Item 5.02. Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.
As previously disclosed on a Form 8-K filed on January 31, 2018, on January 30, 2018, Scott A. McQuilkin, Senior Executive Vice President, Innovation, and Lawrence F. Shay, Senior Executive Vice President, Future Wireless, and Chief Intellectual Property Counsel, each notified InterDigital, Inc. (the “Company”), of their intention to retire from their respective positions at the Company effective April 1, 2018 (the “Retirement Date”).
In consideration of each executive’s distinguished service to the Company and the Company’s desire to ensure smooth transitions to their respective successors, the Company entered into Retirement & Transition Agreement and Releases with each of Mr. McQuilkin (the “McQuilkin Retirement Agreement”) and Mr. Shay (the “Shay Retirement Agreement”), on April 2, 2018.
Under the McQuilkin Retirement Agreement, Mr. McQuilkin agrees to provide limited transition services on a part-time basis for a period of 100 calendar days following the Retirement Date in exchange for $120,000, payable in 3 equal payments on May 1, 2018, June 1, 2018, and July 1, 2018, in order to facilitate and ensure a smooth transition to his successor. If the transition services terminate prior to the end of the transition period, then the transition payment will be paid on a pro-rata basis. Additionally, Mr. McQuilkin will receive (i) a lump sum payment of $596,814 by March 15, 2019, and (ii) health continuation coverage for him and his covered dependents for a period of 12 months (“McQuilkin Retirement Payment”) in exchange for his continued compliance with the restrictive covenants set forth in Mr. McQuilkin’s employment agreement with the Company and his release of claims in favor of the Company and its designated releasees. Mr. McQuilkin’s Company equity awards ceased to vest as of the Retirement Date, and there will be no continued vesting during the transition period. Mr. McQuilkin must not revoke the McQuilkin Requirement Agreement and must reaffirm the release and restrictive covenants set forth in the McQuilkin Retirement Agreement following the end of his transition period in order to receive the McQuilkin Retirement Payment.
Under the Shay Retirement Agreement, Mr. Shay agrees to provide limited transition services on a part-time basis for a period of 100 calendar days following the Retirement Date in exchange for $120,000, payable in 3 equal payments on May 1, 2018, June 1, 2018, and July 1, 2018, in order to facilitate and ensure a smooth transition to his successor. If the transition services terminate prior to the end of the transition period, then the transition payment will be paid on a pro-rata basis. Additionally, Mr. Shay will receive (i) a lump sum payment of $596,814 that will be deferred under the Company’s Deferred Compensation Plan (“NQDC”) and (ii) health continuation coverage for him and his covered dependents for a period of 12 months (“Shay Retirement Payment”) in exchange for his continued compliance with the restrictive covenants set forth in Mr. Shay’s employment agreement with the Company and a release of claims in favor of the Company and its designated releasees. The deferred payment under the NQDC is scheduled to be paid on the fifth anniversary of Mr. Shay’s separation from service from the Company (which separation date is expected to be July 11, 2018). Mr. Shay’s Company equity awards ceased to vest as of the Retirement Date, and there will be no continued vesting during the transition period. Mr. Shay must not revoke the Shay Retirement Agreement and must reaffirm the release and restrictive covenants set forth in the Shay Retirement Agreement following the end of his transition period in order to receive the Shay Retirement Payment.
The summaries of the McQuilkin Retirement Agreement and the Shay Retirement Agreement set forth above do not purport to be complete and are qualified in their entirety by reference to the full text of such documents . The Company will file each agreement as an exhibit to its Quarterly Report on Form 10-Q for the quarter ending March 31, 2018.
"Intellectuals solve problems; geniuses prevent them." - Albert Einstein
