Document:

ex10_2x03302014

Exhibit 10.2

 SUNPOWER CORPORATION
 EXECUTIVE QUARTERLY 
KEY INITIATIVE BONUS PLAN 
(Amended and Restated February 4, 2014) 

Article 1 -Executive KI Plan Objective 
1.1 The objective of this Executive Quarterly Key Initiative Bonus Plan (“Executive KI Plan”) is to encourage retention and provide incentives to key employees of SunPower Corporation and its subsidiaries (collectively, the “Company”) based on the Company’s profit before tax, quarterly company milestones and an individual's performance against set individual key initiatives (KIs). The Executive KI Plan shall be administered by the Compensation Committee appointed by the Board of Directors of SunPower Corporation. 
Article 2 -Effective Date 
2.1 This quarterly program will be effective as of January 1, 2014. “Plan Periods” under the Executive KI Plan will correspond to the fiscal quarters of the Company. 
Article 3 -Eligibility for Executive KI Plan Participation 
3.1 All executive officers of the Company, as well as any other key employees approved by the Compensation Committee of the Board of Directors, shall participate in the Executive KI Plan. Participation will generally be limited to the CEO and executive direct reports. 
Article 4 -Target Bonus Percentages and Calculations 
4.1 Executive KI Target Bonus Percentages. Each Executive KI Plan participant will be allocated a KI target bonus expressed as a percentage of his or her base salary. KI target bonus percentages are set by the Compensation Committee. The Compensation Committee may, in its discretion, set maximum caps on the payout amount for KI bonuses. The Compensation Committee may delegate establishing KI target bonus percentages to officers of the Company; provided that executive officer KI target bonus percentages must be approved by the Compensation Committee. 
		
	4.2 
	Executive KI Plan Components. 

(i) Quarterly KI Score. At the start of each quarter the participant will formulate with his or her supervisor a list of key initiatives for such quarter. Each initiative will be allocated a certain number of points, and the quarterly scorecard shall total 100 points. Following each quarter the participant’s supervisor will score the participant’s achievement of key initiatives (expressed as a percentage). 

(ii) Company Milestone Score. With respect to each quarter the Board of Directors will establish quarterly company milestones for such quarter. Each company milestone will be allocated a certain number of points. Following each quarter, the executive officers of the Company will score the achievement of company milestones (expressed as a percentage). 

(iii) PBT Score. At the start of the quarter the executive officers will establish an internal profit before tax financial target for the Company (“Target PBT”), including minimum and maximum PBT levels for the quarter. Following the quarter, the actual profit before tax will be determined (“Actual PBT”). 
4.3 Quarterly bonuses under this Executive KI Plan are based on a combination of 
(a) the participant’s number of points achieved on his or her key initiative scorecard for the quarter (expressed as a percentage), (b) the percentage of company milestones achieved for the quarter and (c) the Actual PBT for such quarter. In particular, the bonus payout is calculated as follows: 
For each quarter:

(i) The Company Milestone factor is calculated as follows: 

	
		
	If the Company Milestone Score is:
	KI Bonus for the quarter will be:

	= or < 60%
	No KI bonus

	60% < Company Milestone Score </= 80%
	Multiplied by a factor of 50%

	> 80%
	Multiplied by a factor of 100%

 

(ii) The PBT factor is calculated as follows: 

	
		
	If the Actual PBT is:
	KI Bonus for the quarter will be:

	< Minimum PBT
	No KI bonus payout

	Minimum </= Actual PBT < Target PBT
	Paid if the Company Milestone condition is met as set forth above

	Target PBT</=Actual PBT < Maximum
AND
Company Milestone condition is met as set forth above
	Multiplied by an adjustment factor between 100% and 125%, based on a straight-line proration between target and maximum achievement.

NOTE: Adjustment factor will be greater than 100% only if Actual PBT is greater than zero.

(iii) Examples: 
		
	a.
	Actual PBT is between the minimum and Target PBT performance levels and Company milestone score is greater than 80% (Company Milestone factor = 100%).  The employee has a base salary of $100,000, a KI target bonus of 20%, and a KI score of 80%: 

The quarterly bonus = $100,000 x 1⁄4 x 20% x 80% x 100% 

		
	b.
	Company milestone score is greater than 60% and equal to or less than 80% (Company Milestone factor = 50%).  The employee has a base salary of $100,000, a KI target bonus of 20% and a KI score of 80%:

The quarterly bonus = $100,000 x 1⁄4 x 20% x 80% x 50% 

(d.) When the quarterly KI bonus is prorated and paid above 100%, it is subject to a maximum cap of 125%. The Board reserves the right to reduce payments above 100% of target, should the sum of payments above target for all eligible employees become a material portion of the Actual PBT achieved by the Company. 
4.4 Quarterly bonuses under this Executive Quarterly Key Initiative Bonus Plan are paid within 90 days following the end of the quarter.

Article 5 -Effect of Base Salary on Target Bonus Adjustments 
5.1 Payout calculations under the Executive KI Plan will be based on the plan participant's base salary at the end of the quarter being measured. 
5.2 In the event a participant’s KI target bonus percentage is changed during the quarter, the participant’s KI payout for the quarter shall be based on the KI target bonus in effect at the end of that quarter. 
Article 6 -KI Achievement 
6.1 KI attainment for the completed quarter and proposed KI for the next quarter are reviewed at the end of each quarter no later than the third Friday of the first month of the quarter. 

6.2 In setting KIs, a 0% threshold may be defined for each KI. This threshold, which could be timing and/or deliverable-based, is a point at which a KI score starts to be earned. If a participant does not reach/complete the minimum threshold, such KI will be scored 0% (zero). Progress beyond the threshold earns the participant a pro-rated score up to 110%. The score for a particular KI item cannot exceed 110%. Scoring greater than 100% for a KI item is usually limited to numeric or quantitative goals. 
6.3 The Chief Executive Officer’s quarterly KI score is the actual company milestone score for such quarter. 
Article 7 -Eligibility for Payment  
7.1 Employment: Because one of the primary objectives of the Key Employee Bonus Plan is to encourage employee retention, to be eligible for any portion of the bonus payment, the participant must be employed by the Company at the scheduled payment date, unless otherwise required by local law.  A participant who is involuntarily terminated for any reason other than by the Company for cause before the payment date may be eligible for a prorated potion of any bonus not yet paid at the sole discretion of the Company.  A participant who terminates employment prior to the payment date will be ineligible for any and all bonuses not yet paid, except as otherwise provided in this article or any separate agreement approved by the Compensation Committee. 
7.2 New Hires: New Hires shall be eligible to participate in the bonus program starting the first complete month of work, i.e. if they start the first business day of the month, they will be eligible to participate that month; otherwise, they will begin participation the following month. 
7.3 Disability: If a participant is unable to perform the essential functions of his or her job with or without a reasonable accommodation and is eligible to receive disability benefits under the standards used by the Company's disability benefit plan, the participant will receive a bonus calculated as follows: the quarter in which the disability begins will be considered a completed quarter and the KI bonus for that quarter will be paid as though KI attainment was 100%. If/when the participant returns from disability leave, participation will be handled as outlined in section 7.2 above. 
7.4 Retirement: If a participant retires, i.e. permanent termination of employment with the Company in accordance with the Company's retirement policies, the participant will receive a bonus calculated as follows: the quarter in which the retirement begins will be considered a completed quarter and the KI bonus for that quarter will be paid as though KI attainment was 100%. Thereafter, quarterly participation ceases. 
7.5 Death: If a participant dies, awards will be paid to the beneficiary designated by the participant or, if no such designation has been made, to the persons entitled thereto as determined by a court of competent jurisdiction. The bonus will be calculated as follows: the quarter in which death occurred will be considered a completed quarter and the KI bonus for that quarter will be paid as though KI attainment was 100%. Thereafter, quarterly participation ceases. 
7.6 Lay-off: If a participant is terminated by lay-off during a Plan Period, the quarter in which the lay-off occurred will be considered a completed quarter and the KI bonus for that quarter will be paid as though KI attainment was 100%. Thereafter, quarterly participation ceases. 
7.7 No bonus will be paid to employees who are terminated for cause.  The Company shall determine in its sole and absolute discretion whether any employee’s termination is with cause.
7.8 All qualified bonus payments including future scheduled payments pursuant to Sections 7.3, 7.4, 7.5,and 7.6 will be paid in a lump-sum. 
7.9 The Chief Executive Officer reserves the right to reduce the bonus award of a participant on a pro-rata basis to reflect a participant's leave of absence or sabbatical during the applicable Plan Period. 
Article 8 -Miscellaneous 
8.1 Unless as defined in article 8.4, no right or interest in this Executive KI Plan is transferable or assignable except by will or laws of descent and distribution. 
8.2 Participation in this Executive KI Plan does not guarantee any right to continued employment with the Company. 

8.3 Participation in the Executive KI Plan in a particular Plan Period is not a guarantee to participate in subsequent Plan Periods. 
8.4 Management reserves the right to discontinue participation of any participant in this Executive KI Plan, at any time, and for whatever reasons. 
8.5 This Executive KI Plan is unfunded and the Company does not intend to set up a sinking fund. Consequently, payments arising out of bonus earned shall be paid out of the Company's general assets. Accounts recognized by the Company for book purposes are not an indication of funds set aside for payment. Executive KI Plan participants are considered as general creditors of the Company and the obligation of the Company is purely contractual and is not secured by any particular Company asset. 
8.6 The provision of this Executive KI Plan shall not limit the ability of the Compensation Committee (or its designees) to modify said Executive KI Plan, or adopt such other plans on matters of compensation, bonus or incentive, which in its own judgment it deems proper, at any time.ex10_3x03302014

Exhibit 10.3

EXECUTION VERSION
AMENDMENT NO. 3 TO JOINT VENTURE AGREEMENT
This AMENDMENT NO. 3 TO JOINT VENTURE AGREEMENT (this “Amendment”) is made and entered into as of March 2, 2014, by and among (i) SunPower Technology, Ltd., a company organized under the laws of the Cayman Islands (“SPTL”); (ii) AU Optronics Singapore Pte. Ltd., a company organized under the laws of Singapore (“AUO”); (iii) solely for purpose of Section 18 below, AU Optronics Corporation, a company organized under the laws of Taiwan, R.O.C. (“AUO Taiwan”); and (iv) AUO SunPower SDN.BHD. (formerly known as SunPower Malaysia Manufacturing SDN.BHD.), a company organized under the laws of Malaysia (the “JVC”).  Capitalized terms used but not defined herein shall have the meanings given to them in the Initial Agreement (as defined below).
RECITALS
A.    The parties hereto are parties to that certain Joint Venture Agreement dated as of May 27, 2010 (the “Initial Agreement”).
B.    The parties hereto are parties to that certain Amendment No. 1 to Joint Venture Agreement, dated as of June 29, 2010 (the “First Amendment”).
C.    The parties hereto are parties to that certain Amendment No. 2 to Joint Venture Agreement, dated as of July 5, 2010 (the “Second Amendment”).
D.    The parties hereto desire to enter into this Amendment to memorialize their agreement with respect to the matters referred to herein.
AGREEMENT
NOW THEREFORE, in furtherance of the foregoing premises and in consideration of the mutual covenants and obligations hereinafter set forth, and for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto, intending to be legally bound hereby, do agree as follows:
1.Each reference, whether direct or indirect, in the Initial Agreement to the Initial Agreement (including, without limitation, references to “this Agreement”) shall mean and be a reference to the Initial Agreement, as amended by the First Amendment, the Second Amendment and this Amendment.

2.Section 8.11 of the Initial Agreement is hereby deleted in its entirety and replaced with the following:

“8.11    Minutes.  Minutes of each meeting of the Board shall be signed by the Chairman of the meeting, after review and approval by the Board.  Minutes of the meeting of the Board shall be prepared in English, and kept at the JVC’s head office. Copies of the minutes shall be sent to each of the Directors as soon as practicable after each meeting of the Board.” 
3.Each party hereto hereby represents to the other parties hereto that, to the extent applicable, (i) all action on the part of such representing party, its officers, directors, partners and securityholders necessary for the authorization, execution, delivery and performance of all obligations under this Amendment has been taken, (ii) this Amendment constitutes a valid and legally binding obligation of such representing party, enforceable in accordance with its terms, subject to applicable bankruptcy, insolvency, reorganization, moratorium and similar laws

SVI-82074v2 

affecting creditors’ rights and remedies generally, and subject as to enforceability to general principles of equity, and (iii) the execution, delivery and performance of this Amendment will not result in any violation of, be in conflict with, or constitute a default under, with or without the passage of time or the giving of notice, any provision of such representing party’s organizational documents, in each case as amended through the date hereof.

4.Except as expressly modified by the First Amendment, the Second Amendment and this Amendment, the Initial Agreement shall remain in full force and effect in accordance with its terms.  To the extent that there are any inconsistencies or ambiguities between this Amendment and the Initial Agreement, the First Amendment, or the Second Amendment, the terms of this Amendment shall supersede the Initial Agreement, the First Amendment and the Second Amendment.     

5.This Amendment shall not be modified, amended, canceled or altered in any way, and may not be modified by custom, usage of trade or course of dealing, except by an instrument in writing signed by all of the parties hereto. All amendments or modifications of this Amendment shall be binding upon the parties hereto despite any lack of consideration so long as the same shall be in writing and executed by the parties hereto.

6.This Amendment and all disputes arising out of or in connection with this Amendment shall be governed by, interpreted under, and construed and enforceable in accordance with, the laws of the State of California, without regard to conflicts of laws principles.  Any disputes incapable of being resolved by mutual agreement of the parties hereto shall be handled in accordance with Section 18.2 (Arbitration) of the Initial Agreement; provided, however, that the JVC may not take any action with respect to any such disputes or arbitration or settlement thereof without the written consent of both SPTL and AUO.

7.This Amendment may be executed simultaneously in any number of counterparts, each of which shall be deemed an original but all of which together shall constitute one and the same instrument.

[Signatures follow]

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SVI-82074v2 

IN WITNESS WHEREOF, the Parties have caused this Amendment No. 3 to Joint Venture Agreement to be executed by their respective duly authorized signatories as of the day and year first written above.
	
		
	AU OPTRONICS SINGAPORE PTE. LTD.

By: /s/ Peng, Shuang-Lang                               
Name: Peng, Shuang-Lang                
Title: Managing Director                    
	AU OPTRONICS CORPORATION

By: /s/ Lee, Kuen-Yao                      
Name: Lee, Kuen-Yao                     
Title: Chairman                                

	 
	 

	SUNPOWER TECHNOLOGY, LTD.
By: /s/ Marty T. Neese                             
Name: Marty T. Neese                             
Title:    COO                                        
	AUO SUNPOWER SDN.BHD.
By:    Koay Hean Kim                     
Name:   Koay Hean Kim                 
Title:   President                               

 

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SVI-82074v2

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