Exhibit 10.12
SEPARATION AGREEMENT
     This Separation Agreement is entered into this 18th day of September, 2007,
between Christina M. Temperante (“Temperante”) and Hutchinson Technology
Incorporated (“HTI”).
I.       RECITALS
     A.       Temperante has been employed by HTI.
     B.       In connection with her employment by HTI, Temperante executed an
Agreement Not to Compete, Not to Disclose Confidential Information and
Assignment of Inventions dated June 29, 2001 (“Agreement Not to Compete”).
     C.       In connection with her employment by HTI, Temperante executed
Incentive Stock Option Agreements and Non-Statutory Stock Option Agreements
dated July 2, 2001, November 28, 2001, November 20, 2002, November 19, 2003,
December 1, 2004, November 30, 2005, and November 29, 2006 (“Option
Agreements”).
     D.       Temperante’s HTI employment was terminated effective August 29,
2007 (the “Termination Date”).
     E.       Temperante and HTI desire to resolve all of Temperante’s potential
claims on the terms set out in this Separation Agreement.
II.       AGREEMENT
     For the consideration described below, the adequacy of which the parties
acknowledge, the parties agree as follows:
     1.       Release by Temperante. At the same time that she executes this
Separation Agreement, Temperante shall execute the release that is attached as
Exhibit A (the “Release”).
     2.       Payment. Within five business days after the satisfaction of all
of the conditions stated in Paragraph 3 below, HTI shall pay Temperante a lump
sum in the amount of $250,000.00, less applicable withholdings.
     3.       Conditions. HTI need not make the payment described in Paragraph 2
above unless and until all of the following conditions have been satisfied:
(a)       Temperante executes the Release after the Termination Date and
delivers it to HTI within the time specified in the Release.
(b)       The applicable rescission period for the Release expires without a
rescission by Temperante.
     4.       Right to Consult with an Attorney. Temperante understands and
acknowledges that she is hereby being advised by HTI to consult with an attorney
prior to signing this Separation Agreement and the Release.
     5.       Consideration and Rescission. The periods described in the Release
during which Temperante may consider whether to sign or may rescind the Release
and the procedures stated in the Release for accepting or rescinding the Release
also apply to this Separation Agreement. The Release and this Separation
Agreement must be accepted or rescinded together. Rescission of one of these
documents will be deemed a rescission of both of them.
     6.       Cooperation. Upon reasonable notice and request by HTI, Temperante
shall be reasonably available to consult with, advise, and assist HTI with
respect to legal and business matters about which she had knowledge or
responsibility during her employment with the HTI. Without limiting the
foregoing, at HTI’s reasonable request, Temperante shall consult with HTI
regarding business matters that she was involved with while employed by HTI and
be available, with or without subpoena, to be interviewed, review documents or
things, give depositions, testify, or engage in other reasonable activities in
connection with any litigation or investigation, with respect to matters that
Temperante has or may have knowledge of. In performing her

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obligations under this Paragraph 6 to testify or otherwise provide information,
Temperante shall honestly, truthfully, forthrightly, and completely provide
requested information to the extent that she is able to do so.
     7.       Agreement Not to Solicit. For a period of 36 consecutive months
from and after the Termination Date, Temperante shall not, directly or
indirectly, in any manner or capacity (including without limitation as a
proprietor, principal, agent, partner, officer, director, stockholder, employee,
consultant, or otherwise) solicit, request, advise, or induce any person who is
then an employee or contractor of HTI to terminate, curtail, or otherwise
adversely change his or her relationship with HTI.
     8.       Agreement Not to Hire. For a period of 36 consecutive months from
and after the Termination Date, Temperante shall not, directly or indirectly, in
any manner or capacity (including without limitation as a proprietor, principal,
agent, partner, officer, director, stockholder, employee, consultant, or
otherwise) hire, attempt to hire, engage, or attempt to engage any person who is
then an employee of HTI.
     9.       Blue Pencil Doctrine. If the duration of, the scope of, or any
activity covered by any provision of Paragraphs 7 and 8 above is in excess of
what is determined to be valid and enforceable under applicable law, such
provision shall be construed to cover only that duration, scope, or activity
that is determined to be valid and enforceable. Temperante hereby acknowledges
that Paragraphs 7 and 8 above shall be given the construction that renders their
provisions valid and enforceable to the maximum extent, not exceeding their
express terms, possible under applicable law.
     10.       Acknowledgement and Remedies. Temperante hereby acknowledges that
the provisions of Paragraphs 7 and 8 above are reasonable and necessary to
protect the legitimate interests of HTI and that any violation of Paragraphs 7
or 8 by Temperante would cause substantial and irreparable harm to HTI to such
an extent that monetary damages alone would be an inadequate remedy. In the
event that Temperante violates any provision of Paragraphs 7 or 8 above, HTI
shall be entitled to an injunction, in addition to all other remedies it may
have, restraining Temperante from violating or continuing to violate such
provision.
     11.       Non-Admission. Nothing in this Separation Agreement or the
Release is intended to be, nor will be deemed to be, an admission by HTI that it
has violated any law or that it has engaged in any wrongdoing.
     12.       Entire Agreement. This Separation Agreement and the Release
supersede all prior oral and written agreements, representations, and promises
between the parties except that the Agreement Not to Compete and the Option
Agreements shall continue in full force and effect according to their terms.
This Separation Agreement, the Release, the Agreement Not To Compete, and the
Option Agreements constitute the entire agreement between the parties with
respect to Temperante’s employment with HTI and the termination of that
employment. Temperante acknowledges that there were no inducements or
representations leading to the execution of this Separation Agreement or the
Release, except as stated in this Separation Agreement.
     13.       Voluntary and Knowing Action. The parties acknowledge that they
understand the terms of this Separation Agreement and that they are voluntarily
entering into this Separation Agreement. The parties intend to be legally bound.
Temperante represents that she is legally able and entitled to enter into this
Separation Agreement and the Release and to receive the payment described in
Paragraph 2 above.
     14.       Governing Law. All matters relating to the interpretation,
construction, application, validity and enforcement of this Separation Agreement
shall be governed by the laws of the State of Minnesota without giving effect to
any choice or conflict of law provision or rule, whether of the State of
Minnesota or any other jurisdiction, that would cause the application of laws of
any jurisdiction other than the State of Minnesota.
     15.       Jurisdiction and Venue. Temperante and HTI consent to the
jurisdiction of the courts of the State of Minnesota and the United States
District Court for the District of Minnesota for the purpose of resolving all
issues of law, equity, or fact, arising out of or in connection with this
Separation Agreement. Any action involving claims of a breach of this Separation
Agreement shall be brought in such courts. Each party consents to personal
jurisdiction over such party and venue in the state and federal courts
identified above.
     16.       Tax Matters.
(a)       HTI and Temperante acknowledge and agree that the payment described in
Paragraph 2 of this Separation Agreement is paid solely at the discretion of
HTI, does not represent an

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amount to which Temperante had a right to payment prior to the termination of
her employment (under either an employment agreement or other severance plan of
the Company), and is not paid in lieu of any “deferred compensation” as
otherwise defined in Section 409A of the Internal Revenue Code and regulations
thereunder. As a result, the parties intend that the payment be exempt from the
requirements of Internal Revenue Code Section 409A.
(b)       Temperante acknowledges and agrees that neither HTI nor anyone acting
on its behalf has made any representations to her concerning the tax
consequences of entering into this Separation Agreement and receiving the
consideration specified in it and that she has not relied on any tax advice from
HTI or anyone acting on its behalf.

              HUTCHINSON TECHNOLOGY INCORPORATED
    /s/ Christina M. Temperante    By   /s/ Rebecca Albrecht        Christina M.
Temperante    Its   VP of HR     

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EXHIBIT A
RELEASE BY CHRISTINA M. TEMPERANTE
Definitions. I intend all words used in this Release to have their plain
meanings in ordinary English. Specific terms that I use in this Release have the
following meanings:

  A.   I, me, and my include both me and anyone who has or obtains any legal
rights or claims through me.     B.   HTI means Hutchinson Technology
Incorporated, any company related to Hutchinson Technology Incorporated in the
present or past (including without limitation, its predecessors, parents,
subsidiaries, affiliates, and divisions), and any successors of Hutchinson
Technology Incorporated.     C.   Company means HTl; the present and past
officers, directors, committees, and employees of HTl; the present and past
employee benefit plans sponsored or maintained by HTI and the present and past
fiduciaries of such plans; and anyone who acted on behalf of HTl or on
instructions from HTI.     D.   Agreement means the Separation Agreement between
HTl and me that I am executing on the same date on which I execute this Release.
    E.   My Claims means all of my rights that I now have to any relief of any
kind from the Company, including without limitation:

  1.   all claims arising out of or relating to my employment with HTI or the
termination of that employment;     2.   all claims arising out of or relating
to the statements, actions, or omissions of the Company;     3.   all claims for
any alleged unlawful discrimination, harassment, retaliation or reprisal, or
other alleged unlawful practices arising under the laws of the United States or
any other country or of any state, province, municipality, or other unit of
government, including without limitation, claims under Title VII of the Civil
Rights Act of 1964, the Age Discrimination in Employment Act, the Americans with
Disabilities Act, the Family and Medical Leave Act, 42 U.S.C. § 1981, the
Employee Retirement Income Security Act, the Equal Pay Act, the Worker
Adjustment and Retraining Notification Act, the Sarbanes-Oxley Act, the Fair
Credit Reporting Act, the Minnesota Human Rights Act, and workers’ compensation
non-interference or non-retaliation statutes (such as Minn. Stat. §176.82);    
4.   all claims for alleged wrongful discharge; breach of contract; breach of
implied contract; failure to keep any promise; breach of a covenant of good
faith and fair dealing; breach of fiduciary duty; estoppel; my activities, if
any, as a “whistleblower”; defamation; infliction of emotional distress; fraud;
misrepresentation; negligence; harassment; retaliation or reprisal; constructive
discharge; assault; battery; false imprisonment; invasion of privacy;
interference with contractual or business relationships; any other wrongful
employment practices; and violation of any other principle of common law;     5.
  all claims for compensation of any kind, including without limitation,
bonuses, commissions, stock options, vacation pay, employee managed time off
(“EMTO”), perquisites, relocation expenses, and expense reimbursements;

 

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  6.   all claims for back pay, front pay, reinstatement, other equitable
relief, compensatory damages, damages for alleged personal injury, liquidated
damages, and punitive damages; and     7.   all claims for attorneys’ fees,
costs, and interest.

However, My Claims does not include any claims that the law does not allow to be
waived, any claims that may arise after the date on which I sign this Release,
any claims for continuation of coverage under the Consolidated Omnibus Budget
Reconciliation Act (COBRA) or similar state law, and any claims related to the
exercise of stock options that have been awarded under the Hutchinson Technology
Incorporated Incentive Plan.
Agreement to Release My Claims. I will receive consideration from HTI as set
forth in the Agreement if I sign and do not rescind this Release as provided
below. I understand and acknowledge that that consideration is in addition to
anything of value that I would be entitled to receive from HTI if I did not sign
this Release or if I rescinded this Release. In exchange for that consideration,
I give up all of My Claims. I will not make any demands against the Company for
compensation or damages relating to My Claims. The consideration that I am
receiving is a fair compromise for the release of My Claims.
Additional Agreements and Understandings. Even though HTI will provide
consideration for me to settle and release My Claims, the Company does not admit
that it is responsible or legally obligated to me. In fact, the Company denies
that it is responsible or legally obligated to me for My Claims, denies that it
engaged in any unlawful or improper conduct toward me, and denies that it
treated me unfairly.
Advice to Consult with an Attorney. I understand and acknowledge that I am
hereby being advised by the Company to consult with an attorney prior to signing
this Release. My decision whether to sign this Release is my own voluntary
decision made with full knowledge that the Company has advised me to consult
with an attorney.
Period to Consider the Release. I understand that I have 21 days from the day on
which I receive this Release or the day on which my HTI employment ends,
whichever occurs later, to consider whether I wish to sign this Release. If I
sign this Release before the end of the 21-day period, it will be my voluntary
decision to do so because I have decided that I do not need any additional time
to decide whether to sign this Release. I understand that the Company need not
accept this Release if I sign it on or before my last day of employment.
My Right to Rescind this Release. I understand that I may rescind this Release
at any time within 15 days after I sign it, not counting the day upon which I
sign it. This Release will not become effective or enforceable, and no
consideration will be paid, unless and until the 15-day rescission period has
expired without my rescinding it.
Procedure for Accepting or Rescinding the Release. To accept the terms of this
Release, I must deliver the Release, after I have signed and dated it, to HTI by
hand or by mail within the 21-day period that I have to consider this Release.
To rescind my acceptance, I must deliver a written, signed statement that I
rescind my acceptance to HTI by hand or by mail within the 15-day rescission
period. All deliveries must be made to HTI at the following address:
                               Ms. Rebecca Albrecht
                               Vice President of Human Resources
                               Hutchinson Technology Inc.
                               40 West Highland Park Drive N.E.
                               Hutchinson, MN 55350-3797
If I choose to deliver my acceptance or the rescission of my acceptance by mail,
it must be:

  (1)   postmarked within the period stated above; and

 

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  (2)   properly addressed to HTI at the address stated above.

Interpretation of the Release. This Release should be interpreted as broadly as
possible to achieve my intention to resolve all of My Claims against the
Company. If this Release is held by a court to be inadequate to release a
particular claim encompassed within My Claims, this Release will remain in full
force and effect with respect to all the rest of My Claims.
My Representations. I am legally able and entitled to receive the consideration
being provided to me in settlement of My Claims. I have not been involved in any
personal bankruptcy or other insolvency proceedings at any time since I began my
employment with HTI. No child support orders, garnishment orders, or other
orders requiring that money owed to me by HTI be paid to any other person are
now in effect.
I have read this Release carefully. I understand all of its terms. In signing
this Release, I have not relied on any statements or explanations made by the
Company except as specifically set forth in the Agreement. I am voluntarily
releasing My Claims against the Company. I intend this Release and the Agreement
to be legally binding.
Dated: 9/18/2007

                  /s/ Christina M. Temperante       Christina M. Temperante