AFFILIATES AGREEMENT
THIS AFFILIATES AGREEMENT (the "Affiliates Agreement") is entered into as
of the 8th day of May, 1998 between Veeco Instruments Inc., a Delaware
corporation ("Acquiror"), and the undersigned shareholder (the "Shareholder") of
Digital Instruments, Inc. a California corporation ("Target").
RECITALS
A. Target and Acquiror have entered into an Agreement and Plan of Merger,
dated February 28, 1998 (the "Merger Agreement"), pursuant to which Target will
be merged into Acquiror (the "Merger").
B. Upon the consummation of the Merger and in connection therewith, the
undersigned Shareholder will become the owner of shares of common stock, $.01
par value per share, of Acquiror (the "Acquiror Shares").
C. The parties to the Merger Agreement intend to cause the Merger to be
accounted for as a pooling of interests pursuant to APB Opinion No. 16, Staff
Accounting Series Releases No. 130, 135 and 146 and Staff Accounting Bulletins
Topic Two.
NOW, THEREFORE, in consideration of the premises and the mutual agreements,
provisions and covenants set forth in the Merger Agreement and in this
Affiliates Agreement, it is hereby agreed as follows:
1. The undersigned Shareholder hereby agrees that:
(a) The undersigned Shareholder may be deemed to be (but does not
hereby admit to be) an "affiliate" of Target within the meaning of Rule 144
under the Securities Act of 1933, as amended (the "Securities Act"), and
Accounting Series Release No. 130, as amended, of the Securities and Exchange
Commission (the "SEC") ("Release No. 130").
(b) The undersigned Shareholder will not sell, exchange, transfer,
pledge, dispose of or otherwise reduce the undersigned Shareholder's risk
relative to the Acquiror Shares or any part thereof until such time after the
Effective Time of the Merger as financial results covering at least thirty (30)
days of the combined operations of Acquiror and Target after the Effective Time
of the Merger have been, within the meaning of said Release No. 130, filed by
Acquiror with the SEC or published by Acquiror in an Annual Report on Form 10-K,
a Quarterly Report on Form 10-Q, a Current Report on Form 8-K, a quarterly
earnings report, a press release or other public issuance that includes combined
sales and income of Target and Acquiror. Acquiror agrees to notify the
undersigned Shareholder promptly upon making such filing or publication. The
undersigned will not, during the thirty (30) day period prior to the Effective
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Time of the Merger as determined in Acquiror's reasonable discretion, sell,
exchange, transfer, pledge, dispose of or otherwise reduce the undersigned
Shareholder's risk relative to the Acquiror Shares or any part thereof
(including any disposition, within such period, of Shareholder's shares of
Target Common Stock).
(c) The undersigned Shareholder has, and as of the Effective Time of
the Merger will have, no present plan or intent (a "Plan") to engage in a sale,
exchange, transfer, pledge, disposition or any other transaction (including a
distribution by a partnership to its partners or by a corporation to its
shareholders) that results in a reduction in the risk of ownership
(collectively, a "Sale") with respect to more than fifty percent (50%) of the
shares of Acquiror Common Stock to be acquired by the undersigned Shareholder
upon consummation of the Merger. The undersigned Shareholder is not aware of,
or participating in, any Plan on the part of Target's shareholders to engage in
Sales of the shares of Acquiror Common Stock to be issued in the Merger such
that the aggregate fair market value, as of the Effective Time of the Merger, of
the shares subject to such Sales would exceed fifty percent (50%) of the
aggregate fair market value of all shares of outstanding Target Common Stock
immediately prior to the Merger. A Sale of Acquiror Common Stock shall be
considered to have occurred pursuant to a Plan if such Sale occurs in a
transaction that is in contemplation of, or related or pursuant to, the Merger
Agreement (a "Related Transaction"). In addition, shares of Target Common Stock
(i) exchanged for cash in lieu of fractional shares of Acquiror Common Stock and
(ii) with respect to which a Sale occurred in a Related Transaction prior to the
Merger shall be considered to have been shares of outstanding Target Common
Stock that were exchanged for Acquiror Common Stock in the Merger and then
disposed of pursuant to a Plan. If any of the undersigned Shareholder's
representations in this subsection (c) ceases to be true at any time prior to
the Effective Time of the Merger, the undersigned Shareholder shall deliver to
each of Target and Acquiror, prior to the Effective Time of the Merger, a
written statement to that effect. Except as otherwise set forth in APPENDIX A,
the undersigned Shareholder has not engaged in a sale of any shares of Target
Common Stock since January 1, 1996. The undersigned Shareholder understands and
acknowledges that Target, Acquiror and their respective shareholders, as well as
legal counsel to Target and Acquiror, are entitled to rely on (i) the truth and
accuracy of the undersigned Shareholder's representations contained therein and
(ii) the undersigned Shareholder's performance of the obligations set forth
herein.
(d) Subject to paragraphs (b) and (c) of this Section 1, the
undersigned Shareholder agrees not to offer, sell, exchange, transfer, pledge or
otherwise dispose of any of the Acquiror Shares unless at that time the time
period set forth in paragraph (b) of this Section 1 has expired and either:
(i) such transaction is permitted pursuant to the provisions of
Rule 145(d) under the Securities Act;
(ii) counsel representing the undersigned Shareholder, satisfactory
to Acquiror, shall have advised Acquiror in a written opinion letter
satisfactory to Acquiror and Acquiror's counsel, and upon which Acquiror
and its counsel may rely, that no
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registration under the Securities Act is required in connection with the
proposed sale, transfer or other disposition;
(iii) a registration statement under the Securities Act covering the
Acquiror Shares proposed to be sold, transferred or otherwise disposed of,
describing the manner and terms of the proposed sale, transfer or other
disposition, and containing a current prospectus, is filed with the SEC and
made effective under the Securities Act; or
(iv) an authorized representative of the SEC shall have rendered
written advice to the undersigned Shareholder (sought by the undersigned
Shareholder or counsel to the undersigned Shareholder, with a copy thereof
and of all other related communications delivered to Acquiror) to the
effect that the SEC will take no action, or that the staff of the SEC will
not recommend that the SEC take action, with respect to the proposed offer,
sale, exchange, transfer, pledge or other disposition if consummated.
(e) All certificates representing the Acquiror Shares deliverable to
the undersigned Shareholder pursuant to the Merger Agreement and in connection
with the Merger and any certificates subsequently issued with respect thereto or
in substitution therefor shall, unless one or more of the alternative conditions
set forth in the subparagraphs of paragraph (d) of this Section 1 shall have
occurred, bear a legend substantially as follows:
"The shares represented by this certificate may not be
offered, sold, exchanged, transferred, pledged or
otherwise disposed of except in accordance with the
requirements of the Securities Act of 1933, as amended,
and the other conditions specified in that certain
Affiliates Agreement, dated as of May 8, 1998, between
Acquiror and ▇▇▇▇▇▇ ▇▇▇▇▇▇, a copy of which Affiliates
Agreement may be inspected by the holder of this
certificate at the offices of Acquiror, or Acquiror will
furnish, without charge, a copy thereof to the holder of
this certificate upon written request therefor."
Acquiror, at its discretion, may cause stop transfer orders to be placed with
its transfer agent with respect to the certificates for the Acquiror Shares but
not as to the certificates for any part of the Acquiror Shares as to which said
legend is no longer appropriate when one or more of the alternative conditions
set forth in the subparagraphs of paragraph (d) of this Section 1 shall have
occurred.
(f) The undersigned Shareholder will observe and comply with the
Securities Act and the General Rules and Regulations thereunder, as now in
effect and as from time to time amended and including those hereafter enacted or
promulgated, in connection with any offer, sale, exchange, transfer, pledge or
other disposition of the Acquiror Shares or any part thereof.
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(g) The undersigned Shareholder undertakes and agrees to indemnify
and hold harmless Acquiror, Target, and each of their respective current and
future officers and directors and each person, if any, who now or hereafter
controls or may control Acquiror or Target within the meaning of the Securities
Act (an "Indemnified Person") from and against any and all claims, demands,
actions, causes of action, losses, costs, damages, liabilities and expenses
("Claims") based upon, arising out of or resulting from any breach or
nonfulfillment of any undertaking, covenant or agreement made by the undersigned
Shareholder in subsection (b), (c), (d) or (f) of this Section 1, or caused by
or attributable to the undersigned Shareholder, or the undersigned Shareholder's
agents or employees, or representatives, brokers, dealers and/or underwriters
insofar as they are acting on behalf of and in accordance with the instruction
of or with the knowledge of the undersigned Shareholder, in connection with or
relating to any offer, sale, pledge, transfer or other disposition of any of the
Acquiror Shares by or on behalf of the undersigned Shareholder, which claim or
claims result from any breach or nonfulfillment as set forth above. The
indemnification set forth herein shall be in addition to any liability that the
undersigned Shareholder may otherwise have to the Indemnified Persons.
(h) Promptly after receiving definitive notice of any Claim in
respect of which an Indemnified Person may seek indemnification under this
Affiliates Agreement, such Indemnified Person shall submit notice thereof to the
undersigned Shareholder. The omission by the Indemnified Person so to notify
the undersigned Shareholder of any such Claim shall not relieve the undersigned
Shareholder from any liability the undersigned Shareholder may have hereunder
except to the extent that (i) such liability was caused or increased by such
omission, or (ii) the ability of the undersigned Shareholder to reduce or defend
against such liability was adversely affected by such omission. The omission of
the Indemnified Person so to notify the undersigned Shareholder of any such
Claim shall not relieve the undersigned Shareholder from any liability the
undersigned Shareholder may have otherwise than hereunder. The Indemnified
Persons and the undersigned Shareholder shall cooperate with and assist one
another in the defense of any Claim and any action, suit or proceeding arising
in connection therewith.
2. REPORTS. From and after the Effective Time of the Merger and for so
long as necessary in order to permit the undersigned Shareholder to sell the
Acquiror Shares pursuant to Rule 145 and, to the extent applicable, Rule 144
under the Securities Act, Acquiror will file on a timely basis all reports
required to be filed by it pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934, referred to in paragraph (c)(1) of Rule 144 under the
Securities Act (or, if applicable, Acquiror will make publicly available the
information regarding itself referred to in paragraph (c)(2) of Rule 144), in
order to permit the undersigned Shareholder to sell, pursuant to the terms and
conditions of Rule 145 and the applicable provisions of Rule 144, the Acquiror
Shares.
3. WAIVER. No waiver by any party hereto of any condition or of any
breach of any provision of this Affiliates Agreement shall be effective unless
in writing.
4. NOTICES. All notices, requests, demands or other communications that
are required or may be given pursuant to the terms of this Affiliates Agreement
shall be in writing and shall
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be deemed to have been duly given if delivered by hand or mailed by registered
or certified mail, postage prepaid, as follows:
(a) If to the Shareholder, at the address set forth below the
Shareholder's signature at the end hereof.
(b) If to Acquiror, Target or the other Indemnified Persons:
Veeco Instruments Inc.
▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: Chairman, President and Chief Executive Officer
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy (which shall not constitute notice) to:
▇▇▇▇, Scholer, Fierman, ▇▇▇▇ & Handler, LLP
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ ▇▇▇▇▇▇, Esq.
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
and
Digital Instruments, Inc.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇▇▇▇▇▇ and ▇▇▇▇▇▇▇ ▇▇▇▇▇, Esq.
Tel: (▇▇▇)-▇▇▇-▇▇▇▇
Fax: (▇▇▇)-▇▇▇-▇▇▇▇
or to such other address as any party hereto or any Indemnified Person may
designate for itself by notice given as herein provided.
5. COUNTERPARTS. For the convenience of the parties hereto, this
Affiliates Agreement may be executed in one or more counterparts, each of which
shall be deemed an original, but all of which together shall constitute one and
the same document.
6. SUCCESSORS AND ASSIGNS. This Affiliates Agreement shall be
enforceable by, and shall inure to the benefit of and be binding upon, the
parties hereto and their respective successors and assigns. Moreover, this
Affiliates Agreement shall be enforceable by, and shall inure to the benefit of,
the Indemnified Persons and their respective successors and assigns. As
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used herein, the term "successors and assigns" shall mean, where the context so
permits, heirs, executors, administrators, trustees and successor trustees, and
personal and other representatives.
7. GOVERNING LAW. This Affiliates Agreement shall be governed by and
construed, interpreted and enforced in accordance with the laws of the State of
New York.
8. EFFECTIVENESS; SEVERABILITY. This Affiliates Agreement shall become
effective at the Effective Time of the Merger. If a court of competent
jurisdiction determines that any provision of this Affiliates Agreement is
unenforceable or enforceable only if limited in time and/or scope, this
Affiliates Agreement shall continue in full force and effect with such provision
stricken or so limited.
9. EFFECT OF HEADINGS. The section headings herein are for convenience
only and shall not affect the construction or interpretation of this Affiliates
Agreement.
10. DEFINITIONS. All capitalized terms used herein shall have the meaning
defined in the Merger Agreement, unless otherwise defined herein.
IN WITNESS WHEREOF, the parties have caused this Affiliates Agreement to be
executed as of the date first above written.
ACQUIROR SHAREHOLDER
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇ /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇
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▇▇▇▇▇▇ ▇. ▇▇▇▇▇ (Signature)
Chairman, President and
Chief Executive Officer ▇▇▇▇▇▇ ▇▇▇▇▇▇
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(Print Name)
▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
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(Print Address)
▇▇▇-▇▇▇-▇▇▇▇
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(Print Telephone Number)
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