EXHIBIT 10.02
EXECUTIVE
CHANGE IN CONTROL
SEVERANCE BENEFITS
AGREEMENT
THIS EXECUTIVE CHANGE IN CONTROL
SEVERANCE BENEFITS AGREEMENT (the “AGREEMENT” ) is entered
into on April 2, 2007, between David B. Bell
(“Executive”) and INTERSIL CORPORATION , a
Delaware corporation (the “COMPANY”
).
WHEREAS , this Agreement is intended to provide
Executive with the compensation and benefits described herein upon
the occurrence of specific events after the date hereof.
NOW THEREFORE
, The Company and Executive hereby
agree as follows:
Certain capitalized terms used in
this Agreement are defined in Article VI.
ARTICLE I
EMPLOYMENT BY THE
COMPANY
1.1 Executive is currently employed as an executive
of the Company.
1.2 This Agreement shall remain in full force and
effect so long as Executive is employed by the Company or its
subsidiaries; provided, however, that the rights and obligations of
the parties hereto contained in Articles II through VII shall
survive Two and One Half (2-1/2) years following a Covered
Termination (as hereinafter defined).
1.3 The Company and Executive wish to set forth the
compensation and benefits which Executive shall be entitled to
receive if Executive’s employment with the Company terminates
following a Change in Control under the circumstances described in
Article II of this Agreement.
1.4 The duties and obligations of the Company to
Executive under this Agreement shall be in consideration for
Executive’s continued employment with the Company and
Executive’s execution of the general waiver and release
described in Section 3.2.
ARTICLE II
SEVERANCE BENEFIT
2.1 Entitlement To Severance
Benefits. If
Executive’s employment terminates due to an Involuntary
Termination or a Voluntary Termination for Good Reason (as
hereinafter defined) within twelve (12) months following the
effective date of a Change in Control, the termination of
employment will be a Covered Termination and the Company shall pay
Executive the compensation and benefits described in this Article
II. If Executive’s employment terminates, but not due to an
Involuntary Termination or a Voluntary Termination for Good Reason
within twelve (12) months following the effective date of a
Change in Control, then the termination of employment will
not be a Covered Termination and Executive will not
be entitled to receive any payments or benefits under this Article
II.
Payment of any benefits described in
this Article II shall be subject to the restrictions and
limitations set forth in Article III of this Agreement.
2.2 Severance
Payments. The Company
shall continue to pay the Executive’s Annual Base Pay and
full target Annual Bonus (without regard to satisfaction of any
target performance objectives) for two years (the “
Severance Period ”) (less applicable deductions and
withholdings) payable in accordance with Intersil’s normal
payroll practices immediately prior to the Covered
Termination.
2.3 Welfare Benefits.
Following a Covered Termination,
Executive and his covered dependents will be eligible to continue
their Welfare Benefits coverage under any Welfare Benefits plan or
program maintained by the Company on the same terms and conditions
(including cost to Executive) as in effect immediately prior to the
Covered Termination, for a period of one (1) year following
the Covered Termination.
With respect to any Welfare Benefits
provided through an insurance policy, the Company’s
obligation to provide such Welfare Benefits following a Covered
Termination shall be limited by the terms of such a policy;
provided that (i) the Company shall make reasonable efforts to
amend such policy to provide the continued coverage described in
this Section 2.3, and (ii) if a policy providing health
benefits is not amended to provide the continued benefits described
in this Section 2.3, the Company shall pay for the cost of
comparable replacement coverage (or Medigap insurance if Executive
qualifies for Medicare) until the end of the one (1) year
period following the Covered Termination.
The Company shall reimburse
Executive for any income tax liability due as a result of the
provision of Welfare Benefits under this Article II (and as a
result of any payments due under this paragraph) in order to put
Executive in the same after-tax position as if no taxable Welfare
Benefits had been provided.
This Section 2.3 is not
intended to affect, nor does it affect, the rights of Executive, or
Executive’s covered dependents, under any applicable law with
respect to health insurance continuation coverage.
2.4 Mitigation.
Except as otherwise specifically
provided herein, Executive shall not be required to mitigate
damages or the amount of any payment provided under this Agreement
by seeking other employment or otherwise, nor shall the amount of
any payment provided for under this Agreement be reduced by any
compensation earned by Executive as a result of employment by
another employer or by retirement benefits after the date of the
Covered Termination, or otherwise.
2.5 409A Compliance.
If any payments due under this
Agreement would subject Executive to any penalty tax imposed under
Section 409A of the Internal Revenue Code of 1986, as amended
(the “Code”) if such payments were made at the time as
required herein, then the payments that cause the imposition such
penalty tax shall be payable in one lump sum on the first day which
is at least six months after the date of Executive’s
separation of service as set forth in Section 409A of the Code
and the regulations and other official guidance
thereunder.
- 2 -
ARTICLE III
LIMITATIONS AND CONDITIONS ON
BENEFITS
3.1 Withholding of
Taxes. The Company shall
withhold appropriate federal, state or local income and employment
taxes from any payments hereunder.
3.2 Employee Agreement and
Release Prior to receipt of Benefits. Upon the occurrence of a Covered Termination,
and prior to the receipt of any benefits under this Agreement on
account of the occurrence of a Covered Termination, Executive
shall, as of the date of a Covered Termination, execute an employee
agreement and release in the form attached hereto as Exhibit
A . Such employee agreement and release shall specifically
relate to all of Executive’s rights and claims in existence
at the time of such execution and shall confirm Executive’s
obligations under the Company’s standard form of proprietary
information agreement. It is understood such employee release and
agreement shall comply with applicable law. In the event Executive
does not execute such release and agreement within the period
required by applicable law, or if Executive revokes such employee
agreement and release within the period permitted by applicable
law, no benefits shall be payable under this Agreement and this
Agreement shall be null and void.
ARTICLE IV
OTHER RIGHTS AND
BENEFITS
4.1 Nonexclusivity.
Nothing in this Agreement shall
prevent or limit Executive’s continuing or future
participation in any benefit, bonus, incentive or other plans,
programs, policies or practices provided by the Company and for
which Executive may otherwise qualify, nor shall anything herein
limit or otherwise affect such rights as Executive may have under
any stock option or other agreements with the Company. Except as
otherwise expressly provided herein, amounts which are vested
benefits or which Executive is otherwise entitled to receive under
any plan, policy, practice or program of the Company at or
subsequent to the date of a Covered Termination shall be payable in
accordance with such plan, policy, practice or program.
4.2 Parachute
Payments. If all or any
portion of the amounts payable or benefits provided to the
Executive under this Agreement or otherwise are ‘excess
parachute payments’ and are subject to the excise tax imposed
by Section 4999 of the Code (the ‘Excise Tax’),
and if the net after-tax amount (taking into account all applicable
taxes payable by the Executive, including without limitation any
Excise Tax) that the Executive would receive with respect to such
payments or benefits does not exceed the net after-tax amount the
Executive would receive if the amount of such payments and benefits
were reduced to the maximum amount which could otherwise be payable
to the Executive without the imposition of the Excise Tax, then,
only the extent necessary to eliminate the imposition of the Excise
Tax, such payments and benefits shall be reduced, in the order and
of the type mutually agreed to by the Executive and the Company.
The calculations required under this Section 4.2 shall be
prepared by the Company and reviewed for accuracy by the Executive
and the Company’s regular certified public
accountantse.
- 3 -
ARTICLE V
NON-ALIENATION OF
BENEFITS
No benefit hereunder shall be
subject to anticipation, alienation, sale, transfer, assignment,
pledge, encumbrance or charge, and any attempt to so subject a
benefit hereunder shall be void.
ARTICLE VI
DEFINITIONS
For purposes of the Agreement, the
following terms shall have the meanings set forth below:
6.1
“Agreement” means this Executive Change in Control Severance
Benefits Agreement.
6.2 “Annual Base
Pay” means
Executive’s annual base pay at the rate in effect during the
last regularly scheduled payroll period immediately preceding
(i) the Change in Control or (ii) the Covered
Termination, whichever is greater.
6.3 “Annual
Bonus” means the
Executive’s projected or estimated annual cash incentive
bonus at target for the fiscal year of the Company in which
termination of Executive’s employment occurs.
6.4 “Change in
Control” means the
consummation of any of the following transactions after the date
hereof:
(a) the stockholders of the Company approve a merger
or consolidation of the Company with any other corporation, other
than a merger or consolidation which would result in the voting
securities of the Company outstanding immediately prior thereto
continuing to represent (either by remaining outstanding or by
being converted into voting securities of the surviving entity) at
least fifty percent (50%) of the total voting power
represented by the voting securities of the Company or such
surviving entity outstanding immediately after such merger or
consolidation, or the stockholders of the Company approve a plan of
liquidation or dissolution of the Company or an agreement for the
sale, lease, exchange or other transfer or disposition by the
Company of all or substantially
