AMENDED AND RESTATED EMPLOYMENT AGREEMENT
AMENDED AND RESTATED EMPLOYMENT AGREEMENT
AMENDED AND RESTATED EMPLOYMENT
AGREEMENT, dated this ____ day of ___________, 2010 (the “Agreement”), between
Amtech Systems, Inc., an Arizona corporation (the “Company”) with offices at 000
Xxxxx Xxxxx Xxxxx, Xxxxx, Xxxxxxx, and Xxxx X. Xxxxx (the “Executive”),
W I T N E S S E T H:
WHEREAS, the Company and the Executive previously entered into an
Employment Agreement dated April 13, 2007; and
WHEREAS, such Employment Agreement was
amended by the Amendment to Employment Agreement, dated March 10, 2008, and the
409A Amendment to Employment Agreement, dated December 31, 2008 (collectively,
the “Amendments”); and
WHEREAS, the Initial Term of such
Employment Agreement expires on April 13, 2010; and
WHEREAS, the Company and the Executive
wish to extend the Executive’s employment on terms and conditions generally
consistent with the Employment Agreement and the Amendments, and as otherwise
provided herein;
NOW, THEREFORE, the Company and the
Executive hereby enter into an employment and compensation arrangement on the
following terms and conditions:
1. Employment. Subject to the terms and conditions of this
Agreement, the Company agrees to employ the Executive as its Chief Executive
Officer during the Employment Period (as defined in Section 7) and Executive
agrees to perform such acts and duties and furnish such services to the Company
and its affiliates consistent with such position as the Company’s Board of
Directors shall from time to time direct. The Executive shall have general and
active charge of the business and affairs of the Company and, in such capacity,
shall have responsibility for the day-to-day operations of the Company, subject
to the authority and control of the Board of Directors of the Company. During
the Employment Period, the Company shall continue to take such actions as
necessary to cause the Executive’s nomination as a member of the Board of
Directors of the Company. The Executive hereby accepts such employment and
agrees to devote his full time and best efforts to the duties provided herein,
provided, that the Executive may engage in other business activities which (i)
involve no conflict of interest with the interests of the Company (subject to
approval by the Board of Directors, which approval shall not be unreasonably
withheld) and (ii) do not materially interfere with the performance by the
Executive of his duties under this Agreement.
2. Compensation. For services rendered to the Company during
the term of this Agreement, the Company shall compensate the Executive with an
initial base salary, payable in monthly installments, of $350,000 per annum.
Such base salary shall be reviewed on an annual basis by the Compensation
Committee of the Company’s Board of Directors (the “Compensation Committee”) and
shall be subject to being increased but not decreased in the discretion of the
Compensation Committee.
3. Incentive Compensation. The Executive shall also be entitled to
annual cash bonuses for each fiscal year during the Employment Period
(“Incentive Compensation”). The Executive’s Incentive Compensation for each such
fiscal year shall be determined in accordance with an annual bonus plan adopted
by the Compensation Committee, which shall be no less favorable to the Executive
than the bonus plan for fiscal 2010 adopted by the Compensation Committee on
December 21, 2009. Any bonus due to Executive will be paid within 75 days after
the end of the Company’s fiscal year.
4. Stock Options.
(a) Outstanding Options and Restricted
Stock. All currently
outstanding options to purchase Common Stock of the Company and all restricted
stock grants held by Executive shall remain in full force and effect in
accordance with the provisions of Employer’s stock option and restricted stock
plans and the applicable Stock Option Agreements, as may be amended from time to
time.
(b) New Options and Restricted
Stock. As further
compensation, Employee shall be issued an annual grant of stock options and
restricted stock by the Compensation Committee within ninety (90) days after the
end of each fiscal year during the Employment Period. The amount of such grant
and the terms of vesting shall be as determined by the Compensation Committee,
but shall be no less favorable to the Executive than the amounts and terms of
the grant approved by the Compensation Committee on November 20, 2009. All of
the stock options granted to Executive shall be “Incentive Stock Options” within
the meaning of the Internal Revenue Code of 1986, as amended (the “Code”),
subject to the limitations of the Code. Any stock options which are not allowed
to be incentive stock options under the Code shall be non-qualified stock
options. The stock options shall be issued at the fair market value of the
Company’s common stock as of the date of grant.
5. Benefits. During the Employment Period, the Company
shall provide or cause to be provided to the Executive such employee benefits as
are provided to other executive officers of the Company, including family
medical, dental, vision, disability and life insurance, and participation in
pension and retirement plans, incentive compensation plans, stock option plans,
Company-sponsored welfare benefit plans for disability and life insurance and
other benefit plans. During the Employment Period, the Company may provide or
cause to be provided to the Executive such additional benefits as the Company
may deem appropriate from time to time. The Company shall also provide the
Executive with an annual automobile allowance of not less than $14,000, as well
as a life insurance policy in the face amount of $500,000 with Executive’s
spouse as the beneficiary. At Executive’s request, the Company shall transfer
ownership of such life insurance policy to the Executive or his designee, at
such time and in such a manner as to minimize any adverse tax consequences to
the Executive.
6. Vacation. The Executive shall be entitled to annual
vacations in accordance with the Company’s vacation policies in effect from time
to time for executive officers of the Company.
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7. Term: Employment Period. The “Employment Period” shall commence on
the date of this Agreement (the “Effective Date”) and shall continue for an
initial term of three (3) years (the “Initial Term”). Thereafter, the Employment
Period shall continue for successive one (1) year terms (the “Additional Terms”)
unless either the Company or the Executive provides written notice of
termination of the Employment Period not less than one hundred twenty (120) days
prior to the end of the Initial Term or any Additional Term (collectively, the
“Term”), or unless earlier terminated pursuant to Section 8. If the Executive
shall remain in the full time employ of the Company beyond the Employment Period
without any written agreement between the parties, this Agreement shall be
deemed to continue on a month to month basis and either party shall have the
right to terminate this Agreement at the end of any ensuing calendar month on
written notice of at least thirty (30) days.
8. Termination.
(a) Executive’s employment with the company shall be “at will”. Either the
Company or the Executive may terminate this Agreement and Executive’s employment
at any time, with or without Cause or Good Reason (as such terms are defined
below), in its or his sole discretion, upon thirty (30) days prior written
notice of termination.
(b) Without limiting the foregoing Section 8(a), (i) the Executive may
terminate his employment with the company at any time for Good Reason, or (ii)
the Company may terminate his employment at any time for Cause. “Good Reason”
shall mean (i) the Company’s failure to elect or reelect, or to appoint or
reappoint, Executive to the office of Chief Executive Officer of the Company;
(ii) material changes by the Company in the Executive’s function, duties or
responsibilities (including reporting responsibilities) of a scope less than
that associated with the position of Chief Executive Officer of the Company;
(iii) Executive’s base salary is reduced by the Company below the highest base
salary of Executive in effect during the Employment Period; (iv) relocation of
Executive’s principal place of employment to a place that is not within either
the city limits of Tempe, Arizona, or within a radius of twenty (20) miles of
his primary residence; (v) failure by the Company to obtain the assumption of
this Agreement by any successor or assign of the Company; (vi) material breach
of this Agreement by the Company, which breach is not cured within five (5) days
after written notice thereof is delivered to the Company; or (vii) the
occurrence of a Change of Control (as defined in Section 18). “Cause” shall mean
(i) the Executive’s willful, repeated or negligent failure to perform his duties
hereunder and to comply with any reasonable or proper direction given by or on
behalf of the Company’s Board of Directors and the continuation of such failure
following twenty (20) days written notice to such effect, (ii) the Executive
being guilty of serious misconduct on the Company’s premises or elsewhere,
whether during the performance of his duties or not, which is reasonably likely
to cause material damage to the reputation of the Company or render it
materially more difficult for the Executive to satisfactorily continue to
perform his duties and the continuation or a second instance of such serious
misconduct following twenty (20) days written notice to such effect; (iii) the
Executive being found guilty in a criminal court of any offense of a nature
which is reasonably likely to materially adversely affect the reputation of the
Company or to materially prejudice its interests if the Executive were to
continue to be employed by the Company; (iv) the Executive’s commission of any
act of fraud or theft involving the Company or its business, or any intentional
tort against the Company; or (v) the Executive’s violation of any of the
material terms, covenants, representations or warranties contained in this
Agreement and failure to correct such violation within twenty (20) days after
written notice by the Company. Notwithstanding the foregoing, “Cause” shall only
be deemed to exist if it is so determined by a resolution duly adopted by the
Board of Directors of the Company, at a duly noticed meeting at which the
Executive and his counsel are first given the opportunity to address the Board
with respect to such determination.
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(c) “Disability” shall mean that the Executive, in the good faith
determination of the Board of Directors of the Company, based on the advice of a
qualified physician after a proper examination of the Executive, is unable,
without reasonable accommodation, to render services of the character
contemplated hereby and that such inability (i) may be expected to be permanent,
or (ii) may be expected to continue for a period of at least six (6) consecutive
months (or for shorter periods totaling more than six (6) months during any
period of twelve (12) consecutive months). Termination resulting from Disability
may only be effected after at least thirty (30) days written notice by the
Company of its intention to terminate the Executive’s employment.
(d) “Termination Date” shall mean any of the following and which termination
is a “separation of service” within the meaning of Section 409A of the Code: (i)
if this Agreement is terminated on account of death, the date of death; (ii) if
this Agreement is terminated for Disability, the date established by the Company
pursuant to Section 8(c) hereof; (iii) if this Agreement is terminated by the
Company, the date on which a notice of termination is given to the Executive;
(iv) if the Agreement is terminated by the Executive, the date the Executive
ceases work; or (v) if this Agreement expires by its terms, the last day of the
term of this Agreement. Notwithstanding the foregoing, if within thirty (30)
days after any notice of termination is given, the party receiving such notice
notifies the other party that a dispute exists concerning the termination, the
Termination Date shall be the date finally determined to be the Termination
Date, either by mutual written agreement of the parties or by binding
arbitration in the manner provided in Section 23 hereof; provided that the
Termination Date shall be extended by a notice of dispute only if such notice is
given in good faith and the party giving such notice pursues the resolution of
such dispute with reasonable diligence. Notwithstanding the pendency of any such
dispute, the Company will continue to pay the Executive his full compensation in
effect when the notice giving rise to the dispute was given and continue the
Executive as a participant in all compensation, benefit and insurance plans in
which he was participating when the notice giving rise to the dispute was given,
until the dispute is finally resolved. Amounts paid under this Section 8(d)
shall be in addition to all other amounts due under this Agreement and shall not
be offset against or reduce any amounts due under this Agreement; provided,
however, that if the arbitrator determines that any notice of dispute by the
Executive was not given in good faith or that the Executive did not pursue the
resolution of such dispute with reasonable diligence, the Executive shall repay
the Company the amount of compensation paid to the Executive pursuant to Section
8(d) from the Termination Date which would have applied had such notice of
dispute not been given, plus interest thereon at the applicable federal rate
provided for in Section 1274(d) of the Code, or any successor provision thereof,
for an obligation with a term equal to the period from the date of payment to
the date of repayment pursuant to this Section 8(d).
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9. Severance:
(a) If (i) the Company terminates the employment of the Executive against his
will and without Cause (including by giving notice of termination of the
Agreement pursuant to Section 7), or (ii) the Executive terminates his
employment for Good Reason, the Executive shall be entitled to receive salary,
Incentive Compensation and vacation accrued through the Termination Date, plus
the following:
(i) a cash lump sum in an amount equal to the greater of the Executive’s base
salary for the remainder of the Initial Term or two years of Executive’s base
salary in effect on the Termination Date;
(ii) a cash lump sum equal to the maximum amount of the Incentive Compensation
which Executive could earn for the fiscal year in which the Termination Date
occurs (the “Maximum Incentive Compensation”); and
(iii) full vesting of all outstanding stock options and restricted stock held
by Executive.
The Company shall
make the termination payment required hereunder within thirty (30) days of the
Termination Date; provided, however, if such thirty (30) day period begins in
one calendar year and ends in another calendar year, the Executive will not have
the right to designate the calendar year of payment.
In addition, the
Company and the Executive agree that, upon such termination and for a period of
two (2) years following the Termination Date, (i)Executive will make himself
available for an average of 20 hours per week in order to consult with the
Company in such manner and on such matters as the Company shall reasonably
request, (ii) Executive will make himself available to serve on the Board of
Directors of the Company, and (iii) in consideration for the Executives
agreement to perform such services, the Company will (A) pay the Executive an
annual amount equal to 40% of his base salary in effect on the Termination Date,
payable in regular installments in accordance with the Company’s standard
payroll practices, and (B) include the Executive in the Company’s Family
medical, dental and vision insurance plans, or, if the Executive’s inclusion in
such plans is not permitted, provide substantially the same benefits to the
Executive at the Company’s expense.
Notwithstanding the
foregoing, the Company shall not be required to pay any severance pay or
consulting payments for any period following the Termination Date if the
Executive violates the provisions of Section 15, Section 16 or Section 17 of
this Agreement in any material respect, and fails to cure such violation within
thirty (30) days after written notice from the Company to the Executive
detailing such violation.
(b) If (i) the Executive voluntarily terminates his employment other than for
Good Reason, (ii) the Executive’s employment is terminated due to death or
Disability, or (iii) the Executive is terminated by the Company for Cause, then
the Executive shall be entitled to receive his base salary and accrued vacation
through the Termination Date only. In the event of death or Disability the
Executive shall also be entitled to receive the Pro-Rated Incentive Compensation
and full vesting of all outstanding stock options and restricted stock held by
the Executive, subject to the same terms and conditions as provided in Section
9(a).
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(c) In addition to the provisions of Section 9(a) and 9(b) hereof, to the
extent COBRA shall be applicable to the Company or as provided by law, the
Executive shall be entitled to continuation of group health plan benefits in
accordance with COBRA if the Executive makes the appropriate conversion and
payments. If requested to do so, the Company will transfer ownership of the life
insurance policy referred to in Section 5 to the Executive and the Executive
agrees to pay for any costs related to the transfer in excess of $1000 and to be
responsible for all future premiums.
(d) The Executive acknowledges that, upon termination of his employment, he
is entitled to no other compensation, severance or other benefits other than
those specifically set forth in this Agreement or any applicable Stock Option
Agreement, or pursuant to any Applicable Benefit Plan.
(e) All payments to be made to the Executive upon a termination of employment
may only be made upon a “separation from service” (within the meaning of Section
409A) of the Executive. For purposes of Section 409A, (i) each payment made
under this Agreement shall be treated as a separate payment; (ii) the Executive
may not, directly or indirectly, designate the calendar year of payment; and
(iii) no acceleration of the time and form of payment of any nonqualified
deferred compensation to the Executive or any portion thereof, shall be
permitted.
(f) Notwithstanding anything contained in this Agreement to the contrary, if
at the time of the Executive’s “separation from service” (as defined in Section
409A of the Code) the Executive is a “specified employee” (within the meaning of
Section 409A and the Company’s specified employee identification policy) and if
any payment, reimbursement and/or in-kind benefit that constitutes nonqualified
deferred compensation (within the meaning of Section 409A) is deemed to be
triggered by the Executive’s separation from service, then, to the extent one or
more exceptions to Section 409A are inapplicable (including, without limitation,
the exception under Treasury Regulation Section 1.409A-1(b)(9)(iii) relating to
separation pay due to an involuntary separation from service and its requirement
that installments must be paid no later than the last day of the second taxable
year following the taxable year in which such an employee incurs the involuntary
separation from service), all payments, reimbursements, and in-kind benefits
that constitute nonqualified deferred compensation (within the meaning of
Section 409A) to the Executive shall not be paid or provided to the Executive
during the six-month period following the Executive’s separation from service,
and (i) such postponed payment and/or reimbursement/in-kind amounts shall be
paid to the Executive in a lump sum within thirty (30) days after the date that
is six (6) months following the Executive’s separation from service; (ii) any
amounts payable to the Executive after the expiration of such six- (6-) month
period shall continue to be paid to the Executive in accordance with the terms
of this Agreement; and (iii) to the extent that any group hospitalization plan,
health care plan, dental care plan, life or other insurance or death benefit
plan, and any other present or future similar group executive benefit plan or
program or any lump sum cash out thereof is nonqualified deferred compensation
(within the meaning of Section 409A), the Executive shall pay for such benefits
from his Termination Date until the first day of the seventh month following the
month of the Executive’s separation from service, at which time the Company
shall reimburse the Executive for such payments. If the Executive dies during
such six- (6-) month period and prior to the payment of such postponed amounts
of nonqualified deferred compensation, only the amount of nonqualified deferred
compensation equal to the number of whole months that the Executive lived shall
be paid in a lump sum to the Executive’s estate or, if applicable, to the
Executive’s designated beneficiary within thirty (30) days after the date of the
Executive’s death.
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10. Expenses; Reimbursements and In-Kind
Benefits. The Company
shall pay or reimburse the Executive for all expenses normally reimbursed by
Company, reasonably incurred by him in furtherance of his duties hereunder and
authorized and approved by the Company in compliance with such rules relating
thereto as the Company may, from time to time, adopt and as may be required in
order to permit such payments as proper deductions to Company under the Code,
and the rules and regulations adopted pursuant thereto now or hereafter in
effect.
Notwithstanding any
other provision of the applicable plans and programs, all reimbursements and
in-kind benefits provided under this Agreement shall be made or provided in
accordance with the requirements of Section 409A, including, where applicable,
the requirement that (i) the amount of expenses eligible for reimbursement and
the provision of benefits in kind during a calendar year shall not affect the
expenses eligible for reimbursement or the provision of in-kind benefits in any
other calendar year; (ii) the reimbursement for an eligible expense will be made
on or before the last day of the calendar year following the calendar year in
which the expense is incurred; (iii) the right to reimbursement or right to
in-kind benefit is not subject to liquidation or exchange for another benefit;
and (iv) each reimbursement payment or provision of in-kind benefit shall be one
of a series of separate payments (and each shall be construed as a separate
identified payment) for purposes of Section 409A of the Code.
11. Facilities and Services. The Company shall furnish the Executive with
office space, secretarial and support staff and such other facilities and
services as shall be reasonably necessary for the performance of his duties
under this Agreement.
12. Mitigation Not Required. In the event this Agreement is terminated,
the Executive shall not be required to mitigate amounts payable pursuant hereto
by seeking other employment or otherwise. The Executive’s acceptance of any such
other employment shall not diminish or impair the amounts payable to the
Executive pursuant hereto.
13. Place of Performance. The Executive shall perform his duties
primarily in Tempe, Arizona or locations within a reasonable proximity thereof,
except for reasonable travel as the performance of the Executive’s duties may
require.
14. Insurance and Indemnity. During the Employment Period, if available
at reasonable costs, the Company shall maintain, at its expense, officers and
directors fiduciary liability insurance covering the Executive and all other
executive officers and directors in an amount of no less than $5,000,000. The
Company shall also indemnify the Executive, to the fullest extent permitted by
law, from any liability asserted against or incurred by the Executive by reason
of the fact that the Executive is or was an officer or director of the Company
or any affiliate or related party or is or was serving in any capacity at the
request of the Company for any other corporation, partnership, joint venture,
trust, employment benefit plan or other enterprise. This indemnity shall survive
termination of this Agreement.
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15. Noncompetition.
(a) The Executive agrees that, except in accordance with his duties under
this Agreement on behalf of the Company, he will not during the term of this
Agreement:
Participate in, be employed in any capacity
by, serve as director, consultant, agent or representative for, or have any
interest, directly or indirectly, in any enterprise which is engaged in the
business of distributing, selling or otherwise trading in products or services
which are competitive to any products or services distributed, sold or otherwise
traded in by the Company or any of its subsidiaries during the term of the
Executive’s employment with the Company, or which are competitive to any
products or services being actively developed, with the bona fide intent to
market same, by the Company or any of its subsidiaries during the term of the
Executive’s employment with the Company;
In addition, the Executive agrees that for a
period of two years after the end of the term of this Agreement (unless the
Company breaches this Agreement by failing to pay to the Executive all sums due
him under the terms hereof, in which event the following provisions of this
Section 15.A shall be inapplicable), the Executive shall observe the covenants
set forth in this Section 15 and shall not own, either directly or indirectly or
through or in conjunction with one or more members of his or his spouse’s family
or through any trust or other contractual arrangement, a greater than five
percent (5%) interest in, or otherwise control either directly or indirectly,
any partnership, corporation, or other entity which distributes, sells, or
otherwise trades in products which are competitive to any products or services
being developed, distributed, sold, or otherwise traded in by the Company or any
of its subsidiaries, during the term of this Agreement, or being actively
developed by the Company or any of its subsidiaries during the term of this
Agreement with the Company with a bona fide intent to market same. Executive
further agrees, for such two-year period following termination, to refrain from
directly or indirectly soliciting Company’s vendors, customers or employees,
except that the Executive may solicit the Company’s vendors or customers in
connection with a business that does not compete with the Company or any of its
subsidiaries.
(b) The Executive hereby agrees that damages and any other remedy available
at law would be inadequate to redress or remedy any loss or damage suffered by
the Company upon any breach of the terms of this Section 15 by the Executive,
and the Executive therefore agrees that the Company, in addition to recovering
on any claim for damages or obtaining any other remedy available at law, also
may enforce the terms of this section 15 by injunction or specific performance,
and may obtain any other appropriate remedy available in equity.
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16. Assignment of Patents. Executive shall disclose fully to the
Company any and all discoveries and any and all ideas, concepts or inventions
relating to the Company’s business as described in the Company’s most recent
Annual Report on Form 10-K filed with the Securities and Exchange Commission)
which he shall conceive or make during his period of employment, or during the
period of six months after his employment shall terminate, which are in whole or
in part the result of his work with the Company. Such disclosure is to be made
promptly after each such discovery or conception, and each such discovery, idea,
concept or invention will become and remain the property of the Company,
whether or not patent applications are filed thereon. Upon request and at the
expense of the Company, the Executive shall make application through the patent
solicitors of the Company for letters patent of the United States and any and
all other countries at the discretion of the Company on such discoveries, ideas
and inventions, and to assign all such applications to the Company, or at its
order, forthwith, without additional payment by the Company during his period of
employment and for reasonable compensation for time actually spent by the
Executive at such work at the request of the Company after the termination of
the employment. Executive shall give the Company, its attorneys and solicitors,
all reasonable assistance in preparing and prosecuting such applications and, on
request of the Company, execute all papers and do all things that may be
reasonably necessary to protect the right of the Company and vest in it or its
assigns the discoveries, ideas or inventions, applications and letters patent
herein contemplated. Said cooperation shall also include all actions reasonably
necessary to aid the Company in the defense of its rights in the event of
litigation.
17. Trade Secrets.
(a) In the course of the term of this Agreement, it is anticipated that the
Executive shall have access to secret or confidential technical and commercial
information, records, data, specifications, systems, methods, plans, policies,
inventions, material and other knowledge (“Confidential Material”) owned by the
Company and its subsidiaries. The Executive recognizes and acknowledges that
included within the Confidential Material are the Company’s confidential
commercial information, technology, methods of manufacture, designs, and any
computer programs, source codes, object codes, executable codes and related
materials, all as they may exist from time to time, and that they are valuable
special and unique aspects of the Company’s business. All such Confidential
material shall be and remain the property of the Company. Except as required by
his duties to the Company, the Executive shall not, directly or indirectly,
either during the term of his employment or at any time thereafter, disclose or
disseminate to anyone or make use of, for any purpose whatsoever, any
Confidential Material. Upon termination of his employment, the Executive shall
promptly deliver to the Company all Confidential Material (including all copies
thereof, whether prepared by the Executive or others) which are in the
possession or under the control of the Executive. The Executive shall not be
deemed to have breached this Section 17 if the Executive shall be specifically
compelled by lawful order of any judicial, legislative, or administrative
authority or body to disclose any Confidential Material or else face civil or
criminal penalty or sanction.
(b) The Executive hereby agrees that damages and any other remedy available
at law would be inadequate to redress or remedy any loss or damage suffered by
the Company upon any breach of the terms of this Section 17 by the Executive,
and the Executive therefore agrees that the Company, in addition to recovering
on any claim for damages or obtaining any other remedy available at law, also
may enforce the terms of this Section 17 by injunction or specific performance,
and may obtain any other appropriate remedy available in equity.
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18. Provisions After Change of
Control.
(a) In the event Executive’s employment with the Company is terminated (other
than as a consequence of death or Disability) either (x) by the Company for any
reason other than for Cause during a Pending Change of Control (as hereinafter
defined) or within one year following the occurrence of a Change of Control, or
(y) by Executive for Good Reason within one year following the occurrence of a
Change of Control, then Executive shall be entitled to receive from the Company,
in lieu of the severance payment otherwise payable pursuant to Section 9(a), the
following:
(i) a cash lump sum equal to three years of Executive’s base salary in effect
on the Termination Date;
(ii) the Maximum Incentive Compensation; and
(iii) full vesting of all outstanding stock options and restricted stock held
by Executive.
The Company shall
make the termination payments required hereunder within thirty (30) days of the
Termination Date; provided, however, if such thirty (30) day period begins in
one calendar year and ends in another calendar year, Executive will not have the
right to designate the calendar year of payment.
(b) For purposes of this Agreement, the term “Change of Control” shall mean:
(i) The acquisition, other than from the Company, by any individual, entity
or group (within the meaning of Rule 13d-3 promulgated under the Exchange Act or
any successor provision) (any of the foregoing described in this Section 18
(b)(i) hereafter a “Person”) of 20% or more of either (a) the then outstanding
shares of Capital Stock of the Company (the “Outstanding Capital Stock”) or (b)
the combined voting power of the then outstanding voting securities of the
Company entitled to vote generally in the election of directors (the “Voting
Securities”), provided, however, that any acquisition by (x) the Company or any
of its subsidiaries, or any employee benefit plan (or related trust) sponsored
or maintained by the Company or any of its subsidiaries or (y) any Person that
is eligible, pursuant to Rule 13d-1 (b) under the Exchange Act, to file a
statement on Schedule 13G with respect to its beneficial ownership of Voting
Securities, whether or not such Person shall have filed a statement on Schedule
13G, unless such Person shall have filed a statement on Schedule 13D with
respect to beneficial ownership of 35% or more of the Voting Securities or (z)
any corporation with respect to which, following such acquisition, more than 60%
respectively, the then outstanding shares of common stock of such corporation
and the combined voting power of the then outstanding voting securities of such
corporation entitled to vote generally in the election of directors is then
beneficially owned, directly or indirectly, by all or substantially all of the
individuals and entities who were the beneficial owners, respectively, of the
Outstanding Capital Stock and Voting Securities immediately prior to such
acquisition in substantially the same proportion as their ownership, immediately
prior to such acquisition, of the Outstanding Capital Stock and Voting
Securities, as the case may be, shall not constitute a Change of Control; or
(ii) Individuals who, as of the Effective Date, constitute the Board (the
“Incumbent Board”) cease for any reason to constitute at least a majority of the
Board, provided that any individual becoming a director subsequent to the date
hereof whose election or nomination for election by the Company’s shareholders,
was approved by a vote of at least a majority of the directors then comprising
the Incumbent Board shall be considered as though such individual were a member
of the Incumbent Board, but excluding, for this purpose, any such individual
whose initial assumption of office is in connection with an actual or threatened
election contest relating to the election of the Directors of the Company (as
such terms are used in Rule 14a-11 of Regulation 14A, or any successor section,
promulgated under the Exchange Act); or
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(iii) Approval by the shareholders of the Company of a reorganization, merger
or consolidation (a “Business Combination”), in each case, with respect to which
all or substantially all holders of the Outstanding Capital Stock and Voting
Securities immediately prior to such Business Combination do not, following such
Business Combination, beneficially own, directly or indirectly, more than 60%
of, respectively, the then outstanding shares of common stock and the combined
voting power of the then outstanding voting securities entitled to vote
generally in the election of directors, as the case may be, of the corporation
resulting from the Business Combination; or
(iv) (a) a complete liquidation or dissolution of the Company or (b) a sale or
other disposition of all or substantially all of the assets of the Company other
than to a corporation with respect to which, following such sale or disposition,
more than 60% of respectively, the then outstanding shares of common stock and
the combined voting power of the then outstanding voting securities entitled to
vote generally in the election of directors is then owned beneficially, directly
or indirectly, by all or substantially all of the individuals and entities who
were the beneficial owners, respectively, of the Outstanding Capital Stock and
Voting Securities immediately prior to such sale or disposition in substantially
the same proportion as their ownership of the Outstanding Capital Stock and
Voting Securities, as the case may be, immediately prior to such sale or
disposition.
(v) The first purchase under a tender offer or exchange offer for 20% or more
of the outstanding shares of stock (or securities convertible into stock) of the
Company, other than an offer by the Company or any of its subsidiaries or any
employee benefit plan sponsored by the Company or any of its subsidiaries.
(c) For purposes of this Agreement, the term “Pending Change of Control”
shall mean the occurrence of one of the following events as the result of which
a Change in Control pursuant thereto is reasonably expected within ninety (90)
days after the date of determination as to whether there is a Pending Change in
Control: (i) the Company executes a letter of intent, term sheet or similar
instrument with respect to a transaction or series of transactions, the
consummation of which would result in a Change of Control; (ii) the Board
approves a transaction or series of transactions, the consummation of which
would result in a Change of Control; (iii) a Person makes a public announcement
of a tender offer for the Common Stock of the Company, the consummation of which
would result in a Change of Control; or (iv) a Person makes a public
announcement of, or makes a public filing with respect to, the intention of that
Person to seek to change the membership of the Board of Directors of the Company
in a manner that would result in a Change of Control. A Pending Change of
Control shall cease to exist upon a Change of Control.
19. Notices. Any notice required or permitted to be given
under this Agreement shall be sufficient if in writing and if sent by registered
or certified mail, return receipt requested to his residence in the case of the
Executive, or to its principal office in the case of the Company, or to such
other addresses as they may respectively designate in writing.
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20. Entire Agreement; Waiver. This Agreement contains the entire
understanding of the parties and may not be changed orally but only by an
agreement in writing, signed by the party against whom enforcement of any
waiver, change, modification or discharge is sought. Waiver of or failure to
exercise any rights provided by this Agreement in any respect shall not be
deemed a waiver of any further or future rights.
21. Binding Effect; Assignment. The rights and obligations of this Agreement
shall bind and inure to the benefit of any successor of the Company by
reorganization, merger or consolidation, or any assignee of all or substantially
all of the Company’s business or properties. The Executive’s rights hereunder
are personal to and shall not be transferable nor assignable by the Executive.
22. Headings. The headings contained in this Agreement are
for reference purposes only and shall not affect the meaning or interpretation
of this Agreement.
23. Governing Law; Arbitration. This Agreement shall be construed in
accordance with and governed for all purposes by the laws and public policy of
the State of Arizona applicable to contracts executed and to be wholly performed
within such state. Any dispute or controversy arising out of or relating to this
Agreement shall be settled by arbitration in accordance with the rules of the
American Arbitration Association and judgment upon the award may be entered in
any court having jurisdiction thereover. The arbitration shall be held in
Maricopa County or in such other place as the parties hereto may agree.
24. Further Assurances. Each of the parties agrees to execute,
acknowledge, deliver and perform, and cause to be executed, acknowledged,
delivered and performed, at any time and from time to time, all such further
acts, deeds, assignments, transfers, conveyances, powers of attorney and/or
assurances as may be necessary or proper to carry out the provisions or intent
of this Agreement.
25. Severability. The parties agree that if any one or more of
the terms, provisions, covenants or restrictions of this Agreement shall be
determined by a court of competent jurisdiction to be invalid, void or
unenforceable, the remainder of the terms, provisions, covenants and
restrictions of this Agreement shall remain in full force and effect and shall
in no way be affected, impaired or invalidated.
26. Counterparts. This Agreement may be executed in several
counterparts, each of which shall be deemed to be an original, but all of which
together will constitute one and the same Agreement.
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IN WITNESS WHEREOF, AMTECH SYSTEMS, INC. has
caused by instrument to be signed by a duly authorized officer and the Executive
has hereunto set his hand the day and year first above written.
| AMTECH SYSTEMS, INC. | |||
| By | |||
| Xxxxxxx X. Xxxxxxxx | Xxxx X. Xxxxx, Executive | ||
| Vice President and Chief Financial Officer | |||
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