DB2/21688780.1 -2- controlled by, or is under common control with, the Company), of beneficial ownership (within the meaning of Rule 13d-3 of the 1934 Act) of securities possessing more than fifty percent (50%) of the total combined voting power of...
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DB2/21688780.1 ALPHA AND OMEGA SEMICONDUCTOR LIMITED Exhibit 10.2 April 28, 2010 Xx. Xxxx-Xx Xx c/o Alpha and Omega Semiconductor Incorporated 000 Xxxxxxx Xxxxxxx Xxxxxxxxx, Xxxxxxxxxx 00000 Dear Yueh-Se: We are pleased to inform you that the Company's Board of Directors has approved a new severance benefit program for you. The purpose of this letter agreement is to set forth the terms and conditions of your severance benefits and to explain certain limitations that may govern their overall value or payment. Your severance package will become payable should your employment terminate under certain circumstances prior to or following certain changes in ownership or control of the Company. To understand the full scope of your benefits, you should familiarize yourself with the definitional provisions of Part One of this letter agreement. The benefits comprising your severance package are detailed in Parts Two and Three, and the dollar limitations on the overall value of your benefit package and other applicable restrictions are specified in Parts Four and Five. PART ONE – DEFINITIONS For purposes of this Agreement, the following definitions shall be in effect: Board means the Company’s Board of Directors. Change in Control means a change in control of the Company effected through any of the following transactions: (i) a merger, consolidation or other reorganization approved by the Company’s shareholders, unless securities representing more than fifty percent (50%) of the total combined voting power of the voting securities of the successor Company are immediately thereafter beneficially owned, directly or indirectly and in substantially the same proportion, by the persons who beneficially owned the Company’s outstanding voting securities immediately prior to such transaction, or (ii) a shareholder-approved sale, transfer or other disposition of all or substantially all of the Company’s assets in liquidation or dissolution of the Company, or (iii) the acquisition, directly or indirectly by any person or related group of persons (other than the Company or a person that directly or indirectly controls, is
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DB2/21688780.1 -2- controlled by, or is under common control with, the Company), of beneficial ownership (within the meaning of Rule 13d-3 of the 0000 Xxx) of securities possessing more than fifty percent (50%) of the total combined voting power of the Company’s outstanding securities pursuant to a tender or exchange offer made directly to the Company’s shareholders. Change in Control Severance Period means the period commencing with the Company’s execution of the definitive agreement for a Change in Control transaction and continuing until the end of the twelve (12)-month period measured from the closing date of that Change in Control. Code means the Internal Revenue Code of 1986, as amended. Common Share means the Company’s common share. Company means Alpha and Omega Semiconductor Limited, a company incorporated and existing under the laws of the Islands of Bermuda. Executive means the undersigned executive. Good Reason means the Executive’s voluntary resignation within ninety (90) days following one or more of the following events that occur without the Executive’s written consent: (A) a material diminution in the Executive’s authority, duties or responsibilities, (B) a material reduction in his base compensation, with a reduction of fifteen percent (15%) or more to be deemed material for such purpose, (C) a material relocation of his principal place of employment, with a relocation that is more than fifty (50) miles from the location of his principal office in Sunnyvale, California to be deemed material for such purpose, or (D) a material breach by the Company of any of its obligations under this Agreement; provided, however, that none of the events specified above shall constitute Good Reason unless the Executive first provides written notice to the Company describing the applicable event within thirty (30) days following the occurrence of that event and the Company fails to cure such event within thirty (30) days after receipt of such written notice. Involuntary Termination means (i) the Company’s termination of the Executive’s employment for any reason other than a Termination for Cause or (ii) the Executive’s voluntary resignation for Good Reason. 1934 Act shall mean the U.S. Securities Exchange Act of 1934, as amended. Plan means (i) the Company’s 2000 Share Plan, (ii) the Company’s 2009 Share Option/Share Issuance Plan, as amended or restated from time to time, and (iii) any successor stock incentive plan subsequently implemented by the Company. Separation from Service means the Executive’s cessation of Employee status and shall be deemed to occur at such time as the level of the bona fide services the Executive is to perform in Employee status (or as a consultant or other independent contractor) permanently decreases to a level that is not more than twenty percent (20%) of the average level of services the Executive rendered in Employee status during the immediately preceding thirty-six (36) months (or such
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DB2/21688780.1 -3- shorter period for which the Executive may have rendered such service). Any such determination as to Separation from Service, however, shall be made in accordance with the applicable standards of the Treasury Regulations issued under Code Section 409A. For purposes of determining whether the Executive has incurred a Separation from Service, the Executive will be deemed to continue in “Employee” status for so long as he remains in the employ of one or more members of the Employer Group, subject to the control and direction of the employer entity as to both the work to be performed and the manner and method of performance. “Employer Group” means the Company and any other corporation or business controlled by, controlling or under common control with, the Company as determined in accordance with Sections 414(b) and (c) of the Code and the Treasury Regulations thereunder, except that in applying Sections 1563(a)(1), (2) and (3) for purposes of determining the controlled group of corporations under Section 414(b), the phrase “at least 50 percent” shall be used instead of “at least 80 percent” each place the latter phrase appears in such sections and in applying Section 1.414(c)-2 of the Treasury Regulations for purposes of determining trades or businesses that are under common control for purposes of Section 414(c), the phrase “at least 50 percent” shall be used instead of “at least 80 percent” each place the latter phrase appears in Section 1.414(c)-2 of the Treasury Regulations. In addition to the foregoing, a Separation from Service will not be deemed to have occurred while the Executive is on a sick leave or other bona fide leave of absence if the period of such leave does not exceed six (6) months or any longer period for which the Executive is provided with a right to reemployment with the Company by either statute or contract; provided, however, that in the event of a leave of absence due to any medically determinable physical or mental impairment that can be expected to result in death or to last for a continuous period of not less than six (6) months and that causes the Executive to be unable to perform his duties as an Employee, no Separation from Service shall be deemed to occur during the first twenty-nine (29) months of such leave. If the period of leave exceeds six (6) months (or twenty-nine (29) months in the event of disability as indicated above) and the Executive is not provided with a right to reemployment by either statute or contract, then the Executive will be deemed to have Separated from Service on the first day immediately following the expiration of the applicable six (6)-month or twenty-nine (29)-month period. Termination for Cause means the termination of the Executive’s employment due to (i) the commission of any act of fraud, embezzlement or dishonesty by the Executive or his conviction of a felony, (ii) any unauthorized use or disclosure by the Executive of confidential information or trade secrets of the Company (or any parent or subsidiary), (iii) any other misconduct by the Executive adversely affecting the business or affairs of the Company in a material manner, (iv) the Executive’s failure to cure any breach of his obligations under this Agreement or his Proprietary Information and Inventions Agreement with the Company after written notice of such breach from the Company and a reasonable cure period of at least thirty (30) days or (v) the Executive’s breach of any of his fiduciary duties as an officer or director of the Company. The foregoing definition shall not be deemed to be inclusive of all the acts or omissions which the Company (or any parent or subsidiary) may consider as grounds for the dismissal or discharge of the Executive or any other individual in the service of the Company (or any parent or subsidiary), but a dismissal for such other acts or omissions shall not constitute a Termination for Cause for purposes of this Agreement unless otherwise described above.
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DB2/21688780.1 -9- between the Executive and the Company relating to such subject matter. This Agreement may only be amended by a written instrument signed by the Executive and an authorized officer of the Company. Any and all prior agreements, understandings or representations relating to the Executive’s severance benefits, other than (i) the agreements evidencing the Executive’s currently outstanding options under the Plan and (ii) the Executive’s existing Proprietary Information and Inventions Agreement, are hereby terminated and cancelled in their entirety and are of no further force or effect. 15. Governing Law. The provisions of this Agreement shall be construed and interpreted under the laws of the State of California applicable to agreements executed and wholly performed within the State of California. If any provision of this Agreement as applied to any party or to any circumstance should be adjudged by a court of competent jurisdiction to be void or unenforceable for any reason, the invalidity of that provision shall in no way affect (to the maximum extent permissible by law) the application of such provision under circumstances different from those adjudicated by the court, the application of any other provision of this Agreement, or the enforceability or invalidity of this Agreement as a whole. Should any provision of this Agreement become or be deemed invalid, illegal or unenforceable in any jurisdiction by reason of the scope, extent or duration of its coverage, then such provision shall be deemed amended to the extent necessary to conform to applicable law so as to be valid and enforceable or, if such provision cannot be so amended without materially altering the intention of the parties, then such provision will be stricken, and the remainder of this Agreement shall continue in full force and effect. 16. Arbitration. A. Each party agrees that any and all disputes which arise out of or relate to the Executive’s employment, the termination of the Executive’s employment or the terms of this Agreement shall be resolved through final and binding arbitration. Such arbitration shall be in lieu of any trial before a judge and/or ju ry, and the Executive and Company express ly waive all rights to have such disp utes resolved through trial before a judge and/or jury. Such disputes shall include, without limitation, claims for breach of contract or of the covenant of good faith and fair dealing, claims of discrimination, claims under any federal, state or local law or regulation now in existence or hereinafter enacted and as amended from time to time concerning in any way the subject of the Executive’s employment with the Company or its termination. B. Arbitration shall be held in Santa Xxxxx County, California and conducted in accordance with the National Rules for the Resolution of Employment Disputes of the American Arbitration Association (“AAA Rules”), provided, however, that the arbitrator shall allow the discovery authorized by California Code of Civil Procedure section 1282, et seq., or any other discovery required by applicable law in arbitration proceedings. To the extent that any of the AAA Rules conflict with applicable law, the arbitration procedures required by applicable law shall govern. C. During the course of the arbitration, the Company will pay the arbitrator’s fee and any other type of expense or cost that the Executive would not otherwise be required to bear if he were free to bring the dispute or claim in court and any other expense or cost that is
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DB2/21688780.1 EXHIBIT A FORM OF GENERAL RELEASE THIS DOCUMENT IS INTENDED AS A FORM OF THE GENERAL SETTLEMENT AND RELEASE. PURSUANT TO PARAGRAPH 1 AND PARAGRAPH 3 OF THE LETTER AGREEMENT, EXECUTION OF A RELEASE, IN SUBSTANTIALLY THE SAME FORM AS THIS EXHIBIT A IS A CONDITION FOR EXECUTIVE’S RECEIPT OF CERTAIN BENEFITS PURSUANT TO PARAGRAPH 2 AND PARAGRAPH 4. THE FORM MUST BE FINALIZED BY ALPHA AND OMEGA SEMICONDUCTOR LIMITED PRIOR TO EXECUTION.
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DB2/21688780.1 -2- GENERAL SETTLEMENT AND RELEASE AGREEMENT This General Settlement and Release Agreement (the “Agreement”) is by and between Alpha ad Omega Semiconductor Limited, for itself and for all of its affiliated, related, parent and direct and indirect subsidiary companies, joint venturers and partnerships, successors and permitted assigns and each of them (collectively, “AOS”), on the one hand, and __________________, for himself, and his agents, representatives, heirs and assigns (“Executive”), on the other hand. 1. Payments. In full and complete consideration for Executive’s promises and undertaking set forth in this Agreement, following the eighth (8th) day following receipt by AOS of a fully executed Settlement and Release Agreement from Executive, AOS will provide Executive the consideration, if any, to which Executive is entitled pursuant to the Letter Agreement between the parties, dated ________, 2010, at the times specified in Paragraph 2 or Paragraph 4 (as applicable) of that Agreement unless the signature on this Agreement is revoked pursuant to Paragraph 7 below. 2. Release of Known and Unknown Claims. (a) It is understood and agreed by the parties to this Agreement that in consideration of the mutual promises and covenants contained in this Agreement, and after consultation with counsel, Executive irrevocably and unconditionally releases and forever discharges AOS and each of the other Released Parties from any and all causes of action, claims, actions, rights, judgments, obligations, damages, demands, accountings or liabilities of whatever kind or character, which Executive may have against AOS or any of the Released Parties, or any of them, by reason of or arising out of, touching upon or concerning Executive’s employment, separation of his employment and reapplication for employment with AOS, or any statutory claims, or any and all other matters of whatever kind, nature or description, whether known or unknown, occurring prior to the date of the execution of this Agreement. Executive acknowledges that this release of claims specifically includes, but is not limited to, any and all claims for fraud; breach of contract; breach of the implied covenant of good faith and fair dealing; inducement of breach; interference with contractual rights; wrongful or unlawful discharge or demotion; violation of public policy; sexual assault and battery; invasion of privacy; intentional or negligent infliction of emotional distress; intentional or negligent misrepresentation; conspiracy; defamation; unlawful effort to prevent employment; discrimination or harassment on the basis of age, race, color, sex, national origin, ancestry, religion, disability, handicap, medical condition or marital status; any claim under: Title VII, ADA, ADEA OWBPA, FMLA, COBRA, OSHA, ERISA, IRC, FEHA, CalOsha, or any other wrongful conduct, based upon events occurring prior to the date that this Agreement is executed by Executive. Notwithstanding anything to the contrary herein, this Agreement shall not release Executive’s right, if any, to indemnification pursuant to the Company’s Bylaws or insurance policies, for any claims arising out of Executive’s conduct as an employee or officer of the Company during his employment.
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DB2/21688780.1 -3- (b) Executive represents and warrants that he has not assigned or subrogated any of his rights, claims or causes of action, including any claims referenced in this Agreement, or authorized any other person or entity to assert such claims on his behalf, and he agrees to indemnify and hold harmless AOS and each of the Released Parties against any assignment of said rights, claims and/or causes of action. 3. Waiver of Unknown Claims. (a) Executive does hereby expressly waive and relinquish all rights and benefits afforded to him under law, and does so understanding and acknowledging the significance and consequences of such a waiver. (b) Releases of Unknown Claims/Waiver of Civil Code Section 1542 . The parties agree that this Agreement is a full and final release of any and all claims and Executive expressly waives the benefit of Section 1542 of the California Civil Code, which provides: “A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR DOES NOT KNOW OR SUSPECT TO EXIST IN HIS FAVOR AT THE TIME OF EXECUTING THE RELEASE, WHICH IF KNOWN BY HIM MUST HAVE MATERIALLY AFFECTED HIS SETTLEMENT WITH THE DEBTOR” (c) Executive acknowledges and understands that he is being represented in this matter by counsel, and acknowledges that he is not required to release unknown claims but that he expressly acknowledges and agrees that this Agreement is also intended to include in its effect, without limitation, all such claims which he does not know or suspect to exist at the time of the execution of this Agreement, and that this Agreement contemplates the extinguishment of those claims. (d) Executive acknowledges and agrees that he may later discover facts different from or in addition to those he now knows or believes to be true in entering into this Agreement. Executive agrees to assume the risk of the possible discovery of additional or different facts, including facts which may have been concealed or hidden, and agrees that this Agreement shall remain effective regardless of such additional or different facts. Executive further acknowledges and agrees that neither AOS nor any of the other Released Parties had any duty to disclose any fact to him prior to the execution of this Agreement. 4. Non-Admission of Liability . Executive expressly recognizes that this Agreement shall not in any way be construed as an admission by AOS or any of the other Released Parties of any unlawful or wrongful acts whatsoever against Executive or any other person or entity. AOS and each of the Released Parties expressly denies any violation of any policy or procedure, or of any state or federal law or regulation. AOS and each of the Released Parties also specifically denies any liability to or wrongful acts against Executive, or any other person, on the part of themselves or any other employees or agents of AOS. This Agreement shall not be admissible in any proceeding as evidence of or any admission by AOS of any violation of any law or regulation or wrongful act. This Agreement may, however, be introduced in any proceeding to enforce this Agreement. 5. No Filing of Claims . Executive specifically represents that he has no pending complaints or charges against AOS or any of the other Released Parties with any state or federal
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DB2/21688780.1 -4- court or any local, state or federal agency, division or department based on any events occurring prior to the date of execution of this Agreement. 6. Advice of Counsel . Executive acknowledges that he has been given twenty-one days (21) to seek the advice of counsel and to consider the effects of this Agreement upon his legal rights (the “Consideration Period”). To the extent that Executive has signed the Agreement without obtaining the advice of counsel or before expiration of the Consideration Period, Executive acknowledges that he has done so voluntarily with a full understanding of the Agreement and its effect upon his legal rights. Any discussion between Executive and AOS or any of the Released Parties concerning the terms and conditions of this Agreement does not extend the Consideration Period. 7. Revocation Period. Executive acknowledges that he has been informed that, after he signs this Agreement, he has the right to revoke his signature for a period of seven days (7) from the date that he signs the Agreement. To be effective, the revocation must be in writing, signed by Executive, and delivered to Vice President of Human Resources at 000 Xxxxxxx Xxxxxxx, Xxxxxxxxx, Xxxxxxxxxx 00000 before the close of business on the seventh day (7th) day following the date Executive signs this Agreement. Executive acknowledges and agrees that AOS has no obligation to comply with the terms of this Agreement until the Revocation Period has expired without revocation. 8. Confidentiality. Executive consents and agrees that he will not, at any time, disclose the existence of this Agreement, the terms of his severance benefits and/or the alleged facts or circumstances giving rise to any actual or alleged claims or the Action to any person, firm, Company, association, or entity or the press or media for any reason or purpose whatsoever, other than to his attorney, his immediate family and to his accountant or financial advisor for tax purposes. If Executive is served with any subpoena, court order, or other legal process seeking disclosure of any such information, Executive shall promptly send to AOS, within forty-eight (48) hours, via facsimile at (000) 000 0000, such subpoena, court order, or other legal process so that AOS may exercise any applicable legal remedies. Executive agrees and acknowledges that a violation of this paragraph by Executive shall be a material breach of this Agreement. 9. Delivery of Documents. Executive represents and warrants that he has not removed any documents, records or other information, including any such documents, records or information that are or were electronically stored, from the premises of AOS. Executive acknowledges that such documents, records and other information are the exclusive property of AOS or its subsidiaries or affiliates. 10. Remedies For Breach Of This Agreement. (a) Injunctive Relief. In the event of a breach of the provisions of this Agreement, Executive agrees that any remedy at law for any breach or threatened breach of the provisions of such paragraphs and the covenants set forth therein, will be inadequate and, accordingly, each party hereby stipulates that the other is entitled to obtain injunctive relief for any such breaches or threatened breaches (without the necessity of posting a bond). The injunctive relief provided for in this paragraph is in addition to, and is not in limitation of, any and all other remedies at law or in equity otherwise available to the applicable party.
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DB2/21688780.1 -5- (b) Remedies Cumulative. The remedies in this paragraph are not exclusive, and the parties shall have the right to pursue any other legal or equitable remedies to enforce the terms of this Agreement. (c) Governing Law; Consent to Jurisdiction. This Agreement shall be deemed to be a contract made under, and shall be construed in accordance with, the laws of the State of California, without giving effect to conflict of laws principles thereof. All questions concerning the construction, validity, and interpretation of this Agreement shall be governed by and construed in accordance with the domestic laws of the State of California, without giving effect to any choice of law or conflict of law provision that would cause the application of the laws of any jurisdiction other than the State of California. Each of the parties hereby irrevocably and unconditionally consents to submit to the exclusive jurisdiction of the courts of the State of California or the United States District Court for the Northern District of California for any litigation, proceeding or action arising out of or relating to this Agreement (and agrees not to commence any litigation, proceeding or action relating thereto except in such courts). Each of the parties hereby irrevocably and unconditionally waives any objection to the laying of venue of any litigation, proceeding or action arising out of this agreement or thereby in the courts of the State of California or the United States District Court for the Northern District of California and hereby further irrevocably and unconditionally waives and agrees not to plead or claim in any such court that any such litigation, proceeding or action brought in any such court has been brought in an inconvenient forum. 11. Counsel. The parties hereby acknowledge that they have had the reasonable opportunity to consult with attorneys of their own choice concerning the terms and conditions of this Agreement, that they have read and understand this Agreement, that they are fully aware of the contents of this Agreement and that they enter into this agreement freely and knowingly and with a full understanding of its legal effect. 12. Entire Agreement. This is the entire agreement between Executive and AOS with respect to the subject matter hereof and the Agreement supersedes any previous negotiations, agreements and understandings. Executive acknowledges that he has not relied on any oral or written representations by AOS (or its counsel) or any of the other Released Parties to induce him to sign this Agreement, other than the terms of this Agreement. No modifications of this Agreement can be made except in writing signed by Executive and AOS. 13. Severability. If any provision of this Agreement is held to be illegal, invalid or unenforceable under existing or future laws effective during the term of this Agreement, such provisions shall be fully several, the Agreement shall be construed and enforced as if such illegal, invalid or unenforceable provision had never comprised a part of this Agreement, and the remaining provisions of this Agreement shall remain in full force and effect and shall not be affected by the illegal, invalid or unenforceable provision or by its severance from this Agreement. Furthermore, in lieu of such illegal, invalid or unenforceable provision, there shall be added automatically as part of this Agreement a provision as similar in terms to such illegal, invalid or unenforceable provision as may be possible and be legal, valid and enforceable. 14. Ambiguities. Attorneys for both parties have participated in the negotiation of this Agreement and, thus, it is understood and agreed that the general rule that ambiguities are to be