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| || ||The Smart Timing ChoiceTM|
October 20, 2014
Subject: New Terms of Employment
As we have announced, a transaction is pending (the Transaction) whereby SiTime Corporation (the Company) will be acquired by MegaChips Corporation (MegaChips), and the Company will become a wholly owned subsidiary of MegaChips. In connection with the Transaction, you will remain an employee of the Company, subject to the revised terms and conditions of employment set forth below. These terms and conditions are subject to the Transaction closing. In the event the Transaction does not close, your employment with the Company will continue unchanged and the terms and conditions set forth herein will become null and void.
Following the Transaction, you will remain employed in your current position of Executive VP of Marketing. Your duties will remain the same, as well as your reporting relationship and work location. Of course, the Company may change your position, duties, and work location from time to time at its discretion.
Following the Transaction, your salary will be $25,000.00 per month, less payroll deductions and withholdings, payable semi-monthly. Following the Transaction, you will continue to be eligible to participate in the Companys benefit plans. As you know, the Company may change your compensation and benefits at any time in its sole discretion.
You will be eligible to participate in our Exemplary Performance Bonus Plan. Under this plan, you will be eligible to receive an annual bonus of up to $100,000, to be paid out on a quarterly basis during the month following the end of each quarter; provided, that you (l) meet your pre-determined MBO objectives and goals for the applicable quarter, and (2) are an employee in good standing on the applicable payment date. This plan will start in 2015.
You will also be eligible for a retention bonus of $30,000 for each of 2015 and 2016. The 2015 retention bonus will be paid on the first regularly scheduled payroll date to occur on or after January 15, 2016, provided that you are an employee in good standing on December 31, 2015. The 2016 retention bonus will be paid on the first regularly scheduled payroll date to occur on or after January 15, 2017, provided that you are an employee in good standing on December 31, 2016.
Following the closing of the Transaction, subject to the approval of the Board of Directors of MegaChips (the MegaChips Board), you will be granted an option to purchase 45,000 shares of MegaChips common stock (the MegaChips Option). The MegaChips Option will be granted under the MegaChips Equity Plan (the MegaChips Equity Plan) and will be governed by and subject to the terms and conditions of the MegaChips Equity Plan and the applicable stock option grant notice and option agreement thereunder (Option Documents). Subject to applicable laws, the MegaChips Option will be subject to a two-year vesting schedule pursuant to which the shares subject to the MegaChips Option will vest in eight (8) substantially equal installments on each three-month anniversary of the vesting commencement date, as set forth in your Option Documents, provided that you are continuously employed with the Company and/or MegaChips on each applicable vesting date.
The Company plans to adopt a profit sharing plan for 2017 and 2018. If you an employee in good standing at the time it is adopted and otherwise meet the eligibility criteria for participation in the plan at such time, you will be eligible to participate in such plan. Based on current projections, which may change based on business operating results in the future, it is expected that your interest in such plan would be 5.00%. The Company may change such percentage in its discretion. Further details regarding this plan will be communicated to you at a later date.
If the Company terminates your employment without Cause or you resign due to an Involuntary Termination, subject to (1) your execution (and non-revocation) of a release of claims in the form provided by the Company (the Release) within forty five (45) days following the date of your termination, plus the statutorily required seven-day revocation period (the Release Period), and (2) your continued compliance with your Proprietary Information and Invention
990 Almanor Avenue, Sunnyvale, CA 94085, USA 408 ###-###-#### (Main) 408 ###-###-#### (Fax) www.sitime.com