EXHIBIT 10.5
FREESCALE SEMICONDUCTOR HOLDINGS
I, LTD.
RESTRICTED STOCK UNIT AWARD
AGREEMENT
THIS AGREEMENT (the
“Agreement”), is made effective as of April 7,
2008 (the “Date of Grant”), between Freescale
Semiconductor Holdings I, Ltd., a Bermuda exempted limited
liability company (the “Company”), and Richard Beyer
(the “Executive”):
R E C I T A
L S :
WHEREAS, the Committee has
determined that it would be in the best interests of the Company
and its shareholders to grant the Restricted Stock Units provided
for herein to the Executive pursuant to the terms set forth
herein.
NOW THEREFORE, in consideration of
the mutual covenants hereinafter set forth, the parties agree as
follows:
1. Defined Terms .
Capitalized terms used herein and not otherwise defined herein
shall have the meaning assigned to such terms in Exhibit A
.
2. Grant of Restricted Stock
Units .
(a) The Company hereby grants
(subject to the Executive’s execution of the Investors
Agreement) to the Executive, on the terms and conditions
hereinafter set forth, units evidencing a right to receive
2,100,840 shares of Common Stock (each a “Share” and
collectively, the “Shares”) pursuant to the terms and
conditions of this Agreement (the “Restricted Stock
Units” or “Restricted Stock Unit
Award”).
(b) In connection with the grant of
the Restricted Stock Units hereunder, Executive represents and
warrants to the Company as of the date hereof that:
(i) the Restricted Stock Units to be
acquired by Executive pursuant to this Agreement will be acquired
for Executive’s own account and not with a view to, or
intention of, distribution thereof in violation of the Securities
Act, or any applicable state securities laws, and the Restricted
Stock Units will not be disposed of in contravention of the
Securities Act or any applicable state securities laws;
(ii) Executive is an executive
officer of the Company, is sophisticated in financial matters and
is able to evaluate the risks and benefits of the investment in the
Restricted Stock Units;
(iii) Executive is an
“accredited investor” within the meaning of Rule 501 of
Regulation D of the Securities and Exchange Commission;
1
(iv) Executive is able to bear the
economic risk of Executive’s investment in the Restricted
Stock Units for an indefinite period of time because the Restricted
Stock Units have not been registered under the Securities Act or
applicable state securities laws and are subject to substantial
restrictions on transfer set forth herein, and, therefore, cannot
be sold unless subsequently registered under the Securities Act and
applicable state securities laws, or an exemption from such
registration is available, and in compliance with such restrictions
on transfer;
(v) Executive has had an opportunity
to ask questions and receive answers concerning the terms and
conditions of the offering of Restricted Stock Units and has had
full access to such other information concerning the Company as he
has requested;
(vi) this Agreement constitutes the
legal, valid and binding obligation of Executive, enforceable in
accordance with its terms.
3. Restrictions and Vesting
Period .
(a) Restrictions and
Transferability . Except as provided in the Investors
Agreement, the Restricted Stock Unit Award may not be assigned,
alienated, pledged, attached, sold or otherwise transferred or
encumbered by the Executive otherwise than by will or by the laws
of descent and distribution, and any such purported assignment,
alienation, pledge, attachment, sale, transfer or encumbrance shall
be void and unenforceable against the Company or any Affiliate;
provided that the designation of a beneficiary shall not constitute
an assignment, alienation, pledge, attachment, sale, transfer or
encumbrance. No such permitted transfer of the Restricted Stock
Unit Award to heirs or legatees of the Executive shall be effective
to bind the Company unless the Committee shall have been furnished
with written notice thereof and a copy of such evidence as the
Committee may deem necessary to establish the validity of the
transfer and the acceptance by the transferee or transferees of the
terms and conditions hereof.
(b) Vesting Period . Subject
to the Executive’s continued Employment, or except as
otherwise provided below, the Restricted Stock Unit Award shall
vest with respect to thirty-three and one-third percent (33 1/3 %)
of the Shares covered by the Restricted Stock Unit Award on each of
the first, second and third anniversaries of the Effective Date. At
any time, the portion of the Restricted Stock Unit Award which has
become vested as described above (or pursuant to Sections 3(c) or 4
below) is hereinafter referred to as the “Vested
Portion”.
(c) Accelerated Vesting upon a
Change of Control . Notwithstanding any other provisions of
this Agreement to the contrary, in the event of a Change of
Control, the unvested portion of the Restricted Stock Unit Award
shall become fully vested.
(d) Delivery of Shares .
Shares of Common Stock shall become deliverable (provided, that
such delivery is otherwise in accordance with federal and state
securities laws) with respect to the Vested Portion of the
Restricted Stock Unit Award upon the earliest to occur of:
(i) the Executive’s termination of Employment;
(ii) the Executive’s death; (iii) the
Executive’s Disability; (iv) a Change of Control; or
(v) the fifth anniversary of the Effective Date.
2
(e) No Stockholder Rights .
Executive shall have no rights of a stockholder of the Company with
respect to the Restricted Stock Units, including, but not limited
to, the rights to vote and receive ordinary dividends, until the
date of issuance of a stock certificate for such Shares. In the
event that the Committee approves an adjustment to the Restricted
Stock Unit Award pursuant to Section 16, then in such event,
any and all new, substituted or additional securities to which
Executive is entitled by reason of the Restricted Stock Unit Award
shall be immediately subject to the Restrictions and Vesting Period
set forth in Sections 3(a) and (b) above with the same force
and effect as the Restricted Stock Unit Award subject to such
Restrictions immediately before such event.
4. Termination of Employment
.
(a) General . If the
Executive’s Employment is terminated for any reason, the
Restricted Stock Unit Award shall, to the extent not then vested
(after giving effect to the provisions of Section 3(c) and
this Section 4), terminate upon such termination of
Employment.
(b) For Cause . The
Restricted Stock Unit Award (including any Vested Portion thereof)
shall terminate upon the Executive’s termination of
Employment for Cause.
(c) Without Cause or for Good
Reason . Upon the Executive’s termination of Employment
without Cause or by the Executive for Good Reason, the Restricted
Stock Unit Award shall become vested for an additional number of
Shares equal to the number of Shares subject to the Restricted
Stock Unit Award (if any) that would have vested on the next
anniversary of the Effective Date if the Executive had remained
employed until such date (the “Subsequent Tranche”),
multiplied by a fraction, the numerator of which equals the number
of days elapsed from the vesting date immediately preceding
termination of the Executive’s Employment through the
Executive’s termination of Employment and the denominator of
which equals 365, plus the Subsequent Tranche; subject in all
circumstances to the maximum of the total number of Shares subject
to the Restricted Stock Unit Award as of the date of such
termination of Employment. Any portion of the Restricted Stock Unit
Award that is not vested after giving effect to the above
provisions of this Section 4(c) shall terminate immediately
effective as of the termination of the Executive’s
Employment.
(d) Death . Upon the
Executive’s termination of Employment due to death, the
Restricted Stock Unit Award shall become fully vested.
(e) Disability . Upon the
Executive’s termination of Employment due to Disability, the
Restricted Stock Unit Award shall become fully vested.
(f) Retirement . Upon the
Executive’s termination of Employment due to Retirement and
solely to the extent so determined by the Board, the Restricted
Stock Unit Award shall become vested for an additional number of
Shares equal to the Subsequent Tranche multiplied by a fraction,
the numerator of which equals the number of days elapsed from the
vesting date immediately preceding termination of Executive’s
Employment through the Executive’s termination of Employment
and the denominator of which equals 365; subject in all
circumstances to the maximum of the total number of Shares subject
to the Restricted Stock Unit Award as of the date of such
termination of Employment. Any portion of the Restricted Stock Unit
Award that is not vested after giving effect to the above
provisions of this Section 4(f) shall terminate immediately
effective as of the termination of the Executive’s
Employment.
3
(g) By the Executive Other Than
Due to Disability or Good Reason . If the Executive’s
Employment is terminated on account of a termination of the
Executive’s Employment initiated by the Executive other than
due to Disability or Good Reason, then the unvested portion of the
Restricted Stock Unit Award then held by the Executive shall be
automatically forfeited.
(h) Forfeiture .
Notwithstanding anything herein to the contrary, if the Executive
breaches any Restrictive Covenants applicable to the Executive
(including, without limitation, the Restrictive Covenants set forth
in Exhibit B hereto) following Executive’s voluntary
termination of Employment without Good Reason or during the
Severance Period (as defined below) then (x) any Vested
Portion then held by the Executive shall be automatically
forfeited, (y) any Shares acquired pursuant to the Restricted
Stock Unit Award shall be automatically forfeited and (z) any
proceeds from the sale of Shares described in preceding clause (y),
shall be immediately repaid to the Company. For purposes of this
Agreement “Severance Period” shall mean, in the event
of termination of the Executive’s Employment in circumstances
entitling the Executive to severance under an applicable plan or
policy or an individual agreement, and under which plan, policy or
individual agreement the Executive elects to and actually receives
severance, the two-year period immediately following the date of
such termination.
(i) Six-Month Waiting Period for
Distributions Upon Separation From Service . To the extent
required by Section 409A of the Code, any payment of Shares
that would otherwise be payable under this Agreement during the
six-month period immediately following the Executive’s
termination of Employment, shall instead be paid on the first
business day after the expiration of such six-month period, plus
interest thereon, at a rate equal to the applicable Federal
short-term rate (as defined in Section 1274(d) of the Code)
for the month in which such date of termination occurs from the
respective dates on which such amounts would otherwise have been
paid until the actual date of payment. In no event will any payment
of shares be made hereunder, unless the relevant termination of
Employment constitutes a “separation from service”
under Section 409A.
5. Certain Covenants . The
Executive hereby agrees and covenants to perform all of his
obligations set forth in Exhibit B hereto (which is
incorporated by reference hereby) and acknowledges that the
Executive’s obligations set forth in Exhibit B
constitute a material inducement for the Company’s grant of
the Restricted Stock Unit Award t o the
Executive.
6. Share Restrictions, Etc.
Except as expressly provided herein, the Executive’s rights
hereunder and with respect to Shares received with respect to the
Vested Portion are subject to the restrictions and other provisions
contained in the Investors Agreement.
7. No Right to Continued
Employment . The granting of the Restricted Stock Unit Award
evidenced hereby and this Agreement shall impose no obligation on
the Company or any Affiliate to continue the Employment of the
Executive and shall not lessen or affect the Company’s or its
Affiliate’s right to terminate the Employment of such
Executive.
4
8. Legend on Certificates
. The certificates representing the Shares received by
Executive with respect to the Vested Portion shall be subject to
such stop transfer orders and other restrictions as the Committee
may deem advisable under the Agreement or the rules, regulations,
and other requirements of the Securities and Exchange Commission,
any stock exchange upon which such Shares are listed, and any
applicable Federal or state laws, and the Committee may cause a
legend or legends to be put on any such certificates to make
appropriate reference to such restrictions.
9. Withholding . The
Executive may be required to pay to the Company or any Affiliate
and the Company shall have the right and is hereby authorized to
withhold from any payment due or transfer made under the Restricted
Stock Unit Award or from any compensation or other amount owing to
a Executive the amount (in cash, Shares, other securities or other
property) of any applicable withholding taxes in respect of the
Restricted Stock Unit Award or any payment or transfer under or
with respect to the Restricted Stock Unit Award and to take such
other action as may be necessary in the opinion of the Committee to
satisfy all obligations for the payment of such withholding
taxes.
10. Securities Laws . The
issuance of any Shares hereunder shall be subject to the Executive
making or entering into such written representations, warranties
and agreements as the Committee may reasonably request in order to
comply with applicable securities laws.
11. Notices . Any notice
necessary under this Agreement shall be addressed to the Company in
care of its Secretary at the principal executive office of the
Company and to the Executive at the address appearing in the
personnel records of the Company for the Executive or to either
party at such other address as either party hereto may hereafter
designate in writing to the other. Any such notice shall be deemed
effective upon receipt thereof by the addressee.
12. Governing Law . This
Agreement and all claims arising out of or based upon this
Agreement or relating to the subject matter hereof shall be
governed by and construed in accordance with the domestic
substantive laws of the State of Delaware without giving effect to
any choice or conflict of laws provision or rule that would cause
the application of the domestic substantive laws of any other
jurisdiction.
13. Consent to Jurisdiction .
All actions arising out of or relating to this Agreement shall be
heard and determined exclusively in any New York state or federal
court sitting in the Borough of Manhattan in The City of New York.
The parties hereto hereby (a) submit to the exclusive
jurisdiction of any state or federal court sitting in the Borough
of Manhattan of The City of New York for the purpose of any action
arising out of or relating to this Agreement brought by any party
hereto, and (b) irrevocably waive, and agree not to assert by
way of motion, defense, or otherwise, in any such action, any claim
that it is not subject personally to the jurisdiction of the
above-named courts, that its property is exempt or immune of from
attachment or execution, that the action is brought in an
inconvenient forum, that the venue of the ac
