Executive Stock Option Agreement

FAIRCHILD SEMICONDUCTOR INTERNATIONAL, INC.
2000 EXECUTIVE STOCK OPTION PLAN


NONSTATUTORY STOCK OPTION AGREEMENT


Fairchild Semiconductor International, Inc., a Delaware corporation (the "Company"), hereby grants an Option to purchase shares of its Class A Common Stock, par value $.01 per share (the "Shares"), to the Optionee named below. The terms and conditions of the Option are set forth in this cover sheet, in the attachment and in the Company's 2000 Executive Stock Option Plan (the "Plan").


Date of Option Grant: September 15, 2000


Name of Optionee: John M. Watkins, Jr.


Number of Shares Covered by Option: 75,000


Exercise Price per Share: $42.75


Vesting Schedule:


Subject to all the terms of the attached Agreement, your right to purchase Shares under this Option vests in full on April 5, 2005, or earlier as follows: 20% of the Option shall vest at the time the Share price reaches or exceeds $55.00 on each of any 20 trading days during any period of 30 consecutive trading days; an additional 20% of the Option shall vest at the time the Share price reaches or exceeds $64.00 on each of any 20 trading days during any period of 30 consecutive trading days; an additional 30% of the Option shall vest at the time the Share price reaches or exceeds $77.00 on each of any 20 trading days during any period of 30 consecutive trading days; and the remaining 30% of the Option shall vest at the time the Share price reaches or exceeds $90.00 on each of any 20 days during any period of 30 consecutive trading days.


BY SIGNING THIS COVER SHEET, YOU AGREE TO ALL OF THE TERMS AND CONDITIONS DESCRIBED IN THE ATTACHED AGREEMENT AND IN THE PLAN, A COPY OF WHICH IS ALSO ENCLOSED.


Optionee: /s/ John M. Watkins, Jr.
-----------------------------------------------------
(Signature)


Company: /s/ Joseph R. Martin
-----------------------------------------------------
(Signature)


Title: Exec. V.P. & CFO
----------------------------------------------


Attachment


FAIRCHILD SEMICONDUCTOR INTERNATIONAL, INC.
2000 EXECUTIVE STOCK OPTION PLAN


NONSTATUTORY STOCK OPTION AGREEMENT


THE PLAN AND The text of the Plan is incorporated in OTHER AGREEMENTS this Agreement by reference. Certain
capitalized terms used in this Agreement
are defined in the Plan.


This Agreement and the Plan constitute
the entire understanding between you and
the Company regarding this Option. Any
prior agreements, commitments or
negotiations concerning this Option are
superseded.


NONSTATUTORY STOCK OPTION This Option is not intended to be an
Incentive Stock Option under section 422
of the Internal Revenue Code and will be
interpreted accordingly.


VESTING This Option is only exercisable before
it expires and then only with respect to
the vested portion of the Option. This
Option will vest according to the
Vesting Schedule on the attached cover
sheet.


TERM Your Option will expire in any event at
the close of business at Company
headquarters on the day before the 10th
anniversary of the Date of Option Grant,
as shown on the cover sheet. Your Option
may expire earlier if your Service
terminates, as described below.


TERMINATION OF SERVICE If your Service with the Company
terminates, you shall immediately
forfeit all rights to the unvested
portion of your Option, and your right
(or the right of your estate, executor
or representative) to exercise the
vested portion of your Option after
termination shall be governed by the
terms of the Company's Employee Stock
Option Plan as if the Option had been
granted under that plan.


CHANGE IN CONTROL In the event that you are employed by
the Company at the time of a Change in
Control, as defined below, your Option
shall fully vest upon the effective date
of the Change in Control, unless the
Change in Control is initiated by the
Company and you remain employed by the
successor corporation in a position of
equal rank and responsibility to your
position in the Company on the Date of
Option Grant.


"Change in Control" means the occurrence
of any of the following events:


(i) Any "person" (as such term is used
in Sections 13(d) and 14(d) of the
Exchange Act), other than (x) Sterling
Holding Company, LLC and/or Citicorp
Venture Capital Ltd. (either, for
purposes of this definition, "CVC"), (y)
any officer, employee or director of CVC
or any trust, partnership or other
entity established solely for the
benefit


2


of such officers, employees or directors
or (z) any officer, employee or director
of the Company or any subsidiary of the
Company or any trust, partnership or
other entity established solely for the
benefit of such officers, employees or
directors (any of such persons
identified in clauses (x), (y) and (z),
a "Permitted Holder"), is or becomes the
beneficial owner (as such term is
defined in Rules 13d-3 and 13d-5 under
the Exchange Act), directly or
indirectly, of more than 35% of the
total voting power of the voting stock
of the Company, provided, however, that
the Permitted Holders beneficially own
(as defined above), directly or
indirectly, in the aggregate a lesser
percentage of the total voting power of
the voting stock of the Company than
such other person and do not have the
right or ability by voting power,
contract or otherwise to elect or
designate for election a majority of the
board of directors of the Company;


(ii) during any period of two
consecutive years, individuals who at
the beginning of such period constituted
the board of directors of the Company
(together with any new directors whose
election by such board of directors or
whose nomination for election by the
stockholders of the Company was approved
by a vote of a majority of the directors
of the Company then still in office who
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