Participant's new employer or any other person or entity to
        recruit, solicit or employ, any employee of the Company or one of its
        Subsidiaries without the Company's prior written consent, which may withheld
        in
        its sole discretion, or (c) within 36 months of termination of employment
        with
        the Company, or its Subsidiaries, disparages, criticizes, or otherwise makes
        any
        derogatory statements regarding the Company or its Subsidiaries or their
        directors, officers or employees, or (d) discloses or otherwise uses
        confidential information or material of the Company or one of its Subsidiaries,
        each of these constituting a harmful action, then the Participant shall
        immediately repay to the Company the full amount of the award received under
        the
        terms and conditions of the 2006-2008 LTIP. The Committee shall have the
        right
        not to enforce the provisions of this paragraph with respect to the
        Participant.

      

      Participant
        agrees to be fully liable for any breach of this above described covenant,
        promise and agreement. Participant agrees to reimburse Lexmark for all costs
        and
        expenses, including attorneys’ fees, incurred by Lexmark in enforcing the
        obligations of Participant. This entire provision shall survive the termination
        of the Agreement and, in no manner, shall the remedies described herein be
        considered as Lexmark’s exclusive or entire remedy for Participant’s breach,
        non-compliance or violation of any other agreement that Participant may have
        entered into with Lexmark.

       

      Tax
        Withholding

      

      In
        the
        event that the payout of the award is made in Class A Common Stock of the
        Company, delivery of such stock shall not be made unless and until the
        Participant, or, if applicable, the Participant’s beneficiary or estate, has
        made appropriate arrangements for the payment to the Company of an amount
        sufficient to satisfy any applicable U.S. federal, state and local and non-U.S.
        tax withholding or other tax requirements, as determined by the Company.
        To
        satisfy the Participant’s applicable withholding and other tax requirements, the
        Company may, in its sole discretion, withhold a number of shares of Class
        A
        Common Stock having an aggregate Fair Market Value on the payout date equal
        to
        the applicable amount of such withholding and other tax requirements, subject
        to
        any rules adopted by the Committee or required to ensure compliance with
        applicable law, including, but not limited to, Section 16 of the Securities
        Exchange Act of 1934, as amended. Any cash payment made under this Agreement
        shall be made net of any amounts required to be withheld or paid with respect
        thereto (and with respect to any shares of Class A Common Stock delivered
        therewith) under any applicable U.S. federal, state and local and non-U.S.
        tax
        withholding and other tax requirements. 

      

      
        
          
          

        

        
          Page
            3

          
            

          

        

        
          
          

        

      

      Transferability

      

      Unless
        otherwise provided in accordance with the provisions of the Plan, the award
        granted pursuant to this Agreement may not be sold, transferred, pledged,
        assigned or otherwise alienated or hypothecated by the Participant, other
        than
        by will or the laws of descent and distribution. The term “Participant” as used
        in this Agreement shall include any permitted transferee. 

       

      Interpretation;
        Construction

      

      All
        powers and authority conferred upon the Committee pursuant to any term of
        the
        Plan or this Agreement shall be exercised by the Committee, in its sole
        discretion. All determinations, interpretations or other actions made or
        taken
        by the Committee pursuant to the provisions of the Plan or this Agreement
        shall
        be final, binding and conclusive for all purposes and upon all persons and,
        in
        the event of any judicial review thereof, shall be overturned only if arbitrary
        and capricious. The Committee may consult with legal counsel, who may be
        counsel
        to the Company or any of its subsidiaries, and shall not incur any liability
        for
        any action taken in good faith in reliance upon the advice of counsel.

       

      Amendment

      

      The
        Committee shall have the right to alter or amend the 2006-2008 LTIP and this
        Agreement in its sole discretion, from time to time, as provided in the Plan
        in
        any manner for the purpose of promoting the objectives of the Plan, provided
        that no such amendment shall impair the Participant's rights under the 2006-2008
        LTIP without the Participant's consent. Subject to the preceding sentence,
        any
        alteration or amendment to the 2006-2008 LTIP by the Committee shall, upon
        adoption by the Committee, become and be binding and conclusive. The Company
        shall give written notice to the Participant of any such alteration or amendment
        of the 2006-2008 LTIP as promptly as practical after the adoption. This
        Agreement may also be amended in writing signed by both an authorized
        representative of the Company and the Participant.

       

      No
        Guarantee of Employment or Future Incentive Awards

      

      Nothing
        in the Plan or the 2006-2008 LTIP shall be deemed to:

      

      (a)
        interfere with or limit in any way the right of the Company or any Subsidiary
        to
        terminate the Participant's employment at any time for any reason, with or
        without cause;

      

      (b)
        confer upon the Participant any right to continue in the employ of the Company
        or any Subsidiary; and

      

      (c)
        provide Participant the right to receive any Incentive Awards under the Plan
        in
        the future or any other benefits the Company may provide to some or all of
        its
        employees.

       

      Internal
        Revenue Code Section 409A

      

      The
        Company intends for this Agreement to comply with the provisions of Section
        409A
        of the Code and the guidance issued thereunder. The Company intends to amend
        this Agreement, and hereby reserves the right to do so, in the future as
        required to conform to the provisions of Section 409A of the Code with respect
        to amounts subject to Section 409A of the Code.

       

      Assignability

      

      Neither
        this Agreement or any right, remedy, obligation or liability arising hereunder
        or by reason hereof shall be assignable by the Company or the Participant
        without the prior consent of the other party.

       

      Applicable
        Law

      

      The
        2006-2008 LTIP and this Agreement shall be governed by and construed in
        accordance with the laws of the State of Delaware, regardless of the law
        that
        might be applied under principles of conflict of laws and excluding any conflict
        or choice of law rule or principle that may otherwise refer construction
        or
        interpretation of the 2006-2008 LTIP or this Agreement to the substantive
        law of
        another jurisdiction. 

       

      
        
          
          

        

        
          Page
            4

          
            

          

        

        
          
          

        

      

      Jurisdiction

      

      The
        Participant hereby irrevocably and unconditionally submits to the jurisdiction
        and venue of the state courts of the Commonwealth of Kentucky and of the
        United
        States District Court of the Eastern District of Kentucky located in Fayette
        County, Kentucky, and any appellate court from any thereof, in any action
        or
        proceeding arising out of or relating to this Agreement, or for recognition
        or
        enforcement of any judgment, and each of the parties hereby irrevocably agree
        that all claims in respect of any such action or proceeding may be heard
        and
        determined in such Kentucky state, or to the extent required by law, United
        States federal courts located in such jurisdiction. Each of the parties hereto
        agrees that a final judgment in any such action or proceeding shall be
        conclusive and may be enforced in other jurisdictions by suit on the judgment
        or
        in any other manner provided by law. The parties hereby irrevocably waive,
        to
        the fullest extent permitted by applicable law, any objection which they
        may now
        or hereafter have to the laying of venue of any such proceeding brought in
        such
        a court and any claim that any such proceeding brought in such a court has
        been
        brought in an inconvenient forum. Participant further agrees that any action
        related to, or arising out of, this Agreement shall only be brought by
        Participant exclusively in the federal and state courts located in Fayette
        County, Kentucky. Nothing in this Agreement shall affect any right that the
        Company may otherwise have to bring any action or proceeding relating to
        this
        Agreement in the courts of any jurisdiction. 

       

      Section
        and Other Headings, Etc.

      

      The
        section and other headings contained in this Agreement are for reference
        purposes only and shall not affect the meaning or interpretation of this
        Agreement. In this Agreement all references to “dollars” or “$” are to United
        States dollars. 

       

      Severability

      

      If
        any
        provision of this Agreement, the 2006-2008 LTIP or the Plan shall be held
        invalid or unenforceable, such invalidity or unenforceability shall not affect
        any other provisions of this Agreement, the 2006-2008 LTIP or the Plan, and
        the
        Agreement, the 2006-2008 LTIP and the Plan shall be construed and enforced
        as if
        such provision had not been included. 

       

      Survival

      

      Any
        provision of this Agreement which contemplates performance or observance
        subsequent to any termination or expiration of this Agreement shall survive
        any
        termination or expiration of this Agreement and continue in full force and
        effect.

       

      Counterparts

      

      This
        Agreement may be executed in any number of counterparts, each of which shall
        be
        deemed to be an original and all of which together shall constitute one and
        the
        same instrument. 

       

      Please
        sign and date this Agreement to acknowledge that you have read the terms
        of this
        Agreement and understand that this 2006-2008 LTIP award is subject to the
        provisions of the Plan and that you agree to the terms and conditions contained
        herein and therein.

      

       

      LEXMARK
        INTERNATIONAL, INC.

      

      

      By:
        _________________________________

      

      Vice
        President of Human Resources

      

      

      EXECUTIVE:

      

      By:
        (Name)

      

      _________________________________

      (sign
        your name)

      

      Date:_________________________________

      

      

      _________________________________

      (Beneficiary
        Name)

      

      

      

      

      
        
          
          

        

        
          Page
            5

          
            

          

        

        
          
          

        

      

      

      Attachment
        A

       

      2006-2008
        LTIP Examples

       

       

       

       

       

      
 

      
        
          
          

        

        
          Page
            6

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