Document:

bmnm10q20150630x101.htm

EXHIBIT 10.1

 

 

SETTLEMENT AGREEMENT AND RELEASE

 

This CONFIDENTIAL SETTLEMENT AGREEMENT AND RELEASE (the “Agreement”), dated as of May 15, 2015, is entered into by and between HILDENE CAPITAL MANAGEMENT, LLC (“Hildene Capital”), HILDENE OPPORTUNITIES MASTER FUND, LTD., individually and derivatively (“Hildene Master” and, together with Hildene Capital, “Hildene”), PREFERRED TERM SECURITIES XX, LTD  (“PreTSL XX”), and BIMINI CAPITAL MANAGEMENT, INC. (“Bimini,” and together with Hildene and PreTSL XX, the “Settling Parties”).

 

RECITALS

 

WHEREAS, on July 16, 2010, Hildene commenced an action by filing a complaint (the “Hildene Complaint”) against defendants Bimini, the Bank of New York Mellon (“BNYM”) and Hexagon Securities LLC (“Hexagon”) and nominal defendants BNYM and PreTSL XX in the Supreme Court of the State of New York, County of New York, captioned Hildene Capital Management, LLC, et al. v. The Bank of New York Mellon, et. al., Index No. 650980/2010 (Sherwood, J.) (the “Action”);

 

WHEREAS, the Action alleged1 causes of action for breach of contract, breach of the covenant of good faith and fair dealing, tortious interference with contract, breach of fiduciary duty, aiding and abetting breach of fiduciary duty, unjust enrichment and rescission/illegality in connection with the offer by Bimini to repurchase the capital securities of Bimini Capital Trust II (the “TruPS”) from the PreTSL XX collateral pool (the “Bimini TruPS Repurchase”);

 

WHEREAS, the PreTSL XX notes were issued pursuant to an Indenture, dated December 15, 2005 (the “Indenture”), by and between PreTSL XX, Preferred Term Securities XX, Inc., and BNYM, as Indenture Trustee;

 

WHEREAS, on October 19, 2011, nominal defendant PreTSL XX moved to intervene in the Action as a plaintiff in order to assert causes of action against defendants Bimini and BNYM, seeking to recover damages on behalf of all PreTSL XX noteholders to be distributed according to the Priority of Payment provisions in the Indenture;

 

WHEREAS, by Decision and Order, dated August 23, 2012 (the “August 23 Order”), PreTSL XX’s motion to intervene was granted and the Court ordered that the proposed complaint in intervention (the “PreTSL XX Complaint”) was deemed served as of the date of filing of the August 23 Order with Notice of Entry;

 

WHEREAS, on May 3, 2013, a Stipulation of Voluntary Partial Discontinuance was filed with the Court, whereby Hildene voluntarily dismissed without prejudice its derivative claims brought in the name of BNYM, including its claim for rescission/illegality;

 

  

  

  

WHEREAS, on May 15, 2013, Bimini served and filed an answer to the Hildene Complaint denying all allegations of wrongdoing;

 

WHEREAS, on May 15, 2013, Bimini served and filed an answer to the PreTSL XX Complaint denying all allegations of wrongdoing, and asserting counterclaims against PreTSL XX for contribution and set-off (the “PreTSL XX Counterclaims”);

 

WHEREAS, on April 17, 2014, the Court entered a Stipulation of Partial Discontinuance that dismissed all claims between and among Hildene and BNYM;

 

WHEREAS, on May 19, 2014, the Court entered a Stipulation of Partial Discontinuance that dismissed all claims between and among PreTSL XX and BNYM;

 

WHEREAS, on January 6, 2015, the Court entered a Decision and Order on the parties’ motions for summary judgment, granting Bimini’s motion for summary judgment on Hildene’s and PreTSL XX’s claims for aiding and abetting breach of fiduciary duty and unjust enrichment, and granting PreTSL XX’s motion for summary judgment on Bimini’s counterclaims for contribution and set-off;

 

WHEREAS, the Settling Parties deny each and every allegation of wrongdoing asserted against them in the Action; and

 

WHEREAS, Hildene, PreTSL XX and Bimini wish to settle and resolve the Action in its entirety as against each other so that, subject to the terms set forth below: (a) each cause of action asserted by Hildene against Bimini in the Action will be discontinued with prejudice as against Bimini; (b) each cause of action asserted by PreTSL XX against Bimini in the Action will be discontinued with prejudice as against Bimini; (c) the PreTSL XX Counterclaims will be discontinued with prejudice; and (d) each notice of appeal filed by PreTSL XX, Hildene and Bimini will be withdrawn.

 

NOW, THEREFORE, in consideration of the matters set forth in the recitals hereto, the respective promises, covenants, representations, warranties and agreements hereinafter set forth and the exchange of consideration, including but not limited to the monetary consideration set forth in Paragraph 4 below, the payment and sufficiency of such consideration being hereby acknowledged, the Settling Parties agree as follows:

 

                        1. Notice to PreTSL XX Holders.  Following the execution of this Agreement by all Settling Parties as set forth in Paragraph 24, PreTSL XX through BNYM as Indenture Trustee shall give notice of this Agreement to Holders (as defined in the Indenture) through the Depository Trust Company (“DTC”) (the “Notice”).

 

                        2. Effect of a New Holder Objection to the Agreement.  PreTSL XX, at its option, may void this Agreement in its entirety, including but not limited to the releases set forth in this Agreement in Paragraphs 6 through 9 below, upon the occurrence of all of the events described below in subparagraphs (a) through (c):

 

	
(a)  

	
on or before the 30th day following DTC’s receipt of the Notice, PreTSL XX receives, from a Holder other than Hildene (a “New Holder”), a written objection to this Agreement with a request to PreTSL XX to void this Agreement as between PreTSL XX and Bimini;

 

 

 

  

  

  

 

 

	
  

	
(b)

	
on or before five (5) days following PreTSL XX’s receipt of a written objection, the New Holder executes an indemnification agreement agreeing to indemnify PreTSL XX for all costs, including liability in this Action, if any, and reasonable attorney’s fees arising out of PreTSL XX’s prosecution of this Action as against Bimini, in a form agreeable to PreTSL XX, and on or before five (5) days following PreTSL XX’s receipt of a written objection, the New Holder executes an agreement to pay PreTSL XX all costs and expenses incurred by it to date in prosecuting the Action (subparagraphs (a) and (b) of this Paragraph, together, an “Objection”);

 

	
  

	
(c)

	
PreTSL XX, within seven (7) days following an Objection, delivers written notice to all Settling Parties that this Agreement is voided as between the parties pursuant to this Paragraph.

 

Within one (1) business day2 of receipt of a written objection as set forth in Paragraph 2(a) or an Objection, PreTSL XX must provide written notice to Bimini of PreTSL XX’s receipt of such written objection or Objection.  Bimini may void the Agreement in its entirety upon the occurrence of either of the events described in Paragraph 2(a) or 2(b), if within seven (7) days of the receipt of notice from PreTSL XX of a written objection or Objection, Bimini provides written notice to all Settling Parties that the Agreement is voided as between the parties pursuant to this Paragraph.  In the event that this Agreement is voided by PreTSL XX or Bimini pursuant to this Paragraph, the Settling Parties shall not he deemed to have waived any arguments pertaining to alleged conflicts of interest, if any, should Quinn Emanuel Urquhart & Sullivan, LLP be asked to jointly represent (i) Hildene and PreTSL XX against Bimini and (ii) PreTSL XX as against Bimini.

 

3. Hildene’s Non-solicitation.  Hildene agrees not to solicit, fund or assist in soliciting or funding an Objection or additional litigation concerning the Bimini TruPS Repurchase, and agrees not to pay or agree to pay any indemnity, liability or costs or expenses, including but not limited to attorney’s fees, owed by a New Holder, either directly or indirectly.

                   4. Settlement Payments:  Bimini agrees to pay $3,500,000 U.S. pursuant to the following payment schedule, provided that neither PreTSL XX nor Bimini exercises its right to void this Agreement as set forth in Paragraph 2.  The payments shall be made as follows to Hildene Master, and PreTSL XX for distribution according to the Priority of Payment provisions in the Indenture:

 

	
(i)  

	
$2,250,000.00 U.S. to Hildene Master on the “Effective Date”, which is defined as 15 days after the deadline for any New Holders to file an Objection as set forth in Paragraph 2;

 

 

  

  

  

 

	
(ii)  

	
$250,000.00 U.S. to Hildene Master to be paid no later than 180 days after the Effective Date;

 

	
(iii)  

	
$250,000.00 U.S. to PreTSL XX to be paid no later than 1 year from the Effective Date;

 

	
(iv)  

	
$250,000.00 U.S. to PreTSL XX to be paid no later than 2 years from the Effective Date;

 

	
(v)  

	
$250,000.00 U.S. to PreTSL XX to be paid no later than 3 years from the Effective Date; and

 

	
(vi)  

	
$250,000.00 U.S. to PreTSL XX to be paid no later than 4 years from the Effective Date.

 

Payment can be made by check or wire.

 

Wire instructions for Hildene Master are as follows:

 

                                U.S. Bank National Association

                               ABA [xxx-xxx-xxx]

                               Account #:  [xxxxxxxxxxxxx]

                               Account Name:  Hildene Opp Fd Ltd

                               Ref: Hildene Opp Fd Ltd/ [xxxxx-xxx]

                              Attn:  Greg Myers, Legal settlement - PreTSL XX

Wire instructions for PreTSL XX are as follows:

 

The Bank of New York Mellon

New York, NY

ABA# [xxxxxxxx]

Account# [xxxxxxxxxxx]

Account Name: Preferred Term Securities XX

In the event of non-payment by Bimini of any the amounts set forth in this Paragraph 4 within fifteen (15) days of the scheduled payment date, Hildene and/or PreTSL XX shall have the right to immediately seek entry of a judgment against Bimini for all amounts in Paragraph 4 that remain unpaid.

 

5. Discontinuance of the Action.  If no timely Objection is received by PreTSL XX as described in Paragraph 2, or an Objection is received and neither PreTSL XX nor Bimini chooses to void the Agreement as permitted in Paragraph 2, then PreTSL XX and Hildene shall file, no later than two (2) business days after the Effective Date, a Stipulation of Discontinuance in the form attached hereto as Exhibit A.

 

6. Release of Hildene’s Claims against Bimini.  Simultaneous with the receipt of payment described in Paragraph 4(i), Hildene, including its corporate parent, successors, predecessors, assigns, assignees, trustees, shareholders, noteholders, members, owners, partners, joint venturers, principals, creditors, attorneys, representatives, employees, managers, directors, officers, subsidiaries, divisions, subdivisions, departments, and affiliates, hereby releases, waives, and forever discharges Bimini, its successors, predecessors, assigns, assignees, trustees, shareholders, noteholders, members, owners, partners, joint venturers, principals, creditors, attorneys, representatives, employees, managers, directors, officers, subsidiaries, divisions, subdivisions, departments, affiliates, any agent acting or purporting to act for Bimini or on Bimini’s behalf, and/or all other persons who could claim through Bimini, from any and all past claims, demands, actions, liabilities and causes of action, of every kind and character, whether asserted or unasserted, known or unknown, suspected or unsuspected in law, admiralty or equity, for or by reason of any matter, cause or thing whatsoever (i) arising out of or relating to the matters alleged, or that could have been alleged in the Action, or (ii) arising out of or relating to the Bimini TruPS Repurchase.

 

  

  

  

7. Release of PreTSL XX’s Claims against Bimini.  Simultaneous with the receipt of payment described in Paragraph 4(i), PreTSL XX, its successors, predecessors, assigns, assignees, trustees, shareholders, members, owners, partners, joint venturers, principals, creditors, attorneys, representatives, employees, managers, directors, officers, subsidiaries, divisions, subdivisions, departments, and affiliates hereby releases, waives, and forever discharges Bimini, its successors, predecessors, assigns, assignees, trustees, shareholders, noteholders, members, owners, partners, joint venturers, principals, creditors, attorneys, representatives, employees, managers, directors, officers, subsidiaries, divisions, subdivisions, departments, affiliates, any agent acting or purporting to act for Bimini or on Bimini’s behalf, and/or all other persons who could claim through Bimini, from any and all past claims, demands, actions, and causes of action, of every kind and character, whether asserted or unasserted, known or unknown, suspected or unsuspected in law, admiralty or equity, for or by reason of any matter, cause or thing whatsoever (i) arising out of or relating to the matters alleged, or that could have been alleged in the Action or (ii) arising out of or relating to the Bimini TruPS Repurchase.   PreTSL XX agrees that in any subsequent legal action commenced by any PreTSL XX noteholder against Bimini, that it will not take any position inconsistent with the position asserted in this Paragraph 7, i.e., that it has full authority to grant a release on behalf of PreTSL XX to Bimini.

 

8. Release of Bimini’s Claims against Hildene.  Simultaneous with the receipt of payment described in Paragraph 4(i), Bimini including its successors, predecessors, assigns, assignees, trustees, shareholders, members, owners, partners, joint venturers, principals, creditors, attorneys, representatives, employees, managers, directors, officers, subsidiaries, divisions, subdivisions, departments and affiliates, hereby releases, waives, and forever discharges Hildene, its corporate parent, successors, predecessors, assigns, assignees, trustees, shareholders, noteholders, members, owners, partners, joint venturers, principals, creditors, attorneys, representatives, employees, managers, directors, officers, subsidiaries, divisions, subdivisions, departments, affiliates, any agent acting or purporting to act for Hildene or on Hildene’s behalf, and/or all other persons who could claim through Hildene, from any and all past claims, demands, actions, liabilities and causes of action, of every kind and character, whether asserted or unasserted, known or unknown, suspected or unsuspected in law, admiralty or equity, for or by reason of any matter, cause or thing whatsoever (i) arising out of or relating to the matters alleged, or that could have been alleged in the Action or (ii) arising out of or relating to the Bimini TruPS Repurchase.

 

  

  

  

9. Release of Bimini’s Claims against PreTSL XX.  Simultaneous with the receipt of payment described in Paragraph 4(i), Bimini including its successors, predecessors, assigns, assignees, trustees, shareholders, members, owners, partners, joint venturers, principals, creditors, attorneys, representatives, employees, managers, directors, officers, subsidiaries, divisions, subdivisions, departments and affiliates, hereby releases, waives, and forever discharges PreTSL XX, its successors, predecessors, assigns, assignees, trustees, shareholders, members, owners, partners, joint venturers, principals, creditors, attorneys, representatives, employees, managers, directors, officers, subsidiaries, divisions, subdivisions, departments, affiliates, any agent acting or purporting to act for PreTSL XX or on PreTSL XX’s behalf, and/or all other persons who could claim through PreTSL XX, from any and all past claims, demands, actions, liabilities and causes of action, of every kind and character, whether asserted or unasserted, known or unknown, suspected or unsuspected in law, admiralty or equity, for or by reason of any matter, cause or thing whatsoever (i) arising out of or relating to the matters alleged, or that could have been alleged in the Action or the PreTSL XX Counterclaims or (ii) arising out of or relating to the Bimini TruPS Repurchase.

 

10. No Admission of Liability.  This Agreement is not an admission of any liability, but is a compromise, and shall not be treated as an admission of liability.  The Settling Parties expressly deny any action or omission on their part that would give rise to damages to each other.  The Settling Parties acknowledge that this Agreement is entered into to avoid the uncertainties of litigation and constitutes a full compromise and settlement of all claims released in Paragraphs 6 through 9 above.

 

11. Disclosure of Agreement.  The parties agree that Bimini has the right to publicly-file this Agreement to the extent it determines it necessary or appropriate to do so for financial reporting purposes, or to comply with any applicable laws, rules or regulations.  To the extent Hildene or PreTSL XX wish to issue any press release or formal public statement concerning the settlement of this action, other than provided for in Paragraph 1, Hildene and PreTSL XX agree that they/it (i) shall not do so until Bimini publicly issues it financial statements or earnings press release for the first quarter of 2015, (ii) shall give Bimini three days notice of their/its intent to issue such press release or public statement, and (iii) shall give Bimini three days notice to review such press release or public statement and shall consider in good faith any comments that Bimini may have concerning the prejudicial impact to Bimini of such release or statement.  In no event shall Hildene or PreTSL XX issue any press release or formal public statement in which it is stated or implied that Bimini has been found liable of any claim or conceded liability for any claim that was brought in the Action.

 

12. Breach or Failure to Perform.  The obligations of each of the Settling Parties hereunder are expressly conditioned upon the full and complete performance of the obligations of the other Settling Parties hereunder.  Any party who successfully obtains judgment in any action or proceeding to enforce this Agreement will be entitled to recover all costs of the suit, including actual attorneys' fees and court costs.

 

13. Notices.  Any notices required to be given between and among the Settling Parties hereunder shall be provided, by (a) facsimile, (b) overnight courier and (c) certified mail with return receipt requested, to the below addresses, each effective upon sending or mailing:

 

  

  

  

Hildene:

Jonathan E. Pickhardt, Esq.

Quinn Emanuel Urquhart & Sullivan, LLP,

51 Madison Avenue, 22nd Floor

New York, New York 10010

Fax: (212) 849-7100

PreTSL XX:

Jonathan E. Pickhardt, Esq.

Quinn Emanuel Urquhart & Sullivan, LLP,

51 Madison Avenue, 22nd Floor

New York, New York 10010

Fax: (212) 849-7100

Randall R. Rainer, Esq.

Wollmuth Maher & Deutsch LLP

500 Fifth Avenue

New York, New York 10110

Fax: (212) 382-0050

Bimini:

Christopher J. St. Jeanos, Esq.

Willkie Farr & Gallagher LLP

787 Seventh Ave

New York, New York 10019

Fax: (212) 728-9730

14. Governing Law.  This Agreement and the rights and duties of the Settling Parties hereunder shall be governed by, construed, enforced and performed in accordance with the laws of the State of New York, without giving effect to the principles of conflicts of laws that would require the application of the law of any other jurisdiction.

 

15. Successors and Assigns.  This Agreement shall be binding upon, and inure to the benefit of the Settling Parties hereto and their respective, successors, predecessors, assigns, assignees, trustees, shareholders, bondholders, members, owners, partners, joint venturers, principals, creditors, attorneys, representatives, employees, managers, directors, officers, subsidiaries, divisions, subdivisions, departments, affiliates, any agent acting or purporting to act for them or on their behalf, and/or all other persons who could claim through them.

 

16. No Assignment of Claims.  Each of the Settling Parties represents and warrants that it has not assigned any claim, counterclaim or cross-claim that it had or may have against each or any of the Settling Parties, their affiliates, parents, subsidiaries, predecessors, divisions, past and present directors, past and present officers, past and present shareholders or bondholders, past and present employees, agents, attorneys, and successors and assigns, arising out of or concerning any of the matters asserted, or which could have been asserted, in the Actions.

 

  

  

  

17. Authority of Signatories.  The respective signatories below acknowledge that they have read and fully understand the terms and conditions of this Agreement, and any required document attached hereto; that they have been afforded reasonable opportunity to consider the terms and conditions of this Agreement; that they have been given an opportunity to consult, with their respective counsel prior to executing this Agreement; that they are executing this Agreement voluntarily and understand that this Agreement contains a release of all claims that they have or may have against each other up to the present time; and that each is fully authorized to enter into and execute this Agreement.

 

18. Severability.  This Agreement is intended to be performed in accordance with and only to the extent permitted by all applicable laws, ordinances, rules and regulations.  If any provision of this Agreement is determined to be invalid, illegal or unenforceable, the remaining provisions of this Agreement will remain in force.

 

19. Entire Agreement.  This Agreement constitutes the entire agreement between the Settling Parties with respect to the subject matter hereof.  This Agreement supersedes, merges and replaces all prior oral or written negotiations, offers, representations and agreements with respect to the subject matter hereof.  It is expressly understood and agreed that the Settling Parties are not relying upon any agreements, understandings, representations or warranties other than those set forth herein.  This Agreement may not be altered, amended, or otherwise modified in any respect except by a writing, duly executed by all of the Settling Parties.

 

20. Attorneys’ Fees and Costs.  The Settling Parties, as between each other, agree that they shall bear their own attorneys’ fees, costs and expenses incurred in connection with the Action and the negotiation, drafting and execution of this Agreement and the consummation of the settlement.

 

21. Voluntary Agreement.  The Settling Parties covenant, warrant and represent that they (a) have carefully read this Agreement and know the contents thereof; (b) are entering into this Agreement freely and voluntarily; (c) have ascertained and weighed all the facts and circumstances likely to influence their judgment herein; (d) have given due consideration to the provisions contained herein; and (e) thoroughly understand and consent to all provisions hereof.

 

22. Captions.  Paragraph titles or captions contained in this Agreement are used for convenience or reference only and are not intended to and shall not in any way enlarge, define, limit, extend or describe the rights or obligations of the Settling Parties or affect the meaning or construction of this Agreement, or any provision hereof.

 

23. Construction.  The Settling Parties have had an equal opportunity to review and revise this Agreement, and have participated equally in its drafting and revision. The Settling Parties agree that any rule of construction to the effect that any ambiguities in this Agreement are to be resolved against the drafting party shall not be employed in the construction or interpretation of this Agreement.

 

  

  

  

24. Counterparts.  This Agreement may be executed in one or more counterparts, each of which shall be deemed an original, and will become effective and binding upon the Settling Parties at such time as all of the signatories hereto have signed a counterpart of this Agreement.  All counterparts so executed shall constitute one Agreement binding on all of the Settling Parties, notwithstanding that all of the Settling Parties are not a signatory to the same counterpart.  A signed fax or .pdf of this Agreement shall be as effective and enforceable as a signed original.

 

[REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK]

 

 

  

  

  

IN WITNESS WHEREOF, the Settling Parties have executed this Agreement as of the date set forth above.

 

	
HILDENE CAPITAL MANAGEMENT, LLC, on behalf of itself and HILDENE OPPORTUNITIES MASTER FUND, LTD.

By: /s/    Brett Jefferson                                                           

Name:  Brett Jefferson

Title:  President

 

	  

 

PREFERRED TERM SECURITIES XX, LTD.,

 

 

By: /s/     Carrie Bunton                                                         

 

Name: Carrie Bunton

 

Title: Director

 

 

BIMINI CAPITAL MANAGEMENT, INC.

 

 

By: /s/    Robert E. Cauley                                                           

 

Name: Robert E Cauley

 

Title: CEOExhibit
10.1

ALPHA AND OMEGA SEMICONDUCTOR LIMITED

CONSULTING AGREEMENT

This Consulting Agreement (the “Agreement”)
is made and entered into as of the day of August 17, 2015 (the “Effective Date”) by and between Alpha and Omega Semiconductor
Incorporated, a California corporation, and its affiliates (together, the “Company”), and Tony Grizelj (“Consultant”).

1.                 
SERVICES.

1.1            
The Company hereby retains Consultant and Consultant agrees to perform for the Company the services described in Exhibit
A (the “Services”). The Company may amend Exhibit A at any time to reflect the business, development and/or
production needs of the Company. Consultant will keep the Company advised as to Consultant’s progress in performing the Services
and will, as requested by the Company from time to time, promptly prepare written notes and/or reports regarding such progress.

1.2            
The Company and Consultant agree that the sole and exclusive compensation for the Services shall be set forth in Exhibit
B.

2.                 
treatment of equity awards.

Consultant has previously been granted options
and restricted share units covering common shares of the Company (each such grant, an “Equity Award”). Consultant hereby
agrees that, in consideration for this Agreement and notwithstanding the performance of any services pursuant to this Agreement
or anything to the contrary in the agreement evidencing the Equity Award or the terms of the plan under which the Equity Award
was granted, each such Equity Award ceased to vest and/or become exercisable on August 14, 2015 upon Consultant’s termination
of services as an employee of the Company and terminated immediately thereupon with respect to the extent not vested and/or exercisable
as of August 14, 2015. Consultant further agrees that the post-termination exercise period with respect to each such outstanding
option to the extent vested will be measured from August 14, 2015.

3.                 
CONFIDENTIALITY.

3.1            
“Confidential Information” means any proprietary information, technical data, trade secrets or know-how, including
research, product ideas, product plans, products, services, customers, customer lists, markets, software, developments, inventions,
processes, formulas, technology, designs, drawings, hardware configuration information, marketing, finances or other business information
disclosed by the Company, either directly or indirectly in writing, orally or by drawings or inspection of parts or equipment.
Confidential Information does not include information which (i) is known to Consultant at the time of disclosure by the Company
as evidenced by written records of Consultant, (ii) has become publicly known and made generally available through no wrongful
act or non-act of Consultant, or (iii) has been rightfully received by Consultant from a third party who is authorized to
make such disclosure.

    

     

    

3.2            
Consultant recognizes and acknowledges that in the course of performing the Services, Consultant will have access to Confidential
Information. Consultant will not use Confidential Information for any purpose whatsoever other than the performance of the Services
on behalf of the Company or disclose any Confidential Information to any third party. Confidential Information shall remain the
sole property of the Company. Consultant further agrees to take all reasonable precautions to prevent any unauthorized disclosure
of Confidential Information. Without the Company’s prior written approval, Consultant will not directly or indirectly disclose
to anyone the existence of this Agreement or the fact that Consultant has this arrangement with the Company.

3.3            
Consultant will not, during the Term of this Agreement, (i) improperly use or disclose any proprietary information
or trade secrets of any former or current employer or other person or entity which Consultant is obligated to keep confidential;
or (ii) improperly use work time or facilities of the current employer to do any work related to the performance of the Services.
Consultant will indemnify the Company and hold it free and harmless from and against all claims, liabilities, damages and expenses,
including reasonable attorneys fees and costs of suit, arising out of or in connection with any violation or claimed violation
of a third party’s rights resulting in whole or in part from the Company’s use of the work product of Consultant under
this Agreement.

3.4            
Consultant recognizes that the Company may from time to time receive confidential or proprietary information from third
parties. Consultant is obligated to the Company and such third parties, to hold all such confidential or proprietary information
in the strictest confidence, and not to disclose it to any person, firm or corporation or to use it except as necessary in carrying
out the Services for the Company consistent with the Company’s agreement with such third party.

3.5            
Upon the termination of this Agreement, or upon Company’s earlier request, Consultant will promptly deliver to the
Company all of the Company’s property and Confidential Information in tangible form in Consultant’s possession or control.

4.                 
INVENTION ASSIGNMENT AND OWNERSHIP.

4.1            
Consultant agrees that all inventions (whether patentable or not), notes, records, drawings, designs, compositions, improvements,
developments, discoveries and trade secrets (collectively, the “Inventions”) conceived, made or discovered by Consultant,
either solely or in collaboration with others and either on or off the Company’s premises, during the period of this Agreement
which relate in any manner to the business of the Company that Consultant may become associated with in performing the Services
hereunder, are the sole property of the Company. Consultant further hereby assigns fully to the Company all right, title and interest
in the Inventions and any copyrights, patents, mask work rights or other intellectual property rights relating to the Inventions.

    2

     

    

4.2            
Consultant agrees to assist Company or its designee, at the Company’s expense, to secure the Company’s rights
in the Inventions and any copyrights, patents, mask work rights or other intellectual property rights relating to the Inventions,
in any and all countries as elected by the Company or its designee. Consultant’s obligations under this Section may include
disclosing to the Company all pertinent information and data with respect to the Inventions, executing all applications, specifications,
oaths, assignments and all other instruments that the Company deems necessary in order to obtain such rights and to assign to the
Company, its successors, assigns and nominees the sole and exclusive rights, title and interest in and to the Inventions, and any
copyrights, patents, mask work rights or other intellectual property rights relating to the Inventions. In the event that Consultant
fails to execute any such instruments within a reasonable time, Consultant hereby irrevocably appoints the Company and its duly
authorized officers and agents as Consultant’s agent and attorney in fact to execute any such instruments and take all other
action necessary to effectuate the intent of this Section.

4.3            
Consultant hereby attaches, as Exhibit C hereto, a list describing all inventions, original Inventions of authorship,
developments, improvements, trademarks, discoveries, formulae, trade secret and proprietary information that were made by Consultant
prior to his or her retention by the Company. Except as set forth on Exhibit C, if in the course of performing the Services,
Consultant incorporates into any of the Inventions developed hereunder any invention, improvement, development, concept, discovery
or other proprietary information owned by Consultant or in which Consultant has an interest, the Company is hereby granted a nonexclusive,
royalty-free, fully paid-up, irrevocable, worldwide, perpetual license to make, have made, modify, use and sell such items as part
of or in connection with the Inventions.

4.4            
Even though Consultant is not an employee, Consultant understands that the provisions hereof requiring invention assignment
to the Company may not apply to an invention which qualifies fully under the provisions of California Labor Code Section 2870,
attached hereto as Exhibit D. However, Consultant shall promptly advise the Company in writing of any inventions that Consultant
reasonably believes meet the criteria in the aforementioned Labor Code Section.

5.                 
CONFLICTING OBLIGATIONS.

Consultant represents and certifies that
Consultant has no outstanding agreement or obligation that is in conflict with any of the provisions of this Agreement and Consultant
will not enter into any such conflicting agreement during the Term of this Agreement. Consultant agrees to diligently adhere to
the Conflict of Interest Guidelines, attached hereto as Exhibit E. Consultant further agrees not to engage in any other
consulting or business activity directly related to the business in which the Company is now involved or becomes involved during
the Term of this Agreement, if such engagement would negatively impact the Company in any manner.

    3

     

    

6.                 
TERM AND TERMINATION.

6.1            
The term of this Agreement will be from August 17, 2015 to October 16, 2015 (“Term”).

6.2            
The Company may terminate this Agreement at any time during the Term of this Agreement by giving written notice to Consultant.
Consultant may terminate this Agreement by written notice in the event of a material breach by Company that remains uncured for
thirty (30) days after a written notice to cure.

6.3            
At the end of the Term or upon termination of this Agreement, all rights and duties of the parties toward each other shall
cease to exist, provided that:

(a)             
The Company shall be obligated to pay, within thirty (30) days after the Term or termination, all amounts owing to Consultant
for Services performed and related expenses, if any, up to the end of the Term or the date of termination; and

(b)             
Sections 3 (Confidentiality), 4 (Ownership), 6.3 (Survival), and 7-13 (General Provisions) shall survive the Term or termination
of this Agreement.

7.                 
NOTICES.

Any notices given under this Agreement shall
be in writing, addressed as shown below or at such other address specified by written notice. Notices shall be deemed given upon
delivery if personally delivered, three days after deposited in the United States mail, postage prepaid, registered or certified
mail, return receipt requested or within forty-eight (48) hours after delivery to an overnight courier service.

8.                 
ASSIGNMENT; SUCCESSORS AND ASSIGNS.

Neither this Agreement nor any rights or
obligations under this Agreement may be assigned or transferred by Consultant without the express written consent of the Company.
This Agreement shall inure to the benefit of successors and assigns of the Company, and shall be binding upon the heirs, legal
representatives, successors and assigns of Consultant.

9.                 
INDEPENDENT CONTRACTOR.

Consultant is an independent contractor.
Nothing in this Agreement shall be construed to constitute Consultant as an agent, employee or representative of the Company. Consultant
shall not be entitled to any Company employment rights or benefits. Consultant shall bear all expenses associated with performing
the Services except as expressly provided on Exhibit B of this Agreement.

    4

     

    

DISPUTE RESOLUTION. 

To ensure rapid, economical, and confidential
resolution of disputes that may arise hereunder AOS and Consultant agree that any and all disputes, claims, or causes of action,
in law or equity, arising from or relating to the enforcement, interpretation, or making of this Agreement (collectively, “Claims”),
shall be resolved to the fullest extent permitted by law by final, binding and confidential arbitration conducted by Judicial Arbitration
and Mediation Services, Inc. (“JAMS”) by a single arbitrator, under the JAMS rules (which can be found at www.jamsadr.com
or will be provided upon request) in San Francisco, California. The arbitrator shall: (1) have authority to compel adequate discovery
for the resolution of all Claims and award such relief as would otherwise be permitted by law; and (2) issue a written arbitration
decision including the arbitrator’s essential findings and conclusions and a statement of the award. AOS shall pay all of
the arbitrator fees and related JAMS administrative fees. AOS and Consultant acknowledge that, by agreeing to this arbitration
procedure, both parties waive the right to resolve any Claims through a trial by jury or judge or by administrative proceeding.

10.            
GOVERNING LAW.

This Agreement shall be governed by the laws
of the State of California without reference to its conflict of laws provisions.

11.            
SEVERABILITY.

If any Section of this Agreement is found
by competent authority to be invalid, illegal or unenforceable in any respect for any reason, the validity, legality and enforceability
of any such Section in every other respect and the remainder of this Agreement shall continue in effect so long as the Agreement
still expresses the intent of the parties. If the intent of the parties cannot be preserved, this Agreement shall be either renegotiated
or terminated.

12.            
ENTIRE AGREEMENT.

Except for Exhibit A, which may be
amended by the Company in accordance with Section 1, this Agreement together with its exhibits is the entire agreement of the parties

and supersedes any prior agreements between them with respect to the subject matter of this
Agreement.

    5

     

    

 

IN WITNESS WHEREOF, the Company and Consultant
have caused this Agreement to be signed and delivered, all as of the date first above written.

	CONSULTANT	 	ALPHA AND OMEGA SEMICONDUCTOR INCORPORATED
	 	 	 
	By:	 	 	By:	 
	Name:	 	 	Name:	 
	 	 	 	Title:	 
	 	 	 	 	 
	Address:	 	 	 	 
	 	 	 	 
	 	 	 
	 	 	 

 

    6

     

    

EXHIBIT A

SERVICES

1.                 
Contact. Consultant’s principal Company contact person:

Steve Sun, and/or his designee

2.                 
Services. Consultant will render the following Services to the Company:

	 	Consulting services relating to AOS’ customer, market, and products.	 
	 	 	 
	 	 	 
	 	 	 
	 	 	 
	 	 	 
	 	 	 
	 	 	 
	 	 	 
	 	 	 
	 	 	 
	 	 	 
	 	 	 
	 	 	 
	 	 	 
	 	 	 

 

 

 

    7

     

    

EXHIBIT B

COMPENSATION

1.                 
Services. Consultant shall perform the Services described in Exhibit A and as shall further be described to
Consultant by the contact person named on Exhibit A, and such contact person shall serve as Consultant’s supervisor
with regard to the Services and the Inventions.

2.                 
Compensation. Consultant will receive a retainer of $43,709, less taxes and witholdings, as sole and exclusive consideration
for all services to be rendered and performed under the Agreement and for assigning the rights to the Company set forth in Section
4 of the Agreement.

3.                  Expenses. The Company shall reimburse Consultant for
all reasonable travel and living expenses incurred by Consultant in performing the Services pursuant to this Agreement, provided
Consultant receives prior written consent from Company Contact prior to incurring such expenses.

Consultant shall submit invoices for expenses in
a form prescribed by the Company. Such invoices shall be approved by the contact person named on Exhibit A. An invoice shall
be rendered monthly promptly after the end of each calendar month in which Consultant has rendered services, and shall be payable
in full within 30 days after receipt by Company of such an invoice from Consultant.

 

 

 

    8

     

    

EXHIBIT C

LIST OF PRIOR INVENTIONS AND ORIGINAL INVENTIONS
OF AUTHORSHIP

	Title	Date	Identifying Number 

or Brief Description
	 	 	 

 

	 	☐   No inventions or improvements	 
	 	☐   Additional sheets attached	 
	 	Signature of Consultant:	 	 
	 	Printed Name of Consultant:	 	 
	 	Date:	 	 

 

 

 

    9

     

    

EXHIBIT D

CALIFORNIA LABOR CODE SECTION 2870

EMPLOYMENT AGREEMENTS; ASSIGNMENT OF RIGHTS

“(a)Any provision in an employment
agreement which provides that an employee shall assign, or offer to assign, any of his or her rights in an invention to his or
her employer shall not apply to an invention that the employee developed entirely on his or her own time without using the employer’s
equipment, supplies, facilities, or trade secret information except for those inventions that either:

		(1)	Relate at the time of conception or reduction to practice of the invention to the employer’s business, or actual or demonstrably
anticipated research or development of the employer.

(2)Result from any work performed by the employee for the employer.

(b)To the extent a provision in an employment
agreement purports to require an employee to assign an invention otherwise excluded from being required to be assigned under subdivision
(a), the provision is against the public policy of this state and is unenforceable.”

 

 

 

    10

     

    

EXHIBIT E

CONFLICT OF INTEREST GUIDELINES

It is the policy of Alpha and Omega Semiconductor
to conduct its affairs in strict compliance with the letter and spirit of the law and to adhere to the highest principles of business
ethics. Accordingly, all officers, employees and independent contractors must avoid activities that are in conflict, or give the
appearance of being in conflict, with these principles and with the interests of the Company. The following are potentially compromising
situations that must be avoided. Any exceptions must be reported to the CEO of the Company and written approval for continuation
must be obtained from the CEO.

1.                 
Revealing Confidential Information to outsiders or misusing Confidential Information. Unauthorized divulging of Confidential
Information is a violation of this policy whether or not for personal gain and whether or not harm to the Company is intended.

2.                 
Accepting or offering substantial gifts, excessive entertainment, favors or payments that may be deemed to constitute undue
influence or otherwise be improper or embarrassing to the Company.

3.                 
Participating in civic or professional organizations that might involve divulging Confidential Information.

4.                 
Initiating or approving personnel actions affecting reward or punishment of employees or applicants where there is a family
relationship or is or appears to be a personal or social involvement.

5.                 
Initiating, participating or approving any form of personal, social or sexual harassment of employees or other consultants
of the Company.

6.                 
Investing or holding outside directorships in suppliers, customers or competing companies, including financial speculation,
where such investment or directorship might influence in any manner a decision or course of action of the Company.

7.                 
Borrowing from or lending to employees, customers or suppliers of the Company.

8.                 
Acquiring real estate of interest to the Company.

9.                 
Improperly using or disclosing to the Company any proprietary information or trade secrets of any former or concurrent employer
or other person or entity with whom obligations of confidentiality exist.

    11

     

    

10.            
Discussing unlawfully or without proper authorization prices, costs, customers, suppliers, sales or markets of the Company
with competing companies or their employees.

11.            
Making any unlawful agreements with distributors with respect to prices.

12.            
Improperly using or authorizing the use of any invention that is the subject of a patent claim of any other person or entity.

13.            
Engaging in any conduct that is not in the best interest of the Company.

Each officer, employee and independent contractor
must take every necessary action to ensure compliance with these guidelines and to bring problem areas to the attention of the
higher management of the Company for review. Violations of this conflict of interest policy may result in immediate discharge and/or
termination of the business relationship.

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