Spansion Inc. Key Employee Incentive Plan and Centurion Plan (2009)

Contract Categories: Human Resources › Bonus & Incentive Agreements
Summary

Spansion Inc. established two incentive plans in 2009—the Key Employee Incentive Plan (KEIP) for eight select vice presidents and the Centurion Plan for key employees—to encourage retention and performance during its bankruptcy restructuring. The KEIP rewards VPs based on financial milestones, including cash balance and EBITDA, with payouts tied to achieving these targets. The Centurion Plan covers both pre- and post-bankruptcy employees, offering payments based on continued employment and company performance. Awards may be pro-rated if the company is sold or jobs are eliminated before the payout dates.

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EX-10.9 10 dex109.htm SPANSION INC. KEY EMPLOYEE INCENTIVE PLAN AND CENTURION PLAN Spansion Inc. Key Employee Incentive Plan and Centurion Plan
CONFIDENTIAL
KEIP & Centurion Plans       Exhibit 10.9
Program
Participants
Purpose
Metrics/Timing*
Target as % of
Ann. Salary
Cost
KEIP
Approved 7/23/09
•
8 select VPs
•
Maximize estate
value
•
Rapid emergence
from bankruptcy
•
Perform key
restructuring
functions
Milestone 1 (50% of target)
•
Measured 10/1/09
•
Equal weighting of ending
cash balance
(1)
and EBITDA
Milestone 2 (50% of target +
upside opportunity)
•
Later of 4/1/10 or 30 days
after Confirmation of Plan of
Reorganization
•
Based on 4/1/10 EBITDA
•
Target:  70%
•
Max:  100%
-
Upside payout
tied to Milestone
2 based on
aggressive
EBITDA target set
with creditors &
court
•
~$2.0M
(at target)
•
~$2.8M
(at max)
Centurion Plan
(Pre-
& Post-petition)
Approved 6/29/09
•
Pre-Petition:
55 EEs
on
current plan
•
Post-Petition:   
Non-insiders
101 EEs
•
Address current
Centurion
participants
•
Retain key
employees
•
Pre-Petition:
-
100% upon approval
•
Post-Petition:
-
33% on 10/1/09
-
66% on 4/1/10
•
Pre:    2%
-
21%
•
Post:  5%
-
30%
•
~$1.0M
•
~$2.5M
*In the event of the sale of the company or termination by the company (job elimination or restructuring) prior to the period-ending date, the full
award for that period will be pro-rated.
(1)
Excludes cash from Samsung settlement and sale of Wireless business.
Japan receipts accounted for per Financial Plan assumptions –
accounting
changes to be adjusted accordingly.