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EXHIBIT 10.51
EXECUTIVE COMMITTEE EMPLOYMENT AGREEMENT
THIS EXECUTIVE COMMITTEE EMPLOYMENT AGREEMENT (this "AGREEMENT")
is
entered into as of April 28, 2003 between
Izak Bencuya (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
- Other
Compensation
PART 2-- COMPENSATION AND BENEFITS IN
CASE OF ACTUAL OR CONSTRUCTIVE
TERMINATION
(Sections 5-6, beginning on page 4)
-
Termination
PART 3-- COMPENSATION AND BENEFITS IN
CASE OF A CHANGE IN CONTROL
(Section 7, beginning on page 5)
- Change
in Control
PART 4-- TRADE SECRETS, INTELLECTUAL
PROPERTY, NON-COMPETITION, REMEDIES,
SEVERABILITY, SUCCESSORS, MISCELLANEOUS PROVISIONS, SIGNATURE
PAGE
(Sections 8-14, beginning on page 7)
-
Non-Compete
-
Confidentiality
-
Forfeiture in Case of Certain Events
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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 EMPLOYMENT
(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
fourth 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 Executive Vice
President,
Discrete Division, reporting to the Chief Operating Officer.
The
Executive will
be given duties, responsibilities and authorities that are
appropriate to
this position.
(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 $300,000. 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 new targeted participation level of
60%. 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) Retention Bonus.
(i) Subject to clause (ii) below, if the Executive remains
continuously
employed by the Company in his present or any higher ranking
position up to
and including January 1, 2004, then the Company will pay the
Executive a lump
sum of $150,000 within 10 days after that date, if, in the
judgment of the
Company he has worked closely with the CEO on, and made a
significant
contribution to, development of a worldwide power products
strategy. In
addition, subject to clause (ii) below, if the Executive
remains
continuously employed by the Company in his present or any
higher
ranking position
up to and including January 1, 2005, then the Company will
pay the
Executive a lump sum $150,000 within 10 days after that date.
Each
such payment
will be net of withholding of all applicable taxes on wages
and income
assessed at the time of payment. Any additional wage or income
taxes resulting
from the Executive's receipt of such payments will be the
sole
responsibility of the Executive. The obligations of the Company
under
this Section
4(b) are subject to Section 6(a). Without limiting the
Company's other
rights or remedies in the event of the Executive's breach
of any provision
of this Agreement, the obligation of the Company to
provide the
payments described in this Section 4(b) shall cease if the
Executive
breaches any of the provisions of Sections 8 or 10.
(ii) If the Executive terminates his employment with the
Company
before January
1, 2007 for any reason other than Good Reason, then the
Executive will
repay to the Company the full value of any amounts received
from the Company under
clause (i), including the value of any taxes paid by
the Company in
connection with such payments. Such repayment obligation
shall be
effective, and all amounts owing thereunder will be due and
payable, as of
the date of such termination, and the Company may provide
for an offset to
any payments owed by the Company or any subsidiary to the
Executive if
necessary to partially satisfy such repayment obligation.
(c) 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 10,000 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.
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(c) Options. (i) The Company will
grant the Executive options to purchase
100,000 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, provided
that any unvested options will vest in full on the second
anniversary of
the grant date if each of the following conditions is
satisfied on or
before such second anniversary: (1) the Executive has
submitted a plan
reasonably satisfactory to the Company regarding the
development and
succession planning of the Company's worldwide discrete
business, (2)
the Company's net trade revenues for its worldwide discrete
business have
grown each year according to the operating plans submitted by
the Executive,
unless factors beyond the reasonable control of the
Executive have
intervened, and (3) the Executive has submitted a plan
reasonably
satisfactory to the Company articulating a global power
products
strategy, with
measurable strategies and goals. The Executive will be
solely
responsible for any taxes associated with the foregoing stock
option
grant.
(ii) In addition, so long as he is employed by the Company, the
Company will
make annual grants to the Executive of options to purchase
shares of common
stock, subject to the applicable Company plan governing
such award,
covering a number of shares consistent with grants to other
Executive Vice
President-level recipients as recommended by independent
compensation
consultants and determined by the compensation committee of
the Company's
board of directors.
PART 2 COMPENSATION AND BENEFITS IN CASE OF
TERMINATION WITHOUT CAUSE OR FOR
GOOD REASON
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.
Part 3 of the Agreement, consisting of
Section 7, describes benefits and
compensation, if any, payable in case of a
Change in Control.
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
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good faith and
without a reasonable belief that the act or omission was in
the Company's
best interest; and
(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),
(i) the Company will pay the Executive, in a lump sum or, at
the Company's
option, in installments over 24 months following the
effective date
of such termination, an amount equal to two 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) and (ii) the Company
will continue to
make the payments specified in Section 4(b)(i), in
accordance with
the terms of that section, as if the Executive remained
employed by the
Company on the dates specified in that section.
(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 legal or contractual obligation of the Company, including
but not limited
to 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.
(c) Conditions to Receipt of Payments.
Without limiting the
Company's other
rights or
remedies in the event 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
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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, then
all cash payments under Section 6(a) and Section 4(b)(i) will
be paid in a
lump sum within 14 days after the date of such termination.
Any obligation
of the Company unde
