Exhibit 10.4

 

ULTRATECH, INC.

 

RESTRICTED STOCK UNIT ISSUANCE AGREEMENT

 

RECITALS

 

A.            The Board has adopted the Plan for the purpose of retaining the
services of selected Employees and consultants and other independent advisors
who provide services to the Corporation (or any Parent or Subsidiary).

 

B.            Participant is to render valuable services to the Corporation (or
a Parent or Subsidiary), and this Agreement is executed pursuant to, and is
intended to carry out the purposes of, the Plan in connection with the
Corporation’s issuance of shares of Common Stock to the Participant under the
Stock Issuance Program.

 

C.            All capitalized terms in this Agreement shall have the meaning
assigned to them in the attached
Appendix A.

 

NOW, THEREFORE, it is hereby agreed as follows:

 

1.             Grant of Restricted Stock Units. The Corporation hereby awards to
the Participant, as of the Award Date, Restricted Stock Units under the Plan.
Each Restricted Stock Unit which vests during the Participant’s period of
Service shall entitle the Participant to receive one share of Common Stock on
the specified issuance date. The number of shares of Common Stock subject to the
awarded Restricted Stock Units, the applicable vesting schedule for those
shares, the date on which those vested shares shall become issuable to
Participant and the remaining terms and conditions governing the award (the
“Award”) shall be as set forth in this Agreement.

 

AWARD SUMMARY

 

Award Date:

                       , 200    

 

Number of Shares
Subject to Award:

 

                shares of Common Stock (the “Shares”)

 

Vesting Schedule:

The Shares shall vest in a series of          (    ) successive equal         
installments upon the Participant’s completion of each          of Service over
the          (    )-year period measured from         , 20    . However, the
Shares may be subject to accelerated vesting in whole or in part in accordance
with the provisions of Paragraphs 4 and 6 of this Agreement.

 

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Issuance Schedule

The Shares in which the Participant vests in accordance with the foregoing
Vesting Schedule will become issuable on the date (the “Issue Date”) upon which
occurs the earliest of the following dates or events: (i)         20    , (ii)
the date of the Participant’s Separation from Service or (iii) the closing date
of a Change in Control. The actual issuance of the Shares shall be subject to
the Corporation’s collection of all applicable Withholding Taxes and shall be
effected on the applicable Issue Date or as soon as administratively practicable
thereafter, but in no event later than the close of the calendar year in which
such Issue Date occurs or (if later) the fifteenth (15th) day of the third
calendar month following such Issue Date. The procedures pursuant to which the
applicable Withholding Taxes are to be collected are set forth in Paragraph 8 of
this Agreement.

 

2.             Limited Transferability. Prior to actual receipt of the Shares
which vest and become issuable hereunder, the Participant may not transfer any
interest in the Award or the underlying Shares. Any Shares which vest hereunder
but which otherwise remain unissued at the time of the Participant’s death may
be transferred pursuant to the provisions of the Participant’s will or the laws
of inheritance or to the Participant’s designated beneficiary or beneficiaries
of this Award. The Participant may also direct the Corporation to issue the
stock certificates for any Shares which in fact vest and become issuable under
the Award during his or her lifetime to one or more designated family members or
a trust established for the Participant and/or his or her family members. The
Participant may make such a beneficiary designation or certificate directive at
any time by filing the appropriate form with the Plan Administrator or its
designee.

 

3.             Cessation of Service. Except as otherwise provided in Paragraph 4
below, should the Participant cease Service for any reason prior to vesting in
one or more Shares subject to this Award, then the Award will be immediately
cancelled with respect to those unvested Shares, and the number of Restricted
Stock Units will be reduced accordingly. The Participant shall thereupon cease
to have any right or entitlement to receive any Shares under those cancelled
units. Should the Participant’s Service terminate by reason of a Termination for
Cause, then this Award will be immediately cancelled with respect to all the
Restricted Stock Units subject to such Award, whether vested or unvested at the
time, and the Participant shall thereupon cease to have any right or entitlement
to receive any Shares under this Award and the cancelled Restricted Stock Units.

 

4.             Accelerated Vesting. The following special vesting acceleration
provisions shall be in effect for the Award and shall be in addition to the
vesting acceleration provisions of Paragraph 6 of this Agreement:

 

(a)           Should the Participant terminate Service by reason of Retirement
or should the Participant’s Service terminate at or after attainment of age
sixty-five (65) by reason of death, Permanent Disability or Involuntary
Termination (other than a Termination for Cause), then all the Shares at the
time subject to this Award shall immediately vest.

 

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(b)           Should the Participant’s Service terminate prior to attainment of
age sixty-five (65) by reason of his or her death, Permanent Disability or
Involuntary Termination (other than a Termination for Cause), then the
Participant shall immediately vest in the additional number of Shares (if any)
in which the Participant would have been vested at the time of such termination
had the Shares subject to this Award vested in a series of                
(    ) successive equal            installments over the duration of the Vesting
Schedule.

 

(c)           The Shares which vest on an accelerated basis pursuant to this
Paragraph 4, together with any other Shares in which the Participant is at the
time vested, shall be issued on the date of the Participant’s Separation from
Service or as soon as administratively practicable thereafter, subject to the
Corporation’s collection of the applicable Withholding Taxes, but in no event
later than the close of the calendar year in which such Separation from Service
occurs or (if later) the fifteenth (15th) day of the third calendar month
following the date of such Separation from Service.

 

5.             Stockholder Rights and Dividend Equivalents

 

(a)           The holder of this Award shall not have any stockholder rights,
including voting or dividend rights, with respect to the Shares subject to the
Award until the Participant becomes the record holder of those Shares following
their actual issuance upon the Corporation’s collection of the applicable
Withholding Taxes.

 

(b)           Notwithstanding the foregoing, should any dividend or other
distribution, whether regular or extraordinary and whether payable in cash,
securities or other property, be declared and paid on the outstanding Common
Stock while one or more Shares remain subject to this Award (i.e., those Shares
are not otherwise issued and outstanding for purposes of entitlement to the
dividend or distribution), then a special book account shall be established for
the Participant and credited with a phantom dividend equal to the actual
dividend or distribution which would have been paid on the Shares at the time
subject to this Award had those Shares been issued and outstanding and entitled
to that dividend or distribution. The phantom dividend equivalents so credited
shall vest at the same time as the Shares to which they relate and shall be
distributed to the Participant (in the same form the actual dividend or
distribution was paid to the holders of the Common Stock entitled to that
dividend or distribution) concurrently with the issuance of those Shares on the
applicable Issue Date. However, each such distribution shall be subject to the
Corporation’s collection of the Withholding Taxes applicable to that
distribution.

 

6.             Change of Control.

 

(a)           Any Restricted Stock Units subject to this Award at the time of a
Change in Control will vest immediately prior to the closing of that Change in
Control. The Shares subject to those vested units, together with any other
Shares in which the Participant is at that time vested, will be issued on the
Issue Date triggered by the Change in Control (or otherwise converted into the
right to receive the same consideration per share of Common Stock

 

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payable to the other stockholders of the Corporation in consummation of that
Change in Control and distributed at the same time as such stockholder
payments), subject to the Corporation’s collection of the applicable Withholding
Taxes pursuant to the provisions of Paragraph 8.

(b)           This Agreement shall not in any way affect the right of the
Corporation to adjust, reclassify, reorganize or otherwise change its capital or
business structure or to merge, consolidate, dissolve, liquidate or sell or
transfer all or any part of its business or assets.

 

7.             Adjustment in Shares. Should any change be made to the Common
Stock by reason of any stock split, stock dividend, recapitalization,
combination of shares, exchange of shares or other change affecting the
outstanding Common Stock as a class without the Corporation’s receipt of
consideration, appropriate adjustments shall be made to the total number and/or
class of securities issuable pursuant to this Award in order to reflect such
change and thereby preclude a dilution or enlargement of benefits hereunder.

 

8.             Collection of Withholding Taxes.

 

(a)           The Corporation shall collect the employee portion of the FICA
taxes (Social Security and Medicare) with respect to the Shares at the time
those Shares vest hereunder. The FICA taxes shall be based on the Fair Market
Value of the Shares on their vesting date. The Corporation shall also collect
the employee portion of the FICA taxes with respect to any phantom dividends at
the time those phantom dividends vest hereunder. The FICA taxes shall be based
on the cash amount and the fair market value of any other property underlying
the phantom dividends on the vesting date. Unless the Participant delivers a
separate check payable to the Corporation in the amount of the FICA taxes
required to be withheld from the Participant, the Corporation shall withhold
those taxes from the Participant’s wages. However, if the Participant is at the
time an executive officer of the Corporation, then such withholding taxes must
be collected from the Participant through delivery of his or her separate check
not later than the vesting date.

 

(b)           The Corporation shall collect the federal, state and local income
taxes required to be withheld with respect to the distribution of the phantom
dividend equivalents to the Participant by withholding a portion of that
distribution equal to the amount of those taxes, with the cash portion of the
distribution to be the first portion so withheld. Until such time as the
Corporation provides the Participant with notice to the contrary, the
Corporation shall collect the federal, state and local income taxes required to
be withheld with respect to the issuance of the vested Shares hereunder through
an automatic Share withholding procedure pursuant to which the Corporation will
withhold, at the time of such issuance, a portion of the Shares with a Fair
Market Value (measured as of the issuance date) equal to the amount of those
taxes (the “Share Withholding Method”); provided, however, that the amount of
any Shares so withheld shall not exceed the amount necessary to satisfy the
Corporation’s required tax withholding obligations using the minimum statutory
withholding rates for federal and state tax purposes that are applicable to
supplemental taxable income. Participant shall be notified in writing in the
event such Share Withholding Method is no longer available.

 

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(c)           Should any Shares be distributed at time the Share Withholding
Method is not available, then the federal, state and local income taxes required
to be withheld with respect to those Shares shall be collected from the
Participant through either of the following alternatives:

 

•              the Participant’s delivery of his or her separate check payable
to the Corporation in the amount of such Withholding Taxes, or

 

•              the use of the proceeds from a next-day sale of the Shares issued
to the Participant, provided and only if (i) such a sale is permissible under
the Corporation’s trading policies governing the sale of Common Stock, (ii) the
Participant makes an irrevocable commitment, on or before the Issue Date for
those Shares, to effect such sale of the Shares and (iii) the transaction is not
otherwise deemed to constitute a prohibited loan under Section 402 of the
Sarbanes-Oxley Act of 2002.

 

(d)           Except as otherwise provided in Paragraph 6 and Paragraph 8(b),
the settlement of all Restricted Stock Units which vest under the Award shall be
made solely in shares of Common Stock. In no event, however, shall any
fractional shares be issued. Accordingly, the total number of shares of Common
Stock to be issued pursuant to the Award shall, to the extent necessary, be
rounded down to the next whole share in order to avoid the issuance of a
fractional share.

 

9.             Deferred Issue Date. Notwithstanding any provision to the
contrary in this Agreement, no Shares which become issuable by reason of the
Participant’s Separation from Service shall actually be issued to a Participant
prior to the earlier of (i) the expiration of the six (6)-month period measured
from the date of his or her Separation from Service or (ii) the date of his or
her death, if the Participant is deemed at the time of such Separation from
Service to be a “key employee” within the meaning of that term under Code
Section 416(i) and such delayed issuance is otherwise required in order to avoid
a prohibited distribution under Code Section 409A(a)(2). Upon the expiration of
the applicable Code Section 409A(a)(2) deferral period, all Shares deferred
pursuant to this Paragraph 9 shall be issued in a lump sum to the Participant.

 

10.           Benefit Limit. In the event the vesting and issuance of the Shares
subject to this Award would otherwise constitute a parachute payment under Code
Section 280G, then the vesting and issuance of those Shares shall be subject to
reduction to the extent necessary to assure that the number of Shares which vest
and are issued under this Award will be limited to the greater of (i)  the
number of Shares which can vest and be issued without triggering a parachute
payment under Code Section 280G or (ii)  the maximum number of Shares which can
vest and be issued under this Award so as to provide the Participant with the
greatest after-tax amount of such vested and issued Shares after taking into
account any excise tax the Participant may incur under Code Section 4999 with
respect to those Shares and any other benefits or payments to which the
Participant may be entitled in connection with any change in control or
ownership of the Corporation or the subsequent termination of the Participant’s
Service.

 

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11.           Compliance with Laws and Regulations. The issuance of shares of
Common Stock pursuant to the Award shall be subject to compliance by the
Corporation and Participant with all applicable requirements of law relating
thereto and with all applicable regulations of any stock exchange (or the Nasdaq
National Market, if applicable) on which the Common Stock may be listed for
trading at the time of such issuance.

 

12.           Notices. Any notice required to be given or delivered to the
Corporation under the terms of this Agreement shall be in writing and addressed
to the Corporation at its principal corporate offices. Any notice required to be
given or delivered to Participant shall be in writing and addressed to
Participant at the address indicated below Participant’s signature line on this
Agreement. All notices shall be deemed effective upon personal delivery or upon
deposit in the U.S. mail, postage prepaid and properly addressed to the party to
be notified.

 

13.           Successors and Assigns. Except to the extent otherwise provided in
this Agreement, the provisions of this Agreement shall inure to the benefit of,
and be binding upon, the Corporation and its successors and assigns and
Participant, Participant’s assigns, the legal representatives, heirs and
legatees of Participant’s estate and any beneficiaries of the Award designated
by Participant.

 

14.           Construction. This Agreement and the Award evidenced hereby are
made and granted pursuant to the Plan and are in all respects limited by and
subject to the terms of the Plan. All decisions of the Plan Administrator with
respect to any question or issue arising under the Plan or this Agreement shall
be conclusive and binding on all persons having an interest in the Award.

 

15.           Governing Law. The interpretation, performance and enforcement of
this Agreement shall be governed by the laws of the State of California without
resort to that State’s conflict-of-laws rules.

 

16.           Employment at Will. Nothing in this Agreement or in the Plan shall
confer upon Participant any right to continue in Service for any period of
specific duration or interfere with or otherwise restrict in any way the rights
of the Corporation (or any Parent or Subsidiary employing or retaining
Participant) or of Participant, which rights are hereby expressly reserved by
each, to terminate Participant’s Service at any time for any reason, with or
without cause.

 

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IN WITNESS WHEREOF, the parties have executed this Agreement on the day and year
first indicated above.

 

 

ULTRATECH, INC.

 

 

 

 

 

By:

 

 

 

 

Title:

 

 

 

 

 

 

PARTICIPANT

 

 

 

 

 

Signature:

 

 

 

 

 

Address:

 

 

 

 

 

 

 

 

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APPENDIX A

 

DEFINITIONS

 

The following definitions shall be in effect under the Agreement:

 

A.            Agreement shall mean this Restricted Stock Unit Issuance
Agreement.

 

B.            Award shall mean the award of Restricted Stock Units made to the
Participant pursuant to the terms of this Agreement.

 

C.            Award Date shall mean the date the Restricted Stock Units are
awarded to Participant pursuant to the Agreement and shall be the date indicated
in Paragraph 1 of the Agreement.

 

D.            Board shall mean the Corporation’s Board of Directors.

 

E.             Change in Control shall mean a change in ownership or control of
the Corporation effected through any of the following transactions:

 

(i)            a merger or consolidation in which the Corporation is not the
surviving entity and in which securities possessing more than fifty percent
(50%) of the total combined voting power of the Corporation’s outstanding
securities are transferred to person or persons different from the persons
holding those securities immediately prior to such merger or consolidation,

 

(ii)           the sale, transfer or other disposition of all or substantially
all of the assets of the Corporation in complete liquidation or dissolution of
the Corporation, or

 

(iii)          any reverse merger in which the Corporation is the surviving
entity but in which securities possessing more than fifty percent (50%) of the
total combined voting power of the Corporation’s outstanding securities are
transferred to person or persons different from the persons holding those
securities immediately prior to such merger.

 

(iv)          the acquisition, directly or indirectly by any person or related
group of persons (other than the Corporation or a person that directly or
indirectly controls, is controlled by, or is under common control with, the
Corporation), of beneficial ownership (within the meaning of Rule 13d-3 of the
1934 Act) of securities possessing more than fifty percent (50%) of the total
combined voting power of the Corporation’s outstanding securities pursuant to a
tender or exchange offer made directly to the Corporation’s stockholders, or

 

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(v)           a change in the composition of the Board over a period of twelve
(12) consecutive months or less such that a majority of the Board members
ceases, by reason of one or more contested elections for Board membership, to be
comprised of individuals who either (A) have been Board members continuously
since the beginning of such period or (B) have been elected or nominated for
election as Board members during such period by at least a majority of the Board
members described in clause (A) who were still in office at the time the Board
approved such election or nomination.

 

F.             Code shall mean the Internal Revenue Code of 1986, as amended.

 

G.            Common Stock shall mean shares of the Corporation’s common stock.

 

H.            Corporation shall mean Ultratech, Inc., a Delaware corporation,
and any successor corporation to all or substantially all of the assets or
voting stock of Ultratech, Inc. which shall by appropriate action adopt the
Plan.

 

I.              Employee shall mean an individual who is in the employ of the
Corporation (or any Parent or Subsidiary), subject to the control and direction
of the employer entity as to both the work to be performed and the manner and
method of performance.

 

J.             Fair Market Value per share of Common Stock on any relevant date
shall be determined in accordance with the following provisions:

 

(i)            If the Common Stock is not at the time listed or admitted to
trading on any Stock Exchange but is traded on the Nasdaq National Market, the
Fair Market Value shall be the closing selling price per share on the date in
question, as such price is reported by the National Association of Securities
Dealers on the Nasdaq National Market or any successor system. If there is no
reported closing selling price for the Common Stock on the date in question,
then the closing selling price on the last preceding date for which such
quotation exists shall be determinative of Fair Market Value.

 

(ii)           If the Common Stock is at the time listed or admitted to trading
on any Stock Exchange, then the Fair Market Value shall be the closing selling
price per share on the date in question on that Stock Exchange, as such price is
officially quoted in the composite tape of transactions on such exchange. If
there is no reported sale of Common Stock on such Stock Exchange on the date in
question, then the Fair Market Value shall be the closing selling price on the
exchange on the last preceding date for which such quotation exists.

 

K.            Involuntary Termination shall mean the termination of the
Participant’s Service which occurs by reason of:

 

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(i)            such individual’s involuntary dismissal or discharge by the
Corporation (or any Parent or Subsidiary) for reasons other than a Termination
for Cause, or

 

(ii)           such individual’s voluntary resignation following (A) a change in
his or her position with the Corporation (or any Parent or Subsidiary) which
materially reduces his or her duties and responsibilities or the level of
management to which he or she reports, (B) a reduction in his or her rate of
base salary or target bonus under any corporate-performance based bonus or
incentive programs by more than fifteen percent (15%) or (C) a relocation of
such individual’s place of employment by more than sixty (60) miles, provided
and only if such change, reduction or relocation is effected by the Corporation
(or any Parent or Subsidiary) without the individual’s consent.

 

L.             1934 Act shall mean the Securities Exchange Act of 1934, as
amended from time to time.

 

M.           Participant shall mean the person to whom the Award is made
pursuant to the Agreement.

 

N.            Parent shall mean any corporation (other than the Corporation) in
an unbroken chain of corporations ending with the Corporation, provided each
corporation in the unbroken chain (other than the Corporation) owns, at the time
of the determination, stock possessing fifty percent (50%) or more of the total
combined voting power of all classes of stock in one of the other corporations
in such chain.

 

O.            Permanent Disability shall mean the Participant’s inability to
engage in any substantial gainful activity by reason of any medically
determinable physical or mental impairment expected to result in death or to be
of continuous duration of twelve (12) months or more.

 

P.             Plan shall mean the Corporation’s 1993 Stock Option/Stock
Issuance Plan, as amended and restated.

 

Q.            Plan Administrator shall mean either the Board or a committee of
the Board acting in its capacity as administrator of the Plan.

 

R.            Restricted Stock Unit shall mean each unit subject to this Award
which shall entitle the Participant to receive one share of Common Stock under
the Plan at a designated time following the vesting of that unit.

 

S.             Retirement shall mean the Participant’s voluntary termination
from Service on or after his or her attainment of age sixty five (65) other than
in connection with a Termination for Cause event

 

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T.            Separation from Service shall mean the Participant’s termination
of Service under circumstances which are deemed to constitute a separation from
service within the meaning of Code Section 409A and the applicable Treasury
Regulations thereunder.

 

U.            Service shall mean the Participant’s performance of services for
the Corporation (or any Parent or Subsidiary) in the capacity of an Employee, a
non-employee member of the board of directors or a consultant or independent
advisor. For purposes of this Agreement, Participant shall be deemed to cease
Service immediately upon the occurrence of the either of the following events:
(i) Participant no longer performs services in any of the foregoing capacities
for the Corporation (or any Parent or Subsidiary) or (ii) the entity for which
Participant performs such services ceases to remain a Parent or Subsidiary of
the Corporation, even though Participant may subsequently continue to perform
services for that entity. Service shall not be deemed to cease during a period
of military leave, sick leave or other personal leave approved by the
Corporation; provided, however, that except to the extent otherwise required by
law or expressly authorized by the Plan Administrator or the Corporation’s
written leave of absence policy, no Service credit shall be given for vesting
purposes for any period the Participant is on a leave of absence.

 

V.            Stock Exchange shall mean the American Stock Exchange or the New
York Stock Exchange.

 

W.           Subsidiary shall mean any corporation (other than the Corporation)
in an unbroken chain of corporations beginning with the Corporation, provided
each corporation (other than the last corporation) in the unbroken chain owns,
at the time of the determination, stock possessing fifty percent (50%) or more
of the total combined voting power of all classes of stock in one of the other
corporations in such chain.

 

X.            Termination for Cause shall mean the termination of the
Participant’s Service by the Corporation (or any Parent or Subsidiary) for one
or more of the following reasons:

 

(i)            the Participant’s repeated failure to perform any essential duty
of his or her position other than due to Permanent Disability;

 

(ii)           the Participant’s commission of any act that constitutes gross
misconduct and is injurious to the Corporation or any Parent or Subsidiary or
any successor to the Corporation;

 

(iii)          the Participant’s conviction of or pleading guilty or nolo
contendere to any felony involving theft, embezzlement, dishonesty or moral
turpitude;

 

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(iv)          the Participant’s commission of any act of fraud against, or the
misappropriation of property belonging to, the Corporation or any Parent or
Subsidiary or any successor to the Corporation;

 

(v)           the Participant’s commission of any act of dishonesty in
connection with his or her responsibilities as an employee that is intended to
result in his or her personal enrichment or the personal enrichment of his or
her family or others;

 

(vi)          any other intentional misconduct by the Participant adversely
affecting the business or affairs of the Corporation in a material manner; or

 

(vii)         the Participant’s material breach of any employment agreement he
or she may have at the time with the Corporation or any other agreement between
the Participant and the Corporation or any Parent or Subsidiary or successor to
the Corporation.

 

Y.            Withholding Taxes shall mean (i) the employee portion of the
federal, state and local employment taxes required to be withheld by the
Corporation in connection with the vesting of the shares of Common Stock under
the Award and any phantom dividend equivalents relating to those shares and (ii)
the federal, state and local income taxes required to be withheld by the
Corporation in connection with the issuance of those vested shares and the
distribution of any phantom dividend equivalents relating to such shares.

 

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