Exhibit 10.22
FORM OF
STOCK PLEDGE AGREEMENT
PURSUANT TO THE ZILOG, INC. 2002
OMNIBUS STOCK INCENTIVE PLAN
In order to secure payment of the promissory note dated [ ] (the
"Note") payable to ZiLOG, Inc., a Delaware corporation (the "Company"), at
its principal offices in the principal amount of [ ] dollars ($[ ]), which
Note the Borrower delivered in connection with a loan extended to the
Borrower by the Company, the Borrower hereby grants the Company a security
interest in, and assigns, transfers and pledges to the Company, the
following securities and other property:
(a) The [ ] ([ ]) shares of the Company's Common Stock
(the "Common Stock") delivered to and deposited with the Company
as collateral for the Note 1; and
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1 Shares pledged shall be equal to all shares of Restricted Stock with
respect to which the loan was made.
(b) Any and all new, additional or different securities
or other property subsequently distributed with respect to the
shares identified in Subsection (a) above that are to be delivered
to and deposited with the Company pursuant to the requirements of
Section 3 of this Agreement; and
(c) Any and all rights of the Borrower to receive
dividends or other proceeds from the Company, whether in cash or
in kind, excluding dividends paid at such time or times as there
is no "event of default" (as defined below); and
(d) Any and all other property and money that is
delivered to or comes into the possession of the Company pursuant
to the terms and provisions of this Agreement; and
(e) The proceeds of any sale, exchange or disposition of
the property and securities described in Subsection (a), (b), or
(c) above.
All securities, property and money to be assigned to, transferred to and
pledged with the Company shall be herein referred to as the "Collateral"
and shall be accompanied by one or more stock power assignments properly
endorsed by the Borrower. The Company shall hold the Collateral in
accordance with the following terms and provisions:
1. Warranties. The Borrower hereby warrants that effective as of
the date of purchase of the Common Stock from the Company, (a) the Borrower
will be the owner of the Collateral and will have the right to pledge the
Collateral and that the Collateral will be and shall remain free from all
liens, advance claims and other security interests (other than those
created hereby); (b) the execution and delivery of this Agreement will not
constitute a default or result in a lien against the Collateral under any
applicable law or regulation or under any agreement to which the Borrower
is a party; (c) this Agreement is a legal, valid and binding obligation of
the Borrower in accordance with its terms; (d) there is no lawsuit or other
proceeding pending or threatened against the Borrower that could reasonably
be expected to adversely affect the Collateral; and (e) Borrower has no
defense, set-off, claim or counterclaim against the Company whether in a
proceeding to enforce the rights of the Company to the Collateral or
otherwise, excluding claims for employee benefits or compensation payable
in the ordinary course of business or reimbursable expenses.
2. Rights and Powers. The Company may, without obligation to do
so, exercise one or more of the following rights and powers with respect to
the Collateral:
(a) Accept in its discretion, but subject to the
applicable limitations of Section 7, other property of the
Borrower in exchange for all or part of the Collateral and release
Collateral to the Borrower to the extent necessary to effect such
exchange, and in such event the money, property or securities
received in the exchange shall be held by the Company as
substitute security for the Note and all other indebtedness
secured hereunder;
(b) Perform such acts as are necessary to preserve and
protect the Collateral and the rights, powers and remedies granted
with respect to such Collateral by this Agreement, including, but
not limited to, the filing of UCC-1 Financing Statements; and
(c) Transfer record ownership of the Collateral to the
Company or its nominee and receive, endorse and give receipt for,
or collect by legal proceedings or otherwise, dividends or other
distributions made or paid with respect to the Collateral, but
only if there exists at the time an outstanding event of default
under Section 8 of this Agreement.
Any action by the Company pursuant to the provisions of this Section 2 may
be taken without notice to the Borrower. The Borrower hereby appoints the
[Secretary] of the Company as its attorney-in-fact, with full authority in
the place and stead of the Borrower and in the name of the Borrower, in the
event of an event of default to take any action and execute any instrument
as the [Secretary] may deem necessary to accomplish the purposes of this
Agreement. Expenses reasonably incurred in connection with such action
(including reasonable attorneys fees) shall be payable by the Borrower and
form part of the indebtedness secured hereunder, as provided in Section 9.
So long as there exists no event of default under Section 8 of
this Agreement, the Borrower may exercise all shareholder voting rights and
be entitled to receive any and all regular cash dividends paid on the
Collateral. Accordingly, until such time as an event of default occurs
under this Agreement, all proxy statements and other shareholder materials
pertaining to the Collateral shall be delivered to the Borrower at the
address indicated below.
Any cash sums that the Company may receive in the exercise of its
rights and powers under this Section 2 shall be applied to the payment of
the Note and any other indebtedness secured hereunder, in such order of
application as the Company deems appropriate. Any remaining cash shall be
paid over to the Borrower.
3. Duty to Deliver. Any new, additional or different securities
that may now or hereafter become distributable with respect to the
Collateral by reason of (i) any stock dividend, stock split, conversion or
reclassification of the capital stock of the Company or (ii) any merger,
consolidation or other reorganization affecting the capital structure of
the Company shall, upon receipt by the Borrower, be promptly delivered to
and deposited with the Company as part of the Collateral hereunder. Such
securities shall be accompanied by one or more properly endorsed stock
power assignments.
4. Care of Collateral. The Company shall exercise reasonable care
in the custody and preservation of the Collateral but shall have no
obligation to initiate any action with respect to, or otherwise inform the
Borrower of, any conversion, call, exchange right, preemptive right,
subscription right, purchase offer or other right or privilege relating to
or affecting the Collateral; provided, however, that the Company will
notify the Borrower of any such rights of the Borrower to protect against
adverse claims or to protect the Collateral against the possibility of a
decline in market value. The Company shall not be obligated to take any
action with respect to the Collateral requested by the Borrower unless the
request is made in writing and the Company determines that the requested
action will not unreasonably jeopardize the value of the Collateral as
security for the Note and other indebtedness secured hereunder.
The Company may at any time release and deliver all or part of the
Collateral to the Borrower, and the receipt thereof by the Borrower shall
constitute a complete and full acquittance for the Collateral so released
and delivered. The Company shall accordingly be discharged from any further
liability or responsibility for the Collateral, and the released Collateral
shall no longer be subject to the provisions of this Agreement. However,
any and all releases of the Collateral shall be effected in compliance with
the applicable limitations of Section 7(a) and (c).
5. Payment of Taxes and Other Charges. The Borrower shall pay,
prior to the delinquency date, all taxes, liens, assessments and other
charges against the Collateral, and in the event of the Borrower's failure
to do so, the Company may at its election pay any or all of such taxes and
charges without contesting the validity or legality thereof. The payments
so made shall become part of the indebtedness secured hereunder and, until
paid, shall bear interest at the minimum per annum rate, compounded
annually, required to avoid the imputation of interest income to the
Company and compensation income to the Borrower under the federal tax laws.
6. Transfer of Collateral. In connection with the transfer or
assignment of the Note (whether by negotiation, discount or otherwise), the
Company may transfer all or any part of the Collateral, and the transferee
shall thereupon succeed to all the rights, powers and remedies granted the
Company hereunder with respect to the Collateral so transferred. Upon such
transfer, the Company shall be fully discharged from all liability and
responsibility for the transferred Collateral.
7. Release of Collateral. Provided (i) all indebtedness secured
hereunder (other than payments not yet due and payable under the Note)
shall at the time have been paid in full or cancelled and (ii) there does
not otherwise exist any event of default under Section 8, the pledged
shares of Common Stock, together with any additional Collateral that may
hereafter be pledged and deposited hereunder, shall be released from pledge
and returned to the Borrower in accordance with the following provisions.
(a) Upon payment or prepayment of principal under the
Note, together with payment of all accrued interest to date, one
or more shares of Common Stock held as Collateral hereunder shall
(subject to the limitation of Subsection (c) below) be released to
the Borrower within three (3) days after such payment or
prepayment. The number of shares to be so released shall be equal
to the number obtained by multiplying (i) the total number of
shares of Common Stock held under this Agreement at the time of
the payment or prepayment by (ii) a fraction, the numerator of
which shall be the amount of the principal paid or prepaid and the
denominator of which shall be the unpaid principal balance of the
Note immediately prior to such payment or prepayment. In no event,
however, shall any fractional shares be released. In addition, one
or more shares of Common Stock held as Collateral hereunder shall
(subject to the limitation of Subsection (c) below) be released to
a stockbroker designated in writing by the Borrower and acceptable
to the Company for the sole purpose of effecting an immediate sale
of the released shares, provided that such stockbroker agrees to
forward any proceeds (up to the balance of principal and interest
due under the Note) directly to the Company to be used to satisfy
the Note.
(b) Any additional Collateral that may hereafter be
pledged and deposited with the Company (pursuant to the
requirements of Section 3) with respect to the shares of Common
Stock pledged hereunder shall be released at the same time the
particular shares of Common Stock to which the additional
Collateral relates are to be released in accordance with the
applicable provisions of Subsection (a) above. Under no
circumstances, however, shall any shares of Common Stock or any
other Collateral be released if previously applied to the payment
of any indebtedness secured hereunder.
(c) In no event shall any shares of Common Stock be
released pursuant to the provisions of Subsection (a) and (b)
above if, and to the extent, the fair market value of the Common
Stock and all other Collateral that would otherwise remain in
pledge hereunder after such release is effected would be less than
the unpaid balance of the Note (principal and accrued interest).
8. Events of Default. The occurrence of one or more of the
following events shall constitute an event of default under this Agreement:
(a) The occurrence of an event of acceleration pursuant
to Section 4 of the Note;
(b) The failure of the Borrower to perform a material
obligation imposed upon the Borrower by reason of this Agreement;
(c) The failure of the Borrower to execute and deliver
any documents (including, but not limited to, UCC-1 Financing
Statements) reasonably requested by the Company to perfect its
security interest in the Common Stock; or
(d) The breach of any warranty of the Borrower contained
in this Agreement.
Upon the occurrence of any such event of default, the Company may, at its
election, declare the Note and all other indebtedness secured hereunder to
become immediately due and payable and may exercise any or all of the
rights and remedies granted to a secured party under the provisions of
applicable state and federal law, including (without limitation) the power
to dispose of the Collateral by public or private sale or to accept the
Collateral in full payment of the Note and all other indebtedness secured
hereunder.
Any proceeds realized from the disposition of the Collateral
pursuant to the foregoing power of sale shall be applied first to the
payment of reasonable expenses incurred by the Company in connection with
the disposition, then to the payment of the Note and finally to any other
indebtedness secured hereunder. Any surplus proceeds shall be paid to the
Borrower. However, in the event such proceeds are insufficient to satisfy
all obligations of the Borrower under the Note, then the Borrower shall
remain personally liable for the resulting deficiency.
9. Other Remedies. The rights, powers and remedies granted to the
Company and the Borrower pursuant to the provisions of this Agreement shall
be in addition to all rights, powers and remedies granted to the Company
and the Borrower under any statute or rule of law. Any forbearance, failure
or delay by the Company or the Borrower in exercising any right, power or
remedy under this Agreement shall not be deemed to be a waiver of such
right, power or remedy. Any single or partial exercise of any right, power
or remedy under this Agreement shall not preclude the further exercise
thereof, and every right, power and remedy of the Company and the Borrower
under this Agreement shall continue in full force and effect, unless such
right, power or remedy is specifically waived by an instrument executed by
the Company or the Borrower, as the case may be.
10. Costs and Expenses. All reasonable costs and expenses
(including reasonable attorneys fees) incurred by the Company in the
exercise or enforcement of any right, power or remedy granted it under this
Agreement shall become part of the indebtedness secured hereunder and shall
constitute a personal liability of the Borrower payable immediately upon
demand and bearing interest until paid at the Company's bank interest rate
then being earned by the Company on its deposits.
11. Applicable Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of Delaware without
giving effect to the conflict of laws principles thereof and shall be
binding upon the executors, administrators, heirs and assigns of the
Borrower.
12. Severability. If any provision of this Agreement is held to be
invalid under applicable law, then such provision shall be ineffective only
to the extent of such invalidity, and neither the remainder of such
provision nor any other provisions of this Agreement shall be affected
thereby.
IN WITNESS WHEREOF, this Agreement has been executed by the
Borrower on this _______ day of _______________, ____.
____________________________________
Signature of Borrower
____________________________________
Print Name of Borrower
Address: ___________________________
Agreed to and Accepted by:
ZiLOG, Inc.
By: _____________________________
Title: _____________________________
Dated: __________________ ___, _____