FAIRCHILD INCENTIVE PLAN

Page

1.

Objective and Structure

1

2.

Definitions

1

3.

Effective Date

4

4.

Eligibility for Plan Participation

4

5.

Target Awards and Participation Levels

5

6.

Calculation and Payment of Awards

6

A.

Factors

6

B.

Performance Goal

6

C.

Calculation of Awards

7

D.

Extraordinary Events

7

E.

Payment

7

7.

Termination of Employment

8

8.

Interpretations and Rule-Making

8

9.

Declaration of Incentives, Amendment or Discontinuance

8

10.

Miscellaneous

9

Award:

The amount, if any, to be paid to a Plan Participant for a particular Measurement Period.

Award Date:

The date on which a FIP Award, if any, is due to be paid. Awards may be issued once or twice for each Company fiscal year so there shall be annual or semi-annual Award Dates. They shall be no later than sixty (60) days after the last day of each Measurement Period, or fifteen (15) days after consolidated financial statements for the Measurement Period are completed and accepted by the Company, whichever deadline is later.

Company:

Fairchild Semiconductor Corporation (“FSC”) or any corporate successor or assign which adopts or assumes the Plan. For purposes of eligibility to participate in the Plan, the term “Company,” as used herein, may also refer to any subsidiary or affiliate of FSC which adopts the Plan with the approval of FSC.

Committee:

The Plan administrator shall be a committee consisting of the Executive Vice President and CFO, Senior Vice President, Human Resources, and the Senior Vice President and General Counsel. The Committee shall be responsible for the administration of the Plan, as provided in Article 8 below, but may delegate routine administrative or clerical duties to one or more officers or employees of the Company. The actions, duties and responsibilities of the Committee noted and called for herein, are subject to the approval and discretion of the Chief Executive Officer of the Company where stated herein.

Disability :

Inability to perform any services for the Company, combined with eligibility to receive disability benefits under the standards used by the Company’s long-term disability benefit plan.

Employee :

An individual in the regular full-time or regular part-time employ of the Company (or having comparable status in any foreign location of the Company, as determined by foreign management and approved by the Committee based on applicable local laws, customs and practices) at any time during the Measurement Period, not including any non-regular employees. Members of a collective bargaining unit, if any, shall be considered Employees for purposes of the Plan only if they satisfy the eligibility conditions of the preceding sentence and their collective bargaining agreement provides for their participation in the Plan. Any regular employees in a class that is eligible for a different incentive plan – including, without limitation: (i) sales, marketing and other employees who are eligible for the Company’s Sales Incentive Plan (or any successor plan thereto); (ii) any newly acquired employees who remain subject to either their prior employer’s incentive or bonus plan or to any special or transitional incentive or bonus plan assumed or adopted by the Company in connection with the acquisition of such employees; and (iii) any other group of one or more employees who the Committee determines either is covered by a different bonus or incentive plan or arrangement (except for the Company’s Key Technologist Incentive Award Plan) or shall not be covered by this Plan nor any other bonus or incentive plan or arrangement -- shall not be considered Employees under this Plan for any Measurement Period during which they fall within any such exclusion, except to the extent otherwise determined by the Committee or otherwise specified herein. Employees who are subject to a separate incentive or bonus pay formula pursuant to a written employment agreement entered into with their employer and to which the Company or subsidiary becomes obligated also shall be excluded from eligible Employee status under this Plan for any Measurement Periods to which that other arrangement applies, the same as if such Employees were instead covered by another group incentive plan, in accordance with the preceding rules.

Extraordinary

Occurrence :

An event that, in the opinion of the Committee and with the Chief Executive Officer’s concurrence, is beyond the significant influence of Plan Participants or the Company and causes a significant unintended effect, positive or negative, on Company operating and financial results for a particular Measurement Period.

Measurement

Period :

The period of performance on which Awards are based. The Measurement Periods shall be the annual or semi-annual periods corresponding to the fiscal year or the first half and the second half, respectively, of the Company’s fiscal year. The Committee shall have sole discretion in determining whether the Measurement Period shall be annual or semi-annual.

Participant :

An Employee who at the time shall be a Participant in accordance with the provisions of Article 4.

Participation
Levels :

The allocation of Participants into groups, by job code level or management selection, as set forth in Article 4 and 5, for which a single Target Award level applies within the group ( i.e. , for that Participation Level). Different Target Award levels may apply to different groups and within the same job code level, at the discretion of the Chief Executive Officer. Absent any such special designations by the Chief Executive Officer, unless otherwise provided in this Plan a uniform Target Award level of 5% of Qualified Earnings shall apply to all Participants, so there shall be just one Participation level as well.

Performance

Goal :

Levels of performance shall be set in accordance with one or more financial and strategic goals developed by the Chief Executive Officer (with Board approval) for the Company and, if further desired, for any division, department, or other business unit or Employee group within the Company. For each goal up to three levels of performance may beset, as follows: