T.J. Rodgers sues Cypress
- Author:Ella Cai
- Release on:2017-04-25
T.J. Rodgers, the founding CEO of Cypress Semiconductor and the company’s largest individual stockholder, has filed a lawsuit in the Delaware Court of Chancery stating:
“Cypress directors have a legally mandated ‘Duty of Candor’ to make complete disclosures to Cypress stockholders on the issues in this election, including why they are allowing Ray Bingham to serve as executive chairman while he has violated and is continuing to violate numerous provisions of Cypress’s Code of Business Conduct and Ethics.”
“While simultaneously serving as Cypress executive chairman, Mr. Bingham is also actively working as a “Founding Partner” of Canyon Bridge, a private equity firm backed by the People’s Republic of China that now competes head-on with Cypress in the critical semiconductor M&A market.”
“The dual hats Bingham wears suggest that his interests with respect to Canyon Bridge may well conflict with the business interests of Cypress,” and that a “credible basis” exists “to infer that Bingham violated the Code’s prohibition on ‘simultaneous employment of any kind without written permission of the Company.'”
“Mr. Bingham also has negotiated excessive compensation for his part-time work at the currently unnecessary job of executive chairman. His annual salary plus target bonus is $877,500, and he has been granted a total of $4.5 million in restricted stock units (RSUs). Despite Mr. Bingham’s part-time attendance at Cypress, the Cypress Board has kept him on as executive chairman and has very recently awarded him RSUs worth $3 million, which vest over three years, undermining the Board’s claim that Mr. Bingham’s executive chairman “mentoring” position is “temporary.” To make matters worse, in stark contrast to all Cypress executives eligible for the Company’s PARS (Performance Accelerated Restricted Stock) program, his RSUs vest without any performance requirements – meaning that Mr. Bingham will receive $4.5 million in compensation for simply remaining at Cypress in a part-time position, while also working for a direct Cypress Chinese-sovereign-backed competitor.”
Canyon Bridge tried to buy Lattice Semiconductor but the deal was blocked by the US authorities.
“Cypress directors have a legally mandated ‘Duty of Candor’ to make complete disclosures to Cypress stockholders on the issues in this election, including why they are allowing Ray Bingham to serve as executive chairman while he has violated and is continuing to violate numerous provisions of Cypress’s Code of Business Conduct and Ethics.”
“While simultaneously serving as Cypress executive chairman, Mr. Bingham is also actively working as a “Founding Partner” of Canyon Bridge, a private equity firm backed by the People’s Republic of China that now competes head-on with Cypress in the critical semiconductor M&A market.”
“The dual hats Bingham wears suggest that his interests with respect to Canyon Bridge may well conflict with the business interests of Cypress,” and that a “credible basis” exists “to infer that Bingham violated the Code’s prohibition on ‘simultaneous employment of any kind without written permission of the Company.'”
“Mr. Bingham also has negotiated excessive compensation for his part-time work at the currently unnecessary job of executive chairman. His annual salary plus target bonus is $877,500, and he has been granted a total of $4.5 million in restricted stock units (RSUs). Despite Mr. Bingham’s part-time attendance at Cypress, the Cypress Board has kept him on as executive chairman and has very recently awarded him RSUs worth $3 million, which vest over three years, undermining the Board’s claim that Mr. Bingham’s executive chairman “mentoring” position is “temporary.” To make matters worse, in stark contrast to all Cypress executives eligible for the Company’s PARS (Performance Accelerated Restricted Stock) program, his RSUs vest without any performance requirements – meaning that Mr. Bingham will receive $4.5 million in compensation for simply remaining at Cypress in a part-time position, while also working for a direct Cypress Chinese-sovereign-backed competitor.”
Canyon Bridge tried to buy Lattice Semiconductor but the deal was blocked by the US authorities.
