Exhibit 10.1
MKS INSTRUMENTS, INC.
Restricted Stock Unit Agreement
Granted Under the 2004 Stock Incentive Plan
AGREEMENT made this 5th day of April 2006 (the "Grant Date"), between MKS
Instruments, Inc., a Massachusetts corporation (the "Company"), and
<> <> (the "Participant").
For valuable consideration, receipt of which is acknowledged, the parties
hereto agree as follows:
1. General.
The Company has granted to the Participant restricted stock units ("RSUs")
with respect to XXX shares (the "Shares") of common stock, no par value, of the
Company ("Common Stock"), subject to the terms and conditions set forth in this
Agreement and in the Company's 2004 Stock Incentive Plan (the "Plan"). The RSUs
represent a promise by the Company to deliver Shares upon vesting.
2. Vesting Period.
Subject to the terms and conditions of this Agreement (including the
Forfeiture provisions described in Section 3 below), the participant shall vest
all RSU's on the third anniversary of the date of grant (the "Vesting Date"). As
soon as practicable after the Vesting Date, but in any event, within the period
ending on the later to occur of the date that is 2 1/2 months from the end of
(i) the Participant's tax year that includes the Vesting Date, or (ii) the
Company's tax year that includes the Vesting Date, the Company shall instruct
its transfer agent to deposit the Shares subject to the RSUs into the
Participant's existing stock option account (the "Account") at Xxxxxxx Xxxxx, or
such other broker with which the Company has established a relationship
("Broker"),, subject to payment (through sale of a portion of the Shares, or
otherwise, in accordance with Section 7) of all applicable withholding taxes.
3. Forfeiture.
(a) Definitions. For purposes of this Agreement, "Forfeiture" shall
mean any forfeiture of RSUs pursuant to Section 3(b) below. For purposes of this
Agreement, "employ" or "employment" with the Company shall include employment
with a parent or subsidiary of the Company.
(b) Cessation of Employment. In the event that the Participant ceases
to be employed by the Company for any reason or no reason (except for death or
disability), with or without cause, prior to the Vesting Date, all of the
Participant's RSUs shall automatically be forfeited as of such cessation. In the
event that the Participant ceases to be employed by the Company by reason of
death or disability prior to the Vesting Date, then the Company shall deliver to
the Participant a pro rata portion of the Shares covered by the RSUs equal to
the percentage of the period of time between the Grant Date and the Vesting Date
that the Participant
has been employed prior to such death or disability. For the purpose of this
Section 3, "disability" shall mean disability as defined in Section 216(i)(1) of
the U.S. Social Security Act.
(c) Change in Control. Notwithstanding the foregoing, if, prior to the
Vesting Date, and within two years of the effectiveness of a Change in Control
(as defined below), the Participant is (i) terminated by the Company without
Cause (as defined below) or (ii) terminates his employment for Good Reason (as
defined below), then, 100% of the Participant's RSUs shall become immediately
and fully vested and shall no longer be subject to the Forfeiture provisions
under this Agreement. For purposes of this section "Change in Control" means the
first to occur of any of the following events: (I) any "person" (as that term is
used in Section 13 and 14(d)(2) of the Securities Exchange Act of 1934
("Exchange Act")) becomes the beneficial owner (as that term is used in Section
13(d) of the Exchange Act), directly or indirectly, of fifty percent (50%) or
more of the Company's capital stock entitled to vote in the election of
directors; (II) the shareholders of the Company approve any consolidation or
merger of the Company, other than a consolidation or merger of the Company in
which the holders of the common stock of the Company immediately prior to the
consolidation or merger hold more than fifty percent (50%) of the common stock
of the surviving corporation immediately after the consolidation or merger; or
(III) the shareholders of the Company approve the sale or transfer of all or
substantially all of the assets of the Company to parties that are not within a
"controlled group of corporations" (as defined in Code Section 1563) in which
the Company is a member. For purposes of this Agreement, "Cause" shall mean
conviction for the commission of a felony, willful failure by the Participant to
perform his responsibilities to the Company, or willful misconduct by the
Employee. For purposes of this section, "Good Reason" shall mean termination of
the Participant's employment by the Participant within 90 days following (I) a
material diminution in the Participant's positions, duties and responsibilities
from those described in this Employment Agreement, (II) a material reduction in
the Participant's base salary (other than a reduction which is part of a general
salary reduction program affecting senior executives of the Company), (III) a
material reduction in the aggregate value of the pension and welfare benefits
provided to the Participant from those in effect prior to the Change in Control
(other than a reduction which is proportionate to the reductions applicable to
other senior executives pursuant to a cost-saving plan that includes all senior
executives), (IV) a material breach of any provision of this Employment
Agreement by the Company or (V) the Company's requiring the Participant to be
based at a location that creates for the Participant a one way commute in excess
of 60 miles from his primary residence, except for required travel on the
Company's business to an extent substantially consistent with the business
travel obligations of the Participant under this Employment Agreement.
Notwithstanding the foregoing, a termination shall not be treated as a
termination for Good Reason (I) if the Participant shall have consented in
writing to the occurrence of the event giving rise to the claim of termination
for Good Reason or (II) unless the Participant shall have delivered a written
notice to the Company within 30 days of his having actual knowledge of the
occurrence of one of such events stating that he intends to terminate his
employment for Good Reason and specifying the factual basis for such
termination, and such event, if capable of being cured, shall not have been
cured within 30 days of the receipt of such notice.
4. Restrictions on Transfer.
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The Participant shall not sell, assign, transfer, pledge, hypothecate or
otherwise dispose of, by operation of law or otherwise (collectively "transfer")
any RSUs, or any interest therein, except that the Participant may transfer such
RSUs (i) to or for the benefit of any spouse, children, parents, uncles, aunts,
siblings, grandchildren and any other relatives approved by the Board of
Directors (collectively, "Approved Relatives") or to a trust established solely
for the benefit of the Participant and/or Approved Relatives, provided that such
RSUs shall remain subject to this Agreement (including without limitation the
terms of Forfeiture and the restrictions on transfer set forth in this Section
4) and such permitted transferee shall, as a condition to such transfer, deliver
to the Company a written instrument confirming that such transferee shall be
bound by all of the terms and conditions of this Agreement.
5. Provisions of the Plan.
This Agreement is subject to the provisions of the Plan, a copy of
which is furnished to the Participant with this Agreement.
6. No Compensation Deferral. Neither the Plan nor this Agreement is
intended to provide for an elective deferral of compensation that would be
subject to Section 409A ("Section 409A ") of the U.S. Internal Revenue Code of
1986, as amended. The Company reserves the right, to the extent the Company
deems necessary or advisable in its sole discretion, to unilaterally amend or
modify the Plan and/or this Agreement to ensure that no awards (including
without limitation, the RSUs) become subject to the requirements of Section
409A.
7. Withholding Taxes.
(a) The Company's obligation to deliver Shares to the Participant upon
the vesting of the RSUs shall be subject to the satisfaction of all income tax
(including federal, state and local taxes), social insurance, payroll tax,
payment on account or other tax related withholding requirements ("Withholding
Taxes"). In order to satisfy all Withholding Taxes due upon vesting of the
Participant's RSUs, the Participant agrees to the following:
(b) As a condition to receiving any Shares upon vesting of the RSUs,
on the date of this Agreement, the Participant must execute the Irrevocable
Standing Order to Sell Shares attached hereto, which authorizes the Company and
Broker to take the actions described in this subsection 7(b) (the "Standing
Order"). The Participant authorizes Broker to sell, at the market price and on
the Vesting Date the number of Shares that the Company has instructed Broker is
necessary to obtain proceeds sufficient to satisfy the Withholding Taxes. The
Participant understands and agrees that the number of Shares that Broker will
sell will be based on the closing price of the Common Stock on the last trading
day before the Vesting Date. The Participant agrees to execute and deliver such
documents, instruments and certificates as may reasonably be required in
connection with the sale of the Shares pursuant to this Section 7.
(c) The Participant agrees that the proceeds received from the sale of
Shares pursuant to Section 7(b) will be used to satisfy the Withholding Taxes
and, accordingly, the Participant hereby authorizes Broker to pay such proceeds
to the Company for such purpose. The Participant understands that to the extent
that the proceeds obtained by such sale exceed the amount necessary to satisfy
the Withholding Taxes, such excess proceeds shall be deposited into
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the Account. The Participant further understands that any remaining Shares shall
be deposited into the Account.
(d) The Participant acknowledges and agrees that (i) in the event that
there is not a market in the Common Stock or (ii) the Company determines in its
sole discretion that the procedure described in Section 7(b) is not advisable or
sufficient, the Company will have the right to make other arrangements to
satisfy the Withholding Taxes due upon vesting of the RSUs, including, but not
limited to, the right to deduct amounts from salary or payments of any kind
otherwise due to the Participant or withhold in Shares, provided that the
Company only withholds the amount of Shares necessary to satisfy the minimum
withholding amount.
(e) The Participant has reviewed with the Participant's own tax
advisors the federal, state, local and foreign tax consequences of this grant
and the transactions contemplated by this Agreement. The Participant is relying
solely on such advisors and not on any statements or representations of the
Company or any of its agents. The Participant understands that the Participant
(and not the Company) shall be responsible for the Participant's own tax
liability that may arise as a result of this grant or the transactions
contemplated by this Agreement.
(f) The Participant represents to the Company that, as of the date
hereof, he is not aware of any material nonpublic information about the Company
or the Common Stock. The Participant and the Company have structured this
Agreement to constitute a "binding contract" relating to the sale of Common
Stock pursuant to this Section 7, consistent with the affirmative defense to
liability under Section 10(b) of the Securities Exchange Act of 1934 under Rule
10b5-1(c) promulgated under such Act.
8. Nature of the Grant. In signing this Agreement, the Participant
acknowledges that:
(a) the Plan is established voluntarily by the Company, it is discretionary
in nature and may be modified, amended, suspended or terminated by the
Company at any time, unless otherwise provided in the Plan and this
Agreement;
(b) the grant of RSUs is voluntary and occasional and does not create any
contractual or other right to receive future awards of RSUs, or benefits in
lieu of RSUs even if RSUs have been awarded repeatedly in the past;
(c) all decisions with respect to future grants of RSUs, if any, will be at
the sole discretion of the Company;
(d) the Participant's participation in the Plan is voluntary;
(e) RSUs are an extraordinary item that do not constitute compensation of
any kind for services of any kind rendered to the Company or to the
Participant's employer, and RSUs are outside the scope of the Participant's
employment contract, if any;
(f) RSUs are not part of normal or expected compensation or salary for any
purpose, including, but not limited to, calculation of any severance,
resignation, termination,
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redundancy, end of service payments, bonuses, long-service awards, pension
or retirement benefits or similar payments and in no event should be
considered as compensation for, or relating in any way to, past services
for the Company or the Participant's employer;
(g) the future value of the underlying Shares is unknown and cannot be
predicted with certainty;
(h) if the Participant receives Shares upon vesting, the value of such
Shares acquired on vesting of RSUs may increase or decrease in value;
(i) in consideration of the grant of RSUs, no claim or entitlement to
compensation or damages arises from termination of the RSUs or diminution
in value of the RSUs or Shares received upon vesting of RSUs resulting from
termination of the Participant's employment by the Company or the
Participant's employer (for any reason whatsoever and whether or not in
breach of local labor laws) and the Participant irrevocably releases the
Company and his or her employer from any such claim that may arise; if,
notwithstanding the foregoing, any such claim is found by a court of
competent jurisdiction to have arisen, then, by signing this Agreement, the
Participant shall be deemed irrevocably to have waived his or her
entitlement to pursue such claim; and
(j) further, if the Participant ceases to be a employee (whether or not in
breach of local labor laws), the Participant's right to receive RSUs and
vest under the Plan, if any, will terminate effective as of the date that
the Participant is no longer actively employed by the Company and will not
be extended by any notice period mandated under local law (e.g., active
employment would not include a period of "garden leave" or similar period
pursuant to local law); the Committee shall have the exclusive discretion
to determine when the Participant is no longer actively employed for
purposes of the Plan.
9. Data Privacy Notice and Consent. The Participant hereby explicitly and
unambiguously consents to the collection, use and transfer, in electronic or
other form, of his or her personal data as described in this paragraph, by and
among, as applicable, the Participant's employer and the Company and its
subsidiaries and affiliates for, among other purposes, implementing,
administering and managing the Participant's participation in the Plan. The
Participant understands that the Company and its subsidiaries hold certain
personal information about the Participant, including the Participant's name,
home address and telephone number, date of birth, social security number or
identification number, salary, nationality, job title, any Shares or
directorships held in the Company, details of all options or any other
entitlement to Shares awarded, canceled, exercised, vested, unvested or
outstanding in the Participant's favor, for the purpose of managing and
administering the Plan ("Data"). The Participant further understands that the
Company and/or its subsidiaries will transfer Data amongst themselves as
necessary for employment purposes, including implementation, administration and
management of the Participant's participation in the Plan, and that the Company
and/or any of its subsidiaries may each further transfer Data to Broker or such
other stock plan service provider or other third parties assisting the Company
with processing of Data. The Participant understands that these recipients may
be located in the United States, and that the recipient's country may have
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different data privacy laws and protections than in the Participant's country.
The Participant authorizes them to receive, possess, use, retain and transfer
the Data, in electronic or other form, for the purposes described in this
section, including any requisite transfer to Broker or such other stock plan
service provider or other third party as may be required for the administration
of the Plan and/or the subsequent holding of Shares of stock on the
Participant's behalf. The Participant understands that he or she may, at any
time, request access to the Data, request any necessary amendments to it or
refuse or withdraw the consents herein, in any case without cost, by contacting
in writing his or her local human resources representative. The Participant
understands, however, that withdrawal of consent may affect the Participant's
ability participate in or realize benefits from the Plan. For more information
on the consequences of refusal to consent or withdrawal of consent, the
Participant understands that he or she may contact his or her local human
resources representative.
10. Miscellaneous.
(a) No Rights to Employment. The Participant acknowledges and agrees
that the vesting of the RSUs pursuant to Section 2 hereof is earned only in
accordance with the terms of such section. The Participant further acknowledges
and agrees that the transactions contemplated hereunder and the vesting schedule
set forth herein do not constitute an express or implied promise of continued
engagement as an employee or consultant for the vesting period, for any period,
or at all.
(b) Severability. The invalidity or unenforceability of any provision
of this Agreement shall not affect the validity or enforceability of any other
provision of this Agreement, and each other provision of this Agreement shall be
severable and enforceable to the extent permitted by law.
(c) Waiver. Any provision for the benefit of the Company contained in
this Agreement may be waived, either generally or in any particular instance, by
the Board of Directors of the Company.
(d) Binding Effect. This Agreement shall be binding upon and inure to
the benefit of the Company and the Participant and their respective heirs,
executors, administrators, legal representatives, successors and assigns,
subject to the restrictions on transfer set forth in Section 4 of this
Agreement.
(e) Notice. All notices required or permitted hereunder shall be in
writing and deemed effectively given upon personal delivery or five days after
deposit in the United States Post Office, by registered or certified mail,
postage prepaid, addressed to the other party hereto at the address shown
beneath his or its respective signature to this Agreement, or at such other
address or addresses as either party shall designate to the other in accordance
with this Section 10(e).
(f) Pronouns. Whenever the context may require, any pronouns used in
this Agreement shall include the corresponding masculine, feminine or neuter
forms, and the singular form of nouns and pronouns shall include the plural, and
vice versa.
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(g) Language. If the Participant has received this Agreement or any
other document related to the Plan translated into a language other than English
and if the translated version is different than the English version, the English
version will control.
(h) Electronic Delivery. The Company may, in its sole discretion,
decide to deliver any documents related to participation in the Plan, RSUs
granted under the Plan or future RSUs that may be granted under the Plan by
electronic means or to request the Participant's consent to participate in the
Plan by electronic means. The Participant hereby consents to receive such
documents by electronic delivery and, if requested, to agree to participate in
the Plan through an on-line or electronic system established and maintained by
the Company or another third party designated by the Company.
(i) Entire Agreement. This Agreement and the Plan constitute the
entire agreement between the parties, and supersedes all prior agreements and
understandings, relating to the subject matter of this Agreement.
(j) Amendment. This Agreement may be amended or modified only by a
written instrument executed by both the Company and the Participant.
(k) Governing Law. This Agreement shall be construed, interpreted and
enforced in accordance with the internal laws of the Commonwealth of
Massachusetts without regard to any applicable conflicts of laws.
(l) The Participant's Acknowledgments. The Participant acknowledges
that he or she: (i) has read this Agreement; (ii) has been represented in the
preparation, negotiation, and execution of this Agreement by legal counsel of
the Participant's own choice or has voluntarily declined to seek such counsel;
and (iii) understands the terms and consequences of this Agreement; and (iv) is
fully aware of the legal and binding effect of this Agreement.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the day and year first above written.
MKS INSTRUMENTS, INC.
By:
-------------------------------------
Title: Chief Executive Officer &
President
00 Xxxxxxxxxx Xxx
Xxxxxxxxxx, XX 00000
<> <>
Participants Signature:
-----------------
Address: <>, <>
<>, <> <>
<>
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Exhibit A
IRREVOCABLE STANDING ORDER TO SELL SHARES
I, <> <>, have been granted restricted stock
units ("RSUs") with respect to 000000 shares of stock by MKS Instruments, Inc.
("MKS"), which is evidenced by a restricted stock unit agreement between me and
MKS (the "Agreement," copy attached). Provided that I remain employed by MKS (or
one of its subsidiaries) on each vesting date, the RSUs vest according to the
schedule set forth in the Agreement.
I understand that on the vesting date, MKS shares (the "Shares") will
be deposited into my account no. _____________ at Broker and that I may
recognize taxable income as a result. Pursuant to the terms of the Agreement and
as a condition of my receipt of the Shares, I understand and agree that, for
each vesting date, I must sell a number of shares sufficient to satisfy all
withholding taxes applicable to that income. Therefore, I HEREBY DIRECT Broker
TO SELL, AT THE MARKET PRICE AND ON EACH VESTING DATE (OR THE FIRST BUSINESS DAY
THEREAFTER IF A VESTING DATE SHOULD FALL ON A DAY WHEN THE MARKET IS CLOSED),
THE NUMBER OF SHARES THAT MKS INFORMS Broker IS SUFFICIENT TO SATISFY THE
APPLICABLE WITHHOLDING TAXES, WHICH SHALL BE CALCULATED BASED ON THE CLOSING
PRICE OF MKS'S COMMON STOCK ON THE LAST TRADING DAY BEFORE THE VESTING DATE. I
understand that Broker will remit the proceeds to MKS for payment of the
withholding taxes.
I hereby agree to indemnify and hold Broker harmless from and against
all losses, liabilities, damages, claims and expenses, including reasonable
attorneys' fees and court costs, arising out of any (i) negligent act, omission
or willful misconduct by MKS in carrying out actions pursuant to the third
sentence of the preceding paragraph and (ii) any action taken or omitted by
Broker in good faith reliance upon instructions herein or upon instructions or
information transmitted to Broker by MKS pursuant to the third sentence of the
preceding paragraph.
I understand and agree that by signing below, I am making an
Irrevocable Standing Order to Sell Shares which will remain in effect until all
of the RSUs have vested. I also agree that this Irrevocable Standing Order to
Sell Shares is in addition to and subject to the terms and conditions of any
existing Account Agreement that I have with Broker.
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Signature Signature (Additional Account Holder)
Print name: Print name:
------------------------- ----------------------------
Dated: _______ __, 20__ Dated: _________ __, 20__
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