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Exhibit 10.27.2
NOVELLUS SYSTEMS, INC.
RESTRICTED STOCK AGREEMENT
THIS AGREEMENT is entered into as of the 16th day of December, 1999, by
and between Novellus Systems, Inc., a California corporation (the "Company") and
Xxxxxxx Xxxx ("Recipient").
W I T N E S S E T H:
WHEREAS, the Company regards Recipient as a valuable contributor to the
Company and has determined that it would be in the interest of the Company and
its shareholders to issue the Stock (as defined below) provided for in this
Agreement to Recipient as a reward and incentive for his continued service with
the Company;
WHEREAS, the issuance of the Stock pursuant to this Agreement shall be
in accordance with the Company's 1992 Stock Option Plan, as amended (the "Plan")
and subject to the terms of the Plan pertaining to stock grants to employees
thereunder.
NOW, THEREFORE, in consideration of the mutual covenants hereinafter set
forth, the parties to this Agreement hereby agree as follows:
1. Restricted Stock Grant.
(a) Stock Grant. On the Effective Date (as defined in
Section 1(c) below), the Company will grant and issue to Recipient 20,000 shares
of Common Stock, no par value, of the Company (the "Stock") as a consideration
for past services performed by Recipient for the Company. Stock certificates
evidencing the Stock will be retained by the Company, accompanied by blank stock
powers executed by Recipient, for the period during which the Stock constitutes
Restricted Stock (as defined below) pursuant to the terms of Sections 2 and 3
hereof.
(b) Rights of Shareholder; Additional Securities. All shares
of Stock issued hereunder shall be deemed issued to Recipient as fully paid and
nonassessable shares, and Recipient shall have all rights of a shareholder with
respect thereto, including the right to vote, receive dividends (including stock
dividends), participate in stock splits or other recapitalizations, and exchange
such shares in a merger, consolidation or other reorganization. The term
"Stock," in addition to the shares purchased pursuant to this Agreement, also
refers to all securities received as a result of ownership of the Stock
(hereinafter called "Additional Securities"), including, without limitation,
warrants, options and securities received as a stock dividend or as a result of
any stock split, or as a result of a recapitalization, reorganization, exchange
or the like.
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(c) Date. The "Effective Date" for purposes of this Agreement
shall be December 16, 1999.
2. Transfer Restrictions. No Stock issued to the Recipient hereunder
shall be sold, transferred by gift, pledged, hypothecated, or otherwise
transferred or disposed of by the Recipient prior to the date when the Recipient
shall become vested in such Stock pursuant to Section 3 below, and such Stock
shall constitute "Restricted Stock" until such date. Any attempt to transfer
Stock in violation of this Section 2 shall be null and void and shall be
disregarded by the Company.
3. Forfeiture Condition.
(a) Vesting of the Stock. In the event that Recipient's
employment with the Company shall terminate for any reason prior to (1) December
16, 2000, the date on which 33-% of the shares of Stock shall be deemed vested
and cease to be Restricted Stock for the purpose of this Section 3(a) ("1st
Vesting Date"), (2) December 16, 2001, the date on which 33-% of the shares of
Stock issued shall be deemed vested and cease to be Restricted Stock for the
purpose of this Section 3(a) ("2nd Vesting Date"), or (3) December 16, 2002, the
date on which 33-% of the shares of Stock issued shall be deemed vested and
cease to be Restricted Stock for the purpose of this Section 3(a) ("3rd Vesting
Date"), the unvested Stock shall be forfeited and transferred to the Company in
the amounts and in the manner provided in this Section 3(a) effective as of the
date of such termination without further action by Recipient or the Company. In
such event, the Company shall thereafter be authorized to take such action as it
deems appropriate to retire the unvested Stock through use of the executed stock
power and share certificate held by the Company in the escrow established
pursuant to Section 4 below. Subject to the foregoing, the Company and Recipient
agree that (w) 33-% of the Stock shall be vested and no longer be deemed
Restricted Stock as of the 1st Vesting Date (unless the Stock shall have been
previously forfeited by Recipient pursuant to this Section 3); (x) 33-% of the
Stock shall be vested and no longer be deemed Restricted Stock as of the 2nd
Vesting Date (unless the Stock or a portion of the Stock shall have been
previously forfeited by Recipient pursuant to this Section 3); (y) 33-% of the
Stock shall be vested and no longer be deemed Restricted Stock as of the 3rd
Vesting Date (unless the Stock, or a portion of the Stock shall have been
previously forfeited by Recipient pursuant to this Section 3); and (z)
irrespective of the occurrence of the 1st Vesting Date, the 2nd Vesting Date or
the 3rd Vesting Date, 100% of the Stock shall be vested and no longer be deemed
Restricted Stock upon the termination of Recipient's employment with the Company
as a result of his death, Permanent Disability, Involuntary Termination Without
Cause or Constructive Termination.
(b) Definitions. For purposes of this Section, the following
definitions shall apply:
(i) "CONSTRUCTIVE TERMINATION" shall mean any
termination by Recipient of his employment with the Company within sixty (60)
days following the occurrence of any of the following: (A) unless approved in
writing in advance by Recipient, the assignment to Recipient of any duties
materially inconsistent with his position, duties,
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responsibilities, authority and status, or the removal of any material duties,
responsibilities or authority from such position, except to the extent necessary
in connection with a disability that would qualify under the Company's existing
disability plan, if any, but for any requirement in such plan that the
disability continue for any period of time, for the period of such disability;
(B) unless made on a substantially equal percentage basis as part of a general
reduction applicable to all employees of the Company of the same or greater
rank, a reduction in Recipient's annual base salary in effect at the time any
determination thereof is to be made; or (C) unless approved in writing in
advance by the Recipient's Representative, the Company's requiring the Recipient
to work, apart from reasonable business trips, more than 100 miles from the
location at which Recipient was working on the date of this Agreement;
(ii) "INVOLUNTARY TERMINATION WITHOUT CAUSE" shall mean
the termination by the Company of Recipient's employment with the Company other
than as a result of one or more of the following reasons: (w) chronic alcoholism
or drug addiction, to the extent discharge therefor is permitted by applicable
law; (x) misappropriation of any money or other assets or properties of the
Company or any subsidiary of the Company; (y) the conviction of Recipient of any
felony, or of any lesser crime or offense materially and adversely affecting the
property, reputation or goodwill of the Company or any of its subsidiaries; or
(z) willful or gross neglect by Recipient of his duties, or willful misconduct
by Recipient in connection with the performance of his duties, which neglect or
misconduct shall have an adverse effect on the Company or one of its
subsidiaries and which shall remain unremedied for thirty (30) days after
written notice (indicating with reasonable specificity the events of neglect
and/or misconduct) given to Recipient by the Company through its Board of
Directors; and
(iii) "PERMANENT DISABILITY" shall mean a physical or
mental condition that prevents Recipient from performing his employment duties
to the Company for a period of ninety (90) consecutive days or one hundred
twenty (120) days during any one hundred eighty (180) day period.
4. Escrow of Stock. For purposes of facilitating the enforcement of
the provisions of Sections 2 and 3, Recipient agrees, immediately upon receipt
of the certificate(s) for the Stock, to deliver such certificate(s), together
with a stock power executed in blank by Recipient and Recipient's spouse (if
required for transfer) with respect to each such stock certificate, to the
Secretary or Assistant Secretary of the Company, or their designee, to hold in
escrow for so long as such Stock remains Restricted Stock, with the authority to
take all such actions and to effectuate all such transfers and/or releases as
may be necessary or appropriate to accomplish the objectives of this Agreement
in accordance with the terms hereof. Recipient hereby acknowledges that the
appointment of the Secretary or Assistant Secretary of the Company (or their
designee) as the escrow holder hereunder with the stated authorities is a
material inducement to the Company to make this Agreement and that such
appointment is coupled with an interest and is accordingly irrevocable.
Recipient agrees that such escrow holder shall not be liable to any party hereto
(or to any other party) for any actions or omissions unless such escrow holder
is grossly negligent relative thereto. The escrow holder may rely upon any
letter, notice or other document executed by any signature purported to be
genuine and may resign at any time. Any Additional Securities shall be retained
by the Company in the same
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manner and subject to the same conditions as the Restricted Stock with respect
to which they were issued. Recipient shall be entitled to direct the Company to
exercise any warrant or option received as Additional Securities upon supplying
the funds necessary to do so, in which event the securities so purchased shall
constitute Additional Securities, but the Recipient may not direct the Company
to sell any such warrant or option. If Additional Securities consist of a
convertible security, Recipient may exercise any conversion right, and any
securities so acquired shall be deemed Additional Securities. Additional
Securities shall be subject to the provisions of Sections 2, 4 and 6 in the same
manner as the Restricted Stock.
5. Withholding of Taxes. At such time as the Stock becomes vested as
provided in Section 3 hereof, Recipient shall immediately pay the Company the
amount necessary to satisfy any applicable federal, state, and local income and
employment tax withholding requirements. After the possibility of forfeiture
under Section 3 has lapsed and subject to the approval of the Stock Option
Committee if required by Rule 16b-3 of the Securities and Exchange Commission,
Recipient may surrender to the Company any number of shares of Stock necessary
to pay all or part of any withholding tax due arising from shares awarded under
this Agreement, based on the fair market value of such shares surrendered. The
fair market value shall be the closing price of the Company's Common Stock on
the NASDAQ National Market System for the last trading day prior to surrender,
as reported in The Wall Street Journal.
6. Corporate Transaction.
(a) Definition. For purposes of this Section 6, a "Corporate
Transaction" shall include any of the following shareholder-approved
transactions to which the Company is a party:
(i) a merger or consolidation in which the Company is
not the surviving entity, except for a transaction the principal purpose of
which is to change the state of the Company's incorporation;
(ii) the sale, transfer or other disposition of all or
substantially all of the assets of the Company in liquidation or dissolution of
the Company; or
(iii) any reverse merger in which the Company is the
surviving entity but in which securities representing more than fifty percent
(50%) of the total combined voting power of the Company's outstanding securities
are transferred to holders different from those who held such securities
immediately prior to such merger.
(b) Release of Forfeiture Condition. In the event of any
Corporate Transaction, any Restricted Stock shall vest in its entirety and
thereby be released from restrictions on transfer and the Forfeiture Condition,
immediately prior to the specified effective date of the Corporate Transaction.
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7. Legends; Stop Transfer.
(a) All certificates for shares of the Stock shall bear
substantially the following legends:
THE SHARES REPRESENTED BY THIS CERTIFICATE ARE RESTRICTED BY THE
TERMS OF THAT CERTAIN RESTRICTED STOCK AGREEMENT BETWEEN THE
COMPANY AND THE NAMED SHAREHOLDER. THE SHARES REPRESENTED BY THIS
CERTIFICATE MAY BE TRANSFERRED ONLY IN ACCORDANCE WITH SUCH
AGREEMENT, A COPY OF WHICH IS ON FILE WITH THE SECRETARY OF THE
COMPANY.
(b) The certificates for shares of the Stock shall also bear
any other legends required by applicable state corporate or securities laws. 8.
NO EFFECT ON TERMS OF EMPLOYMENT. THIS AGREEMENT SHALL NOT CONFER UPON RECIPIENT
ANY RIGHT WITH RESPECT TO CONTINUATION OF RECIPIENT'S EMPLOYMENT WITH THE
COMPANY, NOR SHALL IT INTERFERE IN ANY WAY WITH THE RIGHT OF RECIPIENT OR THE
COMPANY TO TERMINATE RECIPIENT'S EMPLOYMENT WITH THE COMPANY AT ANY TIME FOR ANY
REASON WITH OR WITHOUT CAUSE OR CHANGE THE TERMS OF EMPLOYMENT OF RECIPIENT.
9. Successors. This Agreement shall be binding upon and shall inure
to the benefit of the parties hereto and their respective heirs, executors,
administrators, successors and assigns.
10. Governance of the Plan. The Stock is being issued to Recipient
hereunder pursuant to the terms of the Plan, which shall govern with respect to
Recipient in the event of any conflict with the terms of this Agreement.
11. California Law. The interpretation, performance and enforcement
of this Agreement shall be governed by the laws of the State of California.
IN WITNESS WHEREOF, the parties hereto have duly executed this
Restricted Stock Agreement as of the date first above written.
NOVELLUS SYSTEMS, INC., RECIPIENT:
a California corporation
By: _____________________________ _______________________________________
Xxxxxxx Xxxx
Title: __________________________
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ATTACHMENT A
CONSENT OF SPOUSE
(IF APPLICABLE)
I, _____________________, spouse of Xxxxxxx Xxxx have read and approved
the foregoing Agreement. In consideration of the right of my spouse to acquire
shares of Novellus Systems, Inc., as set forth in the Agreement, I hereby
appoint my spouse as my attorney-in-fact in respect to the exercise of any
rights under the Agreement insofar as I may have any rights under the community
property laws of the State of California or similar laws relating to marital
property in effect in the state of our residence as of the date of the signing
of the foregoing Agreement.
Dated: December 16, 1999 _______________________________________
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ASSIGNMENT SEPARATE FROM CERTIFICATE
FOR VALUE RECEIVED and pursuant to that certain Restricted Stock
Agreement between the undersigned ("Recipient") and Novellus Systems, Inc. (the
"Company") dated December 16, 1999 (the "Agreement"), Recipient hereby sells,
assigns and transfers unto the Company _______ thousand (_______) shares of
Common Stock of the Company standing in Recipient's name on the books of the
Company represented by Certificate No. _________ herewith and does hereby
irrevocably constitute and appoint the Secretary of the Company to transfer said
stock on the books of the Company with full power of substitution in the
premises. THIS ASSIGNMENT MAY ONLY BE USED AS AUTHORIZED BY THE AGREEMENT AND
THE EXHIBITS THERETO.
Dated: ____________________, _______
By: ___________________________________
___________________________________
INSTRUCTION: Please do not fill in any blanks other than the signature line.
The purpose of this assignment is to enable the Company to effect
the forfeiture condition set forth in the Agreement without
requiring additional signatures on the part of Recipient.
