XM SATELLITE RADIO HOLDINGS INC. 1998 SHARES AWARD PLAN (AS AMENDED) RESTRICTED STOCK AGREEMENT

Contract Categories: Business Finance - Stock Agreements
EX-10.39 2 dex1039.htm EXHIBIT 10.39 Exhibit 10.39

 

Exhibit 10.39

 

Grant No.:             

 

XM SATELLITE RADIO HOLDINGS INC.

 

1998 SHARES AWARD PLAN

(AS AMENDED)

RESTRICTED STOCK AGREEMENT

 

XM Satellite Radio Holdings Inc., a Delaware corporation (the “Company”), hereby grants shares of its common stock, $.01 par value, (the “Stock”) to the Participant named below, subject to the vesting conditions set forth in the attachment. Additional terms and conditions of the grant are set forth in this cover sheet, in the attachment and in the Company’s 1998 Shares Award Plan (the “Plan”).

 

Grant Date: March 23, 2005

 

Name of Participant:                                              

 

Participant’s Social Security Number:             -        -            

 

Number of Shares of Stock Covered by Grant:                 

 

Purchase Price per Share of Stock: $.01

 

By signing this cover sheet, you agree to all of the terms and conditions described in the attached Agreement and in the Plan, a copy of which is available on request. You agree that the Plan will control in the event any provision of this Agreement should appear to be inconsistent.

 

Participant:

    _____________________________________________________________________     
     (Signature)     

Company:

    _____________________________________________________________________     
     (Signature)     
     Title:     _________________________________________________________________     

 

Attachment

 

This is not a stock certificate or a negotiable instrument.

 

 

XM SATELLITE RADIO HOLDINGS INC.

 

1998 SHARES AWARD PLAN

(AS AMENDED)

 

RESTRICTED STOCK AGREEMENT

 

Restricted Stock/

Nontransferability

    This grant is an award of Stock in the number of shares set forth on the cover sheet, at the purchase price (if any) set forth on the cover sheet, and subject to the vesting conditions described below (“Restricted Stock”). The purchase price for the Restricted Stock is deemed paid by your services to the Company. To the extent not yet vested, your Restricted Stock may not be transferred, assigned, pledged or hypothecated, whether by operation of law or otherwise, nor may the Restricted Stock be made subject to execution, attachment or similar process. For the purpose of this Agreement, “Service” means service as an Employee, Non-Employee Director or Consultant.
Issuance and Vesting   

The Company will issue your Restricted Stock in your name as of the Grant Date.

 

Your right to the Stock under this Restricted Stock grant vests as to thirty three and one-third percent (33 1/3%) of the total number of shares covered by this grant, as shown on the cover sheet, on the first day on or after each of the first three one-year anniversaries of the Grant Date (each an “Anniversary Date”), provided you then continue in Service. If, however, such Anniversary Date occurs during a period in which you are (i) subject to a lock-up agreement restricting your ability to sell shares of Stock in the open market or (ii) restricted from selling shares of Stock in the open market because you are not then eligible to sell under the Company’s insider trading or similar plan as then in effect (whether because a trading window is not open or you are otherwise restricted from trading), vesting in such shares of Stock will be delayed until the first date on which you are no longer prohibited from selling shares of Stock due to a lock-up agreement or insider trading plan restriction (the “Vesting Date”), and provided, further, that you have been continuously in Service from the Grant Date until the Vesting Date. The resulting aggregate number of vested shares of Stock will be rounded to the nearest whole number, and you cannot vest in more than the number of shares covered by this grant.

 

Your right to the Stock under this Restricted Stock grant shall become 100% vested upon your termination of Service, if your Service terminates as a result of your death or as the result of an involuntary termination within one year of a Change of Control. No additional shares of Stock will vest after your

 

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     Service has terminated for any reason other than for your death or involuntary termination after a Change of Control.

Forfeiture of Unvested

Stock

    In the event that your Service terminates for any reason, you will forfeit to the Company all of the shares of Stock subject to this grant that have not yet vested.
Certain Restrictions    The Restricted Stock shall be in consideration of your commitment that you shall not during the period ending one (1) year after your termination of employment with Company, directly or indirectly, enter into the employment of, render services to or on behalf of, supply products to or on behalf of, or otherwise assist, Sirius Satellite Radio Inc. or any other person or entity operating or developing any digital audio radio system (other than the XM Satellite Radio System); provided that you shall in no way be prevented from taking employment in the traditional AM/FM radio broadcasting system (collectively, the “Restrictions”). Furthermore, you agree that in the event of your failure to abide by the Restrictions the Company shall have the right to cause a forfeiture of your unvested Restricted Stock, and with respect to those shares of Restricted Stock vesting during the period commencing twelve (12) months prior to your termination of Service with the Company, the right to cause a forfeiture of those vested shares of Stock (but the Company will pay you the purchase price without interest).

Book Entry

Restrictions/Escrow

   

The Restricted Stock may be issued in book entry form. If so, the Company shall cause the transfer agent for the shares of Common Stock to make a book entry record showing ownership for the shares of Restricted Stock in your name subject to the terms and conditions of this Agreement. You shall be issued an account statement acknowledging your ownership of the shares of Restricted Stock.

 

If certificates are issued evidencing the shares of Restricted Stock, the certificates for the Restricted Stock shall be deposited in escrow with the Secretary of the Company to be held in accordance with the provisions of this paragraph. Each deposited certificate shall be accompanied by a duly executed Assignment Separate from Certificate in the form attached hereto as Exhibit A. The deposited certificates shall remain in escrow until such time or times as the certificates are to be released or otherwise surrendered for cancellation as discussed below. Upon delivery of the certificates to the Company, you shall be issued an instrument of deposit acknowledging the number of shares of Stock delivered in escrow to the Secretary of the Company.

 

All regular cash dividends on the Stock (or other securities at the time held in escrow) shall be paid directly to you and shall not be held in escrow. However, in the event of any stock

 

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dividend, stock split, recapitalization or other change affecting the Company’s outstanding common stock as a class effected without receipt of consideration or in the event of a stock split, a stock dividend or a similar change in the Company Stock, any new, substituted or additional securities or other property which is by reason of such transaction distributed with respect to the Stock shall be immediately delivered to the Secretary of the Company to be held in escrow hereunder, but only to the extent the Stock is at the time subject to the escrow requirements hereof.

 

As your interest in the shares vests, as described above, the certificates for such vested shares shall be released from escrow and delivered to you, at your request, within 30 days of their vesting.

Withholding Taxes    You agree, as a condition of this grant, that you will make acceptable arrangements to pay any withholding or other taxes that may be due as a result of the vesting of Stock acquired under this grant. In the event that the Company determines that any federal, state, local or foreign tax or withholding payment is required relating to the vesting of shares arising from this grant, the Company shall have the right to require such payments from you, or withhold such amounts from other payments due to you from the Company or any Affiliate.

Section 83(b)

Election

   

Under Section 83 of the Internal Revenue Code of 1986, as amended (the “Code”), the difference between the purchase price paid for the shares of Stock and their fair market value on the date any forfeiture restrictions applicable to such shares lapse will be reportable as ordinary income at that time. For this purpose, “forfeiture restrictions” include the forfeiture of unvested Stock that is described above. You may elect to be taxed at the time the shares are acquired, rather than when such shares cease to be subject to such forfeiture restrictions, by filing an election under Section 83(b) of the Code with the Internal Revenue Service within thirty (30) days after the Grant Date. You will have to make a tax payment to the extent the purchase price is less than the fair market value of the shares on the Grant Date. No tax payment will have to be made to the extent the purchase price is at least equal to the fair market value of the shares on the Grant Date. The form for making this election is attached as Exhibit B hereto. Failure to make this filing within the thirty (30) day period will result in the recognition of ordinary income by you (in the event the fair market value of the shares as of the vesting date exceeds the purchase price) as the forfeiture restrictions lapse.

 

YOU ACKNOWLEDGE THAT IT IS YOUR SOLE RESPONSIBILITY, AND NOT THE COMPANY’S, TO FILE A TIMELY ELECTION UNDER SECTION 83(b), EVEN IF YOU

 

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     REQUEST THE COMPANY OR ITS REPRESENTATIVES TO MAKE THIS FILING ON YOUR BEHALF. YOU ARE RELYING SOLELY ON YOUR OWN ADVISORS WITH RESPECT TO THE DECISION AS TO WHETHER OR NOT TO FILE ANY 83(b) ELECTION.
Retention Rights    This Agreement does not give you the right to be retained by the Company (or any Affiliates) in any capacity. The Company (and any Affiliates) reserves the right to terminate your Service at any time and for any reason.
Shareholder Rights    You have the right to vote the Restricted Stock and to receive any dividends declared or paid on such stock. Any distributions you receive as a result of any stock split, stock dividend, combination of shares or other similar transaction shall be deemed to be a part of the Restricted Stock and subject to the same conditions and restrictions applicable thereto. The Company may in its sole discretion require any dividends paid on the Restricted Stock to be reinvested in shares of Stock, which the Company may in its sole discretion deem to be a part of the shares of Restricted Stock and subject to the same conditions and restrictions applicable thereto. Except as described in the Plan, no adjustments are made for dividends or other rights if the applicable record date occurs before your stock certificate is issued.
Adjustments    In the event of a stock split, a stock dividend or a similar change in the Company stock, the number of shares covered by this grant may be adjusted (and rounded down to the nearest whole number) pursuant to the Plan. Your Restricted Stock shall be subject to the terms of the agreement of merger, liquidation or reorganization in the event the Company is subject to such corporate activity.
Legends   

All certificates representing the Stock issued in connection with this grant shall, where applicable, have endorsed thereon the following legends:

 

“THE SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO CERTAIN RESTRICTIONS ON TRANSFER AND OPTIONS TO PURCHASE SUCH SHARES SET FORTH IN AN AGREEMENT BETWEEN THE COMPANY AND THE REGISTERED HOLDER, OR HIS OR HER PREDECESSOR IN INTEREST. A COPY OF SUCH AGREEMENT IS ON FILE AT THE PRINCIPAL OFFICE OF THE COMPANY AND WILL BE FURNISHED UPON WRITTEN REQUEST TO THE SECRETARY OF THE COMPANY BY THE HOLDER OF RECORD OF THE SHARES REPRESENTED BY THIS CERTIFICATE.”

 

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Applicable Law    This Agreement will be interpreted and enforced under the laws of the State of Delaware, other than any conflicts or choice of law rule or principle that might otherwise refer construction or interpretation of this Agreement to the substantive law of another jurisdiction.
The Plan   

The text of the Plan is incorporated in this Agreement by reference. Certain capitalized terms used in this Agreement are defined in the Plan, and have the meaning set forth in the Plan.

 

This Agreement and the Plan constitute the entire understanding between you and the Company regarding this grant of Restricted Stock. Any prior agreements, commitments or negotiations concerning this grant are superseded.

Data Privacy    In order to administer the Plan, the Company may process personal data about you. Such data includes but is not limited to the information provided in this Agreement and any changes thereto, other appropriate personal and financial data about you such as home address and business addresses and other contact information, payroll information and any other information that might be deemed appropriate by the Company to facilitate the administration of the Plan. By accepting this grant, you give explicit consent to the Company to process any such personal data. You also give explicit consent to the Company to transfer any such personal data outside the country in which you work or are employed, including, with respect to non-US. resident Participants, to the United States, to transferees who shall include the Company and other persons who are designated by the Company to administer the Plan.

Consent to Electronic

Delivery

    The Company may choose to deliver certain statutory materials relating to the Plan in electronic form. By accepting this grant you agree that the Company may deliver the Plan prospectus and the Company’s annual report to you in an electronic format. If at any time you would prefer to receive paper copies of these documents, as you are entitled to, the Company would be pleased to provide copies. Please contact the Company’s Human Resources Department to request paper copies of these documents.

 

By signing the cover sheet of this Agreement, you agree to all of the terms and conditions described above and in the Plan.

 

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EXHIBIT A

 

ASSIGNMENT SEPARATE FROM CERTIFICATE

 

FOR VALUE RECEIVED,                          sells, assigns and transfers to XM Satellite Radio Holdings, Inc., a Delaware corporation (the “Company”),                          (                        ) shares of common stock of the Company represented by Certificate No.              and does hereby irrevocable constitute and appoint                          Attorney to transfer the said stock on the books of the Company with full power of substitution in the premises.

 

Dated:                    , 200    

 

 
Print Name

 

 
Signature

 

Spouse Consent (if applicable)

 

                                 (Purchaser’s spouse) indicates by the execution of this Assignment his or her consent to be bound by the terms herein as to his or her interests, whether as community property or otherwise, if any, in the shares of common stock of the Company.

 

 
Signature

 

INSTRUCTIONS: PLEASE DO NOT FILL IN ANY BLANKS OTHER THAN THE SIGNATURE LINE. THE PURPOSE OF THIS ASSIGNMENT IS TO ENABLE THE COMPANY TO CANCEL YOUR UNVESTED SHARES AS SET FORTH IN THE AGREEMENT WITHOUT REQUIRING ADDITIONAL SIGNATURES ON THE PART OF PURCHASER.

 

 

EXHIBIT B

 

ELECTION UNDER SECTION 83(b) OF

THE INTERNAL REVENUE CODE

 

The undersigned hereby makes an election pursuant to Section 83(b) of the Internal Revenue Code with respect to the property described below and supplies the following information in accordance with the regulations promulgated thereunder:

 

  1. The name, address and social security number of the undersigned:

 

Name:______________________________________________

 

Address:____________________________________________

 

___________________________________________________

 

Social Security No. :___________________________________

 

  2. Description of property with respect to which the election is being made:

 

                         shares of common stock, par value $.01 per share, XM Satellite Radio Holdings, Inc., a Delaware corporation, (the “Company”).

 

  3. The date on which the property was transferred is                              , 200    .

 

  4. The taxable year to which this election relates is calendar year 200    .

 

  5. Nature of restrictions to which the property is subject:

 

The shares of stock are subject to the provisions of a Restricted Stock Agreement between the undersigned and the Company. The shares of stock are subject to forfeiture under the terms of the Agreement.

 

6. The fair market value of the property at the time of transfer (determined without regard to any lapse restriction) was $                     per share, for a total of $                    .

 

  7. The amount paid by taxpayer for the property was $            .

 

  8. A copy of this statement has been furnished to the Company.

 

Dated:                     , 200    

 

 

Taxpayer’s Signature

 

 

Taxpayer’s Printed Name

 

 

PROCEDURES FOR MAKING ELECTION

UNDER INTERNAL REVENUE CODE SECTION 83(b)

 

The following procedures must be followed with respect to the attached form for making an election under Internal Revenue Code section 83(b) in order for the election to be effective:1

 

1. You must file one copy of the completed election form with the IRS Service Center where you file your federal income tax returns within 30 days after the Grant Date of your Restricted Stock.

 

2. At the same time you file the election form with the IRS, you must also give a copy of the election form to the Secretary of the Company.

 

3. You must file another copy of the election form with your federal income tax return (generally, Form 1040) for the taxable year in which the stock is transferred to you.

1 Whether or not to make the election is your decision and may create tax consequences for you. You are advised to consult your tax advisor if you are unsure whether or not to make the election.