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EXHIBIT 10.64
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT (this "AGREEMENT") is entered into as
of
SEPTEMBER 1, 2003 between Robert J. Conrad (the "EXECUTIVE") and
Fairchild
Semiconductor Corporation, a Delaware corporation (the
"COMPANY").
For ease of reference, this Agreement is divided into the
following
parts, which begin on the pages indicated:
PART 1-- TERM,
DUTIES AND SCOPE, COMPENSATION AND BENEFITS DURING EMPLOYMENT
(Sections 1-4, beginning on page 2)
-
Salary
- EFIP
Bonus
- Signing
Bonus and Relocation
-
Vacation
- Equity
Awards
PART 2--
COMPENSATION AND BENEFITS IN CASE OF ACTUAL OR CONSTRUCTIVE
TERMINATION
(Sections 5-6, beginning on page 3)
-
Termination
PART 3--
COMPENSATION AND BENEFITS IN CASE OF A CHANGE IN CONTROL (Section
7,
beginning on page 5)
PART 4--
CONFIDENTIALITY AND NON-DISCLOSURE, FORFEITURE, INTELLECTUAL
PROPERTY, NON-COMPETITION AND NON-SOLICITATION, REMEDIES,
SUCCESSORS,
MISCELLANEOUS PROVISIONS, SIGNATURE PAGE
(Sections 8-14, beginning on page 6)
-
Confidentiality and Non-Disclosure
-
Forfeiture in Case of Certain Events
-
Non-Competition and Non-Solicitation
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TERMS
For
good and valuable consideration, the adequacy and receipt of which
are
hereby acknowledged, the Company and the Executive, intending to be
legally
bound, agree as follows:
PART 1 TERM OF EMPLOYMENT, DUTIES AND SCOPE, COMPENSATION AND
BENEFITS DURING
EMPLOYMENT
SECTION 1. TERM OF AGREEMENT
(a) Term. Unless
sooner terminated as provided in this Agreement, the term of
this
Agreement will begin on the effective date of this Agreement and
will
end
on the second anniversary thereof (the "INITIAL TERM"). The term
of
this
Agreement will be automatically extended for one or more
successive
one-year periods (each a "RENEWAL TERM") unless the Company or
the
Executive gives the other written notice of non-renewal at least 30
days
before the end of the Initial Term or the applicable Renewal Term.
The
Initial Term and any Renewal Term are collectively referred to as
the
"TERM."
(b) Termination or
Resignation. Subject to the other terms of this Agreement,
including those in
Part 2, either the Company or the Executive may
terminate the Executive's employment with the Company at any time
and for
any
reason or no reason upon written notice to the other party.
SECTION 2. DUTIES AND SCOPE OF EMPLOYMENT
(a) Position. The
Company will employ the Executive (or, if the Company is not
the
Executive's employer, the Company will cause its appropriate
subsidiary
to
employ the Executive) during the Term in the position of Senior
Vice
President and General Manager, Integrated Circuits Group, reporting
to Hans
Wildenberg. The Executive will be given duties, responsibilities
and
authorities that are appropriate to this position. The Executive
will
become an "officer" of the Company as defined by Rule 16a-1(f)
under the
Exchange Act upon election by the board of directors of the
Company.
(b) Obligations.
During the Term, the Executive will devote the Executive's
full
business efforts and time to the business and affairs of the
Company
as
needed to carry out his duties and responsibilities. The foregoing
shall
not
preclude the Executive from engaging in appropriate civic,
charitable,
religious or other non-profit activities or from devoting a
reasonable
amount of time to private
investments or from serving on the boards of
directors of other entities, provided that those activities do
not
interfere or conflict with the Executive's duties or
responsibilities to
the
Company.
SECTION 3. BASE COMPENSATION
During the Term, the Company will pay the Executive, as
compensation for
services, a base salary at the annual rate of at least $230,000.
Salary
increases will be considered after the first anniversary of this
Agreement, or
sooner in the discretion of the Chief Executive Officer, on a basis
consistent
with Company policies.
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SECTION 4. OTHER COMPENSATION
(a) EFIP. During the
Term the Executive will be enrolled in the Enhanced
Fairchild Incentive Plan (EFIP), at a targeted participation level
of 40%.
While bonuses under this program are never guaranteed, typically,
if the
company meets its EBITDA goals, participants receive 100% of the
targeted
payout. If the company exceeds those goals, participants can
receive up to
200%
of the targeted payout.
(b) Signing Bonus.
Once he begins work at the Company, the Executive will
receive a signing bonus of $70,000. This bonus will be tax
protected, or
grossed-up to include the income tax owed on the bonus. If the
Executive
voluntarily terminates his employment with the Company without Good
Reason
(as
defined in Section 5(b)) during the Initial Term, the Executive
must
repay the entire signing bonus including the tax protection
portion.
(c) Vacation. The
Executive will receive four weeks of vacation each year. This
may
be increased pursuant to the Company's normal policies.
(d) Relocation
Allowance. The Executive will receive a relocation allowance of
$19,200, which will not be tax protected. If the Executive
voluntarily
terminates his employment with the Company without Good Reason
during the
Initial Term, the Executive must repay this entire relocation
allowance.
(e) Options. The
Company will grant the Executive the option to purchase 30,000
shares of the company's common stock, subject to the applicable
Company
plan
governing such award and an award agreement under such plan not
inconsistent with the terms of this paragraph. The grant date for
this
grant of options will be the effective date of this Agreement. This
grant
will
vest in 25% increments on the first four anniversaries of the
grant
date. The Executive will be solely responsible for any taxes
associated
with
the foregoing stock option grant.
(f) DSUs. In addition
to any grants of options or other awards for which the
Executive may be eligible under the Company's general stock plan,
the
Company will grant the Executive 15,000 deferred stock units,
subject to
the
applicable Company plan governing such award and an award
agreement
under such plan not inconsistent with the terms of this paragraph.
The
grant date of this grant of deferred stock units will be the
effective date
of
this Agreement. This grant will vest in 25% increments on the first
four
anniversaries of the grant date. The Executive will be solely
responsible
for
any taxes associated with the receipt, vesting, or delivery of
shares
or
cash under, this grant, and the Company will make appropriate
withholdings from any distributions of shares or cash
thereunder.
PART 2 COMPENSATION AND BENEFITS IN CASE OF TERMINATION WITHOUT
CAUSE OR FOR
GOOD
REASON
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SECTION 5. TERMINATIONS AND RELATED DEFINITIONS
Part 2 of the Agreement, consisting of Sections 5 and 6, describes
the benefits
and compensation, if any, payable in case of certain terminations
of employment.
In this Agreement,
(a) "CAUSE" means (1)
a willful failure by the Executive to substantially
perform the Executive's duties under this Agreement, other than a
failure
resulting from the Executive's complete or partial incapacity due
to
physical or mental illness or impairment, (2) a willful act by
the
Executive that constitutes gross misconduct and that is
materially
injurious to the Company, (3) a willful breach by the Executive of
a
material provision of this Agreement (including Sections 8 and 10)
or (4) a
material and willful violation of a federal or state law or
regulation
applicable to the business of the Company that is materially
and
demonstrably injurious to the Company, provided that no act, or
failure to
act,
by the Executive shall be considered "willful" unless committed
without good faith and without a reasonable belief that the act or
omission
was
in the Company's best interest, and provided, further, that, if
the
failure, act, breach or other basis for finding Cause under this
Agreement
is
capable of being cured, then no finding of Cause shall be made
unless
the
Executive has failed to cure such failure, act, breach or other
basis
within 30 days after receiving written notice thereof from the
Company.
(b) "GOOD REASON"
means any of the following: (1) a reduction in the
Executive's base salary other than as part of a broader executive
pay
reduction, (2) a reduction in the Executive's incentive
compensation (EFIP)
target other than as part of a broader executive reduction, (3) a
material
change in the employment benefits available to the Executive, if
such
change does not similarly affect all employees of the Company
eligible for
such
benefits, or (4) a material reduction in the Executive's
duties,
responsibilities or authority.
SECTION 6. TERMINATION BY COMPANY WITHOUT CAUSE OR BY EXECUTIVE FOR
GOOD REASON
(a) Severance. If,
during the Term, the Company terminates the Executive's
employment for any reason other than Cause (including as a result
of the
Executive's death or disability), or if the Executive terminates
his
employment for Good Reason, then, provided the Executive (or his
legal
representative, if applicable) executes the release of claims
described in
Section 6(b), the Company will pay the Executive, in a lump sum or,
at the
Company's option, in installments over 12 months following the
effective
date
of such termination, an amount equal to one times the Executive's
base
salary in effect on such termination date. The Executive will
be
responsible for all taxes relating to such payments and the Company
will
make
all required withholdings of all such taxes. In addition, for a
period
of
one year following such termination, the Company shall provide
continued
medical and dental insurance benefits, for the benefit of the
Executive and
his
eligible dependents, on the same terms and conditions as available
to
executives of the Company in comparable positions (viewing the
Executive
for
this purpose as if he had remained employed by the Company
following
such
termination). At the time of such
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termination, the Company shall pay the Executive in cash for all
accrued
and
unused vacation time.
(b) Release of Claims.
As a condition to the receipt of the payments and
benefits described in Section 6(a), the Executive (or his legal
representative, if applicable) shall be required to execute a
release of
all
claims arising out of the Executive's employment or the
termination
thereof, including any claim of discrimination under U.S. state or
federal
law
or any non-U.S. law, but excluding claims for indemnification from
the
Company under any indemnification agreement with the Company,
its
certificate of incorporation or bylaws (or equivalent
organizing
instruments), or claims under applicable directors' and
officers'
insurance. If the Executive executes such a release, then the
Company shall
release the Executive from all claims arising out of the
Executive's
employment with the Company, other than any claims arising (before
or after
termination) under Sections 8 or 10 of this Agreement.
(c) Conditions to
Receipt of Payments. Without limiting the Company's other
rights or remedies in the even of the Executive's breach of any
provision
of
this Agreement, the obligation of the Company to provide the
payments
described in this Section 6 shall cease if the Executive breaches
any of
the
provisions of Section 8 or 10.
PART 3 COMPENSATION AND BENEFITS IN CASE OF A CHANGE IN CONTROL
SECTION 7. CHANGE IN CONTROL
(a) Payment. In the
event of a Change in Control, if the Executive's employment
is
terminated by the Company other than for Cause (including as a
result of
the
Executive's death or disability), or by the Executive for Good
Reason,
in
either case within the time period beginning six months before
the
Change in Control and ending 12 months after the Change in Control,
the
cash
payment under Section 6(a) will be paid in a lump sum within 14
days
after the date of such termination. Any obligation of the Company
under
this
Section 7 will survive any termination of this Agreement.
(b) Definition. A
"CHANGE IN CONTROL" means the happening of any of the
following events (for purposes of this Section 7 only, the
"COMPANY" means
Fairchild Semiconductor International, Inc., a Delaware
corporation, and
not
any of its subsidiaries):
(1)
An acquisition by any
individual, entity or group (within the meaning
of Section 13(d)(3) or 14(d)(2) of the Securities Exchange Act
of
1934, as amended (the "EXCHANGE ACT")) (any of which, a "PERSON")
of
beneficial ownership (within the meaning of Rule 13d-3
promulgated
under the Exchange Act) of 25% or more of either (i) the
then-outstanding shares of common stock of the Company (the
"OUTSTANDING COMPANY COMMON STOCK") or (ii) the combined voting
power
of the then-outstanding voting securities of the Company entitled
to
vote generally in the election of directors (the "OUTSTANDING
COMPANY
VOTING Securities"); excluding, however, the following: (A) Any
acquisition directly from the Company, other than an acquisition
by
virtue of the exercise of a conversion
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privilege unless the security being so converted was itself
acquired
directly from the Company, (B) Any acquisition by the Company, (C)
Any
acquisition by any employee benefit plan (or related trust)
sponsored
or maintained by the Company or any entity controlled by the
Company,
or (D) Any acquisition pursuant to a transaction which complies
with
clauses (i), (ii) and (ii) of Section 7(b)(3); or
(2)
A change in the
composition of the board of directors of the Company
(the "BOARD") such that the individua
