{"id":38876,"date":"2015-09-17T11:25:58","date_gmt":"2015-09-17T16:25:58","guid":{"rendered":"https:\/\/content.findlaw-admin.com\/ability-legal\/contracts\/uncategorized\/employment-agreement-advanced-micro-devices-inc-and-hector.html"},"modified":"2015-09-17T11:25:58","modified_gmt":"2015-09-17T16:25:58","slug":"employment-agreement-advanced-micro-devices-inc-and-hector","status":"publish","type":"corporate_contracts","link":"https:\/\/corporate.findlaw.com\/contracts\/compensation\/employment-agreement-advanced-micro-devices-inc-and-hector.html","title":{"rendered":"Employment Agreement &#8211; Advanced Micro Devices Inc. and Hector Ruiz"},"content":{"rendered":"<pre>\n                         ADVANCED MICRO DEVICES, INC.\n\n\n                                January 13, 2000\n\n\nMr. Hector Ruiz\n8218 Chalk Knoll Drive\nAustin, TX 78735\n\n                              Employment Agreement\n                              --------------------\n                                        \nDear Hector:\n\n     On behalf of the Board of Directors of Advanced Micro Devices, Inc.\n('AMD'), I am pleased to offer you the position of President and Chief Operating\nOfficer of AMD on the terms set forth below.\n\n     1.  Position. You will be employed by AMD as its President and Chief\n         --------                                                        \nOperating Officer effective commencing upon the date of your resignation from\nyour current employer (the 'Commencement Date'), reporting directly to me.\nDuring your term, you will also be a member of the Office of the CEO. You will\nbe elected to the AMD Board of Directors at the next scheduled Board Meeting\nfollowing your commencement date. During the term of your employment, you will\nbe expected to devote your full working time and attention to the business of\nAMD, and you will not render services to any other business without the prior\napproval of the Board of Directors or, directly or indirectly, engage or\nparticipate in any business that is competitive in any manner with the business\nof AMD. Notwithstanding the foregoing, you may remain a director of businesses\nwith respect to which you are a director on the Commencement Date. You will also\nbe expected to comply with and be bound by AMD's operating policies, procedures\nand practices that are from time to time in effect during the term of your\nemployment.\n\n     2.  Base Salary. Your initial base annual salary will be $750,000, payable\n         -----------                                                           \nin accordance with AMD's normal payroll practices with such payroll deductions\nand withholdings as are required by law. Your base salary will be reviewed on an\nannual basis by the Compensation Committee of the Board of Directors and\nincreased in April 2001 and from time to time thereafter, in the discretion of\nthe Board of Directors.\n\n     3.  Bonus. Your bonus each year will be equal to 0.3% of AMD's Adjusted\n         -----                                                              \nOperating Profit ('AOP') for that fiscal year in excess of 20% of AMD's AOP for\nthe immediately preceding fiscal year, subject to a maximum award of $5M in any\nyear. Since AMD will report a loss for 1999, your bonus for FY2000 will be equal\nto 0.3% of AOP for FY2000. AMD will guarantee that your FY2000 bonus will be no\nless than $500,000.\n\n \n     4.   Stock Options.\n          ------------- \n\n          (a) On the Commencement Date, the Compensation Committee of the Board\nof Directors shall grant you a nonqualified stock option to purchase 1,000,000\nshares of AMD common stock at an exercise price equal to the closing price of\nthe common stock on the Commencement Date (the 'Initial Option'), the schedule\nof which is attached as Exhibit A. This Initial Option will vest and become\n                        ---------                                          \nexercisable over a four year period, with 250,000 shares vesting and becoming\nexercisable on each anniversary of the Commencement Date.\n\n          (b) Commencing in April 2001, you will be granted annually\nnonqualified stock options to purchase 250,000 shares of AMD common stock at an\nexercise price equal to the closing price of the common stock on the grant date\n(the 'Additional Options'). These Additional Options will each vest in two equal\nannual installments such that you will vest in 250,000 shares of AMD common\nstock each year commencing in 2005.\n\n     5.   Retirement Benefit Replacement. AMD will provide you with a lump sum\n          ------------------------------                                      \ncash benefit of $3,727,020, which is estimated to be the current projected\nbenefit available to you under the Motorola Executive Incentive Plan (the\n'Retirement Benefit Amount'), on the date you attain age 57. Upon your\nattainment of age 55 in December 2000, AMD will establish a secular trust in\nyour name, to which we will contribute an amount necessary to fully fund such\nRetirement Benefit Amount by age 57. AMD will pay quarterly cash payments to\nyou between December 2000 and December 2002 in the amounts necessary for you\nto pay federal and state income or employment taxes on this Retirement Benefit\nAmount.\n\n     6.   Other Benefits. You will be entitled to the following additional\n          --------------                                                  \nbenefits:\n\n          (a) You will be eligible for the normal vacation, health insurance,\n401(k), Employee Stock Purchase Plan and other benefits offered to all AMD\nsenior executives of similar rank and stares.\n\n          (b) You will be eligible for other employee benefits as set forth in\nExhibit B of the letter.\n----------              \n\n     7.   At-Will Employment and Termination. Your employment with AMD will be\n          ----------------------------------                                  \nat-will and may be terminated by you or by AMD at any time for any reason as\nfollows:\n\n          (a) You may terminate your employment upon written notice to the Board\nof Directors within ten (10) days following a determination no later than\nDecember 31, 2001 by such Board of Directors that you will not become Chief\nExecutive Officer of AMD following the Company's 2002 Annual Meeting (a\n'Specific Constructive Termination');\n\n          (b) You may terminate your employment upon written notice to the Board\nof Directors at any time in your discretion. ('Voluntary Termination');\n\n          (c) AMD may terminate your employment upon written notice to you at\nany time following a determination by the Board of Directors that there is\n'Cause,' as defined below, for such termination ('Termination for Cause'); or\n\n                                       2\n\n \n          (d) AMD may terminate your employment upon written notice to you at\nany time in the sole discretion of the Board of Directors without a\ndetermination that there is Cause for such termination ('Termination without\nCause').\n\n     8.   Definitions. As used in this agreement, the following terms have the\n          -----------                                                         \nfollowing meanings:\n\n          (a) 'Cause' means the termination of your employment by AMD for\nrepeated failure to perform assigned duties after being notified in writing of\nsuch failure with an opportunity to correct, or if you are determined by a court\nof law or pursuant to Section 13 below to have committed a willful act of\nembezzlement, fraud or dishonesty which resulted in material loss, material\ndamage or material injury to AMD.\n\n          (b) 'Change in Control' means a change in control of a nature which\nwould be required to be reported in response to Item 6(e) of Schedule 14A of\nRegulation 14A promulgated under the Securities Exchange Act of 1934, as amended\n('Exchange Act') or in response to any other form or report to the Securities\nand Exchange Commission or any stock exchange on which AMD's shares are listed\nwhich requires the reporting of a change of control. In addition, a Change of\nControl shall be deemed to have occurred if (i) any 'person' (as such term is\nused in Sections 13(d) and 14(d) of the Exchange Act) is or becomes the\nbeneficial owner, directly or indirectly, of securities of AMD representing 35%\nor more of the combined voting power of AMD's then outstanding securities; or\n(ii) in any two year period, individuals who were members of AMD's Board of\nDirectors at the beginning of such period plus each new director whose election\nor nomination for election was approved by at least two-thirds of the directors\nin office immediately prior to such election or nomination, cease for any reason\nto constitute at least a majority of the Board, or (iii) a majority of the\nmembers of the Board in office prior to the happening of any event and who are\nstill in office after such event, determines in its sole discretion within one\nyear after such event, that as a result of such event there has been a Change of\nControl.\n\n     9.   Separation Benefits. Upon termination of your employment with AMD for\n          -------------------                                                  \nany reason, you will receive payment for all salary and vacation accrued but\nunpaid to the date of your termination of employment and your benefits will be\ncontinued under AMD's then existing benefit plans and policies for so long as\nprovided under the terms of such plans and policies and as required by\napplicable law. Under certain circumstances, you will also be entitled to\nreceive severance benefits as set forth below, but you will not be entitled to\nany other compensation, award or damages with respect to your employment or\ntermination.\n\n          (a) In the event of your Voluntary Termination or Termination for\nCause, you will not be entitled to any cash severance benefits or additional\nvesting of options. You also will not be entitled to any Retirement Benefit\nAmount, provided that upon your Voluntary Termination following your attainment\nof age 55 you will be entitled to a lump sum payment of the Retirement Benefit\nAmount otherwise payable to you at age 57, together with any additional payments\nfor federal or state income or employment taxes on such Retirement Benefit\nAmount in full satisfaction of all obligations of AMD pursuant to Section 5 of\nthis agreement.\n\n                                       3\n\n \n          (b) (i) In the event of your Termination without Cause within three\nyears of the Commencement Date, you will be entitled to (A) a single lump sum\nseverance payment equal to one year of your current annual base salary (less\napplicable deductions and withholdings), (B) acceleration of the vesting and\nexercisability of that portion of your Initial Option that would have become\nvested within twelve months following your termination and (C) a lump sum\npayment of the Retirement Benefit Amount (regardless of your age on date of\ntermination), otherwise payable to you at age 57, together with any additional\npayments for federal and state income or employment taxes on such Retirement\nBenefit Amount in full satisfaction of all obligations of AMD pursuant to\nSection 5 of this agreement.\n\n              (ii) In the event of your Specific Constructive Termination, you\nwill be entitled to (A) a single lump sum severance payment equal to two years\nof your current annual base salary (less applicable deductions and\nwithholdings), (B) acceleration of the vesting and exercisability of that\nportion of your Initial Option that would have become vested within twenty-four\nmonths following notification that you will not become Chief Executive Officer\nof AMD, and (C) a lump sum payment of the Retirement Benefit Amount (regardless\nof your age on date of termination), otherwise payable to you at age 57,\ntogether with any additional payments for federal and state income or employment\ntaxes on such Retirement Benefit Amount in full satisfaction of all obligations\nof AMD pursuant to Section 5 of this agreement.\n\n              (iii) In the event of your Constructive Termination or Termination\nwithout Cause in each case following a Change in Control, you will be entitled\nto a (A) single lump sum severance payment equal to the sum of (x) three years\ncurrent annual base salary and (y) the average of your two highest bonuses in\nthe five years preceding your termination of employment (less applicable\ndeductions and withholdings), (B) full acceleration of the vesting and\nexercisability of your Initial Option and any Additional Options, and (C) a lump\nsum payment of the Retirement Benefit Amount (regardless of your age on date of\ntermination), otherwise payable to you at age 57, together with any additional\npayments for federal and state income or employment taxes on such Retirement\nBenefit Amount in full satisfaction of all obligations of AMD pursuant to\nSection 5 of this agreement. For purposes of this Section 9(b)(iii),\n'Constructive Termination' shall mean a resignation by you due to any diminution\nor adverse change in the circumstances of your employment as determined in good\nfaith by you, including, without limitation, your reporting relationships, job\ndescription, duties, responsibilities, compensation, prerequisites, office or\nlocation of employment.\n\n          (c) If all or any portion of the amounts payable to you on your behalf\nunder this agreement or otherwise are subject to the excise tax imposed by\nSection 4999 of the Internal Revenue Code of 1986, as amended (or similar state\ntax and\/or assessment), AMD shall pay to you an amount necessary to place you in\nthe same after-tax position as you would have been in had no such excise tax\nbeen imposed. The amount payable pursuant to the preceding sentence shall be\nincreased to the extent necessary to pay income and excise taxes due on such\namount. The determination of the amount of any such tax indemnity shall be made\nby the independent accounting firm employed by AMD immediately prior to the\nChange of Control.\n\n          (d) No payments due to you under this Section 9 shall be subject to\nmitigation or offset.\n\n                                       4\n\n \n     10.  Restoration Payments. AMD will work with you and Motorola senior\n          --------------------                                            \nmanagement to avoid any forfeiture of your 1999 Annual Bonus from Motorola and\nto avoid any forfeiture of any gains attributable to your 46,667 vested Motorola\nstock options.\n\n          (a) In the event that you forfeit any portion of your Motorola 1999\nAnnual Bonus, AMD will pay an equivalent amount to you (not to exceed $500,000)\non the date that you provide evidence of such forfeiture.\n\n          (b) In the event that you forfeit any gains attributable to your\n46,667 vested Motorola stock options, AMD will pay an amount to you equal to the\nlesser of (i) the aggregate amount of the forfeiture by you of such gains or\n(ii) the aggregate spread on shares subject to the option based on the\ndifference between $52 per share and the closing price of Motorola common stock\non the New York Stock Exchange on the Commencement Date, in either case on the\ndate your provide evidence of such forfeiture.\n\n          (c) You shall be required to make reasonable efforts (including, but\nnot limited to, at the request of AMD after consultation with you, commencement\nof litigation for which AMD will pay reasonable costs) to avoid the above\nforfeitures or to reinstate any forfeited benefits and you shall be required to\nreimburse AMD if such amounts are subsequently reinstated by Motorola.\n\n          (d) In the event of your Voluntary Termination or Termination for\nCause within two years of the Commencement Date, you shall be required to repay\nthe full amount of any payments by AMD pursuant to this Section 10.\n\n     11.  Confidential Information and Invention Assignment Agreement. Upon your\n          -----------------------------------------------------------           \ncommencement of employment with AMD, you will be required to sign its standard\nform of Nondisclosure Agreement to protect AMD's confidential information and\nintellectual property.\n\n     12.  Nonsolicitation. During the term of your employment with AMD and for\n          ---------------                                                     \none year thereafter, you will not, on behalf of yourself or any third party,\nsolicit or attempt to induce any employee of AMD to terminate his or her\nemployment with AMD.\n\n     13.  Arbitration. The parties agree that any dispute regarding the\n          -----------                                                  \ninterpretation or enforcement of this agreement shall be decided by\nconfidential, final and binding arbitration conducted in Austin, Texas by\nJudicial Arbitration and Mediation Services under the then existing roles rather\nthan by litigation in court, trial by jury, administrative proceeding or in any\nother forum.\n\n     14.  Miscellaneous.\n          ------------- \n\n          (a) Absence of Conflicts. You represent that upon the Commencement\n              --------------------                                          \nDate your performance of your duties under this agreement will not breach any\nother agreement as to which you are a party.\n\n          (b) Successors. This agreement is binding on and may be enforced by\n              ----------                                                     \nAMD and its successors and assigns and is binding on and may be enforced by you\nand your heirs and legal representatives. Any successor to AMD or substantially\nall of its business (whether by\n\n                                       5\n\n \npurchase, merger, consolidation or otherwise) will in advance assume in writing\nand be bound by all of AMD's obligations under this agreement.\n\n          (c) Notices. Notices under this agreement must be in writing and will\n              -------                                                          \nbe deemed to have been given when personally delivered or two days after mailed\nby U.S. registered or certified mail, return receipt requested and postage\nprepaid. Mailed notices to you will be addressed to you at the home address\nwhich you have most recently communicated to AMD in writing. Notices to AMD will\nbe addressed to its General Counsel at AMD's corporate headquarters.\n\n          (d) Waiver. No provision of this agreement will be modified or waived\n              ------                                                           \nexcept in writing signed by you and an officer of AMD duly authorized by its\nBoard of Directors. No waiver by either party of any breach of this agreement by\nthe other party will be considered a waiver of any other breach of this\nagreement.\n\n          (e) Entire Agreement. This agreement, including the attached exhibits,\n              ----------------                                                  \nrepresents the entire agreement between us concerning the subject matter of your\nemployment by AMD and supersedes any prior agreements.\n\n          (f) Governing Law. This agreement will be governed by the laws of the\n              -------------                                                    \nState of California without reference to conflict of laws provisions.\n\n     Hector, we are very pleased to extend this offer of employment to you and\nlook forward to your joining AMD as its President and Chief Operating Officer.\nPlease indicate your acceptance of the terms of this agreement by signing in the\nplace indicated below.\n\n\nVery truly yours,                     Accepted January 24, 2000:\n                                  \n\n\n\/s\/ W.J. Sanders, III                 \/s\/ Hector Ruiz\n-------------------------             ----------------------------------\nW.J. Sanders, III                     Hector Ruiz\nChairman of the Board of Directors\nAdvanced Micro Devices, Inc.\n\n                                       6\n\n\n<\/pre>\n","protected":false},"template":"","meta":{"_acf_changed":false,"_stopmodifiedupdate":true,"_modified_date":"","_cloudinary_featured_overwrite":false},"corporate_contracts_companies":[6576],"corporate_contracts_industries":[9512],"corporate_contracts_types":[9539,9544],"class_list":["post-38876","corporate_contracts","type-corporate_contracts","status-publish","hentry","corporate_contracts_companies-advanced-micro-devices-inc","corporate_contracts_industries-technology__semiconductors","corporate_contracts_types-compensation","corporate_contracts_types-compensation__employment"],"acf":[],"_links":{"self":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts\/38876","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts"}],"about":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/types\/corporate_contracts"}],"wp:attachment":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/media?parent=38876"}],"wp:term":[{"taxonomy":"corporate_contracts_companies","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_companies?post=38876"},{"taxonomy":"corporate_contracts_industries","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_industries?post=38876"},{"taxonomy":"corporate_contracts_types","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_types?post=38876"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}