Exhibit 10.4

VARIAN SEMICONDUCTOR EQUIPMENT ASSOCIATES, INC.

Restricted Stock Agreement

Granted Under 2006 Stock Incentive Plan

This agreement evidences the grant by Varian Semiconductor Equipment Associates,
Inc., a Delaware corporation (the “Company”) on [            ], 200[ ] (the
“Grant Date”) to ________________________ (the “Participant”) [            ]
shares (the “Shares”) of common stock, par value $0.01 per share, of the Company
(the “Common Stock”), as “Restricted Stock” under the Company’s 2006 Stock
Incentive Plan (the “Plan”). Subject to the provisions of Appendix A (attached
hereto) and of the Plan, the Restricted Stock shall vest in thirteen
(13) installments. The vesting schedule is as follows:

 

Total Number of Shares of Restricted Stock: [            ]

  

Scheduled Vesting Dates:

  

Percentage of Shares:

First anniversary of Grant Date

  

25% of Shares

End of each successive three-month period following the

  

first anniversary of Grant Date until the fourth anniversary

  

of Grant Date:

  

6.25% of Shares

Your online acceptance indicates your agreement and understanding that this
grant is subject to all the terms and conditions contained in Appendix A and the
Plan. PLEASE BE SURE TO READ ALL OF APPENDIX A, WHICH CONTAINS THE SPECIFIC
TERMS AND CONDITIONS OF THIS AGREEMENT.

 

VARIAN SEMICONDUCTOR

EQUIPMENT ASSOCIATES, INC.

   

        Gary E. Dickerson

        Chief Executive Officer

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APPENDIX A

TERMS AND CONDITIONS OF RESTRICTED STOCK AGREEMENT

 

1. Issuance of Shares.

The Company shall issue to the Participant in consideration for the
Participant’s past services and as a separate incentive in connection with his
or her employment and not in lieu of any salary or other compensation for his or
her services, subject to the terms and conditions set forth in this Agreement
and in the Plan, ______ Shares of Common Stock. The Shares will be held in book
entry by the Company’s transfer agent in the name of the Participant for that
number of Shares issued to the Participant. The Company shall not be required
(i) to transfer on its books any of the Shares that have been transferred in
violation of any of the provisions set forth in this Agreement or (ii) to treat
as the owner of such Shares, or to pay dividends to, any transferee to whom such
Shares have been transferred in violation of any of the provisions of this
Agreement. The Participant agrees that the Shares shall be subject to Forfeiture
as set forth in Section 2 of this Agreement and the restrictions on transfer set
forth in Section 3 of this Agreement.

 

2. Forfeiture.

 

  (a) Except as otherwise provided in this Agreement or any other agreement
between the Participant and the Company, the balance of the Shares that are
Unvested Shares (as defined below) at the time of the Participant’s termination
of employment with the Company shall thereupon be forfeited and automatically
transferred to and reacquired by the Company at no cost to the Company
(“Forfeiture”). The Participant hereby appoints the Secretary of the Company
with full power of substitution, as the Participant’s true and lawful
attorney-in-fact with irrevocable power and authority in the name and on behalf
of the Participant to take any action and execute all documents and instruments,
including, without limitation, stock powers that may be necessary to transfer
the Shares to the Company upon such termination of employment.

“Unvested Shares” means the total number of Shares multiplied by the Applicable
Percentage at the time of Forfeiture. The “Applicable Percentage” shall be
(i) 100% during the 12-month period ending ____________, 200_, (ii) [75%] less
[6.25%] for each three months of employment completed by the Participant with
the Company from and after _________, 200_, and (iii) zero on or after ________,
200__.

 

  (b) In the event that the Participant’s employment with the Company terminates
by reason of the Participant’s disability (within the meaning of
Section 22(e)(3) of the Internal Revenue Code of 1986 (the “Code”), provided
that the Board of Directors of the Company (the “Board”) in its discretion may
determine whether a disability exists in accordance with uniform and
non-discriminatory standards adopted by the Board from time to time), death or
Retirement (as defined pursuant to the Company’s or the Board’s Retirement
Policies, as they may be established from time to time), the balance of the
Shares that have not vested as of immediately prior to the Participant’s death,
disability or Retirement shall be fully vested effective as of the date of such
death, disability or Retirement.

 

  (c) If the Participant is employed by a parent or subsidiary of the Company,
any references in this Agreement to employment with the Company or termination
of employment by or with the Company shall instead be deemed to refer to such
parent or subsidiary.

 

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3. Restrictions on Transfer.

 

  (a) The Participant shall not sell, assign, transfer, pledge, hypothecate or
otherwise dispose of, by operation of law or otherwise (collectively “transfer”)
any Shares, or any interest therein, that are subject to Forfeiture, except that
the Participant may transfer such Shares (i) to or for the benefit of any
spouse, children, parents, siblings, grandchildren and any other relatives
approved by the Board (collectively, “Approved Relatives”) or to a trust
established solely for the benefit of the Participant and/or Approved Relatives,
provided that such Shares shall remain subject to this Agreement (including
without limitation the restrictions on transfer set forth in this Section 3 and
Forfeiture) 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
or (ii) as part of the sale of all or substantially all of the shares of capital
stock of the Company (including pursuant to a merger or consolidation), provided
that, in accordance with the Plan, the securities or other property received by
the Participant in connection with such transaction shall remain subject to this
Agreement.

 

4. Provisions of the Plan.

 

  (a) This Agreement is subject to the provisions of the Plan, a copy of which
is furnished to the Participant with this Agreement.

 

  (b) As provided in the Plan, upon the occurrence of a Reorganization Event (as
defined in the Plan), the repurchase and other rights of the Company hereunder
shall inure to the benefit of the Company’s successor and shall apply to the
cash, securities or other property which the Shares were converted into or
exchanged for pursuant to such Reorganization Event in the same manner and to
the same extent as they applied to the Shares under this Agreement. If, in
connection with a Reorganization Event, a portion of the cash, securities and/or
other property received upon the conversion or exchange of the Shares is to be
placed into escrow to secure indemnification or similar obligations, the mix
between the vested and unvested portion of such cash, securities and/or other
property that is placed into escrow shall be the same as the mix between the
vested and unvested portion of such cash, securities and/or other property that
is not subject to escrow.

 

5. Withholding Taxes; Section 83(b) Election.

 

  (a) The Participant acknowledges and agrees that the Company has the right to
deduct from payments of any kind otherwise due to the Participant any federal,
state or local taxes of any kind required by law to be withheld with respect to
the issuance of the Shares to the Participant or the vesting of any Shares. The
Participant acknowledges and agrees that the Company may elect to satisfy any
such income tax withholding requirement by causing Shares to be sold on the
Participant’s behalf at each vesting date in an amount sufficient to satisfy any
tax withholding resulting from such vesting.

 

  (b) The Participant has reviewed with the Participant’s own tax advisors the
federal, state, local and foreign tax consequences of this investment 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 investment or the transactions contemplated by this
Agreement. The Participant understands that it may be beneficial in many
circumstances to elect to be taxed at the time the Shares are purchased rather
than when and as the Company’s Purchase Option expires by filing an election
under Section 83(b) of the Code with the I.R.S. within 30 days from the date of
purchase.

 

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THE PARTICIPANT ACKNOWLEDGES THAT IT IS SOLELY THE PARTICIPANT’S RESPONSIBILITY
AND NOT THE COMPANY’S TO FILE TIMELY THE ELECTION UNDER SECTION 83(b), EVEN IF
THE PARTICIPANT REQUESTS THE COMPANY OR ITS REPRESENTATIVES TO MAKE THIS FILING
ON THE PARTICIPANT’S BEHALF.

 

6. Miscellaneous.

 

  (a) No Rights to Employment. The Participant acknowledges and agrees that the
vesting of the Shares pursuant to Section 2 hereof is earned only by continuing
service as an employee at the will of the Company (not through the act of being
hired or being issued Shares hereunder). 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.

 

  (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 3 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 6(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.

 

  (g) 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.

 

  (h) Amendment. This Agreement may be amended or modified only by a written
instrument executed by both the Company and the Participant.

 

  (i) Governing Law. This Agreement shall be construed, interpreted and enforced
in accordance with the internal laws of the State of Delaware without regard to
any applicable conflicts of laws.

 

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