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Change of Control Severance Agreement

 

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Title:

Change of Control Severance Agreement

Entities:

Solectron Corp.

Date:

2005

Size:

Preview shows 6KB of 29KB total

Price:

$47

ID:

#1226020

 

 

► Employment ► Severance Agmt. ► Change of Control Severance Agreements
► Technology ► Electronic Instruments & Controls

 

 

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                              SOLECTRON CORPORATION


CHANGE OF CONTROL SEVERANCE AGREEMENT

This Change of Control Severance Agreement (the "AGREEMENT") is made and
entered into by and between [_________________] (the "EXECUTIVE") and Solectron
Corporation, a Delaware Corporation (the "COMPANY"), effective as of
[_____________], 2002 (the "EFFECTIVE DATE").

RECITALS

1. It is expected that the Company from time to time will consider the
possibility of an acquisition by another company or other change of control. The
Board of Directors of the Company (the "BOARD") recognizes that such
consideration can be a distraction to Executive and can cause Executive to
consider alternative employment opportunities. The Board has determined that it
is in the best interests of the Company and its stockholders to assure that the
Company will have the continued dedication and objectivity of Executive,
notwithstanding the possibility, threat or occurrence of a Change of Control of
the Company.

2. The Board believes that it is in the best interests of the Company
and its stockholders to provide Executive with an incentive to continue his or
her employment and to motivate Executive to maximize the value of the Company
upon a Change of Control for the benefit of its stockholders.

3. The Board believes that it is imperative to provide Executive with
certain severance benefits upon Executive's termination of employment following
a Change of Control. These benefits will provide Executive with enhanced
financial security and incentive and encouragement to remain with the Company
notwithstanding the possibility of a Change of Control.

4. Certain capitalized terms used in the Agreement are defined in
Section 6 below.

AGREEMENT

NOW, THEREFORE, in consideration of the mutual covenants contained herein,
the parties hereto agree as follows:

1. Term of Agreement. This Agreement shall terminate upon the date that
all of the obligations of the parties hereto with respect to this Agreement have
been satisfied.

2. At-Will Employment. The Company and Executive acknowledge that
Executive's employment is and shall continue to be at-will, as defined under
applicable law, except as may otherwise be specifically provided under the terms
of any written formal employment agreement or offer letter between the Company
and Executive (an "EMPLOYMENT AGREEMENT"). If Executive's employment terminates
for any reason, including (without limitation) any termination prior to a Change
of Control, Executive shall not be entitled to any payments, benefits, damages,
awards or compensation other than as provided by this Agreement or under his or
her Employment Agreement.

<PAGE>

3. Severance Benefits.

(a) Involuntary Termination Following a Change of Control. If
within twelve (12) months following a Change of Control (i) Executive terminates
his or her employment with the Company (or any parent or subsidiary of the
Company) for Good Reason or (ii) the Company (or any parent or subsidiary of the
Company) terminates Executive's employment for other than Cause, and Executive
signs and does not revoke a standard release of claims with the Company in a
form acceptable to the Company, then Executive shall receive the following
severance from the Company:

(i) Severance Payment. For a period of twenty-four (24)
months following Executive's termination of employment, Executive shall be paid
Executive's average annual base salary and target bonus for the two years prior
to such termination payable in accordance with the Company's normal payroll
practices; provided, however, that if Executive has been employed for less than
two years prior to such termination, for a period of twenty-four (24) months
following such termination, Executive will be paid Executive's average annual
base salary and target bonus for the period Executive was actually employed with
the Company; provided, further, that in the event Executive engages in
Competition during the twenty-four month period following such termination, all
payments pursuant to this subsection shall immediately cease.

(ii) Options. Executive shall be entitled to continue vesting
for twelve (12) months following the date of such termination with respect to
any Company stock options (whether granted to Executive on, before or after the
date of this Agreement); provided, however, that all Company stock options will
immediately cease vesting if Executive engages in Competition during such
12-month period. Additionally, Executive shall have a period of one year and
ninety (90) days following such termination of employment (the "POST-TERMINATION
EXERCISE PERIOD") to exercise Executive's vested Company stock options (whether
granted on, before or after the date of this Agreement), but in no event beyond
the original maximum term of the option; provided, however, that all Company
stock options shall immediately terminate and Executive shall have no further

 

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