Document:

Spansion Inc. 2010 Equity Incentive Award Plan - Sub-Plan - Israel

 Exhibit 10.1(g) 

SPANSION, INC 

2010 EQUITY INCENTIVE AWARD PLAN 

SUB-PLAN – ISRAEL 

 

	1.	Special Provisions for Persons who are Israeli Taxpayers 

1.1 This Sub-Plan (the “Sub-Plan”) to the Spansion, Inc. 2010 Equity Incentive Award Plan (the “Plan”)
is made in accordance with Section 4.5 of the Plan, effective as of May 10, 2010 (the “Effective Date”). 

1.2 The provisions specified hereunder apply only to persons who are deemed to be residents of the State of Israel for tax purposes, or
are otherwise subject to taxation in Israel with respect to Awards. 
 1.3 This Sub-Plan applies with respect to Awards granted
under the Plan. The purpose of this Sub-Plan is to establish certain rules and limitations applicable to Awards that may be granted under the Plan from time to time, in compliance with the tax, securities and other applicable laws currently in force
in the State of Israel. Except as otherwise provided by this Sub-Plan, all grants made pursuant to this Sub-Plan shall be governed by the terms of the Plan. This Sub-Plan is applicable only to grants made after the Effective Date. This Sub-Plan is
intend to comply with, and be subject to the ITO and Section 102. 
 1.4 The Plan and this Sub-Plan shall be read together.
In any case of contradiction, whether explicit or implied, between the provisions of this Sub-Plan and the Plan, the provisions of this Sub-Plan shall govern. 
  

	2.	Definitions 

Capitalized terms not otherwise defined herein shall have the meaning assigned to them in the Plan. The following additional definitions
will apply to grants made pursuant to this Sub-Plan: 
 “3(i) Option” means an Option that is subject to taxation
pursuant to Section 3(i) of the ITO which has been granted to any person who is not an Eligible 102 Holder. 
 “102
Capital Gains Track” means the tax alternative set forth in Section 102(b)(2) of the ITO pursuant to which income resulting from the sale of shares of Common Stock is taxed as a capital gain. 

“102 Capital Gains Track Grant” means a 102 Trustee Grant qualifying for the special tax treatment under the 102 Capital Gains
Track. 
 “102 Ordinary Income Track” means the tax alternative set forth in Section 102(b)(1) of the ITO
pursuant to which income resulting from the sale of shares of Common Stock is taxed as ordinary income. 
 “102 Ordinary
Income Track Grant” means a 102 Trustee Grant qualifying for the ordinary income tax treatment under the 102 Ordinary Income Track. 

“102 Trustee Grant” means a Award granted pursuant to Section 102(b) of the ITO and held in trust by a Trustee for the
benefit of the Holder, and includes both 102 Capital Gains Track Grants and 102 Ordinary Income Track Grants. 

 “Affiliate” as used in this Sub-Plan, shall mean any Subsidiary (as defined in the
Plan) that is an “employing company” within the meaning of Section 102(a) of the ITO. 
 “Controlling
Shareholder” as defined under Section 32(9) of the ITO, means an individual who prior to the grant or as a result of the exercise of any Option, holds or would hold, directly or indirectly, in his name or with a relative (as defined in the
ITO) (i) 10% of the outstanding shares of the Company, (ii) 10% of the voting power of the Company, (iii) the right to hold or purchase 10% of the outstanding equity or voting power, (iv) the right to obtain 10% of the
“profit” of the Company (as defined in the ITO), or (v) the right to appoint a director of the Company. 

“Election” means the Company’s choice of the type of 102 Trustee Grants it will make under the Plan, (as between capital
gains track or ordinary income track) as filed with the ITA. 
 “Eligible 102 Holder” means an Employee or an
individual who is serving as a director or an office holder of an Affiliate, who is not a Controlling Shareholder. 

“Israeli Fair Market Value” shall mean with respect to 102 Capital Gains Track Grants only and for the sole purpose of
determining tax liability pursuant to Section 102(b)(3) of the ITO, if at the date the grant is made the Company’s shares are listed on any established stock exchange or a national market system or if the Company’s shares will be
registered for trading within ninety (90) days following the date the grant is made, the average value of the Company’s shares on the thirty (30) trading days preceding the date the grant is made or on the thirty (30) trading
days following the date of registration for trading, as the case may be. 
 “ITA” means the Israeli Tax Authority.

 “ITO” means the Israeli Income Tax Ordinance (New Version), 1961, and the rules, regulations, orders or procedures
promulgated thereunder and any amendments thereto, including specifically the Rules, all as may be amended from time to time. 

“Non-Trustee Grant” means a Award granted to an Eligible 102 Holder pursuant to Section 102(c) of the ITO and not held in
trust by a Trustee. 
 “Option” means an Option granted pursuant to the terms and conditions of the Plan and the
Sub-Plan. 
 “Required Holding Period” means the requisite period prescribed by the ITO and the Rules, or such other
period as may be required by the ITA, with respect to 102 Trustee Grants, during which Awards granted by the Company must be held by the Trustee for the benefit of the person to whom it was granted. As of the Effective Date, the Required Holding
Period for 102 Capital Gains Track Grants is 24 months from the date of grant. 
 “Rules” means the Income Tax Rules
(Tax Benefits in Share Issuance to Employees), 2003. 
 “Section 102” shall mean the provisions of Section 102 of
the ITO, as amended from time to time, including most recently by the Law Amending the Income Tax Ordinance (Number 132), 2002, effective as of January 1, 2003 and the Law Amending the Income Tax Ordinance (Number 147), 2005. 

“Trust Agreement” shall mean the agreement between the Company, any Affiliate, and the Trustee regarding 102 Trustee Grants and
related matters. 
  

 2 

 “Trustee” means a person or entity designated by the Administrator to serve as a
trustee and approved by the ITA in accordance with the provisions of Section 102(a) of the ITO. 
  

	3.	Types of Awards and Section 102 Election 

3.1 Grants of Awards made pursuant to Section 102, shall be made pursuant to either (a) Section 102(b)(2) of the ITO as 102
Capital Gains Track Grants or (b) Section 102(b)(1) of the ITO as 102 Ordinary Income Track Grants. The Company’s Election regarding the type of 102 Trustee Grant it chooses to make shall be filed with the ITA. Once the Company has
filed such Election, it may change the type of 102 Trustee Grant that it chooses to make only after the passage of at least 12 months from the end of the calendar year in which the first grant was made in accordance with the previous Election, in
accordance with Section 102. For the avoidance of doubt, such Election shall not prevent the Company from granting Non-Trustee Grants to Eligible 102 Holders at any time. 

3.2 Eligible 102 Holders may receive only 102 Trustee Grants or Non-Trustee Grants under this Sub-Plan. Holders who are not Eligible 102
Holders may be granted only 3(i) Options under this Sub-Plan. 
 3.3 No 102 Trustee Grants may be made effective pursuant to
this Sub-Plan until 30 days after the requisite filings required by the ITO and the Rules have been made with the ITA. 
 3.4
The Award Agreement or documents evidencing the Awards granted or shares of Common Stock issued pursuant to the Plan and this Sub-Plan shall indicate whether the grant is a 102 Trustee Grant, a Non-Trustee Grant or a 3(i) Grant; and, if the grant is
a 102 Trustee Grant, whether it is a 102 Capital Gains Track Grant or a 102 Ordinary Income Track Grant. 
  

	4.	Terms And Conditions Of 102 Trustee Options 

4.1 Each 102 Trustee Grant will be deemed granted on the date stated in a written or electronic notice by the Company, provided that
effective as of such date (i) the Company has provided such notice to the Trustee and (ii) the Holder has signed all documents or provided other confirmation in a form acceptable to the Company and the Trustee required pursuant to this
Section 4. 
 4.2 Each 102 Trustee Grant granted to an Eligible 102 Holder and each certificate for shares of Common Stock
acquired pursuant to a 102 Trustee Grant shall be issued to and registered in the name of a Trustee and shall be held in trust for the benefit of the Holder for the Required Holding Period. After termination of the Required Holding Period, the
Trustee may release such Option and any such Common Stock, provided that (i) the Trustee has received an acknowledgment from the Israeli Income Tax Authority that the Eligible 102 Holder has paid any applicable tax due pursuant to the ITO or
(ii) the Trustee and/or the Company or its Affiliate withholds any applicable tax due pursuant to the ITO. The Trustee shall not release any 102 Trustee Grants prior to the full payment of the Eligible 102 Holder’s tax liabilities.

 4.3 Each 102 Trustee Grant shall be subject to the relevant terms of Section 102 and the ITO, which shall be deemed an
integral part of the 102 Trustee Grant and shall prevail over any term contained in the Plan, this Sub-Plan or any Award Agreement that is not consistent therewith. Any provision of the ITO and any

  

 3 

 
approvals by the Income Tax Commissioner not expressly specified in this Sub-Plan or any document evidencing a Award that are necessary to receive or maintain any tax benefit pursuant to the
Section 102 shall be binding on the Eligible 102 Holder. The Trustee and the Eligible 102 Holder granted a 102 Trustee Grant shall comply with the ITO, and the terms and conditions of the Trust Agreement entered into between the Company and the
Trustee. For avoidance of doubt, it is reiterated that compliance with the ITO specifically includes compliance with the Rules. Further, the Eligible 102 Holder agrees to execute any and all documents which the Company or the Trustee may reasonably
determine to be necessary in order to comply with the provision of any applicable law, and, particularly, Section 102. With respect to 102 Capital Gain Track Grants, to the extent that the shares of Common Stock are listed on any established
stock exchange or a national market system, the provisions of Section 102(b)(3) of the ITO will apply with respect to the Israeli tax rate applicable to such Awards (including Restricted Stock Units and Options whose exercise price is lower
than the Israeli Fair Market Value of the shares of Common Stock on the date of grant). 
 4.4 During the Required Holding
Period, the Eligible 102 Holder shall not require the Trustee to release or sell Options or shares of Common Stock and other shares received subsequently following any realization of rights derived from shares of Common Stock or Options or other
Awards (including stock dividends) to the Eligible 102 Holder or to a third party, unless permitted to do so by applicable law. Notwithstanding the foregoing, the Trustee may, pursuant to a written request and subject to applicable law, release and
transfer such shares of Common Stock to a designated third party, provided that both of the following conditions have been fulfilled prior to such transfer: (i) all taxes required to be paid upon the release and transfer of the shares have been
withheld for transfer to the tax authorities and (ii) the Trustee has received written confirmation from the Company that all requirements for such release and transfer have been fulfilled according to the terms of the Company’s corporate
documents, the Plan, any applicable agreement and any Applicable Laws. To avoid doubt such sale or release during the Required Holding Period will result in different tax ramifications to the Eligible 102 Holder under Section 102 of the ITO and
the Rules and/or any other regulations or orders or procedures promulgated thereunder, which shall apply to and shall be borne solely by such Eligible 102 Holder (including tax and mandatory payments otherwise payable by the Company or its
Affiliates, which would not apply absent a sale or release during the Required Holding Period). 
 4.5 In the event a stock
dividend is declared and/or additional rights are granted with respect to shares of Common Stock which derive from Awards granted as 102 Trustee Grants, such dividend and/or rights shall also be subject to the provisions of this Section 4 and
the Required Holding Period for such dividend shares and/or rights shall be measured from the commencement of the Required Holding Period for the Award with respect to which the dividend was declared and/or rights granted. In the event of a cash
dividend on Common Stock, the Trustee shall transfer the dividend proceeds to the Eligible 102 Holder after deduction of taxes and mandatory payments in compliance with applicable withholding requirements. 

4.6 If an Option granted as a 102 Trustee Grant is exercised during the Required Holding Period or shares of Common Stock are issued upon
vesting of an Award, the shares of Common Stock issued upon such exercise shall be issued in the name of the Trustee for the benefit of the Eligible 102 Holder. If such shares of 

 

 4 

 
Common Stock are issued after the Required Holding Period has elapsed, the shares of Common Stock issued upon such exercise shall, at the election of the Eligible 102 Holder, either (i) be
issued in the name of the Trustee, or (ii) be transferred to the Eligible 102 Holder directly, provided that the Holder first complies with all applicable provisions of the Plan and this Sub-Plan. 

4.7 To avoid doubt, and notwithstanding anything to the contrary in the Plan, (including, without limitation, Section 6.7 and 9.1),
no Award granted as a 102 Trustee Grant may be settled for cash payment or any other form of consideration, unless and to the extent permitted under Section 102 or as expressly authorized by the ITA. Furthermore, Stock Appreciation Rights may
not be granted as a 102 Trustee Grant absent the express authorization of the ITA, and the grant of Restricted Stock Units as 102 Trustee Grants is subject to the confirmation of the ITA. 

4.8 To avoid doubt, and notwithstanding anything to the contrary in the Plan or an Award Agreement, no Option qualifying as a 102 Trustee
Grant shall be exercisable by the surrender of shares of Common Stock or withholding of otherwise deliverable shares of Common Stock, and withholding tax obligations will not be satisfiable with respect to an Award by withholding shares of Common
Stock otherwise deliverable upon exercise or vesting of the Award, unless and to the extent permitted under Section 102 or as expressly authorized by the ITA. 

4.9 The implementation of a paperless documentation administration for the granting and exercise of 102 Trustee Grants pursuant to
Section 14.4 of the Plan will be subject to the consent of the Trustee and compliance with ITA requirements. 
  

	5.	Assignability 

 As
long as a Award or shares of Common Stock are held by the Trustee on behalf of the Eligible 102 Holder, all rights of the Eligible 102 Holder over the Award or shares of Common Stock are personal, can not be transferred, assigned, pledged or
mortgaged, other than by will or laws of descent and distribution (and notwithstanding Section 11.3(b) of the Plan). 
  

	6.	Tax Consequences 

6.1 Any tax consequences arising from the grant or exercise of any Award, from the payment for shares of Common Stock covered thereby, or
from any other event or act (of the Company, and/or its Affiliates, and the Trustee or the Holder), hereunder (the “Tax Liability”), shall be borne solely by the Holder. The Company and/or its Affiliates, and/or the Trustee shall withhold
taxes according to the requirements under the applicable laws, rules, and regulations, including withholding taxes at source. Furthermore, the Holder shall agree to indemnify the Company and/or its Affiliates and/or the Trustee and hold them
harmless against and from any and all liability for any such tax or interest or penalty thereon, including without limitation, liabilities relating to the necessity to withhold, or to have withheld, any such tax from any payment made to the Holder.
The Holder agrees as a condition of his or her participation in the Plan to make arrangements satisfactory to the Company and its Subsidiaries and/or the Trustee to enable it to satisfy all withholding, payment and/or collection requirements
associated with the satisfaction of the Tax Liability, including authorizing the Company or the Subsidiary or the Trustee to: (i) withhold all applicable amounts from the Holder’s wages or other cash compensation due to the Holder, in
accordance with any requirements under the laws, rules, and regulations of 
  

 5 

 
the country of which the Holder is a resident, and (ii) act as the Holder’s agent to sell sufficient shares of Common Stock for the proceeds to settle such requirements. Furthermore,
the Holder agrees to pay the Company or the Subsidiary any amount the Company or any Subsidiary or the Trustee may be required to withhold, collect or pay as a result of the Holder’s participation in the Plan or that cannot be satisfied by
deduction from the Holder’s wages or other cash compensation paid to the Holder by the Company or the Subsidiary or the Trustee or sale of the shares of Common Stock acquired under the Plan. The Holder acknowledges that he or she may not
participate in the Plan and the Company, the Subsidiary and the Trustee shall have no obligation to deliver shares of Common Stock until the Tax Liability has been satisfied by the Holder. 

6.2 With respect to Non-Trustee Grants, if the Holder ceases to be employed by the Company or any Affiliate, the Eligible 102 Holder
shall extend to the Company and/or its Affiliate a security or guarantee for the payment of tax due at the time of sale of shares of Common Stock to the satisfaction of the Company, all in accordance with the provisions of Section 102 of the
ITO and the Rules. 
  

	7.	Securities Laws 

All Awards hereunder shall be subject to compliance with the Israeli Securities Law, 1968, and the rules and regulations promulgated
thereunder. 
 *        *        * 

 

 6Spansion Inc. 2010 Employee Incentive Plan

 Exhibit 10.2 

CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN
THIS DOCUMENT, MARKED BY BRACKETS, IS FILED WITH THE SECURITIES AND
EXCHANGE COMMISSION PURSUANT TO RULE 24B-2 OF THE SECURITIES EXCHANGE ACT
OF 1934, AS AMENDED. 
 Spansion 

Employee Incentive 

Plan 

Effective 1-1-2010 

 

 

 SPANSION EMPLOYEE INCENTIVE PLAN 

 

	I.	Introduction 

 The
Spansion Employee Incentive Plan (“Plan”) recognizes and rewards Plan Participants for furthering Spansion’s ongoing success against strategic objectives. A Participant’s award under the Plan is funded based on the company’s
performance against one or more Plan Metrics (e.g., revenue, operating margin) established and approved by the Compensation Committee of the Board of Directors for any given Plan Year. Plan Metrics may change from year-to-year at the sole discretion
of Spansion. 
 A Participant’s eligibility and target opportunity (“Target”) for the Plan Year is based on the
Participant’s role and job level, and may change from year-to-year at the sole discretion of Spansion. Award funding can range from [*]% to [*]% of Target. A portion of the award may be tied to individual performance depending on the
Participant’s job level. 
 Award payments, if any, are made following evaluation of Plan Metrics and the completion of the
compensation rewards process after the close of the Plan Period. Depending on the Participant’s job level, the plan will be measured and paid on either a quarterly or annual basis. 

Plan participation summary: 
  

					
	 	  	Plan Period	  	Individual
Performance
Modifier
	 Sr. Director & Above
	  	Annual	  	Yes
	 Individual Contributor to Director
	  	Quarterly	  	Yes
	 Support Staff
	  	Quarterly	  	No

  

	II.	Explanation of Terms Base Salary for annual Participants is generally the Participant’s annualized base pay at the end of the Plan Year; for quarterly
participants it is generally the annualized base salary at the end of the Plan Period, divided by 4. (See Section V for further detail on the administrative provisions.) 

Participant is any employee of Spansion who is eligible to participate in the Plan based on their role and job level. Sales
Incentive Plan 
  

	[*]	Certain information in this document has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with
respect to the omitted portions. 

  

					
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 SPANSION EMPLOYEE INCENTIVE PLAN 

 

 
participants and employees otherwise eligible to participate in local broad-based incentive programs are not eligible. 

Plan Year is Spansion’s fiscal year, approximately each January 1 through December 31. For 2010, the Plan will begin
effective January 1, 2010. 
 Plan Period, for the purposes of the Plan Metrics, is either the fiscal quarter or
fiscal year, depending on the Participant’s role. 
 Plan Metric is an overarching goal for the Plan Year and is
generally financial in nature (e.g., revenue, operating margin). There may be more than one Plan Metric established for any Plan Year, and metrics may change from year-to-year. 

Plan Objectives are the parameters by which achievement of a Plan Metric is measured for a Plan Period (e.g., minimum, goal and
maximum). For example, for a revenue Plan Metric, minimum, goal and maximum Plan Objectives might be $1B, $1.2B and $1.5B, respectively. 

Target is the percentage of base salary for which a Participant is eligible assuming goals are achieved for the Plan Metrics. (See
Exhibit B for Plan Targets) 
 Company Target Multiplier is the percentage of a Participant’s Target used to
calculate initial award amounts. The Company Target Multiplier takes into consideration any applicable weighting for each Plan Metric, and the degree to which each Plan Objective for each Plan Metric is achieved. 

Individual Performance Modifier, for eligible Participants, is applied to the initial award amounts based on the Participant’s
performance for the Plan Period. 
  

	III.	Plan Metrics 

 Plan
Metrics and related Plan Objectives are determined for each Plan Year. Exhibit A provides details for the relevant Plan Year, including: 
  

	 	•	 	 Plan Metrics; 

  

	 	•	 	 Percent of Target awards funded when minimum, goal and maximum Plan Objectives are met; and 

 

	 	•	 	 Metrics details specific to the relevant Plan Year. 

  

					
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 SPANSION EMPLOYEE INCENTIVE PLAN 

 

	IV.	Award Determination 

Following the close of a Plan Period, after actual company performance is known, the Plan awards are calculated as follows: 

A. Company Performance Multiplier 

The Company Performance Multiplier, ranging from [*]% to [*]%, is determined and applied to the Participant’s assigned Plan Target
based on company performance to objectives established at the beginning of the Plan Period. 
 B. Individual Performance
Modifier 
 For eligible participants, an Individual Performance Modifier, ranging from [*]% to [*]%, is determined and
approved by the Participants’ management based on achievement against pre-established objectives (either quarterly or annually, depending upon eligibility). The Modifier applies to the result of the calculation in A above. The individual
modifier will be forced through the application of a bell curve rating system each manager will use to rate his/her employees. 

C. Maximum Spend 

While Participants eligible for the Individual Performance Modifier may earn up to [*]% of the company-based award based on their
individual performance, the maximum plan expenditure cannot exceed the overall budget for the plan period. The overall budget is the sum of all awards resulting from the calculation in A above. Each senior manager will force a distribution for their
direct reports. 
 For Participants for whom the Individual Performance Modifier does not apply, the award is calculated as
follows: 
  

													
	 Base

Salary
	  	X	  	Participant Target	  	X	  	 Company

Performance

Multiplier

([*]% - [*]%)
	  	=	  	Award

 For
Participants for whom the Individual Performance Modifier does apply, the award is calculated as follows: 
  

	[*]	Certain information in this document has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatement has been requested with
respect to the omitted portions. 

  

					
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 SPANSION EMPLOYEE INCENTIVE PLAN 

 

																	
	 Base

Salary
	  	X	  	 Participant

Target
	  	X	  	 Company

Performance

Multiplier

([*]% - [*]%)
	  	X	  	 Individual

Performance

Modifier

([*]% - [*]%)
	  	=	  	Award

  

	V.	Administrative Provisions 

The following provisions apply generally to all Plan participants on a worldwide basis. However, some variations may exist based on local
legal requirements (e.g., laws regarding base salary calculation, payments upon termination). Please contact the local Division HR Representative for specific details. 
  

	 	A.	Changes in a Participant’s Status 

  

	 	1.	Change in Participation Level (e.g., individual contributor to manager, manager to director) – If a Participant changes participation levels during a Plan
Year, an award is calculated on a pro rata basis (as described in B.2. below) taking into account (i) the time the Participant was in each level, (ii) the ending Base Salary for each level, and (iii) the Targets applicable to each
level. 

  

	 	2.	Plan Participation Ends – If a Participant stops participating in the Plan but continues to be eligible for a pro-rated award, the Base Salary and Target
used to calculate their award are those in effect at the time participation ended. 

  

	 	B.	Eligibility for Plan Award Payments 

  

	 	1.	Employment at Time of Payment: Subject to the provisions below, to be eligible to receive an award, a Participant must be actively employed by Spansion on the
date awards are paid unless otherwise required by local law. 

  

	 	2.	New Participant/Inactive Status: Participants must be on active status for at least 30 days of the Plan Period to be eligible for an award. Payment to an
employee who was not an active Participant for an entire Plan Period (i.e., became a Participant mid-quarter and/or was on inactive status for part of the Plan Year), is prorated; the amount of the payment is based on the number of days of active
participation in the Plan during the Plan Period. For leaves of absence, proration will occur based on local guidelines; subject to those guidelines, proration will generally occur where inactive status exceeds 14 calendar days (2 work weeks).

  

	 	3.	 Death: A Participant who dies, and has actively participated in the Plan for at least half of the Plan Period, is eligible for a Plan

  

 

	[*]	Certain information in this document has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with
respect to the omitted portions. 

  

					
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 SPANSION EMPLOYEE INCENTIVE PLAN 

 

	 	 
payment. Payments in these cases are prorated based on the number of days of participation during the Plan Period and will be calculated and paid at the regularly scheduled time. Payment is made
to the participant’s designated beneficiary. 

  

	 	4.	Reduced Work Schedule: A Participant who has a reduced work schedule receives a pro-rated payment based on the percent by which the schedule is reduced.

  

	 	5.	Performance Requirement: Subject to the discretion of a Participant’s Vice President, a Participant may not be eligible to receive an award unless a minimum
level of overall performance has been achieved. An employee is not eligible for an award if he/she has received a warning within 3 months prior to when payments are made. 

 

	 	C.	Timing of Award Payments 

Awards for a Plan Period are paid during the quarter immediately following the end of the Plan Period, following determination of
performance against both company and individual objectives. 
  

	 	D.	Approval of Plan Metrics and Plan Objectives 

Annual Plan Metrics and Plan Objectives are approved by the Compensation Committee of the Board of Directors at the beginning the Plan
Year. Quarterly Objectives, and performance against them, are determined at the end of each Plan Period and approved by the Compensation Committee of the Board of Directors, the CFO, or the CEO. Plan Objectives and results align with the
Company’s forecast and results plus publicly reported quarterly/annual results unless specifically approved otherwise by the Compensation Committee. 
  

	 	E.	Discretionary Nature of Plan and Award Payments 

No participant has a vested entitlement to any payment under the Plan; all awards are paid at the sole discretion of Spansion’s
executive officers. Specifically, regardless of whether an award has been consistently paid over any period of time, Spansion, at its sole discretion, reserves the right to (i) increase or decrease Targets and Target Percentages for
each Plan Year, (ii) terminate the participation of any participant in the Plan at any time for any legal reason, and/or (iii) modify or terminate the Plan, in whole or in part, all with or without notice or cause. Award payments will
be offset for participants who are eligible for other bonus plans. 
  

	 	F.	Application of Deferred Compensation Rules 

  

					
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 SPANSION EMPLOYEE INCENTIVE PLAN 

 

 The Plan is generally operated in a manner that complies with Internal Revenue Code
Section 409A and, as such, all awards paid under the Plan will be paid according to section V.C. 
  

					
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 SPANSION EMPLOYEE INCENTIVE PLAN 

 

 EXHIBIT A 

2010 Pay for Performance Plan Details 

Annual Plan Metrics and Objectives 

2010 Annual Bonus Payout Matrix 
  

																									
	 	 	 	 	 	  	Revenue (M$)
	 	 	 	 	 	  	 [*]

	 	 	 	 	 	  	 	  	 	  	 	  	 	  	 	  	 	  	 	  	 	  	 	  	 
	Operating Margin %	 	 	 	 	  	 	  	 	  	 	  	 	  	 	  	 	  	 	  	 	  	 	  	 
	 [*]
	 		 		  		  		  		  		  		  		  		  		  		  	
		 		 		  		  		  		  		  		  		  		  		  		  	

 These performance metrics are Spansion Confidential and must not be disclosed outside
Spansion.
 Quarterly Plan Metrics and Objectives 

Metrics for quarterly plan participants will be established separately and tracked each quarter by Finance. The following are the Plan Metrics for Q1 and
Q2 2010 (subject to review and approval: 
 Q110 Bonus Payout Matrix 

 

																									
	 	 	 	 	 	  	Revenue (M$)
	 	 	 	 	 	  	 [*]

	 	 	 	 	 	  	 	  	 	  	 	  	 	  	 	  	 	  	 	  	 	  	 	  	 
	Operating Margin %	 	 	 	 	  	 	  	 	  	 	  	 	  	 	  	 	  	 	  	 	  	 	  	 
	 [*]
	 		 		  		  		  		  		  		  		  		  		  		  	
		 		 		  		  		  		  		  		  		  		  		  		  	

 These performance metrics are Spansion Confidential and must not be disclosed outside Spansion. 

  
  

	[*]	Certain information in this document has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with
respect to the omitted portions. 

  

					
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 SPANSION EMPLOYEE INCENTIVE PLAN 

 

 Q210 Bonus Payout Matrix 

 

																									
	 	 	 	 	 	  	Revenue (M$)
	 	 	 	 	 	  	 [*]

	 	 	 	 	 	  	 	  	 	  	 	  	 	  	 	  	 	  	 	  	 	  	 	  	 
	Operating Margin %	 	 	 	 	  	 	  	 	  	 	  	 	  	 	  	 	  	 	  	 	  	 	  	 
	 [*]
	 		 		  		  		  		  		  		  		  		  		  		  	
		 		 		  		  		  		  		  		  		  		  		  		  	

 For subsequent quarters, a similar matrix will be established and approved per the Administrative
Provisions. Quarterly Objectives and results align with the Company’s forecast and results plus publicly reported quarterly/annual results unless specifically approved otherwise by the Compensation Committee. 

Where achievement falls between the values in the matrices, the funding percent will be interpolated. Where achievement falls below the minimum level of
either objective, no awards will be funded or distributed based on the guidelines established in these plans. In the event targets are not achieved, but the company is still profitable, a pool of funds totaling [*]% of base salary will be available
for distribution to employees at the sole discretion of management. Section 16 officers and employees, at the Senior Vice President Level or above, are not eligible for these bonus awards. The Compensation Committee has the sole authority to
recommend bonus awards for the Section 16 officers or Senior Vice Presidents or above, based on recommendations from the CEO, for exemplary performance to the Board for approval. Special awards made to the CEO are made and recommended by the
Compensation Committee and approved by the Board. 
 Sample Calculation 

 
  

	[*]	Certain information in this document has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with
respect to the omitted portions. 

  

					
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 SPANSION EMPLOYEE INCENTIVE PLAN 

 

																		
	 	  	 	  	 	  	 	  	Employee Incentive Plan Payout Examples	  	 
	 Plan Level
	  	Annual
Salary	  	Plan
Target	  	Company
Performance
Multiplier
([*]% - [*]%)	  	Initial Award	 	 	Individual
Performance
Multiplier
([*]% - [*]%)	  	Target x
Corporate x
Individual	  	Quarterly*
Award	  	Annual/
Annualized
Award
	 Support
	  		  		  		  	[	*] 	 		  		  		  	
	 Support
	  		  		  		  			 		  		  		  	
	 Support
	  		  		  		  			 		  		  		  	
		  		  		  		  			 		  		  		  	
	 IC/Manager
	  		  		  		  			 		  		  		  	
	 IC/Manager
	  		  		  		  			 		  		  		  	
	 IC/Manager
	  		  		  		  			 		  		  		  	
		  		  		  		  			 		  		  		  	
	 Sr Director/VP
	  		  		  		  			 		  		  		  	
	 Sr Director/VP
	  		  		  		  			 		  		  		  	
	 Sr Director/VP
	  		  		  		  			 		  		  		  	
		  		  		  		  			 		  		  		  	

  

	*	Support and IC/Manager plan levels have quarterly awards. Sr Director/VP plan levels have annual awards. 

2010 Plan Metrics Definitions 

Revenue refers to sales generated from all Spansion’s products and services as reported in Spansion’s pro-forma Profit and Loss
statement. Pro-forma adjustments to GAAP (Generally Accepted Accounting Principles) revenue would include: 
  

	 	•	 	 Add back of deferred revenue lost due to fresh start accounting; and 

 

	 	•	 	 Reduction of revenue from companies acquired during fiscal 2010. 

Operating Margin is derived from Operating Income divided by Revenue (as defined above). Operating Income refers to Spansion’s earnings
before interest income/expense, other income/expense, taxes and extraordinary items as reported in Spansion’s pro-forma P&L. Pro-forma adjustments to GAAP Operating Income would include: 

 

	 	•	 	 Revenue adjustments; and 

  

	 	•	 	 Expense adjustments indicated as follows. 

GAAP Expense Adjustments 
  

	 	•	 	 Elimination of bankruptcy-related reorganization, restructuring, and any other applicable costs, including any items identified as such in the 2010
Annual Budget; 

  

	 	•	 	 Elimination of any other fees or bonuses that are required for or payable upon the company’s successful emergence from Chapter 11 bankruptcy;

  

	 	•	 	 Adjustment for Spansion Japan or Spansion Nihon KK related payments or expenses, settlement, or other such activities; 

 

	 	•	 	 Adjustments for changes in the carrying costs of assets and depreciation levels due to fresh start accounting, including but not limited to inventory,
property and equipment, and intangibles; 

  

 

	[*]	Certain information in this document has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with
respect to the omitted portions. 

  

					
		 		 	9
		 		 	

 SPANSION EMPLOYEE INCENTIVE PLAN 

 

	 	•	 	 Adjustments for changes in the liabilities due to fresh start accounting, including but not limited to market valuation of debt, capital leases, and
other such items; 

  

	 	•	 	 Adjustment for change in expenses due to equity grants (valuation, vesting, etc); 

 

	 	•	 	 Elimination of costs and expenses from companies acquired during fiscal 2010 and any administrative costs associated with board-approved transactions;

  

	 	•	 	 Elimination of any expenses or credits recorded on unconventional line items in GAAP Operating Income due to unforeseen accounting situations (e.g.,
sort reserve, claims agent, gain on extinguishment of debt, ARS, etc) 

 Due to various accounting matters not known due
to fresh start accounting, the Company may revisit the above definitions after completion of Fresh Start Accounting. 
  

					
		 		 	10
		 		 	

 SPANSION EMPLOYEE INCENTIVE PLAN 

 

 EXHIBIT B 

2010 Pay for Performance Plan Targets 
  

									
	 Participation Level
	  	Plan Target	 	Plan
	 Manager
	  	 Individual
Contributor
	  	Global
Task Level	  	As % of Base	 	Measurement &
Payout
Timing
	 CEO
	  		  	99	  	[*]	 	Annually
	 CFO/COO
	  		  	98	  	[*]	 
	 EVP
	  		  	96	  	[*]	 
	 SVP
	  		  	93	  	[*]	 
	 VP
	  		  	91	  	[*]	 
	 Sr. Director
	  	Sr. Fellow	  	83	  	[*]	 
	 Director
	  	Fellow	  	82	  	[*]	 	Quarterly
	 Sr. Manager
	  	Professional 6	  	43/26	  	[*]	 
	 Manager
	  	Professional 5	  	42/25	  	[*]	 
	 Section Manager/

Staff Supv.
	  	Professional 4	  	34/41/24	  	[*]	 
	 Supervisor
	  	Professional 3	  	31-33, 23	  	[*]	 
		  	Prof. 1 & 2	  	21, 22	  	[*]	 
		  	Support - US	  	1-5	  	[*]	 	Quarterly
		  	Support - Int’l	  	1-5	  	[*]	 	(Based on Company
Performance only)

 

	[*]	Certain information in this document has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with
respect to the omitted portions. 

  

					
		 		 	11

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