EXHIBIT 10.1
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ON Semiconductor Corporation
5005 E. McDowell Road
Phoenix, AZ 85008
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SEMICONDUCTOR COMPONENTS
INDUSTRIES, LLC
Confidential
Communication
October 27, 2006
Peter Green
3532 E. Kachina Drive
Phoenix, Arizona 85044
Re: Transition and Separation
Agreement
Dear Peter:
As you know, November 30, 2006
will be your last day of employment with Semiconductor Components
Industries, LLC (collectively, “Company,”
“us” or “we”). Between the current date and
November 30, 2006, you have stated that you will assist us
with leadership transition. You and we have reached agreement with
regard to this transition and your severance benefits upon your
ultimate separation from the Company.
This letter agreement (“Letter
Agreement”) is intended to formalize our mutual understanding
with regard to the transition and your severance benefits. In
addition, this Letter Agreement delineates certain other
understandings between you and the Company.
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1.
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You acknowledge
that effective October 31, 2006, you are no longer the
Company’s Senior Vice President and General Manager, Digital
and Consumer Products Group, and as of the date of this Letter
Agreement through November 30, 2006 (“Transition
Period”), subject to this Letter Agreement, you will assist
us with the leadership transition and other projects as requested
or specified by us in our sole and absolute discretion.
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2.
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During the
Transition Period, you will remain an employee of the Company at
your current base salary of $332,500 per annum and your current
benefits (i.e., medical benefits, eligible for bonus plan and
401(k) participation, etc.). Your unvested options will also
continue to vest as an employee.
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3.
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You and we agree that your
employment with the Company shall terminate effective
November 30, 2006 (“Termination Date”) and after
the Termination Date, but no later than the close of business on
December 7, 2006, you and we shall execute the separation
agreement (“Separation Agreement”) attached hereto as
Exhibit A , including its waiver
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1
Green Termination Letter
October 27, 2006
Page 2 of 3
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and release provisions. You
acknowledge that you have read and understand the Separation
Agreement. Among other things, the Separation Agreement provides
that, upon its effectiveness and pursuant to its terms:
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(i) Base Salary Related
Payments . You will receive a series of severance payments
totaling $166,250, subject to applicable tax and payroll
deductions, representing six (6) months of your annual base
salary as of the Termination Date. This amount would be paid by us
in accordance with our ordinary payroll practices for base
salaries.
(ii) ONcentive Bonus . You
will be eligible to receive your “ONcentive” bonus
payment under the ON Semiconductor 2002 Executive Incentive Plan
for the performance cycle for the second half of 2006 (“H2-06
Performance Cycle”), prorated for your period of employment
with the Company during the H2-06 Performance Cycle (i.e., through
November 30, 2006), subject to ONcentive bonuses being earned
and paid to the Company’s employees for the H2-06 Performance
Cycle and further subject to applicable tax and payroll deductions.
Any such bonus would be paid to you when bonuses are paid to active
employees under ONcentive for the H2-06 Performance
Cycle.
(iii) Health and Medical
Benefits. You may elect to continue your health insurance
benefits for you and your immediate family as provided under
Section 4980B of the Internal Revenue Code of 1986 and
Section 601 of the Employee Retirement Income Security Act of
1974, as amended (which provisions are commonly known as
“COBRA”). The Company will then, at our option, pay
directly or reimburse you for the cost of such COBRA benefits for a
period of up to six (6) months from your Termination Date. If
you become eligible for medical benefits in connection with new
employment during this period, the coverage and
payment/reimbursement provided by us under this subsection will
terminate immediately.
(iv) Outplacement Services .
Within fifteen (15) days following the Termination Date, ON
shall pay you $5,000 in lieu of providing any executive or
other similar outplacement services.
The Separation Agreement also
contains various restrictive covenants, and a waiver and
release.
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4.
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Upon execution
of this Letter Agreement, you agree to sign and return to us a
resignation letter in the form of the letter attached hereto as
Exhibit B .
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5.
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You understand and agree that
neither the granting of any benefits set forth in this Letter
Agreement, nor this Letter Agreement, shall constitute or be
evidence of any agreement or understanding, either expressed or
implied, on the part of the Company to employ you for any definite
period of time. During the Transition Period, you are an
“at-will” employee, which means that you or the Company
may terminate the employment relationship at any time and for any
reason, with or without notice and with or without cause and you
will only be entitled to the amounts specified in your
Separation
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2
Green Termination Letter
October 27, 2006
Page 3 of 3
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Agreement, subject to this
agreement becoming effective. Specifically, the Transition Period
may be shortened by the Company in its sole discretion at any time
and for any reason.
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6.
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You agree and
acknowledge that this Letter Agreement contains all of the terms of
your transition with and separation from the Company and that you
have not relied on any oral or written representations that are not
explicitly set forth in this Letter Agreement in deciding whether
to accept these arrangements.
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7.
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This Letter
Agreement may be executed in two or more counterpart, each of which
shall be deemed to constitute an original, but all of which
together shall constitute one and the same documents. A facsimile
of a signature shall be deemed to be and have the same force and
effect as an original.
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Please acknowledge your agreement to
the foregoing by signing in the appropriate space below. This
Letter Agreement shall be effective as of October 27, 2006
provided that it is executed by each of the parties
hereto.
Very truly yours,
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Semiconductor Components Industries,
LLC
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/S/ George
“Sonny” Cave
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George
“Sonny” Cave
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Senior Vice
President and General Counsel
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Accepted and Agreed to as of the date first written above:
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/S/ Peter
Green
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Peter
Green
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Enclosures:
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Exhibit A
– Separation Agreement
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Exhibit B
– Resignation Letter
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Exhibit A
SEPARATION
AGREEMENT
This Separation Agreement
(“Agreement”) is made and entered into as of
, 2006 by and between Peter Green
(“you”), a resident of the state of Arizona, and
Semiconductor Component Industries, LLC, doing business as ON
(“ON”), a Delaware limited liability company, with its
principal place of business in Phoenix, Arizona.
You and ON have agreed that your
employment will conclude as provided in this Agreement and, in
connection with the termination of your employment, ON has agreed
to provide you with certain payments and other benefits to which
you would not be entitled absent your execution of this Agreement.
Further, you and ON desire to settle any and all disputes related
directly or indirectly to your employment by ON and/or your
termination from employment, in accordance with the terms and
conditions set forth in this Agreement. Therefore, in consideration
of the mutual covenants and agreements set forth in this Agreement
and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, you and ON agree as
follows:
1. Termination of
Employment . Your employment with ON is terminated
effective November 30, 2006 (“Termination Date”).
Except as otherwise provided in this Agreement or as set forth in
the applicable employee benefit plan, all of your privileges as an
ON employee will end as of the close of business on the Termination
Date.
2. ON’s Severance
Commitment and Other .
(a) In exchange for your agreement
to abide by the commitments set forth in this Agreement and upon
its effectiveness, ON will provide you with the following severance
benefits in consideration for, among other things, your effective
waiver and release in paragraph 9 hereof:
(i) Base Salary Related
Payments . Pursuant to this Agreement, ON shall pay you a
series of severance payments totaling $166,250, subject to
applicable tax and payroll deductions, representing six
(6) months of your annual base salary as of the Termination
Date. This amount shall be paid in accordance with ON’s
ordinary payroll practices for base salaries in effect from time to
time and such payments shall begin as soon as practicable after the
Effective Date (as defined in paragraph 10 hereof) of this
Agreement.
(ii) ONcentive Bonus . You
will be eligible to receive your “ONcentive” bonus
payment under the ON Semiconductor 2002 Executive Incentive Plan
for the performance cycle for the second half of 2006 (“H2-06
Performance Cycle”), prorated for your period of employment
with ON during the H2-06 Performance Cycle (i.e., through
November 30, 2006), subject to ONcentive bonuses being earned
and paid to ON employees for the H2-06 Performance Cycle and,
further subject to applicable tax and payroll deductions. Any such
bonus would be paid to you when bonuses are paid to active
employees under the ONcentive program and related bonus plans for
the H2-06 Performance Cycle.
(iii) Health and Medical
Benefits. If you elect continuation of health insurance
benefits for you and your immediate family as provided under
Section 4980B of the Internal Revenue Code of 1986 and
Section 601 of the Employee Retirement Income Security Act of
1974, as amended (which provisions are commonly known as
“COBRA”), ON shall, at its
option, pay directly or reimburse
you for the cost of such COBRA benefits for a period of up to six
(6) months from your Termination Date. ON will make these
benefits available to you as soon as possible after the Effective
Date of this Agreement. If you become eligible for medical benefits
in connection with new employment during this period, the coverage
and payment/reimbursement provided by ON under this subsection
shall terminate immediately. You agree that you will notify ON
promptly of your subsequent employment and eligibility for
benefits.
(iv) Outplacement Services .
Within fifteen (15) days following the Termination Date, ON
shall pay you $5,000 in lieu of providing any executive or
other similar outplacement services.
(b) Any stock options will become
vested at their normal vesting dates until your Termination Date,
at which time all non-vested stock options shall be forfeited. You
will have the right to exercise any vested options within ninety
(90) days after the end of the Termination Date.
(c) ON will pay you your base salary
that is accrued but not yet paid through the Termination Date, and
will also pay you your accrued and unused vacation balance, if any,
subject to applicable tax and payroll deductions, within three
(3) business days of your Termination Date.
(d) Except as provided above, you
acknowledge that you have received all other compensation and
benefits due and owing to you from ON and that you have no further
claim to any compensation or employee benefits from ON. You
acknowledge that you are only entitled to the severance benefits in
paragraph 2(a) upon the Effective Date of this Agreement and that
these severance benefits constitute consideration in addition to
anything of value to which you would otherwise be entitled if you
did not sign the Agreement and allow it to become
effective.
3. Your Death . In the
event of your death prior to the date any of the payments provided
hereunder become due and payable, ON agrees that such amounts will
be paid to your beneficiaries or estate, as applicable, to the
extent they would otherwise have been paid to you.
4. Unemployment
Compensation . ON agrees not to challenge your entitlement
to unemployment compensation benefits as provided by
law.
5. Confidential
Information . Except to the
