Document:

Exhibit 4.2.4

 

FOURTH AMENDMENT TO THE

REVOLVING CREDIT AGREEMENT

 

THIS FOURTH AMENDMENT to the REVOLVING CREDIT
AGREEMENT, dated as of this 24th day of August, 2005 (the “Fourth
Amendment”), is entered into in connection with and as an amendment to that certain
Revolving Credit Agreement, dated as of March 10th, 2003 (the
“Credit Agreement”), as amended by that First Amendment, dated as of August 31st,
2003, as further amended by that Second Amendment, dated as of February 27,
2004, as further amended by that Third Amendment, dated as of August 30, 2004,
and as further amended, restated or modified from time to time, by and between
First National Bank of Omaha (the “Bank”) and Ballantyne of Omaha, Inc. (the
“Borrower”).  All capitalized terms used
but not otherwise defined herein shall have their respective meanings as
prescribed in the Credit Agreement.

 

WHEREAS, the maturity date for the Base Revolving
Credit Facility pursuant to the Credit Agreement is currently August 29th,
2005; and

 

WHEREAS, the Borrower and the Bank desire to extend
the maturity date of the Base Revolving Credit Facility to August 28th,
2006 and to make such other amendments as discussed below.

 

NOW, THEREFORE, the parties hereby agree that as of
the date hereof:

 

1.             The
following definition in Article I of the Credit Agreement is hereby amended to
read as follows:

 

Termination Date: 
August 28, 2006, or such later date as is approved in writing by FNBO.

 

2.             Section
2.1 of the Credit Agreement is hereby amended by replacing the phrase “Until
August 29, 2005” with “Until August 28, 2006”.

 

3.             This Fourth Amendment shall not affect any and all amounts and
obligations that may be outstanding from the Borrower to the Bank under the
Credit Agreement, and all such obligations remain secured by the Collateral.

 

4.             This
Fourth Amendment may be executed in several counterparts, and such counterparts
together shall constitute one and the same instrument.

 

5.             Except
as expressly agreed herein, all terms of the Credit Agreement shall remain in
full force and effect.

 

 

 

[Signature page follows]

 

 

 

 

IN WITNESS WHEREOF, the Borrower and the Bank have
caused this Fourth Amendment to be executed as of the day and year first above
written.

 

 

 

	
   

  	
  BANK:

  
	
   

  	
   

  
	
   

  	
  FIRST NATIONAL BANK OF OMAHA

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Marc T. Wisdom

  
	
   

  	
  Name: Marc T. Wisdom

  
	
   

  	
  Title: Commercial Loan Officer

  
	
   

  	
   

  
	
   

  	
  BORROWER:

  
	
   

  	
   

  
	
   

  	
  BALLANTYNE OF OMAHA, INC.

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ John Wilmers

  
	
   

  	
  Name: John Wilmers

  
	
   

  	
  Title: President and CEO

  
	
   

  	
   

  

 

 

NOTICE:  A credit agreement must be in writing to be
enforceable under Nebraska law.  To
protect you and us from any misunderstandings or disappointments, any contract,
promise, undertaking, or offer to forebear repayment of money or to make any
other financial accommodation in connection with this loan of money or grant or
extension of credit, or any amendment of, cancellation of, waiver of, or
substitution for any or all of the terms or provisions of any instrument or
document executed in connection with this loan of money or grant or extension
of credit, must be in writing to be effective.

 

	
   

  	
  INITIALED: 

  	
    JW

  	
   

  
	
   

  	
   

  	
     BorrowerEXHIBIT 10.1

 

EMPLOYMENT AGREEMENT

 

THIS AGREEMENT is entered into by and between Jan Johannessen (the
“Executive”) and LATTICE SEMICONDUCTOR CORPORATION,
a Delaware corporation (the “Company”) as of November 1,
2005 (the “Effective Date”).

 

1.                                       Duties
and Scope of Employment.

 

(a)                                  Position.  For the
term of his employment under this Agreement (“Employment”), the Executive will
serve as the Senior Vice President, Chief
Financial Officer and Assistant Secretary (“CFO”). 
The Executive shall report directly to the Company’s Chief Executive
Officer (the “CEO”) or to an executive officer designated by the CEO.  Executive will render such business and
professional services in the performance of his duties, consistent with the
Executive’s position within the Company, as will reasonably be assigned to him
by the CEO or, if applicable, such executive officer designated by the CEO.

 

(b)                                 Obligations.  The
Executive shall have such duties, authority and responsibilities that are
commensurate with being an executive officer. 
During the term of his Employment, the Executive will devote Executive’s
full business efforts and time to the Company. 
For the duration of his Employment, Executive agrees not to actively
engage in any other employment, occupation, or consulting activity for any
direct or indirect remuneration without the prior approval of the Board of
Directors (the “Board”) (which approval will not be unreasonably withheld);
provided, however, that Executive may, without the approval of the Board, serve
in any capacity with any civic, educational, or charitable organization,
provided such services do not interfere with Executive’s obligations to the
Company.  Executive shall perform his
duties primarily at the Company’s corporate facility in Hillsboro, Oregon.

 

(c)                                  Effective Date.  The
Executive shall commence full-time Employment as CFO under this Agreement on the Effective Date.

 

2.                                       Cash
and Incentive Compensation.

 

(a)                                  Salary.  As of July 3,
2005 and thereafter, the Company shall pay Executive as compensation for his
services a base salary at a gross annual rate of not less than $262,096 (such annual salary, as is then in
effect, to be referred to herein as “Base Salary”).  The Base Salary will be paid periodically in
accordance with the Company’s normal payroll practices and be subject to the
usual, required withholdings, provided, however, that Executive shall receive pro-rata payments of Base Salary no less
frequently than once per month. 
Executive’s Base Salary will be subject to review by the Compensation
Committee of the Board (the “Committee”) not less than annually, and
adjustments will be made in the discretion of the Committee.

 

1

 

(b)                                 Incentive Bonuses. 
For the Company’s 2005 fiscal year (which ends on December 31,
2005) the Executive shall be eligible to receive an annual fiscal year
incentive bonus of up to $100,000 (the “2005
Bonus”).  50% of the 2005 Bonus (the “First
Half-2005 Bonus”) shall be earned on December 30, 2005 if Executive is an
employee of the Company on such date. 
The remaining 50% of the 2005 Bonus shall be earned based on the
achievement of performance objectives that are mutually agreed upon in writing
by the Committee and Executive.  The
earned portion of the 2005 Bonus shall be paid to Executive in cash no later
than 45 days after the end of the Company’s 2005 fiscal year.

 

For Company’s fiscal
years 2006 and beyond, Executive shall be a participant in an Executive Bonus
Plan that shall be established by the Company (the “EBP”).  Under the EBP, Executive shall be eligible to
be considered for an annual fiscal year incentive bonus of 40% of Executive’s Base Salary as of the
beginning of such fiscal year or such higher figure that the Committee may
select (such annual amount is the “Target Bonus”).  The Target Bonus shall be awarded based upon
the achievement of specific milestones that will be mutually agreed upon by the
Committee and Executive no later than 45 days after the start of each fiscal
year (the “Target Bonus Milestones”). 
For superior achievement of the Target Bonus Milestones, Executive may
earn a maximum annual fiscal year incentive bonus of up to 250% of Executive’s Target Bonus.  Cash payment for each fiscal year’s Target
Bonus actually earned shall be made to Executive no later than 45 days after
the end of the applicable fiscal year.

 

(c)                                  Terms of Company Compensatory Equity Awards.  Executive shall be eligible for grants of
options to purchase shares of the Company’s common stock or other Company
equity (any prior or future compensatory equity grants to Executive shall be
collectively referred to herein as “Compensatory Equity”) at times and in such
amounts as determined by the Committee. 
All future grants of Compensatory Equity (and the issuance of any
underlying shares) to Executive shall be: (i) issued pursuant to an
applicable stockholder-approved plan and (ii) issued pursuant to an
effective registration statement filed with the Securities and Exchange
Commission under the Securities Act of 1933 as amended.  Accelerated vesting of Compensatory Equity
may occur: (x) pursuant to the terms of this Agreement and in addition (y)
pursuant to the terms of the Plan and any applicable Compensatory Equity
agreement.  Executive may elect to
establish a trading plan in accordance with Rule 10b5-1 of the Securities
Exchange Act of 1934 for any of his Compensatory Equity shares, provided,
however, that such trading plan must comply with all of the requirements for
the safe harbor under Rule 10b5-1 and must be either (i) approved by the
Board (such approval not to be unreasonably withheld) or (ii) approved in
accordance with any Rule 10b5-1 Trading Plan Policy the Company may
subsequently implement.

 

(d)                                 Service Definition. 
For purposes of this Agreement and Executive’s Compensatory Equity, “Service”
shall mean service by the Executive as an employee and/or consultant of the
Company (or any subsidiary or parent or affiliated entity of the Company)
and/or service by the Executive as a member of the Board.

 

3.                                       Vacation
and Employee Benefits.  During the term of his Employment, the
Executive shall accrue paid vacation annually in accordance with the Company’s
standard vacation policy.  During the
term of his Employment, the Executive shall be eligible to participate in any
employee benefit plans or arrangements maintained by the Company on no less 

 

2

 

favorable terms than for other
Company executives, subject in each case to the generally applicable terms and
conditions of the plan or arrangement in question and to the determinations of
any person or committee administering such plan or arrangement.

 

4.                                       Business
Expenses. 
During the term of his Employment, the Executive shall be authorized to
incur necessary and reasonable travel, entertainment and other business
expenses in connection with his duties hereunder.  The Company shall promptly reimburse the
Executive for such expenses upon presentation of appropriate supporting
documentation, all in accordance with the Company’s generally applicable
policies.  The Company shall also timely
pay (or continue to timely pay, as applicable) for all of Executive’s home
telecommunications phone and facsimile lines and reimburse Executive for his
actual mobile phone costs on a monthly basis (not to exceed $200 per monthly
bill).

 

5.                                       Term
of Employment.

 

(a)                                  Basic Rule. The Company may terminate the Executive’s
Employment with or without Cause, by giving the Executive 30 days advance
notice in writing.  The Executive may
terminate his Employment by giving the Company 30 days advance notice in
writing.  The Executive’s Employment
shall terminate automatically in the event of his death.

 

(b)                                 Employment at Will. 
The Executive’s Employment with the Company shall be “at will,” meaning
that either the Executive or the Company shall be entitled to terminate the
Executive’s employment at any time and for any reason, with or without
Cause.  This Agreement shall constitute
the full and complete agreement between the Executive and the Company on the “at
will” nature of the Executive’s Employment, which may only be changed in an
express written agreement signed by the Executive and a member of the Board.

 

(c)                                  Rights Upon Termination. 
Upon the termination of the Executive’s Employment, the Executive shall
be entitled to the compensation, benefits and reimbursements described in this
Agreement for the period ending as of the effective date of the termination
(the “Termination Date”).  Upon
termination of Executive’s Employment for any reason, the Executive shall
receive the following payments on the Termination Date: (i) all unpaid
salary and unpaid vacation accrued through the Termination Date, (ii) any
unpaid, but earned and accrued incentive bonus for any completed applicable
bonus determination period under the EBP (whether paid quarterly, annually or
as might otherwise be established under the EBP) which has not yet been paid on
the Termination Date and (iii) any unreimbursed business expenses.  Executive may also be eligible for other
post-Employment payments and benefits as provided in this Agreement.

 

6.                                       Termination
Benefits.

 

(a)                                  Severance Pay.  If
there is an Involuntary Termination (as defined below) of Executive’s
Employment, then the Company shall pay the Executive an amount equal to 1.0
times Executive’s then Base Salary, plus up to 1.0 times Executive’s then
Target Bonus amount (adjusted pro rata on a monthly basis depending upon the
month in which the Involuntary Termination may occur) (collectively in the
aggregate, the “Cash Severance”).  In
addition, if not 

 

3

 

previously paid to
Executive, he shall also receive the First Half-2005 Bonus.  Such Cash Severance (and First Half-2005
Bonus if applicable) shall be made in a single lump sum cash payment to
Executive on the effective date of the separation agreement referenced in Section 8(a).  Executive shall also be entitled to receive
the benefits provided in Sections 6(b) and 6(c) and, if applicable,
6(d).

 

(b)                                 Health Insurance.  If
Subsection (a) above applies, and if Executive elects to continue
health insurance coverage under the Consolidated Omnibus Budget Reconciliation
Act of 1985 (“COBRA”) following the termination of his Employment, then the
Company shall pay Executive’s monthly premium under COBRA until the earliest of
(i) twelve months after the Termination Date or (ii) the date when
Executive commences receiving substantially equivalent health insurance
coverage in connection with new employment.

 

(c)                                  Equity Vesting.  If
Subsection (a) above applies, then Executive will be vested only in
that number of shares of Company common stock under all of Executive’s
outstanding Compensatory Equity as are actually vested as of the Termination
Date according to the terms of such Compensatory Equity arrangements.

 

(d)                                 Effect of Change in Control. 
If the Company is subject to a Change in Control (as defined below) and
if there is an Involuntary Termination of Executive’s Employment in
connection with such Change in Control (it will automatically be deemed to be
in connection with the Change in Control if there is an Involuntary Termination
during the period commencing immediately prior to the Change in Control and
extending through the date that is 24 months after the Change in Control): (x)
Executive shall immediately vest in (and the Company’s right to repurchase, if
applicable, shall lapse immediately as to) all of Executive’s Compensatory
Equity, (y) the amount of the Cash Severance in Section 6(a) shall be
increased such that while the Executive shall still receive 1.0 times Base
Salary, he shall receive in addition 1.0 times Target Bonus (with no pro
ration), and (z) the duration of COBRA coverage in Section 6(b) shall
continue to be for 12 months.  The
Company’s obligation to continue to provide Section 6(b) benefits
shall not be relieved merely because the legally required minimum period for
providing COBRA continuation coverage is for a shorter period than 12 months.

 

(e)                                  Excise Tax Gross-Up. 
In the event that the benefits provided for in this Agreement (i) constitute
“parachute payments” within the meaning of Section 280G of the Code and (ii) but
for this Subsection (e), would be subject to the excise tax imposed by Section 4999
of the Code, then the Executive’s benefits under this Agreement shall be
payable either (1) in full, or (2) as to such lesser amount which
would result in no portion of the such 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 the
Executive on an after-tax basis, of the greatest amount of benefits under this
Agreement, notwithstanding that all or some portion of such benefits may be
taxable under Section 4999 of the Code. 
Unless Executive and the Company agree otherwise in writing, the
determination of Executive’s excise tax liability, if any, and the amount, if
any, required to be paid under this Subsection (e) will be made in
writing by the independent auditors who are primarily used by the Company
immediately prior to the Change of Control (the “Accountants”).  For purposes of making the calculations
required by this 

 

4

 

Subsection (e), 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.  Executive and the Company agree to furnish
such information and documents as the Accountants may reasonably request in
order to make a determination under this Subsection (e).  The Company will bear all costs the
Accountants may reasonably incur in connection with any calculations
contemplated by this Subsection (e).

 

(f)                                    Change in Control Definition.  For purposes of this Agreement, “Change
in Control” shall mean the occurrence of any of the following events:  (i) the consummation of a merger
or consolidation of the Company with or into another entity or any other
corporate reorganization, if persons who were not stockholders of the Company
immediately prior to such merger, consolidation or other reorganization own
immediately after such merger, consolidation or other reorganization 50% or
more of the voting power of the outstanding securities of each of (A) the
continuing or surviving entity and (B) any direct or indirect parent
corporation of such continuing or surviving entity, (ii) the sale,
transfer or other disposition of all or substantially all of the Company’s
assets, (iii) the approval by the stockholders of the Company, or if
stockholder approval is not required, approval by the Board, of a plan of
complete liquidation or dissolution of the Company or (iv) solely with
respect to determining the treatment of Compensatory Equity under the terms of
this Agreement, the terms of any applicable definition provided by the Plan or
other Company equity incentive plan or arrangement.  A transaction shall not constitute a Change
in Control if its sole purpose is to change the state of the Company’s
incorporation or to create a holding company that will be owned in
substantially the same proportions by the persons who held the Company’s
securities immediately before such transaction.

 

(g)                                 Cause Definition.  For
purposes of this Agreement, “Cause” shall mean (i) Executive’s material
breach of this Agreement that is not corrected within a 30 day correction
period that begins upon delivery to Executive of a written demand from the
Board that describes the basis for the Board’s belief that Executive has
materially breached this Agreement; (ii) any willful act of fraud or
dishonesty that causes material damage to the Company; (iii) any willful
violation of the Company’s insider trading policy; (iv) any willful violation
of the Company’s conflict of interest policies; (v) any willful
unauthorized use or disclosure of trade secrets or other confidential
information; or (vi) Executive’s conviction of a felony.

 

The foregoing shall not
be deemed an exclusive list of all acts or omissions that the Company may
consider as grounds for the termination of Executive’s Employment, but it is an
exclusive list of the acts or omissions that shall be considered “Cause” for
the termination of Executive’s Employment by the Company.

 

(h)                                 Good Reason Definition. 
For all purposes under this Agreement, “Good Reason” shall mean the
occurrence of any of the following, without Executive’s express written
consent: (i) a substantial reduction of Executive’s duties or
responsibilities; (ii) a reduction in Executive’s Base Salary or Target
Bonus other than a one-time reduction (not exceeding 10% in the aggregate) that
also is applied to substantially all other executive officers of the Company on
the CEO’s written recommendation or written approval if Executive’s reduction
is substantially proportionate to, or no greater than, the reduction applied to

 

5

 

substantially all other
executive officers; (iii) the Company’s material breach of this Agreement
including without limitation the failure to timely provide Executive the cash
compensation, equity compensation and/or employee benefits specified under this
Agreement; or (iv) the Company requiring Executive to relocate his
principal place of business or the Company relocating its headquarters, in
either case to a facility or location outside of a 30 mile radius from
Executive’s current principal place of employment; provided, however, that
Executive will only have Good Reason if the event or circumstances constituting
Good Reason specified in any of the preceding clauses is not cured or otherwise
remedied to the Executive’s satisfaction within 30 days after Executive gives
written notice to the Board.

 

(i)                                     Involuntary Termination Definition.  For all purposes under this Agreement, “Involuntary
Termination” shall mean any of the following that occur without Executive’s
prior written consent:  (i) termination
of Executive’s Employment by the Company without Cause, or (ii) Executive’s
resignation of Employment for Good Reason.

 

7.                                       Successors.

 

(a)                                  Company’s Successors. 
This Agreement shall be binding upon any successor (whether direct or
indirect and whether by purchase, lease, merger, consolidation, liquidation or
otherwise) to all or substantially all of the Company’s business and/or
assets.  For all purposes under this
Agreement, the term “Company” shall include any successor to the Company’s
business and/or assets which becomes bound by this Agreement.

 

(b)                                 Executive’s Successors. 
This Agreement and all rights of the Executive hereunder shall inure to
the benefit of, and be enforceable by, the Executive’s personal or legal
representatives, executors, administrators, successors, heirs, distributees,
devisees and legatees.

 

8.                                       Conditions
to Receipt of Severance; No Duty to Mitigate.

 

(a)                                  Separation Agreement and Release of Claims.  The
receipt of any severance benefits pursuant to Section 6 will be subject to
Executive signing and not revoking a separation agreement and release of claims
in substantially the form attached hereto as Exhibit A, but with
any appropriate modifications, reflecting changes in applicable law, as is
necessary or appropriate to provide the Company with the protection it would
have if the release were executed as of the Start Date.  No severance benefits will be paid or
provided until the separation agreement and release agreement becomes
effective.

 

(b)                                 Non-solicitation and Non-competition.  The receipt of any severance benefits will be
subject to the Executive agreeing that during Employment and for the 12 month
period after the Termination Date (the “Continuance Period”), the Executive
will not (i) solicit any employee of the Company for employment other than
at the Company, or (ii) directly or indirectly engage in, have any
ownership interest in or participate in any entity that as of the Termination
Date, directly competes with the Company in any substantial business of the
Company or any business reasonably expected to become a substantial business
(i.e., at least 5% of the Company’s gross revenues) of the Company during the
Continuance Period.

 

6

 

Notwithstanding
the foregoing, the provisions of Section 8(b)(ii) shall not be
applicable to Executive on or after a Change in Control.  The Executive’s passive ownership of not more
than 1% of any publicly traded company and/or 5% ownership of any privately
held company will not constitute a breach of this Subsection (b).

 

(c)                                  Non-disparagement.  During Employment and the
Continuance Period, the Executive will not knowingly publicly disparage,
criticize, or otherwise make any derogatory statements regarding the Company,
its directors, or its officers.  The
Company’s then and future directors will not knowingly publicly disparage,
criticize, or otherwise make any derogatory statements regarding the Executive
during his Employment or the Continuance Period.  The Company will also instruct its officers
to not knowingly publicly disparage, criticize, or otherwise make any
derogatory statements regarding the Executive during his Employment or the
Continuance Period.  Notwithstanding the
foregoing, nothing contained in this Agreement will be deemed to restrict the
Executive, the Company or any of the Company’s current or former officers
and/or directors from providing information to any governmental or regulatory
agency (or in any way limit the content of such information) to the extent they
are requested or required to provide such information pursuant to any
applicable law or regulation.

 

(d)                                 No Duty to Mitigate.  No payments or benefits
provided to Executive (except as expressly provided in Section 6(b)) shall
be subject to mitigation or offset.

 

9.                                       Miscellaneous
Provisions.

 

(a)                                  Indemnification.  The Company shall indemnify Executive to the
maximum extent permitted by any applicable indemnification agreement,
applicable law and the Company’s bylaws with respect to Executive’s Service
(including timely advancing and/or reimbursing costs as incurred by Executive)
and the Executive shall also be covered under a directors and officers
liability insurance policy(ies) paid for by the Company.

 

(b)                                 Notice.  Notices and
all other communications contemplated by this Agreement shall be in writing and
shall be deemed to have been duly given when personally delivered or when
mailed by overnight courier, U.S. registered or certified mail, return receipt
requested and postage prepaid.  In the
case of the Executive, mailed notices shall be addressed to him at the home
address that he most recently communicated to the Company in writing.  In the case of the Company, mailed notices
shall be addressed to its corporate headquarters, and all notices shall be
directed to the attention of its CEO.

 

(c)                                  Arbitration.  The
Company and Executive agree that any and all disputes arising out of the terms
of this Agreement, the Executive’s Employment, Executive’s Service, or
Executive’s compensation and benefits, their interpretation and any of the
matters herein released, will be subject to binding arbitration in Portland,
Oregon before the American Arbitration Association under its National Rules for
the Resolution of Employment Disputes. 
The Company and the Executive agree that the prevailing party in any
arbitration will be entitled to injunctive relief in any court of competent
jurisdiction to enforce the arbitration award. 
The Company and the Executive hereby agree to
waive their right to have any dispute between them resolved in a court of law
by a judge or jury.  This Subsection (c) will
not prevent either 

 

7

 

party from seeking
injunctive relief (or any other provisional remedy) from any court having
jurisdiction over the Company or the Executive and the subject matter of their
dispute relating to Executive’s obligations under this Agreement.  The Company shall be responsible for timely
paying for all arbitration and legal fees incurred by both parties as such
costs are incurred, provided, however that if (i) the Executive initiates
the arbitration proceeding and (ii) the Company prevails in such
arbitration that was initiated by the Executive, then each side shall be
responsible for paying for their own costs.

 

(d)                                 Modifications and Waivers. 
No provision of this Agreement shall be modified, waived or discharged
unless the modification, waiver or discharge is agreed to in writing and signed
by the Executive and by an authorized officer of the Company (other than the
Executive).  No waiver by either party of
any breach of, or of compliance with, any condition or provision of this
Agreement by the other party shall be considered a waiver of any other
condition or provision or of the same condition or provision at another time.

 

(e)                                  Whole Agreement.  This
Agreement contains the entire understanding of the parties with respect to the
subject matter hereof and supersedes any other agreements, representations or
understandings (whether oral or written and whether express or implied) with
respect to the subject matter hereof.  In
the event of any conflict in terms between this Agreement and/or the Plan
and/or any agreement executed by and between Executive and the Company, the
terms of this Agreement shall prevail and govern.

 

(f)                                    Legal Fees.  Each
party shall pay its own legal fees and expenses incurred in connection with the
preparation and execution of this Agreement.

 

(g)                                 Withholding Taxes. 
All payments made under this Agreement shall be subject to reduction to
reflect taxes or other charges required to be withheld by law.

 

(h)                                 Choice of Law.  The
validity, interpretation, construction and performance of this Agreement shall
be governed by the laws of the State of Oregon (except their provisions
governing the choice of law).

 

(i)                                     Severability.  The
invalidity or unenforceability of any provision or provisions of this Agreement
shall not affect the validity or enforceability of any other provision hereof,
which shall remain in full force and effect.

 

(j)                                     Code Section 409A. 
The Company and the Executive agree to work together in good faith to
consider amendments to this Agreement necessary or appropriate to avoid
imposition of any additional tax or income recognition prior to actual payment
to Executive under Code Section 409A and any temporary or final Treasury
Regulations and Internal Revenue Service guidance thereunder.

 

(k)                                  No Assignment.  This
Agreement and all rights and obligations of the Executive hereunder are
personal to the Executive and may not be transferred or assigned by the
Executive at any time.  The Company may
assign its rights under this Agreement to any 

 

8

 

entity that expressly in
writing assumes the Company’s obligations hereunder in connection with any sale
or transfer of all or substantially all of the Company’s assets to such entity.

 

(l)                                     Counterparts.  This
Agreement may be executed in two or more counterparts, each of which shall be
deemed an original, but all of which together shall constitute one and the same
instrument.

 

IN WITNESS WHEREOF,
each of the parties has executed this Agreement, in the case of the Company by
its duly authorized officer, as of the Start Date.

 

	
   

  	
  /s/
  Jan Johannessen

  
	
   

  	
  Jan
  Johannessen

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  LATTICE SEMICONDUCTOR
  CORPORATION

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By

  	
   /s/
  Stephen A. Skaggs

  
	
   

  	
   

  	
   

  
	
   

  	
  Title:

  	
   President &
  CEO

  
				

 

9

 

EXHIBIT A

 

GENERAL RELEASE

 

RECITALS

 

This Separation Agreement
and Release (“Agreement”) is made by and between Jan Johannessen (“Employee”) and Lattice Semiconductor Corporation
(the “Company”) (jointly referred to as the “Parties”):

 

WHEREAS, Employee was
employed by the Company;

 

WHEREAS, the Company and
Employee entered into an Employment Agreement dated November 1, 2005 (the “Employment Agreement”);

 

WHEREAS, the Parties
agree that Employee’s employment with the Company will terminate on                           
(the “Termination Date”);

 

WHEREAS, the Company and
Employee entered into an Employee Agreement dated [                 ]
regarding Confidential Information (the “Confidentiality Agreement”);

 

WHEREAS, the Company and
Employee entered into an Indemnification Agreement, dated [                 ],
regarding Employee’s rights to indemnification (the “Indemnification Agreement”);

 

WHEREAS, Employee is a
participant, or is eligible to participate, in the Company’s Executive Deferred
Compensation Plan dated [                 ],
as amended, regarding Employee’s rights to receive deferred compensation (the “Deferred
Compensation Plan”);

 

WHEREAS, the Company and
Employee entered into Stock Option Agreements dated [       ]
granting Employee the option to purchase shares of the Company’s common stock
subject to the terms and conditions of the Company’s Stock Option Plan(s) and
the Stock Option Agreements (the “Stock Agreements”);

 

WHEREAS, the Parties wish
to resolve any and all disputes, claims, complaints, grievances, charges,
actions, petitions and demands that Employee may have against the Company as
defined herein, arising out of, or related to, Employee’s employment with, or
separation from, the Company;

 

NOW THEREFORE, in
consideration of the promises made herein, the Parties hereby agree as follows:

 

COVENANTS

 

1.                                      Consideration.

 

(a)                                  Pursuant
to Section 8(a) of the Employment Agreement, Employee’s receipt of
severance is subject to Employee executing and not revoking this Release.  In consideration of Employee executing and
not revoking this Release, the Company agrees to 

 

10

 

pay (or provide, as
applicable) Employee a cash payment of $                 
on the Effective Date and also the benefits specified in the Employment
Agreement.  Employee acknowledges that
such cash payment and the provision of such benefits will be in full
satisfaction of the payments and obligations provided under the Employment
Agreement and he will not be entitled to any additional salary, wages, bonuses,
accrued vacation, housing allowances, relocation costs, interest, severance,
stock, stock options, outplacement costs, fees, commissions or any other
benefits and compensation, except as provided in any Company employee welfare
or pension benefit plans as defined by the Employee Retirement Income Security
Act of 1974, as amended (“ERISA”) (such plans, the “Benefit Plans”), this
Agreement, the Indemnification Agreement, the Deferred Compensation Plan and/or
the Stock Agreements.

 

(b)                                 Stock.  Employee acknowledges that as of the
Termination Date, and after taking into account any accelerated vesting
provided by the Employment Agreement or Stock Agreements, he will then hold
vested stock options to acquire [              ]
shares of Company common stock and no more. 
The exercise of any stock options shall continue to be subject to the
terms and conditions of the Stock Agreements and the Employment Agreement.

 

(c)                                  Benefits.  Employee’s
health insurance benefits will cease on the last day of the month of the
Termination Date, subject to Employee’s right to continue his health insurance
as provided in the Employment Agreement (with such premiums to be paid by the
Company as provided in the Employment Agreement).  Subject to the Employment Agreement, the
Deferred Compensation Plan, the Indemnification Agreement, the Stock Agreements
and/or the Benefit Plans, Employee’s participation in all other benefits and
incidents of employment (including, but not limited to, the accrual of vacation
and paid time off, and the vesting of stock options) will cease on the
Termination Date.

 

2.                                      Confidential
Information.  Employee shall continue to comply with the
terms and conditions of the Confidentiality Agreement, and maintain the
confidentiality of all of the Company’s confidential and proprietary
information.  Employee also shall return
to the Company all of the Company’s property, including all confidential and
proprietary information, in Employee’s possession, on or before the Effective
Date.

 

3.                                      Release of
Claims.  Employee agrees that the foregoing
consideration represents settlement in full of all outstanding obligations owed
to Employee by the Company.  Employee, on
his own behalf and on behalf of his respective heirs, family members,
executors, agents, and assigns, hereby fully and forever releases the Company
and its current and former: officers, directors, employees, agents, investors,
attorneys, shareholders, administrators, affiliates, divisions, subsidiaries,
predecessor and successor corporations and assigns (the “Releasees”) from, and
agrees not to sue concerning, any claim, duty, obligation or cause of action
relating to any matters of any kind arising out of or relating to his
employment by the Company (except as provided in the Employment Agreement), or
his service as an officer of the Company and/or a director of the Company,
whether presently known or unknown, suspected or unsuspected, that Employee may
possess arising from any omissions, acts or facts that have occurred up until
and including the Effective Date, excluding the “Excluded Claims” (as defined
below) and including, without limitation:

 

11

 

(a)                                  any
and all claims relating to or arising from Employee’s employment with the
Company, or the termination of that employment;

 

(b)                                 any
and all claims relating to, or arising from, Employee’s right to purchase, or
actual purchase of, shares of Company stock, including, but not limited to, any
claims for fraud, misrepresentation, breach of fiduciary duty, breach of duty
under applicable state corporate law, and securities fraud under any state or
federal law;

 

(c)                                  any
and all claims under the law of any jurisdiction, including, but not limited
to, wrongful discharge of employment; constructive discharge from employment;
termination in violation of public policy; discrimination; breach of contract,
both express and implied; breach of a covenant of good faith and fair dealing,
both express and implied; promissory estoppel; negligent or intentional
infliction of emotional distress; negligent or intentional misrepresentation;
negligent or intentional interference with contract or prospective economic
advantage; unfair business practices; defamation; libel; slander; negligence;
personal injury; assault; battery; invasion of privacy; false imprisonment; and
conversion;

 

(d)                                 any
and all claims for violation of any federal, state or municipal statute,
including, but not limited to, Title VII of the Civil Rights Act of 1964; the
Civil Rights Act of 1991; the Age Discrimination in Employment Act of 1967; the
Americans with Disabilities Act of 1990; the Fair Labor Standards Act; ERISA;
the Worker Adjustment and Retraining Notification Act; the Older Workers
Benefit Protection Act; the Family and Medical Leave Act; and the Fair Credit
Reporting Act;

 

(e)                                  any
and all claims for violation of the federal, or any state, constitution;

 

(f)                                    any
and all claims arising out of any other laws and regulations relating to
employment or employment discrimination; and

 

(g)                                 any
and all claims for attorney fees and costs.

 

For purposes of this
Agreement, the “Excluded Claims” shall include any claims pursuant to the
Benefit Plans, the Deferred Compensation Plan, the Indemnification Agreement,
the right to receive an excise tax gross-up under Section 6(e) of the
Employment Agreement, the non-disparagement clause of Section 8(c) of
the Employment Agreement, the right to indemnification under Section 9(a) of
the Employment Agreement, the Code Section 409A clause of Section 9(j)
of the Employment Agreement, and any right to exercise stock options pursuant
to the relevant provisions of the Stock Agreements.

 

4.                                      Acknowledgement
of Waiver of Claims Under ADEA.  Employee acknowledges that
he is waiving and releasing any rights he may have under the Age Discrimination
in Employment Act of 1967 (“ADEA”) and that this waiver and release is knowing
and voluntary.  Employee and the Company
agree that this waiver and release does not apply to any rights or claims that
may arise under the ADEA after the Effective Date.  Employee acknowledges that the consideration
given for this waiver and release Agreement is in addition to 

 

12

 

anything of value to which
Employee was already entitled.  Employee
further acknowledges that he has been advised by this writing that:

 

(a)                                  he
should consult with an attorney prior to executing this Release;

 

(b)                                 he
has up to twenty-one (21) days within which to consider this Release;

 

(c)                                  he
has seven (7) days following his execution of this Release to revoke this
Release;

 

(d)                                 this
ADEA waiver shall not be effective until the revocation period has expired;
and,

 

(e)                                  nothing
in this Release prevents or precludes Employee from challenging or seeking a
determination in good faith of the validity of this waiver under the ADEA, nor
does it impose any condition precedent, penalties or costs for doing so, unless
specifically authorized by federal law.

 

5.                                      Unknown Claims.  The Parties represent that they are not aware of any claim by either of
them other than the claims that are released by this Release.  Employee acknowledges that he has been
advised by legal counsel and are familiar with the principle that a general
release does not extend to claims which the releasor does not know or suspect
to exist in his favor at the time of executing the Release, which if known by
him must have materially affected his settlement with the Releasee.  Employee, being aware of said principle,
agree to expressly waive any rights Employee may have to that effect, as well
as under any other statute or common law principles of similar effect.

 

6.                                      Application
for Employment.  Employee understands and
agrees that, as a condition of this Release, he shall not be entitled to any
employment with the Company, its subsidiaries, or any successor, and he hereby
waives any alleged right of employment or re-employment with the Company, its
subsidiaries or related companies, or any successor.

 

7.                                      No Cooperation.  Employee agrees that he will not knowingly counsel or assist any
attorneys or their clients in the presentation or prosecution of any disputes,
differences, grievances, claims, charges, or complaints by any third party
against any of the Releasees, unless requested by a governmental agency or
unless under a subpoena or other court order to do so.  Employee agrees both to immediately notify
the Company upon receipt of any such subpoena or court order, and to furnish,
within three (3) business days of its receipt, a copy of such subpoena or
court order to the Company.  If otherwise
approached by anyone for counsel or assistance in the presentation or
prosecution of any disputes, differences, grievances, claims, charges, or
complaints against any of the Releasees, Employee shall state no more than that
he cannot provide counsel or assistance.

 

8.                                      Costs.  The Parties shall each bear their own costs, expert fees, attorney fees
and other fees incurred in connection with the preparation of this Release.

 

13

 

9.                                      Arbitration.  The Parties agree that any and all disputes arising out of, or relating
to, the terms of this Release, their interpretation, and any of the matters
herein released, shall be subject to binding arbitration as described in Section 9(c) of
the Employment Agreement.

 

10.                               No Representations.  Each Party represents that it has had the opportunity to consult with an
attorney, and has carefully read and understands the scope and effect of the
provisions of this Release.  Neither
Party has relied upon any representations or statements made by the other Party
hereto which are not specifically set forth in this Release.

 

11.                                 No
Oral Modification.  Any modification or
amendment of this Release, or additional obligation assumed by either Party in
connection with this Release, shall be effective only if placed in writing and
signed by both Parties or their authorized representatives.

 

12.                               Entire Agreement.  This Release, the Employment Agreement, the Indemnification Agreement,
the Deferred Compensation Plan, the Benefit Plans, the Confidentiality
Agreement and the Stock Agreements represent the entire agreement and
understanding between the Company and Employee concerning the subject matter of
this Release and Employee’s relationship with the Company, and supersede and
replace any and all prior agreements and understandings between the Parties
concerning the subject matter of this Release and Employee’s relationship with
the Company.

 

13.                               Governing Law.  This Release shall be governed by the laws of the State of Oregon,
without regard for choice of law provisions.

 

14.                               Effective Date.  This Release is only effective after it has been signed by both parties
and after eight (8) days have passed following the date Employee signed
the Agreement without Employee revoking this Agreement (the “Effective Date”).

 

15.                               Voluntary Execution
of Release.  This Release is executed voluntarily and with
the full intent of releasing all claims, and without any duress or undue
influence by any of the Parties.  The
Parties acknowledge that:

 

(a)                                  They
have read this Release;

 

(b)                                 They
have been represented in the preparation, negotiation, and execution of this
Release by legal counsel of their own choice or that they have voluntarily
declined to seek such counsel;

 

(c)                                  They
understand the terms and consequences of this Release and of the releases it
contains; and

 

(d)                                 They
are fully aware of the legal and binding effect of this Release.

 

14

 

IN WITNESS WHEREOF, each
of the Parties has executed this Release, in the case of the Company by a duly
authorized officer, as of the day and year written below.

 

	
  COMPANY:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  LATTICE SEMICONDUCTOR
  CORPORATION

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
  Date:

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Title:

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  EMPLOYEE:

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Date:

  	
   

  
	
  Jan
  Johannessen

  	
   

  	
   

  
							

 

15

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