Exhibit 10.2
EXECUTIVE OFFICER FORM
INTEGRATED SILICON SOLUTION,
INC.
CHANGE IN CONTROL
AGREEMENT
This Change in Control Agreement
(the “Agreement”) is made and entered into by and
between
(“Executive”) and Integrated Silicon Solution, Inc.
(the “Company”), effective as of
, 2009 (the “Effective Date”).
RECITALS
1. It is expected that the Company
from time to time will consider the possibility of an acquisition
by another company or other change in control. The Board of
Directors of the Company (the “Board”) has determined
that it is in the best interests of the Company and its
stockholders to assure that the Company will have the continued
dedication and objectivity of Executive, notwithstanding the
possibility, threat or occurrence of a Change in Control (as
defined herein) of the Company.
2. The Board believes that it is in
the best interests of the Company and its stockholders to provide
Executive with an incentive to continue his or her employment and
to motivate Executive to maximize the value of the Company upon a
Change in Control for the benefit of its stockholders.
3. The Board believes that it is
imperative to provide Executive with certain severance benefits
upon Executive’s termination of employment following a Change
in Control. These benefits will provide Executive with enhanced
financial security and incentive and encouragement to remain with
the Company notwithstanding the possibility of a Change in
Control.
4. Certain capitalized terms used in
the Agreement are defined in Section 6 below.
AGREEMENT
NOW, THEREFORE, in consideration of
the mutual covenants contained herein, the parties hereto agree as
follows:
1. Term of Agreement . This
Agreement will terminate upon the date that all of the obligations
of the parties hereto with respect to this Agreement have been
satisfied.
2. At-Will Employment . The
Company and Executive acknowledge that Executive’s employment
is and will continue to be at-will, as defined under applicable
law.
3. Severance Benefits
.
(a) Change in Control Bonus
Payment . Immediately prior to the closing of a Change in
Control, Executive will receive a lump sum cash payment (less
applicable withholding taxes) under the Company’s executive
bonus program for the fiscal year during which the Change in
Control occurs, in an amount determined by the Compensation
Committee of the Board in its discretion, which amount shall be pro
rated for the portion of the fiscal year ending on the date of the
Change in Control.
(b) Involuntary Termination
Following a Change in Control . If within twelve
(12) months following a Change in Control (i) Executive
terminates his or her employment with the Company (or any parent,
subsidiary or successor of the Company) for Good Reason (as defined
herein) or (ii) the Company (or any parent, subsidiary or
successor of the Company) terminates Executive’s employment
without Cause (as defined herein), and Executive signs and does not
revoke the release of claims required by Section 4, Executive
will receive the following severance benefits from the
Company:
(i) Severance Payment .
Executive will receive a single lump sum severance payment (less
applicable withholding taxes) in an amount equal to the greater of
(A) twelve (12) months of Executive’s annual salary
or (B) four (4) weeks of Executive’s annual salary
plus an additional two (2) weeks of Executive’s annual
salary for each year of completed continuous service with the
Company or any parent or subsidiary of the Company (including any
service with Integrated Circuit Solution, Inc.) beginning with the
Executive’s most recent hire date through the date of
Executive’s termination (with the greater of the periods
described in (A) or (B) above referred to herein as
“Severance Period”), in each case with annual salary
determined at a rate equal to the greater of
(X) Executive’s annual base salary as in effect
immediately prior to the Change in Control, or
(Y) Executive’s Base Salary (as defined herein);
provided, however, that such amount (before giving effect to
any tax withholding) shall be reduced on a dollar-for-dollar basis
by the aggregate amount that Executive is entitled to receive from
the Company as severance payments under any of the Company’s
other then existing severance guidelines, any agreement, applicable
law or as negotiated in accordance with applicable law (including,
but not limited to, any notice payments during the applicable
notice period, any statutory severance payments, and any
supplemental severance payments)(which payments shall be
collectively referred to herein as “Statutory
Payments”). If Executive completed a partial year of service
of at least six (6) months and one (1) day,
Executive’s years of service will be rounded up to the next
full year of service. If Executive completed a partial year of
service of six (6) months or less, Executive’s years of
service will be rounded down to the last full year of service.
Except as otherwise required by applicable law, any cash severance
payable pursuant to this Section 3(b), the Company’s
other then existing severance guidelines, any other agreement or
otherwise, will be paid in a lump sum, notwithstanding any
provision in any other agreement or otherwise providing for
severance payments over time.
(ii) Equity Awards . One
hundred percent (100%) of Executive’s then outstanding
and unvested awards relating to the Company’s common stock
(whether stock options, stock appreciation rights, shares of
restricted stock, restricted stock units, or otherwise
(collectively, the “Equity Awards”)) as of the date of
Executive’s termination of employment will become vested and
will otherwise remain subject to the terms and conditions of the
applicable Equity Award agreement.
(iii) Benefits . The Company
agrees to provide Executive the same level of health coverage as in
effect for Executive on the day immediately preceding the date of
termination; provided, however, that (1) Executive constitutes
a qualified beneficiary, as defined in Section 4980(B)(g)(1)
of the Internal Revenue Code of 1986, as amended (the
“Code”); and (2) Executive
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elects continuation coverage
pursuant to the Consolidated Omnibus Budget Reconciliation Act of
1985, as amended (“COBRA”), within the time period
prescribed pursuant to COBRA. The Company will pay such COBRA
premiums to provide for continuation benefits on behalf of the
Executive through the Severance Period. Executive will thereafter
be responsible for the payment of COBRA premiums (including,
without limitation, all administrative expenses) for the remaining
COBRA period. Notwithstanding (1) and (2) above, if
Executive is located outside of the United States and is not
subject to COBRA, then the Company shall not have any obligations
under this Section 3(b)(iii).
(c) Timing of Severance
Payments . Unless otherwise required pursuant to
Section 10 of this Agreement, the Company will pay the cash
severance payments to which Executive is entitled under this
Agreement in a lump sum as soon as practicable following the date
of termination, provided, however, that such payment will be
delayed to the extent required by Section 4 of this
Agreement.
(d) Voluntary Resignation;
Termination For Cause . If Executive’s employment with
the Company terminates (i) voluntarily by Executive (other
than for Good Reason) or (ii) for Cause by the Company, then
Executive will not be entitled to receive severance or other
benefits except for those (if any) as may then be established under
the Company’s then existing severance and benefits plans and
practices or pursuant to other written agreements with the Company,
including, without limitation, any Equity Award
agreement.
(e) Disability; Death . If
the Company terminates Executive’s employment as a result of
Executive’s Disability, or Executive’s employment
terminates due to his or her death, then Executive will not be
entitled to receive severance or other benefits except for those
(if any) as may then be established under the Company’s then
existing written severance and benefits plans and practices or
pursuant to other written agreements with the Company, including,
without limitation, any Equity Award agreement.
(f) Termination Apart from Change
in Control . In the event Executive’s employment is
terminated for any reason, either prior to the occurrence of a
Change in Control or after the twelve (12) month period
following a Change in Control, then Executive will be entitled to
receive severance and any other benefits only as may then be
established under the Company’s existing written severance
and benefits plans and practices or pursuant to other written
agreements with the Company, including, without limitation, any
Equity Award agreement.
(g) Exclusive Remedy . In the
event of a termination of Executive’s employment within
twelve (12) months following a Change in Control, the
provisions of this Section 3 are intended to be and are
exclusive and in lieu of any other rights or remedies to which
Executive or the Company may otherwise be entitled, whether at law,
tort or contract, in equity, or under this Agreement, other than
any Statutory Payments. Executive will be entitled to no benefits,
compensation or other payments or rights upon termination of
employment following a Change in Control other than those benefits
expressly set forth in this Section 3, except any Statutory
Payments or as may be provided in any Equity Award
agreement.
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4. Conditions to Receipt of
Severance .
(a) Release of Claims
Agreement . The receipt of any severance or other benefits
pursuant to Section 3 will be subject to Executive signing and
not revoking a release of claims agreement in a form reasonably
acceptable to the Company, and such release becoming effective
within forty-five (45) days of Executive’s termination.
No severance or other benefits will be paid or provided until the
release of claims agreement becomes effective, and any severance
amounts or benefits otherwise payable between the date of
Executive’s termination and the date such release becomes
effective shall be paid on the effective date of such
release.
(b) Other Requirements .
Executive’s receipt of any payments or benefits under
Section 3 will be subject to Executive continuing to comply
with the terms of any form of confidential information agreement
with the Company and the provisions of this Section 4.
H!
(c) No Duty to Mitigate .
Executive will not be required to mitigate the amount of any
payment contemplated by this Agreement, nor will any earnings that
Executive may receive from any other source reduce any such
payment.
5. Limitation on Payments .
In the event that the severance and other benefits provided for in
this Agreement or otherwise payable to Executive
(i) constitute “parachute payments” within the
meaning of Section 280G of the Code and (ii) but for this
Section 5, would be subject to the excise tax imposed by
Section 4999 of the Code, then Executive’s severance
benefits under Section 3 will be either:
(a) delivered in full, or
(b) delivered as to such lesser
extent which would result in no portion of such severance benefits
being subject to excise tax under Section 4999 of the
Code,
whichever of the foregoing amounts,
taking into account the applicable federal, state and local income
taxes and the excise tax imposed by Section 4999, results in
the receipt by Executive on an after-tax basis, of the greatest
amount of severance benefits, notwithstanding that all or some
portion of such severance benefits may be taxable under
Section 4999 of the Code. Unless the Company and Executive
otherwise agree in writing, any determination required under this
Section 5 will be made in writing by the Company’s
independent public accountants immediately prior to a Change in
Control (the “Accountants”), whose determination will
be conclusive and binding upon Executive and the Company for all
purposes. For purposes of making the calculations required by this
Section 5, the Accountants may make reasonable assumptions and
approximations concerning applicable taxes and may rely on
reasonable, good faith interpretations concerning the application
of Sections 280G and 4999 of the Code. The Company and Executive
will furnish to the Accountants such information and documents as
the Accountants may reasonably request in order to make a
determination under this Section. The Company will bear all costs
the Accountants may reasonably incur in connection with any
calculations contemplated by this Section 5. Any reduction in
payments and/or benefits required by this Section 5 shall
occur in the following order: (1) reduction of cash payments;
and (2) reduction of other benefits paid to Executive. In the
event that acceleration of vesting of Equity Awards is to be
reduced, such acceleration of vesting shall be cancelled in the
reverse order of the date of grant for Executive’s Equity
Awards.
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6. Definition of Terms . The
following terms referred to in this Agreement will have the
following meanings:
(a) Base Salary . For
pur
