8-K

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

Form 8-K

Current Report
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): January 19, 2011

TRIDENT MICROSYSTEMS, INC.

(Exact name of registrant as specified in its charter)

0-20784
(Commission File Number)

Delaware
(State or other jurisdiction of incorporation) 77-0156584
(I.R.S. Employer Identification No.)

1170 Kifer Road
Sunnyvale, California 94086
(Address of principal executive offices, with zip code)

(408) 962-5000
(Registrant’s telephone number, including area code)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 5.02 Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.

     (b), (c)

     On January 19, 2011, Trident Microsystems, Inc. (the “Company”) issued a press release announcing the appointment, effective immediately, of Mr. Philippe Geyres as Interim CEO and the resignation of its Chief Executive Officer (“CEO”), and its President’s departure and resignation from the Company, effective February 9, 2011. The Company also announced that it is conducting a CEO search and Mr. Geyres is a candidate for the permanent CEO position.

     On January 21, 2011, Mr. Geyres and Trident Digital Systems (UK) Ltd. (“TDS”), a wholly-owned subsidiary of the Company, entered into a letter agreement with Mr. Geyres (the “TDS Employment Letter”), pursuant to which he accepted employment as the Executive Director of TDS. In such capacity, he will provide services as Interim CEO for the worldwide operations of the Company and its subsidiaries. Mr. Geyres will be paid a base salary of $50,000 monthly, and will be eligible to participate in the Company’s key employee bonus plan with a target bonus of 100% of his monthly base salary for the period of time he is providing such services. The Compensation Committee will determine the bonus amount following the end of the current performance period for the Company’s executive bonus plan. The Compensation Committee has approved the grant to Mr. Geyres of a stock option to acquire 150,000 shares of Common Stock, vesting on the Company’s standard terms, and the issuance of 20,000 restricted stock units for each month during which such services are provided, issuable on the last day of each month, pro rated for partial months and vesting when the Company retains a permanent CEO, provided Mr. Geyres’ service continues through such date.

     The TDS Employment Letter also provides that upon the retention by the Company of a CEO other than Mr. Geyres, his stock option will be cancelled. In such event, under the TDS Employment Letter, Mr. Geyres will provide transition assistance to the permanent CEO and receive compensation of $225,000 for such services over a six month period as part of his assignment. Mr. Geyres will be eligible for certain health and other benefits as provided in the TDS Employment Letter. While serving in his current role, he will not be eligible to participate in the Company’s executive severance or change in control plans.

     Additionally, on January 21, 2011, Mr. Geyres and the Company entered into an offer letter (the “Trident Offer Letter”) pursuant to which the Company and Mr. Geyres agreed that if he is issued a visa to work in the United States: (i) Mr. Geyres will relocate temporarily to the United States, (ii) the Company will employ him as Interim CEO and (iii) the Company will assume the obligations under the TDS Employment Letter. The Company would also reimburse Mr. Geyres for reasonable living expenses in California while he is serving as Interim CEO.

     Mr. Geyres has stepped down from membership on the Audit Committee and A.C. D’Augustine has been elected to the Audit Committee.

     A copy of the TDS Employment Letter and copy of the Trident Offer Letter are attached hereto as exhibits, and this description of the terms thereof is qualified in its entirety by the terms therein.

     On January 20, 2011, Mr. Christos Lagomichos and the Company entered into a Confidential Retirement Agreement and Release of Claims (the “Lagomichos Agreement”). The Lagomichos Agreement is designed to ensure that there is a smooth and orderly transition of his duties, detail his separation benefits and resolve any claims that he has or may have against the Company. Pursuant to the terms of the Lagomichos Agreement, the Company will pay to Mr. Lagomichos a lump sum payment of $1,256,000, subject to applicable withholding, and in the event that he timely elects to obtain continued group health insurance coverage under COBRA, the Company will pay the premiums for such coverage through the earlier of (i) February 28, 2012, or (ii) the first date on which he becomes eligible to obtain other group health insurance coverage. In consideration for these benefits, Mr. Lagomichos has granted to the Company a release of claims.

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Item 9.01 Financial Statements and Exhibits

     (d) Exhibits

Exhibit No.	Description
10.51	Letter Agreement dated January 21, 2011 between Philippe Geyres and Trident Digital Systems (UK) Ltd.
10.52	Letter Agreement dated January 21, 2011 between Philippe Geyres and Trident Microsystems, Inc.
99.1	Press release dated January 19, 2011 announcing appointment of Interim CEO.

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SIGNATURES

     Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

Date: January 24, 2011

TRIDENT MICROSYSTEMS, INC.
 

/s/ David L. Teichmann  

David L. Teichmann 

Executive Vice President, General Counsel & Corporate Secretary 

EX-10.51

EXHIBIT 10.51

January 21, 2011

Philippe Geyres
63 Rue Des Saints-Peres
75006 Paris
France

Dear Philippe,

We are pleased to make this offer of employment to you with Trident Digital Systems (UK) Ltd. (“Trident”), in the position of Executive Director. In such capacity you will provide services as the Interim Chief Executive Officer for the worldwide operations of Trident Microsystems, Inc. (“TMI”) and its subsidiaries. In this role, you will be performing your duties both inside the UK and outside of the UK. Trident may decide at some point in the future that you should be dually employed by another entity within the Trident group. As you know, this is a temporary but full-time position while the Board of TMI is conducting a search for a Chief Executive Officer (“CEO”).

The details of this offer, including the compensation package, are as follows:

1. Your salary will be US $50,000 per month, paid on a semi-monthly basis and pro rated for any partial month of service. Your monthly salary, and any other payments due hereunder, will be paid in Euros converted at the currency rate of conversion used by TMI’s finance group for purposes of inter-company payments in the most recently ended month prior to the date of payment.

2. You will be eligible to receive a discretionary bonus target of $50,000 per month of your service (pro rated for any partial month) through the date of the election by TMI of a CEO. The bonus will be subject to TMI’s executive bonus plan for its worldwide executives. The amount of the bonus is to be determined by the Compensation Committee of TMI’s Board of Directors (“Compensation Committee”) after the current performance period ends on June 30, 2011, and can be varied by the Compensation Committee in its discretion between 0% and 200% of such target amount based on the Compensation Committee’s evaluation of your contribution.

3. You will receive benefits while you are employed as Executive Director provided that the total cost is reasonable taking into account Trident’s policies applicable at your location of employment and in the US, and provided that the Compensation Committee will have the right to review the benefits package if the cost would exceed 125% of the benefits cost for a permanent CEO of Trident located in the U.S.

4. Upon the approval of the Compensation Committee you will be granted the equity incentive awards described in Appendix A, subject to the terms set forth therein.

5. In the temporary role of Executive Director, you will not be eligible to participate in TMI’s Executive Change in Control Severance Plan or in its Executive Retention and Severance Plan.

6. In providing services as Interim CEO for the worldwide operations of TMI and its subsidiaries your position will require substantial travel around the world. We will reimburse you for all travel expenses you incur in fulfilling your function as Executive Director, pursuant to Trident’s travel policy.

7. If TMI’s CEO search concludes with TMI electing a permanent CEO other than you, then as part of your compensation as Executive Director and provided you (i) continue as a member of the Board of Directors of TMI and (ii) have not resigned or been terminated for cause prior to such time, you agree to devote substantial additional time in your role as a director during the six months following the election of the

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CEO to assist at the CEO’s request with his or her transition. You will be provided with a fee of $225,000 for such services, payable ratably over the six month period.

8. We will pay, or reimburse you for, reasonable legal fees incurred with respect to the review of this letter.

9. You will be indemnified for your activities as Executive Director as provided under your current Indemnification Agreement with TMI.

If TMI has not appointed a permanent CEO within six months of your accepting the position of Executive Director, we will re-evaluate your compensation at that time.

Within three (3) days of the start of your employment, you will be required to complete the following:

• Your employment with Trident is “at will”; it is for no specified term, and may be terminated by you or Trident at any time, with or without cause or advance notice. As a condition of your employment, you will be required to sign Trident’s standard form of Employment, Proprietary Information and Invention Assignment Agreement.

Trident is a dynamic, fast growing company whose success depends upon the contributions of talented individuals such as you. You can accept this offer by signing below, indicating your anticipated start date, and returning this copy to me. Should you have any questions or if you need additional information, please feel free to contact me.

Sincerely,
Trident Digital Systems (UK) Ltd.

/s/ David L. Teichmann  

David L. Teichmann 

Director 

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ACKNOWLEDGMENTS & ACCEPTANCE

I accept this employment offer with the understanding that it is not a contract for a fixed term or specified period of time. I understand that my employment is voluntary, “at will” and can be terminated either by me or by Trident at any time, with or without notice and with or without cause, subject to the terms of this letter. The provisions stated in this offer letter supersede all prior representations or agreements, whether written or oral. This offer letter may not be modified or amended except by a written agreement, signed by an authorized officer of Trident and me.

/s/ Philippe Geyres  

Philippe Geyres 

Dated January 21, 2011
Anticipated Start Date: January 21, 2011 

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Appendix A

Equity Incentive Compensation

Upon the approval of TMI’s Compensation Committee, you will be granted:

• for each month of service in which you provide interim CEO services whether as Executive Director or through TMI or any of its subsidiaries (“Services”), 20,000 restricted stock units (“RSUs”), with that number being prorated for any partial month of such Services, and the RSUs being issued on the last day of each month in which you provide Services. These RSUs will vest when the permanent CEO is elected by TMI, provided your Services and your service on the TMI Board continue through such date. Your RSU award will be granted under and subject to the terms and conditions of TMI’s standard form of RSU agreement, as modified by this letter, which you will be required to sign as a condition to receiving the award. If your Services are terminated without “cause” before TMI has selected a permanent CEO any RSUs you have been issued or are entitled to receive through such date will vest upon the effective date of such termination. For this purpose, “cause” will have the definition provided in TMI’s Amended and Restated Executive Retention and Severance Plan, although no other terms of such plan are incorporated herein.

• A non-qualified stock option to acquire 150,000 shares of common stock priced at the time of grant pursuant to TMI’s standard option grant policies. The option will vest pursuant to the standard terms of TMI’s initial option grants. This option will terminate and be cancelled if you are not later appointed as the permanent CEO of TMI.

Subject to the other terms of this appendix or the offer letter to which it is attached, these equity awards will be subject to the standard terms of the TMI’s 2010 Equity Incentive Plan.

/s/ Philippe Geyres  

Philippe Geyres 

January 21, 2011 

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EX-10.52

EXHIBIT 10.52

January 21, 2011

Philippe Geyres
63 Rue Des Saints-Peres
75006 Paris
France

Dear Philippe,

We are pleased to make this contingent offer of employment to you with Trident Microsystems, Inc. (“TMI”), in the position of Interim Chief Executive Officer reporting to the Board of Directors (“Board”). You are currently employed by Trident Digital Systems (UK) Ltd as Executive Director (“Executive Director”) on terms set forth in an offer letter dated January 21, 2011 (the “Executive Director Agreement”). As described below, we have requested that you seek a visa to work in the United States, and under the provisions described below, we are making you this contingent offer to become the Interim Chief Executive Officer of TMI (“Interim CEO”).

The details of this offer, including the compensation package, are as follows:

1. TMI will file the appropriate documents and petition with U.S. Citizenship and Immigration Services requesting H-1B work authorization for you. If such petition is granted, we will assist you in applying for an H-1B visa(the “H-1B Visa”). Upon your initial entry into the U.S. with the H-1B visa, (i) you will become an employee of TMI with the title Interim Chief Executive Officer, (ii) you agree that you will relocate temporarily to the United States and move your principal place of business and place of employment to our office in Sunnyvale, California and (iii) we will pay for, or reimburse you for, reasonable local housing and rental car expenses. The Chairman of the Compensation Committee will review and approve any housing arrangements in advance.

2. If you are appointed Interim Chief Executive Officer of TMI, we will assume the obligations under the Executive Director Agreement and such terms shall become binding upon you and TMI, provided that all payments made thereunder shall, after the date of such assumption, be made in U.S. dollars.

3. We will pay, or reimburse you for, reasonable legal fees incurred with respect to the review of this letter and your visa application.

4. TMI will indemnify you for your activities as TMI’s Interim CEO as provided under your current Indemnification Agreement with TMI.

To the extent you are subject to U.S. income taxation, for purposes of compliance with Section 409A of the Internal Revenue Code, any reimbursement of expenses to which you are entitled under this agreement will be paid in accordance with TMI’s policy and in all events will (a) be paid no later than the last day of the calendar year following the calendar year in which the expense was incurred, (b) not affect or be affected by the amount of expenses for which you are eligible for reimbursement in any other calendar year, and (c) not be subject to liquidation or exchange for another benefit.

While you are employed under Executive Director Agreement, and if and after you become TMI’s Interim CEO, you will continue as a member of the Board of Directors, but will no longer be deemed independent and will step down from the Audit Committee immediately. You will not receive compensation for your TMI Board work while serving as Executive Director or as Interim CEO. After the appointment of a new CEO of TMI, other than yourself,

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you will be expected to continue on the TMI Board and will be deemed independent as soon as the regulatory requirements permit, from which time you will be compensated according to the then current Board compensation policy.

Within three (3) days of the start of your employment by TMI, you will be required to complete the following:

• Your employment with TMI is “at will”; it is for no specified term, and may be terminated by you or TMI at any time, with or without cause or advance notice. As a condition of your employment, you will be required to sign TMI’s standard form of Employment, Proprietary Information and Invention Assignment Agreement.

• Provide acceptable documentation of proof of your eligibility to work in the United States as required by the Immigration and Naturalization Act (I-9).

TMI is a dynamic, fast growing company whose success depends upon the contributions of talented individuals such as you. Please acknowledge your agreement to this contingent offer by signing below. Should you have any questions or if you need additional information, please feel free to contact me.

Sincerely,

/s/ Shirley Olerich  

Shirley Olerich 

Vice President, Human Resources 

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Please indicate your acceptance of this contingent offer of employment by countersigning below:

/s/ Philippe Geyres  

Philippe Geyres 

Dated: January 21, 2011

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EX-99.1

Exhibit 99.1

Trident Announces Appointment of Interim CEO

SUNNYVALE, Calif., Jan. 19, 2011 — Trident Microsystems, Inc. (NASDAQ: TRID), a leading provider of set-top box and TV semiconductor solutions, today announced that Sylvia Summers Couder has resigned as CEO and as a director to pursue other opportunities. The company also announced that Mr. Philippe Geyres has been appointed as Interim CEO effective immediately and that the company has initiated a search for a CEO following this transition. Mr. Geyres is a candidate for the permanent CEO position.

“Sylvia Summers’ accomplishments at Trident have been substantial. She oversaw a significant management transition early in her tenure and worked closely with the board to reposition the company. We greatly appreciate her efforts and leadership, including the recent management of the integration of the NXP and Micronas assets and the cost reductions that have been achieved,” said David Courtney, Chairman of the Board.

“We are pleased and excited that Philippe Geyres has agreed to assume the role of Interim CEO. We believe his background and experience will be quite helpful during this transition and that he will bring a valuable perspective and focus to our business,” said Mr. Courtney.

Mr. Geyres joined Trident’s board in February 2010 following the company’s acquisition of certain assets of NXP. Mr. Geyres has substantial executive experience. He was CEO of Oberthur Card Systems, a French publicly listed smart card company during 2007 and 2008. He was previously an executive at ST Microelectronics from 1983 to 2006, most recently as Executive Vice President, Consumer and Telecom Products. Prior to that, he held positions at Fairchild Semiconductor and IBM. Mr. Geyres serves as a member of the board of directors of Advanced Digital Broadcast, a Swiss company listed in Zurich, and of Arteris, a privately held networking IP company.

The company also announced that Christos Lagomichos has announced his departure from Trident and resignation as its President effective Feb. 9, 2011.

“We want to thank Mr. Lagomichos for his service to Trident, and particularly the assistance he has provided in implementing our transition plan following the transaction with NXP,” said Mr. Courtney.

Forward-Looking Information

This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, and is subject to the safe harbor created by those sections. These forward-looking statements include, but are not limited to, statements about Trident’s expectations regarding the changes in its management team. Investors are cautioned that any such forward-looking statements are not guarantees of future performance and involve risks and uncertainties, and there are important factors that could cause Trident’s actual results to differ materially from those in the forward looking statements. These risks include, without limitation, Trident’s success in pursuing license agreements of this patented technology, and its ability to realize benefits as a result of this licensing program. The forward-looking statements included in this press release are made only as of the date of this press release; Trident does not undertake any obligation to publicly revise or update any such forward-looking statement to reflect events or circumstances that may arise after the statement was made. Investors are cautioned not to place undue reliance on forward-looking statements. Additional information concerning factors that could cause results to differ can be found in the Company’s filings with the Securities and Exchange Commission, including the Company’s most recently filed Reports on Form 8-K, Form 10-K and Form 10-Q., which are available at http://www.sec.gov.

About Trident Microsystems, Inc.

Trident Microsystems, Inc., with headquarters in Sunnyvale, California, is a leading force in the digital home entertainment market, delivering an extensive range of platform solutions that enhance the consumer experience in the Connected Home. As one of the top-three semiconductor providers to both the TV and set-top box markets, Trident’s solutions can be found in the products of leading OEMs and channel partners worldwide. The company’s extensive IP portfolio of more than 2,000 patents has been driving key innovations in image quality, 3D TV, low power consumption, and 45nm designs. For further information about Trident and its products, please consult the Company’s web site: www.tridentmicro.com.