exv4w8



 





Exhibit 4.8

EXECUTION COPY




DEFERRED COMPENSATION AGREEMENT




          This agreement (the “Agreement”) between Federal-Mogul Corporation, a Delaware corporation
(the “Company”) and José Maria Alapont (the “Executive”) is entered into on December 27, 2007,
which is the grant date of non-qualified options (the “Options”) to purchase from the Company
4,000,000 shares of its Class A Common Stock (“Stock”) granted pursuant to the Fourth Amended Joint
Plan of Reorganization (As Modified) that was confirmed by the court in the jointly-administered
Chapter 11 cases in the District of Delaware and docketed as Case No. 01-10578 (the “Plan”) through
an order entered November 8, 2007.




     1. Entitlement to Distribution. The Executive shall be entitled to an amount
calculated in accordance with paragraph 3 hereof (the “Distribution”).



     2. Payment of Distribution.




     (a) Form of Distribution. The Distribution shall be payable in equity (shares
of Class A Common Stock of the Company), provided that at the election of the Executive,
some or all of the Distribution will be payable in cash.




     (b) Date of Distribution. The Distribution shall be paid on the first to
occur of: (1) 6 months after the date on which the Executive’s employment with the Company
terminates, (2) December 27, 2014, which is the seventh anniversary of the effective date of
this Agreement, (3) the Executive’s death, (4) the date the Executive becomes Disabled, as
defined for purposes of section 409A of the Internal Revenue Code of 1986, as amended (the
“Code”), or (5) the occurrence of an Unforeseeable Emergency, as defined for purposes of
section 409A of the Code, provided that the amount of the Distribution payable upon an
Unforeseeable Emergency shall be limited to the amount necessary to satisfy such
Unforeseeable Emergency, and the remaining amount of the Distribution, if any, shall be paid
on the next to occur of such dates. No amount shall be payable under this Agreement,
however, if prior to March 23, 2010, the Company terminates the Executive’s employment for
Cause, or the Executive terminates his employment without Good Reason, as such terms are
defined in the Employment Agreement between the Company and the Executive dated February 2,
2005 (the “Employment Agreement”).




     (c) Change in Distribution Date. Executive shall have the right to substitute
a different date for the date in paragraph 2(a)(2) (December 27, 2014), provided that the
Executive must notify the Company of such substitution at least 12 months before such date,
such substitution shall not be effective until 12 months after the date of notification, and
the different date provided in substitution must be at least 5 years after December 27,
2014.



     3. Amount of Distribution. The amount of the Distribution shall be equal to the Base
Value, reduced by the Offset Amount (but not below zero), determined as of a Determination Date, as
defined in paragraph 3(d).



 









 






     (a) Base Value. The Base Value shall be equal to the fair market value of
500,000 shares of Stock as of the “Determination Date.”




     (b) Adjustments to Base Value. Notwithstanding anything to the contrary
herein, in the event that the date on which the Executive’s employment with the Company
terminates is prior to March 23, 2010, the Base Value shall be reduced by the fair market
value of 8,333.33 shares of Stock multiplied by the number of full months remaining from the
date on which the Executive’s employment with the Company terminates until March 23, 2010.
In addition, if the Executive has fewer than 2,000,000 vested, unexercised Options
outstanding as of the Determination Date, the Base Value shall be reduced by an amount equal
to the fair market value of the number of shares of Stock equal to 2,000,000 minus the
number of vested, unexercised Options outstanding as of the Determination Date, divided by
4.




     (c) Offset Amount. The Offset Amount shall equal the number of vested,
outstanding Options as of the Determination Date, up to a maximum of 2,000,000 Options,
multiplied by the excess of the fair market value of a share of Stock as of the
Determination Date over the per share exercise price of the Options.




     (d) Determination Date. The Determination Date shall be the first to occur of
(1) the date on which the Executive’s employment with the Company terminates, (2) March 23,
2010, (3) the Executive’s death, (4) the date the Executive becomes Disabled, as defined for
purposes of section 409A of the Code, (5) at the election of the Executive, a Change in
Control, as defined for purposes of section 409A of the Code, or (6) the occurrence of an
Unforeseeable Emergency, as defined for purposes of section 409A of the Code.




     (e) Final Adjustment. In the event that the Determination Date occurs before
the Distribution Date, then the Distribution may be reduced (but not below zero) by a Final
Adjustment, calculated under this paragraph 3(e). The Final Adjustment is calculated only
with respect to Options which were taken in account in calculating the Offset Amount under
paragraph 3(c) and are exercised after the Determination Date on a date when the fair market
value of a share of Stock exceeds the fair market value of a share of Stock as of the
Determination Date. The amount of the Final Adjustment, if any, is equal to the sum for
each such Option of 75% of the amount by which the fair market value of a share of Stock on
the date of exercise exceeds the fair market value of a share of Stock as of the
Determination Date.



     4. Other Provisions.




     (a) Withholding Taxes. The Company is authorized to withhold from any
Distribution such amount as the Company may be required, under all applicable federal,
state, local or other laws or regulations, to withhold and pay over as income or other
withholding taxes



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     (b) Adjustment. In the event of any stock split, stock dividend,
recapitalization, reorganization, merger, consolidation, combination, exchange of shares,
liquidation, spin-off or other similar change in capitalization or event, or any
distribution to holders of Stock other than a regular cash dividend,
the number and class of shares taken into account under paragraph 3 shall be appropriately adjusted by the Company
to reflect such change in capitalization or distribution.




     (c) Agreement Confers No Rights as Stockholder. This Agreement does not
entitle the Executive to status as a shareholder with respect to the shares of Stock taken
into account in calculating the amount of Distribution.




     (d) Agreement Confers No Rights to Continued Employment. In no event shall
this Agreement give or be deemed to give the Executive any right to continued employment by
the Company or any affiliate of the Company.




     (e) Successors. This Agreement shall be binding upon and inure to the benefit
of any successor or successors of the Company and any person or persons who shall, upon the
death of the Executive, acquire any rights hereunder in accordance with this Agreement.




     (f) Notices. All notices, requests or other communications provided for in
this Agreement shall be made, if to the Company, to Federal-Mogul Corporation, 26555
Northwestern Highway, Southfield, Michigan 48034, Attention: General Counsel; and if to the
Executive, to José Maria Alapont, 1772 Heron Ridge Drive, Bloomfield Hills, MI 48302. All
notices, requests or other communications provided for in this Agreement shall be made in
writing either (a) by personal delivery to the party entitled thereto, (b) by facsimile with
confirmation of receipt, (c) by mailing in the United States mails to the last known address
of the party entitled thereto or (d) by express courier service. The notice, request or
other communication shall be deemed to be received upon personal delivery, upon confirmation
of receipt of facsimile transmission or upon receipt by the party entitled thereto if by
United States mail or express courier service; provided, however, that if a notice, request
or other communication sent to the Company is not received during regular business hours, it
shall be deemed to be received on the next succeeding business day of the Company.




     (g) Related Trust. Simultaneously with the execution of this Agreement, the
Company shall establish a trust or similar arrangement with respect to this Agreement and
transfer 500,000 shares of Stock to the trustee or equivalent party of such similar
arrangement. Such trust or similar arrangement will provide that the shares of Stock held
thereunder may not be released to the Company until after the amount of the Distribution, if
any, required to be paid to the Executive under this Agreement has been paid in full.
Notwithstanding anything herein to the contrary, any such arrangement will be established so
as to preserve the status of the Agreement as an unfunded, unsecured
promise to pay of the Company and in compliance with the requirements of section 409A of the
Code.



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     (h) Amendment. The provisions of this Agreement may be amended only by the
written agreement of the Company and the Executive.




     (i) Governing Law. This Agreement and all determinations made and actions
taken pursuant hereto and thereto, to the extent not governed by the laws of the United
States, shall be governed by the laws of the State of Michigan and construed in accordance
therewith without giving effect to principles of conflicts of laws. This Agreement
provides for nonqualified deferred compensation for purposes of section 409A of the Code and
shall be construed so as to comply with the provisions of such section. To the extent that
an amendment or revision to this Agreement is necessary to ensure compliance with such
section, the Company and the Executive agree to cooperate to make such amendment or revision
in a manner consistent with the other provisions of this Agreement.




     (j) Counterparts. This Agreement may be executed in two counterparts, each of
which shall be deemed an original and both of which together shall constitute one and the
same instrument.



	 	 	 	 	 
	 	FEDERAL-MOGUL CORPORATION

 	 
	 	By:  	/s/ Robert L. Katz_
 	 
	 	 	 	 
	 	 	 	 
	 
	 	 	 
	 	                                        /s/ Josè Maria Alapont
 	 
	 	JOSÉ MARIA ALAPONT 	 
	 	 	 
	 




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