Exhibit 10.1

 

EMPLOYMENT SEPARATION AND GENERAL RELEASE AGREEMENT

 

This Employment Separation and General Release Agreement (this “Separation
Agreement”) is entered into this 1st day of October 2008, by and between Brad W.
Godfrey, an individual (“Executive”), and Power-One, Inc., a Delaware
corporation (the “Company”).

 

WHEREAS, Executive has been employed as the President and Chief Operating
Officer for the Company;

 

WHEREAS, Executive and the Company are parties to that certain Change in Control
Agreement dated May 24, 2007 (the “Change in Control Agreement”);

 

WHEREAS, Executive and the Company are parties to that certain Indemnification
Agreement dated April 25, 2006 (the “Indemnification Agreement”);

 

WHEREAS, Executive agrees to provide transitional consulting services to the
Company upon the terms and conditions herein; and

 

WHEREAS, Executive and the Company mutually agreed to terminate Executive’s
employment relationship with the Company effective on September 29, 2008 (the
“Separation Date”) upon the terms set forth herein.

 

NOW, THEREFORE, in consideration of the covenants undertaken and the releases
contained in this Separation Agreement, Executive and the Company agree as
follows:

 

I.              Resignation / Consulting Services.

 

A.            Resignation. Executive’s employment by the Company terminated on
the Separation Date. Executive hereby confirms that he resigned as an officer,
director, employee, member, manager and in any other capacity with the Company
and each of its affiliates effective as of the Separation Date and that he
currently holds no such position with the Company or any of its affiliates. The
Company confirms that it and each of its affiliates accepted such resignation
effective as of the Separation Date. Executive acknowledges and agrees that he
has received all amounts owed for his regular and usual salary (including, but
not limited to, any severance (other than the Severance Benefits expressly
provided for in, and subject to the terms of, this Separation Agreement),
overtime, bonus, accrued vacation, commissions, or other wages), reimbursement
of expenses, and usual benefits, and that all payments due to Executive from the
Company and each of its affiliates after the Separation Date shall be determined
under this Separation Agreement. Notwithstanding the foregoing, the Company
acknowledges and agrees that Executive is not waiving his right to file for
state unemployment insurance, which the Company will not contest.

 

B.            Consulting Services. For up to thirty (30) days following the
Separation Date, the Executive shall be available to perform consulting,
transition and advisory services as reasonably requested by the Company. During
such period, the Executive shall not have any right to act for, represent or
otherwise bind the Company or its affiliates and the Executive shall not be
entitled to participate in any employee benefit plans of the Company or its

 

--------------------------------------------------------------------------------

 

affiliates (except as provided in this Separation Agreement). Executive shall
not be entitled to any additional compensation for such services.

 

II.            Severance.

 

A.            Subject to Sections II(B) and II(C) below, the Company shall
provide to the Executive the following benefits, collectively the “Severance
Benefits”:

 

(i)            Severance Pay. The Company shall provide as severance pay to
Executive continued payment of his base salary in effect immediately prior to
the Separation Date during the thirteen (13) month period following the
Separation Date (the “Severance Pay”), less standard withholding and authorized
deductions. The Severance Pay shall be paid in substantially equal biweekly
installments beginning in the biweekly period immediately following the
Separation Date.

 

(ii)           Outplacement Services Reimbursement. The Company shall reimburse
Executive’s costs for reasonable outplacement services during the twelve (12)
month period following the Separation Date up to a maximum of $25,000
(twenty-five thousand and 00/100), payable quarterly in arrears upon the
Company’s receipt of satisfactory invoices (the “Outplacement Benefits”).

 

(iii)         Benefits Continuation. The Company shall provide to Executive
reimbursement of medical and dental benefits under COBRA (the “Benefits
Continuation”) for up to thirteen (13) months following the Separation Date.
Benefits Continuation shall cease upon the Executive being eligible to obtain
coverage from a new employer.

 

(iv)          Relocation Reimbursement. The Company shall provide to Executive
reimbursement, or, in the alternative, the Company shall arrange for direct
payment, of reasonable and documented costs relating to the relocation of
Executive’s personal and household property from Camarillo/Thousand Oaks to the
Dominican Republic to the extent Executive so relocates within one year after
the Separation Date (the “Relocation Benefit”).

 

(v)            Continued Vesting of Equity Awards. As of the Separation Date,
Executive holds 320,000 fully vested stock options to purchase shares of the
Company’s common stock (the “Options”). Notwithstanding anything to the contrary
under any equity plan or award agreement evidencing the Options, the Company
shall permit the Options to remain exercisable for a period of ninety (90) days
following the Separation Date (subject to earlier termination on a change in
control or similar event in accordance with the provisions of the equity
compensation plan under which such awards were granted and the applicable stock
option agreement). As of the Separation Date, Executive also holds 200,000
outstanding and unvested restricted stock units (collectively, the “Restricted
Awards”). Notwithstanding anything to the contrary under any equity plan or
award agreement evidencing the Restricted Awards, the Company shall permit the
Restricted Awards to continue to vest for twelve (12) months following the
Separation Date (to the extent they are scheduled to vest during that period in
accordance with their customary vesting schedules). Any Restricted Awards not
scheduled (in accordance with the usual vesting schedule applicable to such
awards) to vest

 

2

--------------------------------------------------------------------------------

 

within one year after the Separation Date, terminated on the Separation Date and
Executive has no further right with respect thereto or in respect thereof.

 

B.            The Company’s obligation to provide the Severance Benefits (or to
continue providing any portion thereof, as applicable) is subject to the
Executive’s agreement to execute any and all agreements to waive and release,
without additional consideration from the Company other than as explicitly set
forth in this Agreement, all Claims against Releasees under international laws.
In addition, the Company’s obligation to provide the Severance Benefits (or to
continue providing any portion thereof, as applicable) is subject to continuing
compliance with the restrictive covenants set forth in Section VII hereof. The
Company shall have no obligation to provide the Severance Benefits at any time
after a breach by Executive of either or both of the covenants set forth in
Sections VII.A and B, or after any material breach of any other covenant set
forth in Section VII. For purposes of clarity, upon any breach by Executive of
either or both of the covenants set forth in Sections VII.A and B, or after any
material breach of any other covenant set forth in Section VII (which material
breach remains uncured following written notice thereof), the Options and
Restricted Awards shall be immediately forfeited by the Executive.
Notwithstanding the foregoing provisions of this Section II(B), in no event
shall the amount of the Severance Pay actually paid by the Company to Executive
be less than Ten Thousand Dollars ($10,000) in the aggregate, regardless of any
breach by Executive of the restrictive covenants set forth in Section VII, which
amount the parties agree is good and sufficient consideration for the Release
and other obligations of Executive under this Separation Agreement.

 

C.            The Company’s obligation to provide the Severance Benefits (or any
portion thereof, as applicable) is further subject to the condition that
Executive shall not have revoked the Release set forth in Section III hereof
pursuant to any revocation rights afforded by applicable law. The Company shall
have no obligation to provide the Severance Benefits to Executive unless and
until the Release becomes irrevocable by Executive under all applicable laws.

 

D.            To the extent that the Outplacement Benefits, Benefits
Continuation or Relocation Benefit are taxable to the Executive, any
reimbursement payment due to the Executive pursuant to such provisions shall be
paid to the Executive on or before the last day of the Executive’s taxable year
following the taxable year in which the related expense was incurred. The
Outplacement Benefits, Benefits Continuation and Relocation Benefit are not
subject to liquidation or exchange for another benefit and the amount of such
benefits and reimbursements that the Executive receives in one taxable year
shall not affect the amount of such benefits or reimbursements that the
Executive receives in any other taxable year.

 

III.           Release. Executive, on behalf of himself, his descendants,
dependents, heirs, executors, administrators, assigns, and successors, and each
of them, hereby covenants not to sue and fully releases and discharges the
Company and each of its parents, subsidiaries and affiliates, past and present,
as well as its and their trustees, directors, officers, members, managers,
partners, agents, attorneys, insurers, employees, stockholders, representatives,
assigns, and successors, past and present, and each of them, hereinafter
together and collectively referred to as the “Releasees,” with respect to and
from any and all claims, wages, demands, rights, liens, agreements or contracts
(written or oral), covenants, actions, suits, causes of

 

3

--------------------------------------------------------------------------------

 

action, obligations, debts, costs, expenses, attorneys’ fees, damages,
judgments, orders and liabilities of whatever kind or nature in law, equity or
otherwise, whether now known or unknown, suspected or unsuspected, and whether
or not concealed or hidden (each, a “Claim”), which he now owns or holds or he
has at any time heretofore owned or held or may in the future hold as against
any of said Releasees (including, without limitation, any Claim arising out of
or in any way connected with Executive’s service as an officer, director,
employee, member or manager of any Releasee, Executive’s separation from his
position as an officer, director, employee, manager and/or member, as
applicable, of any Releasee, or any other transactions, occurrences, acts or
omissions or any loss, damage or injury whatever), whether known or unknown,
suspected or unsuspected, resulting from any act or omission by or on the part
of said Releasees, or any of them, committed or omitted prior to the date of
this Release Agreement including, without limiting the generality of the
foregoing, any Claim under Title VII of the Civil Rights Act of 1964, the Age
Discrimination in Employment Act of 1967, the Americans with Disabilities Act,
the Family and Medical Leave Act of 1993, the California Fair Employment and
Housing Act, the California Family Rights Act, or any other federal, state or
local law, regulation, or ordinance, or any Claim for severance pay, bonus, sick
leave, holiday pay, vacation pay, life insurance, health or medical insurance,
pension, retirement or any other fringe benefit, workers’ compensation or
disability (the “Release”); provided, however, that the foregoing Release does
not apply to any obligation of the Company to Executive pursuant to any of the
following: (1) the Executive’s rights to receive the Severance Benefits pursuant
to the terms and conditions of this Agreement; (2) any right to indemnification
that Executive may have pursuant to the Bylaws of the Company, its Articles of
Incorporation, the laws of the State of Delaware, or under any written
indemnification agreement with the Company (or any corresponding provision of
any subsidiary or affiliate of the Company) with respect to any loss, damages or
expenses (including but not limited to attorneys’ fees to the extent otherwise
provided) that Executive may in the future incur with respect to his service as
an employee, officer or director of the Company or any of its subsidiaries or
affiliates; (3) with respect to any rights that Executive may have to insurance
coverage for such losses, damages or expenses under any Company (or subsidiary
or affiliate) directors and officers liability insurance policy; (4) any rights
to continued medical or dental coverage that Executive may have under COBRA; or
(5) any rights to payment of benefits that Executive may have under a retirement
plan sponsored or maintained by the Company that is intended to qualify under
Section 401(a) of the Internal Revenue Code of 1986, as amended. In addition,
this Release does not cover any Claim that cannot be so released as a matter of
applicable law. Executive acknowledges and agrees that he has received any and
all leave and other benefits that he has been and is entitled to pursuant to the
Family and Medical Leave Act of 1993.

 

4

--------------------------------------------------------------------------------

 

IV.           1542 Waiver. It is the intention of Executive in executing this
Separation Agreement that the same shall be effective as a bar to each and every
Claim hereinabove specified. In furtherance of this intention, Executive hereby
expressly waives any and all rights and benefits conferred upon him by the
provisions of SECTION 1542 OF THE CALIFORNIA CIVIL CODE and expressly consents
that this Separation Agreement (including, without limitation, the Release set
forth above) shall be given full force and effect according to each and all of
its express terms and provisions, including those related to unknown and
unsuspected Claims, if any, as well as those relating to any other Claims
hereinabove specified. SECTION 1542 provides:

 

“A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR DOES NOT KNOW OR
SUSPECT TO EXIST IN HIS OR HER FAVOR AT THE TIME OF EXECUTING THE RELEASE, WHICH
IF KNOWN BY HIM OR HER MUST HAVE MATERIALLY AFFECTED HIS OR HER SETTLEMENT WITH
THE DEBTOR.”

 

Executive acknowledges that he may hereafter discover Claims or facts in
addition to or different from those which Executive now knows or believes to
exist with respect to the subject matter of this Separation Agreement and which,
if known or suspected at the time of executing this Separation Agreement, may
have materially affected this settlement. Nevertheless, Executive hereby waives
any right, Claim or cause of action that might arise as a result of such
different or additional Claims or facts. Executive acknowledges that he
understands the significance and consequences of the foregoing Release and such
specific waiver of SECTION 1542.

 

V.            ADEA Waiver. Executive expressly acknowledges and agrees that by
entering into this Separation Agreement, he is waiving any and all rights or
claims that he may have arising under the Age Discrimination in Employment Act
of 1967, as amended (“ADEA”), which have arisen on or before the date of
execution of this Separation Agreement. Executive further expressly acknowledges
and agrees that:

 

A.            In return for this Separation Agreement, he will receive
consideration beyond that which he was already entitled to receive before
entering into this Separation Agreement, including, without limitation, the
Severance Benefits;

 

B.            He is hereby advised in writing by this Separation Agreement to
consult with an attorney before signing this Separation Agreement;

 

C.            He was given a copy of this Separation Agreement on September 30,
2008 and informed that he had twenty-one (21) days within which to consider the
Separation Agreement and that if he wished to execute this Separation Agreement
prior to expiration of such 21-day period, he should execute the Acknowledgement
and Waiver attached hereto as Exhibit A;

 

D.            Nothing in this Separation Agreement prevents or precludes
Executive from challenging or seeking a determination in good faith of the
validity of this waiver under the ADEA, nor does it impose any condition
precedent, penalties or costs from doing so, unless specifically authorized by
federal law; and

 

5

--------------------------------------------------------------------------------

 

E.             He was informed that he has seven (7) days following the date of
execution of this Separation Agreement in which to revoke this Separation
Agreement, and this Separation Agreement will become null and void if Executive
elects revocation during that time. Any revocation must be in writing and must
be received by the Company during the seven-day revocation period. In the event
that Executive exercises his right of revocation, neither the Company nor
Executive will have any obligations under this Separation Agreement.

 

VI.           No Transferred Claims. Executive warrants and represents that
Executive has not heretofore assigned or transferred to any person not a party
to this Separation Agreement any released matter or any part or portion thereof
and he shall defend, indemnify and hold the Company and each of its affiliates
harmless from and against any claim (including the payment of attorneys’ fees
and costs actually incurred whether or not litigation is commenced) based on or
in connection with or arising out of any such assignment or transfer made,
purported or claimed.

 

VII.         Restrictive Covenants.

 

A.            Solicitation of Customers. Executive promises and agrees that, for
a period of one (1) year following the Separation Date, he will not influence or
attempt to influence customers, vendors, or business partners of the Company or
any of its subsidiaries, either directly or indirectly, to divert their business
from the Company or any of its subsidiaries to any individual, partnership,
firm, corporation or other entity then in competition with the business of the
Company or any subsidiary. Notwithstanding the foregoing, the Company
acknowledges that Executive is entitled to seek and obtain employment and
business opportunities within the same industry as the Company, and that
Executive may compete, directly or indirectly, with the Company.

 

B.            Solicitation of Employees. Executive promises and agrees that, for
a period of one (1) year following the Separation Date, he will not directly or
indirectly solicit any employee of the Company or any of its subsidiaries to
work for any business, individual, partnership, firm, corporation, or other
entity then in competition with the business of the Company or any subsidiary.

 

C.            Confidentiality. Executive promises and agrees that he will not at
any time after the Separation Date, unless compelled by lawful process, disclose
or use for his own benefit or purposes or the benefit or purposes of any other
person, firm, partnership, joint venture, association, corporation or other
business organization, entity or enterprise (other than the Company and any of
its subsidiaries or affiliates), any trade secrets, or other confidential data
or information relating to customers, design programs, costs, marketing, sales
activities, promotion, credit and financial data, financing methods, or plans of
the Company or any subsidiary or affiliate of the Company; provided that the
foregoing shall not apply to information which is not unique to the Company (or
subsidiary or affiliate, as applicable) or which is generally known to the
industry or the public other than as a result of Executive’s breach of this
covenant. Executive agrees that, to the extent he has not already done so, he
will return to the Company immediately all memoranda, books, papers, plans,
information, letters and other data, and all copies thereof or therefrom, in any
way relating to the business of the

 

6

--------------------------------------------------------------------------------

 

Company or any subsidiary or affiliate of the Company, whether such information
is in tangible or electronic form. Executive further agrees that he has not
retained and will not retain or use for his account at any time any trade names,
trademark or other proprietary business designation used or owned in connection
with the business of the Company or any subsidiary or affiliate of the Company;
provided, however, that Executive may retain his rolodex, address books,
information relating to his compensation or relating to reimbursement of
expenses, documents relating to his participation in employee benefit plans or
programs of the Company or any of its subsidiaries, any agreement between
Executive and the Company or a subsidiary relating to his employment with the
Company or a subsidiary, and other personal property provided that such items do
not contain any confidential information of the Company or a subsidiary.

 

D.            Non-Disparagement. Executive promises and agrees that, for a
period of one (1) year following the Separation Date, he will not by any means
issue or communicate any private or public statement that may be critical or
disparaging of any member of the Company or its affiliates, or any of their
respective products, services, officers, directors or employees. The Company
promises and agrees that it will not by any means issue or communicate any
private or public statement that may be critical or disparaging of Executive.
However, nothing in this paragraph shall affect Executive’s or the Company’s
ability or obligation to provide complete and truthful testimony or other
information in connection with any (i) governmental and/or regulatory
investigation or proceeding, (ii) required public, governmental or regulatory
disclosure or filing, or (iii) pleadings, discovery and/or trial in litigation.

 

E.             Injunctive Relief. Executive expressly agrees that the Company
will or would suffer irreparable injury if he were to breach any of the
provisions of this Section VII and that the Company would by reason of such
conduct be entitled, in addition to any other remedies, to injunctive relief.
Executive consents and stipulates to the entry of such injunctive relief
prohibiting him from engaging in conduct which violates any of the provisions of
this Section VII.

 

VIII.        Miscellaneous.

 

A.            Company Insider Trading Restrictions. The Company agrees to
immediately notify E*Trade, as the administrative brokerage for the Executive’s
stock options and equity grants, that as of the Separation Date the Executive is
no longer considered a “company insider” for the purposes of trading of any
Company stock options. Executive hereby acknowledges that he is personally
responsible for complying with all applicable securities laws regarding trading
while in possession of material inside information.

 

B.            Section 16 Officer Status/SEC Reporting Requirements. The parties
hereby acknowledge and agree that as of the Separation Date, the Executive will
cease to be considered an officer of the Company who is subject to Section 16 of
the Securities Exchange Act of 1934. The Company will arrange for necessary
public filings and reports, as applicable, which confirm and memorialize this
Section 16 status change, and such other reports (e.g., 8-K, 10-Q) as are
required. The Executive may be subject to certain additional filings and
Section 16 considerations for a period of up to six (6) months following the
Separation Date, in

 

7

--------------------------------------------------------------------------------

 

the event he engages in any transaction in Company common stock. Executive is
encouraged to coordinate with his own personal legal advisor, as may be relevant
for any transaction in Company stock within a period of up to six (6) months
following the Separation Date.

 

C.            Return of Company Property. On the Separation Date, the Executive
shall return the Company automobile, laptop computer, cellular phone, employee
identification, and all other equipment, devices, or items provided to the
Executive by the Company. Except as otherwise provided herein, all Company
provided services will be discontinued as of the Separation Date.

 

D.            Successors.

 

(i)            This Separation Agreement is personal to Executive and shall not,
without the prior written consent of the Company, be assignable by Executive.
However, should Executive die during the twelve (12) month period following the
Separation Date, then, so long as Executive had not theretofore materially
breached his obligations under this Separation Agreement, (and such material
breach remains uncured following notice thereof) the Company agrees to pay any
then remaining balance of the Severance Benefits to the Executive’s heirs or his
estate, as applicable.

 

(ii)           This Separation Agreement shall inure to the benefit of and be
binding upon the Company and its respective successors and assigns and any such
successor or assignee shall be deemed substituted for the Company under the
terms of this Separation Agreement for all purposes. As used herein, “successor”
and “assignee” shall include any person, firm, corporation or other business
entity which at any time, whether by purchase, merger, acquisition of assets, or
otherwise, directly or indirectly acquires the ownership of the Company,
acquires all or substantially all of the Company’s assets, or to which the
Company assigns this Separation Agreement by operation of law or otherwise.

 

E.             Waiver. No waiver of any breach of any term or provision of this
Separation Agreement shall be construed to be, nor shall be, a waiver of any
other breach of this Separation Agreement. No waiver shall be binding unless in
writing and signed by the party waiving the breach.

 

F.             Modification. This Separation Agreement shall not be modified by
any oral agreement, either express or implied, and all modifications hereof
shall be in writing and signed by the parties hereto.

 

G.            Complete Agreement. This Separation Agreement embodies the entire
agreement of the parties hereto respecting the matters within its scope. This
Separation Agreement supersedes all prior agreements of the parties hereto on
the subject matter hereof. Any prior negotiations, correspondence, agreements,
proposals, or understandings relating to the subject matter hereof shall be
deemed to be merged into this Separation Agreement and to the extent
inconsistent herewith, such negotiations, correspondence, agreements, proposals,
or understandings shall be deemed to be of no force or effect. There are no
representations, warranties, or agreements, whether express or implied, or oral
or written, with respect to the subject matter hereof, except as set forth
herein. Notwithstanding the foregoing, the

 

8

--------------------------------------------------------------------------------

 

Company’s rights under any confidentiality, trade secret, proprietary
information, inventions or similar agreement to which Executive was a party or
otherwise bound, including but not limited to the Employee Agreement dated
March 28, 1994, are not integrated into this Agreement and such rights of the
Company shall continue in effect.

 

H.            Termination and Cessation of Change in Control Agreement. For the
avoidance of doubt, the Company and Executive acknowledge and agree that the
Change in Control Agreement terminated as of the Separation Date, as of and as a
direct result of Executive’s termination of employment as of the Separation
Date, independent of and unrelated to this Separation Agreement. The Company and
Executive further acknowledge and agree that Executive retains no further
rights, interests, claims for benefits, or eligibility for coverage under the
terms and conditions of such Change in Control Agreement.

 

I.              Severability. In the event that a court of competent
jurisdiction determines that any portion of this Separation Agreement is in
violation of any statute or public policy, then only the portions of this
Separation Agreement which violate such statute or public policy shall be
stricken, and all portions of this Separation Agreement which do not violate any
statute or public policy shall continue in full force and effect. Furthermore,
any court order striking any portion of this Separation Agreement shall modify
the stricken terms as narrowly as possible to give as much effect as possible to
the intentions of the parties under this Separation Agreement.

 

J.             Governing Law. This Separation Agreement and the legal relations
hereby created between the parties hereto shall be governed by and construed
under and in accordance with the internal laws of the State of California,
without regard to conflicts of laws principles thereof.

 

K.            Legal Counsel; Mutual Drafting. Each party recognizes that this is
a legally binding contract and acknowledges and agrees that they have had the
opportunity to consult, and have consulted, with legal counsel of their choice.
Each party has cooperated in the drafting, negotiation and preparation of this
Separation Agreement. Hence, in any construction to be made of this Separation
Agreement, the same shall not be construed against either party on the basis of
that party being the drafter of such language. Executive agrees and acknowledges
that he has read and understands this Separation Agreement, is entering into it
freely and voluntarily, and has been advised to seek counsel prior to entering
into this Separation Agreement, has had ample opportunity to do so, and has had
the benefit of such counsel.

 

L.            Notices. All notices under this Separation Agreement shall be in
writing and shall be either personally delivered or mailed postage prepaid, by
certified mail, return receipt requested:

 

(i)            if to the Company:

 

Power-One, Inc.

Attention: General Counsel

740 Calle Plano

 

9

--------------------------------------------------------------------------------

 

Camarillo, California 93012

 

(ii)           if to Executive:

 

At the address on file with the Company

 

Notice shall be effective when personally delivered, or five (5) business days
after being so mailed. Any party may change its address for purposes of giving
future notices pursuant to this Agreement by notifying the other party in
writing of such change in address, such notice to be delivered or mailed in
accordance with the foregoing.

 

M.           On-going Communication and Cooperation with the Company. For the
purposes of coordinating and controlling any ongoing communications, contacts,
or interactions between the Executive and the Company following the Separation
Date, Glenn Grindstaff, Vice President, Corporate Human Resources, is to be the
sole and exclusive point of contact between the Executive and the Company. Any
and all communications, contacts, questions, requests, or other interactions of
any nature by the Executive or on the Executive’s behalf whatsoever must be
directed to Mr. Grindstaff as the exclusive point of contact with and “entry” to
the Company for any matter dealing with the Company, or for any matter which
arises from or relates in any way to the Executive’s involvement with the
Company. This arrangement includes, by way of example and not as any limitation
or restriction on the generality of the foregoing, requests involving employee
benefit questions, matters involving any transaction with equity awards the
Executive beneficially owns from whatever source, or matters of administration
of any aspect of this Separation Agreement. Mr. Grindstaff will arrange for
contact with, response by, or communication with, the applicable personnel of
the Company on a case-by-case basis. Mr. Grindstaff may be reached at office
phone 805-445-1700. If Mr. Grindstaff is not then employed by the Company, the
Company’s General Counsel will designate the appropriate new contact person.

 

N.            Counterparts. This Separation Agreement may be executed in any
number of counterparts, each of which shall be deemed an original and all of
which together shall constitute one and the same instrument.

 

O.            Arbitration. Any controversy arising out of or relating to this
Separation Agreement, its enforcement or interpretation, or because of an
alleged breach, default, or misrepresentation in connection with any of its
provisions, or any other controversy arising out of Executive’s employment or
the termination thereof, including, but not limited to, any state or federal
statutory claims, shall be submitted to arbitration before a sole arbitrator
(the “Arbitrator”) selected from Judicial Arbitration and Mediation
Services, Inc., or its successor (“JAMS”), or if JAMS is no longer able to
supply the arbitrator, such arbitrator shall be selected from the American
Arbitration Association, and shall be conducted in accordance with the
provisions of California Code of Civil Procedure §§ 1280 et seq. as the
exclusive forum for the resolution of such dispute. The arbitration shall be
held in the JAMS’ office nearest to the city in which the Executive was last
employed by the Company or at a mutually agreeable location. Pursuant to
California Code of Civil Procedure § 1281.8, provisional injunctive relief may,
but need not, be sought by either party to this Separation Agreement in a court
of law while arbitration proceedings are pending, and any provisional injunctive
relief

 

10

--------------------------------------------------------------------------------

 

granted by such court shall remain effective until the matter is finally
determined by the Arbitrator. Final resolution of any dispute through
arbitration may include any remedy or relief which the Arbitrator deems just and
equitable, including any and all remedies provided by applicable state or
federal statutes. At the conclusion of the arbitration, the Arbitrator shall
issue a written decision that sets forth the essential findings and conclusions
upon which the Arbitrator’s award or decision is based. Any award or relief
granted by the Arbitrator hereunder shall be final and binding on the parties
hereto and may be enforced by any court of competent jurisdiction. The parties
acknowledge and agree that they are hereby waiving any rights to trial by jury
in any action, proceeding or counterclaim brought by either of the parties
against the other in connection with any matter whatsoever arising out of or in
any way connected with this Separation Agreement or Executive’s employment. The
parties agree that (i) the Company shall be responsible for payment of the forum
costs of any arbitration hereunder, including the Arbitrator’s fee, in
connection with any proceeding to enforce the terms of this Separation
Agreement, and (ii) in any such arbitration, the prevailing party shall be
entitled to his or its reasonable attorney’s fees and expenses, including costs
of expert witnesses (if any) (except that in all cases the Company shall be
responsible for payment of the forum costs of such arbitration, including the
Arbitrator’s fee).

 

P.            Number and Gender. Where the context requires, the singular shall
include the plural, the plural shall include the singular, and any gender shall
include all other genders.

 

Q.            Headings. The section headings in this Separation Agreement are
for the purpose of convenience only and shall not limit or otherwise affect any
of the terms hereof.

 

R.            Taxes. The Company has the right to withhold from any payment
hereunder or under any other agreement between the Company and Executive the
amount required by law to be withheld with respect to such payment or other
benefits provided to Executive. Other than as to such withholding right,
Executive shall be solely responsible for any taxes due as a result of the
payments and benefits received by Executive contemplated by this Separation
Agreement.

 

[Remainder of page intentionally left blank.]

 

11

--------------------------------------------------------------------------------

 

I have read the foregoing Separation Agreement and I accept and agree to the
provisions it contains and hereby execute it voluntarily with full understanding
of its consequences.

 

EXECUTED this 1st day of October 2008, at Camarillo, California.

 

 

“Executive”

 

 

 

 

 

 

 

 

/s/ Brad W. Godfrey

 

Brad W. Godfrey

 

 

 

EXECUTED this 1st day of October 2008, at Camarillo, California.

 

 

“Company”

 

 

 

 

 

Power-One, Inc.,

 

 

a Delaware corporation

 

 

 

 

 

 

 

 

      /s/  Glenn Grindstaff

 

By:

Glenn Grindstaff

 

Its:

Vice President, Corporate

 

 

  Human Resources

 

--------------------------------------------------------------------------------

 

EXHIBIT A

 

ACKNOWLEDGEMENT AND WAIVER

 

I, Brad W. Godfrey, hereby acknowledge that I was given 21 days to consider the
foregoing Employment Separation and General Release Agreement and voluntarily
chose to sign the Employment Separation and General Release Agreement prior to
the expiration of the 21-day period.

 

I declare under penalty of perjury under the laws of the state of California,
that the foregoing is true and correct.

 

EXECUTED this 1st day of October 2008, at Camarillo, California.

 

 

 

/s/ Brad W. Godfrey

 

Brad W. Godfrey

 

--------------------------------------------------------------------------------