Exhibit 10.102.1


 


CATALYST SEMICONDUCTOR, INC.


 


AMENDMENT TO SEVERANCE AGREEMENT


 


This Amendment to the
Severance Agreement (the “Amendment”) is made as of February 26, 2008, by
and between Catalyst Semiconductor, Inc. (the “Company”), and Scott Brown  (the “Employee”).


 


RECITALS


 


WHEREAS,  the Company
and Employee entered into that certain Severance Agreement dated September 10,
2007 (the “Agreement”).


 


WHEREAS,  the Company and Employee
desire to amend the Agreement to comply with the requirements of Section 409A
of the Internal Revenue Code of 1986, as amended.


 


NOW, THEREFORE, the Company and Employee agree that in consideration of the foregoing and the
promises and covenants contained herein, the parties agree as follows:


 


AGREEMENT


 


1.               Section 3(a) of
the Agreement, entitled “Involuntary
Termination other than for Cause, Death or Disability Prior to a Change of
Control or after Twelve Months Following a Change of Control.” is hereby amended to read in its entirety as
follows:


 


Involuntary Termination other than for Cause, Death
or Disability Prior to a Change of Control or after Twelve Months Following a
Change of Control.  If, prior to a Change of Control or after
twelve (12) months following a Change of Control, the Company (or any parent or
subsidiary of the Company employing Employee) terminates Employee’s employment
with the Company (or any parent or subsidiary of the Company) without Employee’s
consent and for a reason other than (x) Cause, (y) Employee becoming
Disabled or (z) Employee’s death, (any such termination, an “Involuntary
Termination”) and Employee signs,
delivers and does not revoke a separation agreement and release of claims in a
form satisfactory to the Company (the “Release”) within the time period required by the
Release (but in no event later than two and one-half (21⁄2) months following the
end of the calendar year in which the Involuntary Termination occurs), then
following such termination of employment, or, if later, the effective date of
the Release, Employee will receive the following payments and other benefits
from the Company:


 


(i)             Accrued Compensation.  Employee
will be entitled to receive all accrued vacation, expense reimbursements and
any other benefits due to Employee through the date of termination of
employment in accordance with the Company’s then existing employee benefit
plans, policies and arrangements.


 

















 


(ii)          Severance.  Subject to Section 9(a),
Employee will be entitled to receive continued payments of Employee’s base
salary (as in effect immediately prior to such termination) for a period of six
(6) months (the “Severance
Period”), less applicable
withholding payable in accordance with the Company’s normal payroll
policies.  Notwithstanding the foregoing
and except as provided by the following sentence, if during the Severance Period Employee engages in
Competition or breaches the covenants in Section 6 or in the Release, all
payments pursuant to this subsection will immediately cease effective as of the
first date that constitutes engagement in Competition or a breach of the
applicable covenants (the “Breach Date”). 
Notwithstanding the preceding sentence, if payment of the severance
amounts is delayed in accordance with Section 9(a) of this Agreement,
the Company’s obligation to make severance payments to Executive during the
Severance Period shall not terminate pursuant to the preceding sentence (i.e.,
upon the Breach Date) with respect to any severance payments that have been
accrued prior to the Breach Date in accordance with Section 9(a) of
this Agreement and such accrued severance payments shall be paid in a lump sum
payment on the date six (6) months and one (1) day following the date
of Executive’s termination of employment (or such earlier date as provided in Section 9(a) of
this Agreement).


 


(iii)       Continued Employee Benefits.  The Company will reimburse Employee for
premiums paid for the continuation
of benefits Employee timely elects pursuant
to the Consolidated Omnibus Budget Reconciliation Act of 1985, as amended (“COBRA”)  for Employee and Employee’s eligible dependents
under the Company’s Benefit Plans for a period of six (6) months following
Employee’s termination of employment; provided, however, that if during such
period Employee engages in Competition or breaches the covenants in Section 6
or in the Release, all Company-reimbursements pursuant to this subsection will
immediately cease.  Employee will be solely responsible for
electing such continuation coverage for Employee and Employee’s eligible
dependents.


 


(iv)      Options.  With
respect to all of Employee’s options (the “Options”) to purchase Company common stock
outstanding on the date of such termination (whether granted on, before or
after the date of this Agreement), Employee will have the period following such
termination of employment to exercise such Options that is specified in the
stock plans, if any, under which the Options were granted and in any applicable
agreements between the Company and Employee; provided, however, to the extent
that, pursuant to the provisions of such stock plans and applicable agreements,
such Options continue to vest during the period, if any, that Employee provides
consulting services to the Company pursuant to Section 3(a)(ii) or
otherwise, then Employee will have the period following the termination of such
consulting services to exercise such Options that is specified in such stock
plans and applicable agreements; provided further, however, that all Options
will immediately terminate and Employee will have no further rights with
respect to such Options in the event Employee engages in Competition or
breaches the covenants in Section 6 or in the Release during such
period.  In all other respects, such
Options will continue to be subject to the terms and conditions of the stock
plans, if any, under which they were granted and any applicable agreements
between the Company and Employee.


 


(v)         Payments or Benefits Required by Law. 
Employee will receive such other compensation or benefits from the
Company as may be required by law (for example, “COBRA” coverage under Section 4980B
of the Internal Revenue Code of 1986, as amended (the “Code”)).”


 


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2.               Section 3(b) of
the Agreement, entitled “Involuntary
Termination other than for Cause, Death or Disability or Termination for Good
Reason within Twelve Months of a Change of Control.” is hereby
amended to read in its entirety as follows:


 


“Involuntary Termination other than for Cause,
Death or Disability or Termination for Good Reason within Twelve Months of a
Change of Control.  If (i) within twelve (12) months
following a Change of Control (A) Employee terminates his or her
employment with the Company (or any parent or subsidiary of the Company) for
Good Reason or (B) the Company (or any parent or subsidiary of the
Company) terminates Employee’s employment for other than (x) Cause, (y) Employee
becoming Disabled or (z) Employee’s death (any such termination pursuant
to (A) or (B), a “Change of Control Termination”) and (ii) Employee signs, delivers and
does not revoke a Release within the time period required by the Release (but
in no event later than two and one-half (21⁄2) months following the end of the
calendar year in which the Involuntary Termination occurs), then promptly
following such termination of employment, or, if later, the effective date of
the Release, Employee will receive the following payments and other benefits
from the Company:


 


(i)             Accrued Compensation.  Employee
will be entitled to receive all accrued vacation, expense reimbursements and
any other benefits due to Employee through the date of termination of
employment in accordance with the Company’s then existing employee benefit
plans, policies and arrangements.


 


(ii)          Severance.  Subject to Section 9(a),
Employee will be entitled to receive continued payments of Employee’s base
salary (as in effect immediately prior to such termination) for a period of nine (9) months (the “Post-Change of
Control Severance Period”),
less applicable withholding, payable in accordance with the Company’s normal
payroll policies.  Notwithstanding the
foregoing and except as provided by the following sentence, if during the Post-Change of Control Severance Period Employee engages in Competition or
breaches the covenants in Section 6 or in the Release, all payments
pursuant to this subsection will immediately cease effective as of the Breach
Date.  Notwithstanding the preceding
sentence, if payment of the severance amounts is delayed in accordance with Section 9(a) of
this Agreement, the Company’s obligation to make severance payments to
Executive during the
Post-Change of Control
Severance Period shall not terminate pursuant to the preceding sentence (i.e.,
upon the Breach Date) with respect to any severance payments that have been
accrued prior to the Breach Date in accordance with Section 9(a) of
this Agreement and such accrued severance payments shall be paid in a lump sum
payment on the date six (6) months and one (1) day following the date
of Executive’s termination of employment (or such earlier date as provided in Section 9(a) of
this Agreement).


 


(iii)       Options, Restricted Stock and Restricted Stock Units.  100%
of the unvested shares subject to all of Employee’s Options, 100% of the
unvested shares subject to all of Employee’s restricted stock units (“RSUs”) and 100% any of Employee’s shares of
Company common stock subject to a Company repurchase right upon Employee’s
termination of employment for any reason (the “Restricted
Stock”) whether acquired by
Employee on, before or after the date of this Agreement, will immediately vest upon
such termination.  With respect to all of
Employee’s Options outstanding on the date of such termination (whether granted
on, before or after the date of this Agreement), Employee will have the period
following such termination of employment to exercise such Options that is
specified in the stock plans, if any, under which the Options were 


 


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granted and in any applicable agreements between the
Company and Employee; provided, however, that all Options will immediately
terminate and Employee will have no further rights with respect to such Options
in the event Employee engages in Competition or breaches the covenants in Section 6
or in the Release during such period.  In
all other respects, such Options will continue to be subject to the terms and
conditions of the stock plans, if any, under which they were granted and any
applicable agreements between the Company and Employee.


 


(iv)      Continued Employee Benefits.  The Company will reimburse Employee for premiums
paid for the continuation of
benefits Employee timely elects pursuant
to the Consolidated Omnibus Budget Reconciliation Act of 1985, as amended (“COBRA”)  for Employee and Employee’s eligible dependents
under the Company’s Benefit Plans for a period of nine (9) months following Employee’s termination of
employment; provided, however, that if during such period Employee engages in
Competition or breaches the covenants in Section 6 or in the Release, all
Company-reimbursements pursuant to this subsection will immediately cease.  Employee will be solely responsible for electing
such continuation coverage for Employee and Employee’s eligible dependents.


 


(v)         Payments or Benefits Required by Law. 
Employee will receive such other compensation or benefits from the
Company as may be required by law (for example, “COBRA” coverage under Section 4980B
of the Code).”


 


3.                                       Section 4 of the
Agreement, entitled “Limitation on Payments.” is hereby
amended to read in its entirety as follows:


 


“4.                                 Limitation on Payments.  In
the event that the severance and other benefits provided for in this Agreement
or otherwise payable to Employee (i) constitute “parachute payments”
within the meaning of Section 280G of the Code and (ii) but for this Section 4,
would be subject to the excise tax imposed by Section 4999 of the Code,
then Employee’s severance benefits under Section 4(a)(i) will be
either:


 


(a)                                  delivered in
full, or


 


(b)                                 delivered as to
such lesser extent which would result in no portion of such severance benefits
being subject to excise tax under Section 4999 of the Code,


 


whichever
of the foregoing amounts, taking into account the applicable federal, state and
local income taxes and the excise tax imposed by Section 4999, results in
the receipt by Employee on an after-tax basis, of the greatest amount of
severance benefits, notwithstanding that all or some portion of such severance
benefits may be taxable under Section 4999 of the Code.  Unless the Company and Employee otherwise
agree in writing, any determination required under this Section 4 will be
made in writing by BDO Seidman or by a national “Big Four” accounting
firm (the “Accountants”), whose determination will be conclusive
and binding upon Employee and the Company for all purposes.  For purposes of making the calculations
required by this Section 4, the Accountants may make reasonable
assumptions and approximations concerning applicable taxes and may rely on
reasonable, good faith interpretations concerning the application of Sections
280G and 4999 of the Code.  The Company
and Employee will furnish to the Accountants such information and 


 


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documents
as the Accountants may reasonably request in order to make a determination
under this Section.  The Company will bear
all costs the Accountants may reasonably incur in connection with any
calculations contemplated by this Section 4.”


 


4.                                       Section 5(a) of
the Agreement, entitled “Benefit Plans.” is hereby
amended to read in its entirety as follows:


 


“(a)                            “Benefit
Plans” means plans, policies or arrangements that the Company
sponsors (or participates in) and that immediately prior to Employee’s
termination of employment provide Employee and/or Employee’s eligible
dependents with medical, dental, and/or vision benefits.  Benefit Plans do not include any other type
of benefit (including, but not by way of limitation, disability, life insurance
or retirement benefits). A requirement that the Company provide Employee and
Employee’s eligible dependents with coverage under the Benefit Plans will not
be satisfied unless the coverage is no less favorable than that provided to
Employee and Employee’s eligible dependents immediately prior to Employee’s
termination of employment.”


 


5.                                       Section 5(f) is
hereby added to the Agreement, and shall read in its entirety as follows:


 


“(f)                              Good Reason.  “Good Reason” means
the occurrence of any of the following without the Employee’s consent: (i) a
material diminution in Employee’s Base Salary, except for reductions that are
in proportion to any salary reduction program approved by the Board that
affects a majority of the senior executives of the Company; (ii) a
material diminution in Employee’s authority, duties, or responsibilities; (iii) a
material diminution in the authority, duties, or responsibilities of the
supervisor to whom Employee is required to report, including a requirements
that Employee report to a corporate officer or employee instead of reporting
directly to the Board; (iv)  a material change in the geographic location
at which Employee must perform his services of not less than fifty (50) miles
from the Company’s primary place of business immediately prior to such
relocation; or (v) any other action or inaction that constitutes a
material breach by the Company of this Agreement; provided, however, that
Employee must provide written notice to the Board of the condition that could
constitute a “Good Reason” event within ninety (90) days of the initial
existence of such condition and such condition must not have been remedied by
the Company within thirty (30) days (the “Cure Period”) of such written
notice.  A termination will not be deemed
to be for “Good Reason” unless such termination occurs within ninety (90) days
following the end of the Cure Period.”


 


6.                                       Section 5(g) is
hereby added to the Agreement, and shall read in its entirety as follows:


 


“(g)                           Section 409A Limit. 
“Section 409A Limit” means the lesser of two (2) times: (i) Employee’s annualized
compensation based upon the annual rate of pay paid to Employee during the
Company’s taxable year preceding the Company’s taxable year of Employee’s
termination of employment as determined under Treasury Regulation
1.409A-1(b)(9)(iii)(A)(1) and any Internal Revenue Service guidance issued
with respect thereto; or (ii) the maximum amount that may be taken into
account under a qualified plan pursuant to Section 401(a)(17) of the Code
for the year in which Employee’s employment is terminated.”


 


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7.                                       Section 9 of the
Agreement, entitled “Code Section 409A.” is hereby
amended to read in its entirety as follows:


 


“(a)                            Code Section 409A
Notwithstanding anything to the contrary in this Agreement, if Employee is a “specified
employee” within the meaning of Section 409A of the Code and any final
regulations and guidance promulgated thereunder, as they each may be amended from time to time (“Section 409A”) at the time of Employee’s termination
other than due to Employee’s death (provided that such termination is a “separation
from service” within the meaning of Section 409A, as determined by the
Company), then only that portion of the cash severance and shares subject to
accelerated RSUs payable to Employee pursuant to this Agreement, if any, and
any other severance payments or separation benefits, in each case which may be
considered deferred compensation under Section 409A (together, the “Deferred Compensation Separation Benefits”),
which (when considered together) do not exceed the Section 409A Limit (as
defined herein) may be made within the first six (6) months following
Employee’s termination of employment in accordance with the payment schedule
applicable to each payment or benefit.  Any portion of the Deferred
Compensation Separation Benefits in excess of the Section 409A Limit
otherwise due to Employee on or within the six (6) month period following
Employee’s termination will accrue during such six (6) month period and
will become payable in a lump sum payment on the date six (6) months and
one (1) day following the date of Employee’s termination of
employment.  All subsequent Deferred
Compensation Separation Benefits, if any, will be payable in accordance with
the payment schedule applicable to each payment or benefit.  Notwithstanding anything herein to the
contrary, if Employee dies following his termination but prior to the six month
anniversary of his date of termination, then any payments delayed in accordance
with this paragraph will be payable in a lump sum as soon as administratively
practicable after the date of Employee’s death and all other Deferred
Compensation Separation Benefits will be payable in accordance with the payment
schedule applicable to each payment or benefit. 
It is the intent of this Agreement to comply with the requirements of Section 409A
so that none of the severance payments and benefits to be provided hereunder
will be subject to the additional tax imposed under Section 409A, and any
ambiguities herein will be interpreted to so comply.”


 


8.                                       Full Force and Effect.  To
the extent not expressly amended hereby, the Agreement shall remain in full
force and effect.


 


9.                                       Entire Agreement.  This
Amendment and the Agreement constitute the full and entire understanding and
agreement between the parties with regard to the subjects hereof and
thereof.  No future agreements between the
Company and Employee may supersede the Amendment, unless they are in writing
and specifically mention this Amendment. 
With respect to equity
awards granted on or after the date hereof, the acceleration of vesting
provided herein will apply to such awards except to the extent otherwise
explicitly provided in the applicable equity award agreement, which provision
must include a reference to the Amendment.


 


10.                                 Successors and Assigns.  This
Amendment and the rights and obligations of the parties hereunder shall inure
to the benefit of, and be binding upon, their respective successors, assigns,
and legal representatives.


 


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11.                                 Counterparts.  This
Amendment may be executed in counterparts, all of which together shall
constitute one instrument, and each of which may be executed by less than all
of the parties to this Amendment.


 


12.                                 Governing Law.  This
Amendment shall be governed in all respects by the internal laws of California,
without regard to principles of conflicts of law.


 


13.                                 Amendment.  Any provision of this Amendment may be
amended, waived or terminated by a written instrument signed by the Company and
Executive.


 


(Signature page follows)


 


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IN WITNESS WHEREOF, the undersigned parties have caused this Amendment to
be executed as of the date first set forth above.


 


	
  Scott Brown

  	
   

  	
  CATALYST SEMICONDUCTOR, INC.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
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  Scott Brown

  	
   

  	
   

  
	
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(Signature page to Amendment
to Severance Agreement)


 


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