**Exhibit10.2*** Text Omitted and Filed SeparatelyPursuant to a Confidential Treatment Requestunder 17 C.F.R. §§ 200.80(b)(4) and 240.24b-2(b)(1)**

**AMENDED AND RESTATED**

**JOINT VENTURE AGREEMENT**

**AMONG**

**TCZ GMBH**

**CYMER, INC.**

**CARL ZEISS SMT AG**

**CARL ZEISS LASER OPTICS BETEILIGUNGSGESELLSCHAFTMBH**

**AND**

**TCZ PTE. LTD.**

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**TABLE OFCONTENTS**
|            | ** ** | ** **                                  | **Page** |
|------------|------------|---------------------------------------------|----------|
| ARTICLE 1  |       | Definitions                                 |     | 2 |
| ARTICLE 2  |       | Representations and Warranties              |     | 6 |
| ARTICLE 3  |       | Purposes of the Company                     |     | 7 |
| ARTICLE 4  |       | Percentage Interests; Capital Contributions |     | 8 |
| ARTICLE 5  |       | Distributions                               |     | 9 |
| ARTICLE 6  |       | Corporate Governance                        |     | 10 |
| ARTICLE 7  |       | Accounting and Tax Matters                  |     | 16 |
| ARTICLE 8  |       | Certain Covenants                           |     | 17 |
| ARTICLE 9  |       | Exculpation and Indemnification             |     | 18 |
| ARTICLE 10 |       | Disposition of Interests                    |     | 18 |
| ARTICLE 11 |       | Termination, Dissolution and Liquidation    |     | 20 |
| ARTICLE 12 |       | Miscellaneous                               |     | 24 |

 

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## ** **

## **AMENDED AND RESTATED**

**JOINT VENTURE AGREEMENT**

ThisAmended and Restated Joint Venture Agreement is made on 12 September 2006amongst:

(1)                                  **TCZ GmbH** of Bionstrasse 5, 9015 St. Gallen, Switzerland (“**TCZ Switzerland**”);

(2)                                  **Cymer, Inc.**, a Nevada corporation (“**Cymer**”);

(3)                                  **Carl Zeiss SMT AG**, a stock corporation organized under thelaws of Germany (“**Zeiss SMT**”);

(4)                                  **Carl Zeiss Laser Optics Beteiligungsgesellschaft mbH**, alimited liability company organized under the laws of Germany and an indirectwholly-owned subsidiary of Zeiss SMT (“**Zeiss LOB**”);and

(5)                                  **TCZ Pte. Ltd.**, a company incorporated inSingapore (registration no. 200609581M), whose registered office is at 1Temasek Avenue #27-01, Singapore 039192 (the “**Company**”);

Capitalized termsused herein but not defined when used have the meanings assigned to such termsin Article 1.

**RECITALS:**

(A)                              On15 July 2005, TCZ Switzerland, Cymer, Zeiss SMT and Zeiss LOB entered into ajoint venture agreement (as amended by an amendment agreement no. 1 dated 16September 2005 entered into amongst the parties) (together, the “**Original JV Agreement**”) to establish TCZ Switzerland as ajoint venture to develop, integrate, market, sell and support tools employing abeam generated by an excimer laser to induce crystallization for LowTemperature Poly-Silicon (LTPS) processing (the “**Products**”)for the manufacture of flat panel displays, including LCDs, LCD SOGs and OLEDs,to engage in related application development and to search for other businessopportunities for process tools for the manufacture of flat panel displays.

(B)                                TheOriginal JV Agreement provided for (i) the governance of the affairs of TCZSwitzerland, (ii) the rights, obligations and understandings of Cymer and ZeissLOB in relation to TCZ Switzerland and (iii) the [ . . . ***  . . .] under the Original JV Agreement.

(C)                                Cymer,Zeiss SMT and Zeiss LOB have agreed to move their joint venture vehicle toSingapore in the form of the Company with effect from 12 September 2006 (orsuch other date as may be agreed amongst the parties) (the “**Effective Date**”) and in this regard, are desirous ofamending and restating the Original JV Agreement in the manner provided herein.

 

*****Confidential Treatment Requested**

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(D)                               Asat the date of this Agreement, the Company has a paid-in capital of [ . . . ***  . . .] consisting of [ . . . ***  . . .]****shares ofwhich [ . . . ***  . . .] shares are held by Cymer and [ . . . ***  . . .] shares are held by Zeiss LOB.

(E)                                 Forthe avoidance of doubt, the Original JV Agreement remains in full force andeffect as amongst TCZ Switzerland, Cymer, Zeiss SMT and Zeiss LOB until thisAmended and Restated Joint Venture Agreement is deemed to take effect as of theEffective Date.

NOW, THEREFORE,the parties hereto agree as follows:

ARTICLE1 DEFINITIONS

Section 1.01.          *Definitions. *(a) Asused herein, the following terms have the following meanings:

“**ACRA**” means the Accounting & Corporate RegulatoryAuthority of Singapore.

“**Act**” means the Companies Act (Chapter 50 of Singapore), asamended, supplemented or otherwise modified from time to time.

“**Additional Funding Date**” means 13 September****2006 (or such other date as may be agreed by and among theparties).

“**Administrative Services Agreements**” means the AdministrativeServices Agreement dated as of 16 September 2005 entered into between Cymer andTCZ Switzerland (which has been novated to the Company by way of a deed ofnovation executed on or around the Effective Date), as amended, supplemented orotherwise modified from time to time.

“**Affiliate**” means, with respect to any Person, any otherPerson directly or indirectly controlling, controlled by or under commoncontrol with such Person.  As usedherein, “**control**” (and the derivative terms “**controlling**” and “**controlled**”)means the direct or indirect ownership of more than fifty percent (50%) of theequity securities or other ownership interests and voting rights of, and thepossession, direct or indirect, of the power to direct or cause the directionof the management and policies of a person, whether through the ownership ofvoting securities, by contract or otherwise. No party or its Affiliates shall by reason of this Agreement be deemedto be an affiliate of the other party or its Affiliates.  The term “**affiliated**”shall have a corresponding meaning. Notwithstanding the foregoing definition, when used with respect toZeiss SMT or Zeiss LOB, the term “**Affiliate**”shall exclusively mean (a) Zeiss SMT and any Person under the control of ZeissSMT and (b) IMT and any Person under the control of IMT.  Notwithstanding the foregoing definition, forpurposes of this Agreement, the Company and its subsidiaries shall not beconsidered an Affiliate of either Member.

“**Agreement**” means this Joint Venture Agreement, as amended,supplemented or otherwise modified from time to time.

 

*****Confidential Treatment Requested**

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“**Area of Responsibility**” means each area of the R&DEffort in which one Member or the Company has primary responsibility fordirecting and carrying out research, as specified from time to time in the thencurrent Business Plan.

“**Budget Year**” means the period commencing on the date of thisAgreement and ending on December 31, 2006 and each successive one-year periodthereafter.

“**Capital Call Notice**” means a written request delivered bythe Company to each Member from time to time requesting that each Memberprovide funds to the Company.  Suchnotice shall specify in reasonable detail (i) the amount being requested, (ii)the Company’s anticipated use of funds and the timing of such use, and (iii)wire transfer instructions.

“**Confidentiality Agreement**” means the ConfidentialityAgreement dated as of 16 September 2005 entered into among Cymer, Zeiss SMT,IMT and TCZ Switzerland (which has been novated to the Company by way of a deedof novation executed on or around the Effective Date), as amended, supplementedor otherwise modified from time to time.

“**Cymer Supply Agreement**” means the Supply Agreement dated asof 16 September 2005 entered into between Cymer and TCZ Switzerland (which hasbeen novated to the Company by way of a deed of novation executed on or aroundthe Effective Date), as amended, supplemented or otherwise modified from timeto time.

“**Deliverable**” means work product or deliverables of any typeto be developed or delivered by a Member during the course of a Project.

“**Facilities License Agreement**” means the Facilities LicenseAgreement entered into between TCZ USA LLC and Cymer relating to use by TCZ USALLC of certain facilities in the United States, as amended, supplemented orotherwise modified from time to time.

“**FRS**” meansFinancial Reporting Standards, which Singapore-incorporated companies areobliged to follow in preparing their accounts and which are set out in theCompanies (Accounting Standards) Regulations.

“**GAAP**”means United States generally accepted accounting principles, consistentlyapplied.

“**IMT**” means Carl Zeiss Industrielle Messtechnik GmbH.

“**IMT IP Side Letter**” means the side letter to theIntellectual Property Agreement dated 16 September 2005 executed by IMT (whichhas been novated to the Company by way of a deed of novation executed on oraround the Effective Date), as amended, supplemented or otherwise modified fromtime to time.

“**Intellectual Property Agreement**” means the intellectualproperty agreement dated as of 16 September 2005 among TCZ Switzerland, Cymerand Zeiss SMT (which has been novated to the Company by way of a deed ofnovation executed on or around the Effective Date), as amended, supplemented orotherwise modified from time to time.

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 “**Intellectual Property**”means any or all of the following: (i) works of authorship, including, withoutlimitation, computer programs, algorithms, routines, source code and executablecode, whether embodied in software, firmware or otherwise, documentation,designs, files, records and data, (ii) inventions (whether or not patentable),improvements, and technology, (iii) proprietary and confidential information,including, without limitation, technical data and customer and supplier lists,trade secrets, know-how and techniques, (iv) databases, data compilations andcollections and technical data, (v) logos, trade names, trade dress, trademarksand service marks, (vi) domain names, web addresses and sites, (vii) tools,methods, processes, devices, prototypes, schematics and test methodologies, and(viii) any and all instantiations of the foregoing in any form and embodied inany media.

“**Intellectual Property Rights**” means any or all of thefollowing and all rights in, arising out of, or associated therewith, whetherarising from statute or common law: (i) all United States and foreign patentsand utility models and applications therefor and all reissues, divisions,re-examinations, renewals, extensions, provisionals, continuations andcontinuations-in-part thereof, and equivalent or similar rights anywhere in theworld in inventions and discoveries, including, without limitation, inventiondisclosures, (ii) all trade secrets and other rights in know-how andconfidential or proprietary information, (iii) all copyrights, copyright registrationsand applications therefor and all other rights corresponding thereto throughoutthe world, (iv) all industrial designs and any registrations and applicationstherefor throughout the world, (v) all rights in World Wide Web addresses anddomain names and applications and registrations therefor, all trade names,logos, common law trademarks and service marks, trademark and service markregistrations and applications therefor and all goodwill associated therewiththroughout the world, and (vi) any similar, corresponding or equivalent rightsto any of the foregoing throughout the world.

“**Interest**” means, with respect to any Member, the aggregateshares in the Company held by such Member.

“**Joint Venture Documents**” means, collectively, thisAgreement, the Intellectual Property Agreement, the Supply Agreements, theAdministrative Services Agreements, the Facilities License Agreement and theConfidentiality Agreement.

“**Member**” means Cymer, Zeiss LOB or any other Person who, atsuch time, is admitted to the Company as a Member in accordance with the termsof this Agreement, each in its capacity as a shareholder of the Company.

“**Members Meeting**” means a meeting of the Members held inaccordance with the provisions of this Agreement, the Singapore Corporate Documentsand the Act.

“**Member Parent**” means, with respect to any Member, (i) in the case of Cymer or anyMember that is an Affiliate of Cymer, Cymer, Inc., (ii) in the case of ZeissLOB or any Member that is an Affiliate of Zeiss SMT, Carl Zeiss SMT AG and (iii)in the case of any Member that is not an Affiliate of either Cymer or ZeissSMT, the ultimate parent company of such Member.

“**Net Income**” shall mean, for any period, the Company’s netincome as determined under FRS.

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“**Percentage Interest**” means, with respect to any Member, suchMember’s percentage Interest as set forth in Section 4.01.

“**Person**” means an individual, corporation, partnership,association, trust, limited liability company or any other entity ororganization, including a government or political subdivision or an agency orinstrumentality thereof.

“**R&D Effort**” means research and development undertaken byeither Member reasonably related to the Business.

“**subsidiary**” bears the same meaning as set out in section 5of the Act.

“**Supplier**” means, with respect to any Supply Agreement, thePerson identified as the Supplier in such Supply Agreement, including anytransferee of all or substantially all of the assets of a Supplier that hasassumed such Supply Agreement in accordance therewith.

“**Supply Agreements**” means the Cymer Supply Agreement and theZeiss Supply Agreement.

“**S$**” or “**$**” means thelawful currency of the Republic of Singapore.

“**Transfer**” means any direct or indirect sale, assignment,disposition, exchange, mortgage, pledge or grant of a security interest in,foreclosure or any other transfer of any portion of, or economic or votinginterest in, an Interest, but shall not include any sale, assignment,disposition, exchange, mortgage, pledge or grant of a security interest in,foreclosure or any other transfer of any capital stock of a Member Parent.  A “Transfer” shall also include any sale,assignment or other transfer by a Member Parent of any direct or indirectinterest in the Member that is its Affiliate. When used as a verb, the term “Transfer” refers to entering into anytransaction or series of transactions that results in a “Transfer.”

“**US$**” means the lawful currency of the United States ofAmerica.

“**Work Plan**” means a mutually agreed written schedule settingforth a description of a Project to be performed under this Agreement.

“**Zeiss Supply Agreement**” means the Supply Agreement dated asof 16 September 2005 entered into between Carl Zeiss Laser Optics GmbH and TCZSwitzerland (which has been novated to the Company by way of a deed of novationexecuted on or around the Effective Date), as amended, supplemented orotherwise modified from time to time.

(b)           Eachof the following additional terms is defined in the Section set forth oppositesuch term:

| Term                                          | ** ** | **Section** |
|-----------------------------------------------|------------|-------------|
| Annual Maximum  Required Funding Contribution |       | 4.02(a)     |
| Board                                         |       | 6.01(a)     |
| Business                                      |       | 3.02        |
| Business Plan                                 |       | 6.03(a)     |

 

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| Term                              | ** ** | **Section** |
|-----------------------------------|------------|-------------|
| Chief Executive  Officer          |       | 6.01(a)     |
| Company                           |       | Preamble    |
| Director                          |       | 6.01(a)     |
| Fiscal Year                       |       | 7.01        |
| Gate Reviews                      |       | 6.03(a)     |
| Liquidating  Event                |       | 11.05       |
| Liquidator                        |       | 11.06       |
| Major Customer                    |       | 11.04(a)    |
| Non-Affiliate  Transfer           |       | 10.02(a)    |
| Non-Compete  Period               |       | 11.02(b)    |
| Non-Transferring  Member          |       | 10.02(a)    |
| Non-Triggering  Party             |       | 11.02(a)    |
| Other FPD  Business Opportunities |       | 3.02        |
| Permitted  Transferee             |       | 10.01(a)    |
| Products                          |       | Recital A   |
| Project                           |       | 6.03(a)     |
| Proposed  Transferee              |       | 10.02(a)    |
| Required Funding  Contributions   |       | 4.02(a)     |
| Singapore  Corporate Documents    |       | 12.13       |
| Transferring  Member              |       | 10.02(a)    |
| Triggering Event                  |       | 11.02(a)    |
| Triggering Party                  |       | 11.02(a)    |
| Triggering  Separation            |       | 11.04(b)    |

 

ARTICLE2 REPRESENTATIONS AND WARRANTIES

Section 2.01.          *Representations And Warranties. *(a)Cymer hereby represents and warrants that as of the date hereof (i) it is acorporation duly organized, validly existing and in good standing under thelaws of the State of Nevada, (ii) it has the requisite power and authority toexecute and deliver this Agreement and the other Joint Venture Documents and tofully perform its obligations hereunder and thereunder, (iii) the execution,delivery and performance of this Agreement and the other Joint VentureDocuments have been duly authorized on the part of Cymer, (iv) it is not partyto or affected by contractual or other legal obligations that would in anymaterial respect interfere with its full performance of this Agreement or theother Joint Venture Documents, and (v)the individuals executing this Agreement on behalf of Cymer have the authorityto do so.

(b)           ZeissLOB hereby represents and warrants that (i) it is a limited liability companyduly organized, validly existing and in good standing under the laws ofGermany, (ii) it has the requisite power and authority to execute and deliverthis Agreement and the other Joint Venture Documents and to fully perform its obligationshereunder and thereunder, (iii) the execution, delivery and performance of thisAgreement and the other Joint Venture Documents have been duly authorized onthe part of Zeiss LOB, (iv) it is not party to or affected by contractual orother legal obligations that would in any material respect interfere with itsfull performance of this Agreement or 

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theother Joint Venture Documents, and (v) the individuals executing this Agreementon behalf of Zeiss LOB have the authority to do so.

(c)           ZeissSMT hereby represents and warrants that (i) it is a stock corporation dulyorganized, validly existing and in good standing under the laws of Germany,(ii) it has the requisite power and authority to execute and deliver thisAgreement and the other Joint Venture Documents to which it is a party and tofully perform its obligations hereunder and thereunder, (iii) the execution,delivery and performance of this Agreement and the other Joint VentureDocuments to which it is a party have been duly authorized on the part of ZeissSMT, (iv) it is not party to or affected by contractual or other legalobligations that would in any material respect interfere with its fullperformance of this Agreement or the other Joint Venture Documents to which itis a party, (v) the individuals executing this Agreement on behalf of Zeiss SMThave the authority to do so, and (vi) all right, title and interest in and toForeground Technology (as defined in the Intellectual Property Agreement)conceived or reduced to practice by IMT or any Person under the control of IMTwill be owned by SMT and that, upon execution and delivery of the IMT IP SideLetter by IMT, SMT will obtain all rights from IMT to fully perform itsobligations under the Intellectual Property Agreement.

(d)           Notwithstandingany other provision contained in this Agreement, the Company shall beauthorized to execute, deliver and perform this Agreement and the other JointVenture Documents to which it is a party and all documents, agreements,certificates, or statements contemplated thereby or related thereto, exclusiveof any future amendments, without any further act, vote or approval of anyMember or any other Person.

ARTICLE3 PURPOSES OF THE COMPANY

Section 3.01.          *Name.*The initial name of the Company shall be “TCZ Pte.Ltd.”.  The business of the Company shallbe conducted under such name or names as the Members may from time to timedetermine in accordance with the provisions hereof.

Section 3.02.          *Purpose. *The purposeof the Company is to develop, market, sell, integrate and service the Productsand to engage in related application development based on the Products (the “**Business**”), and to search for other business opportunitiesfor process tools for the manufacture of flat panel displays, and to takeactions reasonably related thereto, in each case as set forth in greater detailin the Business Plan as in effect from time to time.  If the Company identifies businessopportunities for process tools for the manufacture of flat panel displaysother than the Products and applications based on the Products (“**Other FPD Business Opportunities**”), the Company shall bringsuch Other FPD Business Opportunities to the attention of the Members, and theMembers will discuss in good faith whether or not to expand the scope of theBusiness of the Company to pursue such Other FPD Business Opportunities.  For the avoidance of doubt, the “Business”shall not include the development, marketing, selling, integration or servicesof tools other than the Products, unless the Members so agree and amend thisAgreement to expand the definition of the Business accordingly.

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Section 3.03.          *Place of Business of the Company. *The principal place of business of the Company shall belocated at such address as may be designated by the Board from time to time.

Section 3.04.          *Registered Office; Registered Agent. *The address of the registered office of the Company inSingapore shall be as determined by the Board and as registered with ACRA.

Section 3.05.          *Duration of the Company. *TheCompany shall continue until its dissolution in accordance with the provisionsof Article 11.

Section 3.06.          *Title to Company Property. *Allproperty of the Company, whether real or personal, tangible or intangible,shall be deemed to be owned by the Company as an entity, and no Member, in itscapacity as such, shall have any direct ownership interest in such property,except upon dissolution of the Company as set forth in Article 11.

Section 3.07.          *Limited Liability. *Exceptas required by mandatory Singaporean law, the debts, obligations andliabilities of the Company, whether arising in contract, tort or otherwise,shall be solely the debts, obligations and liabilities of the Company, and noMember shall be obligated personally for any such debt, obligation or liabilityof the Company solely by reason of being a Member.

ARTICLE4 PERCENTAGE INTERESTS; CAPITALCONTRIBUTIONS

Section 4.01.          *Percentage Interests; Capital Contributions. *(a) The names and PercentageInterests of the Members shall be as follows:

| Name      | ** ** | **Percentage Interest** | ** ** |
|-----------|------------|------------------------------|------------|
| Cymer     |       | 60                           | %          |
| Zeiss LOB |       | 40                           | %          |

 

(b)           ThePercentage Interests shall not be subject to adjustment unless agreed by theMembers, except as otherwise provided in Sections 6.03(c)(iii) or 11.03.

(c)           Otherthan the Members’ initial capital contributions and their Required FundingContributions, no additional funding or capital contribution of the Membersshall be required, except as the Members may unanimously agree.

Section 4.02.          *Funding Commitments. *(a)**The Members from time to time shall be obligated to providefunds to the Company, as provided in this Section 4.02, up to the amountspecified in Section 4.02(a)(iii), which each such Member shall make by way ofa contribution of capital, in all cases, by wire transfer of immediately availablefunds.

(i)            At the Additional Funding Date,Cymer shall contribute [ . . . ***  . . .] (equivalent to [ . . . ***  . . .]) in cash and Zeiss LOB shallcontribute [ . . . ***  . . .] (equivalent to [ . . . ***  . . .])****in cash inrespect of their required funding contributions for 2006.

 

*****Confidential Treatment Requested**

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(ii)           The amount and timing of subsequentrequired funding contributions under this Section 4.02 (“**RequiredFunding Contributions**”) shall be determined by the Chief ExecutiveOfficer consistent with the then current Business Plan as in effect from timeto time, subject to the provisions of Section 4.02(a)(iii).  Each Member shall make each such fundingcontribution within ten business days of receipt of a Capital Call Notice fromthe Company.

(iii)          No Member shall be required tocontribute to the Company an amount for any Budget Year that exceeds itsproportionate share (determined on the basis of its Percentage Interest) of theannual maximum required funding contribution amount (the “**AnnualMaximum Required Funding Contribution**”) for such Budget Year (whichshall cover the Company’s expected funding requirements for the period ending15 months after the beginning of such Budget Year), set forth for such BudgetYear in the then current Business Plan as may be in effect from time to time,or, absent an updated Business Plan containing an Annual Maximum RequiredFunding Contribution for such Budget Year, the amount determined as provided inSection 6.03(c).

(b)           Ifa Member fails to contribute its required portion of any Required FundingContribution as and when required by this Agreement, the Company shall thennotify the Members in writing of such default, specifying the default inreasonable detail, and if the defaulting Member shall not have cured suchdefault within ten business days after receipt of such default notice, suchfailure shall be deemed a material breach of this Agreement and in addition to,and without prejudice to, any and all other remedies, the non-defaulting Membermay treat such default as a “Triggering Event” pursuant to Section 11.02(a),except that the non-defaulting Member shall be treated as the Non-TriggeringParty and the defaulting Member shall be treated as the Triggering Partythereunder.  The foregoing shall beexercisable by written notice from non-defaulting Member to the defaultingMember, given within 30 days after receipt of the default notice.

Section 4.03.          *Other Matters. *(a)Except as otherwise provided in this Agreement, no Member shall demand orreceive a return of its capital contributions without the consent of the otherMember.  Under circumstances requiring areturn of any capital contributions, no Member shall have the right to receiveproperty other than cash, except as may be specifically provided herein.

(b)           NoMember shall receive any interest, salary or drawing with respect to itscapital contributions or for services rendered on behalf of the Company orotherwise in its capacity as a Member, except as otherwise contemplated by thisAgreement.

ARTICLE5 DISTRIBUTIONS

Section 5.01.          *Distributions. *Afterthe Effective Date, when, if and as approved by the Board or required by aMember pursuant to Section 5.02, the Company shall make available the NetIncome of the Company for distribution to the Members (or to any Affiliate of aMember designated by such Member) in proportion to their Percentage Interests,and each Member agrees to vote its shares in favor of such a distribution; *provided* that Intellectual Property Rights owned or licensedby the Company shall be 

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distributedonly in accordance with the Intellectual Property Agreement or otherwise upontermination and dissolution of the Company in accordance with Article 11.  With respect to the amount to which eachMember is entitled pursuant to the preceding sentence, such Member may elect,at its sole option, to (i) receive such amount in cash or, if so determined bythe Board or (pursuant to Section 5.02) Member, property or (ii) treat suchamount as part of such Member’s funding contribution for purposes of satisfyingits Required Funding Contribution.

Section 5.02.          *Member’s Right to Require Distribution. *Either Member shall have the right to require a resolution ofthe Board to be passed to make a distribution of the Net Income of the Companyto the Members under Section 5.01, *provided* thatthe Company will have sufficient available funds on hand after the distributionto meet 110% of its reasonably foreseeable working capital requirements duringthe 18 months following the date of such distribution based on the moreconservative of the (a) the financial projections in the then current BusinessPlan or (b) the most recent financial projections approved by the Board.

Section 5.03.          *Amounts Withheld. *TheCompany is authorized to withhold from distributions to the Members and to payover to any governmental or regulatory authorities any amounts which itreasonably determines may be required to be so withheld pursuant to anyprovisions of any other law (local or otherwise).  All amounts withheld pursuant to anyprovision of any tax law with respect to any distribution to any Member shallbe treated as amounts distributed to such Member pursuant to this Article forall purposes under this Agreement.

Section 5.04.          *Dissolution. *Upon dissolutionand winding up of the Company, the Company shall make distributions inaccordance with Article 11.

Section 5.05.          *No Distributions in Violation of Law. *Notwithstanding any other provision contained in thisAgreement, the Company shall not be required to make a distribution to anyMember to the extent that such distribution would violate mandatory Singaporelaw.

ARTICLE6 CORPORATE GOVERNANCE

Section 6.01.          *Board of Directors. *(a)**Except as otherwise provided in this Agreement, thebusiness and affairs of the Company shall be managed by the Chief ExecutiveOfficer (the “**Chief Executive Officer**”) underthe supervision of the board of directors (the “**Board**”).

(b)           Exceptas otherwise provided in Section 10.02(b), Section 11.03 and Section 11.04, theBoard shall consist of five individuals (each a “**Director**”).  The Board shall consist of (X) two of suchDirectors which shall be designated by Cymer, (Y) a further two of suchDirectors which shall be designated by Zeiss LOB and (Z) the Chief ExecutiveOfficer.  Each Director (i) shall holdoffice until a successor shall have been duly designated or if earlier, suchDirector’s death, resignation or removal and (ii) except as otherwise providedin Section 11.03, may be removed only by the Member having designated suchDirector.  A Director shall not beentitled to appoint any person to act as his alternate.

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(c)           Thefollowing actions may not be taken by the Company or by the Chief ExecutiveOfficer acting on behalf of the Company without obtaining the approval of theBoard as set forth herein:

(i)            adoption or amendment of a BusinessPlan and the product development process as described in Section 6.03(a)(iii);

(ii)           entering into or making any loans oradvances to, guarantees for the benefit of, or investments by the Company, inexcess of US$100,000, other than trade credit in the ordinary course ofbusiness and investments in cash or cash equivalents in accordance with aninvestment policy adopted by the Board;

(iii)          entering into any agreement orcommitment (or series of related agreements or commitments) outside theordinary course of business involving an aggregate value of more thanUS$100,000 per year;

(iv)          entering into any transaction with anyMember or Affiliate of any Member other than the transactions contemplatedhereby and by the other Joint Venture Documents for which a final form has beenagreed;

(v)           any acquisition or disposition (in asingle transaction or a series of related transactions) of any assets, businessor operations outside the ordinary course of business in an aggregate value ofmore than US$100,000;

(vi)          subject to the terms of theIntellectual Property Agreement, licensing the Company’s Intellectual Propertyoutside the ordinary course of business or commencing or settling any litigationor claim involving the Company’s Intellectual Property; or

(vii)         commencing or settling any materiallitigation or claim.

Section 6.02.          *Officers. *(a) TheCompany will be managed by the Chief Executive Officer in accordance with theCompany’s then current Business Plan as in effect from time to time.  Without limiting the generality of theforegoing, the Chief Executive Officer will be responsible for managing thefollowing activities of the Company, in accordance with the Company’s thencurrent Business Plan as in effect from time to time: (i) sales and marketing,(ii) application development, (iii) supply management, (iv) service and supportto the Company’s customers, (v) systems integration, (vi) business developmentand (vii) accounting, finance, and general and administrative functions.  The Chief Executive Officer may delegate anyof such authority to the other officers of the Company.  The other officers of the Company may includeone or more vice presidents or other officers as the Chief Executive Officermay in his or her discretion determine. One person may hold the offices and perform the duties of any two ormore of said offices.  All of theofficers of the Company shall report to the Chief Executive Officer of theCompany.

(b)           TheMember with the greater Percentage Interest shall have the right to appoint theChief Executive Officer of the Company, *provided* thatsuch appointment shall be subject to the approval of the other Member, whichapproval shall not be 

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unreasonablywithheld or delayed.  The Chief ExecutiveOfficer may be removed at any time by the Members.

(c)           Theofficers of the Company (other than the Chief Executive Officer) shall beappointed by the Chief Executive Officer to hold office for such term as theChief Executive Officer may determine; provided that such appointments shall besubject to the approval of the Board, which approval shall not be unreasonablywithheld or delayed.  Each such officershall hold office until his or her successor is appointed, or until the earlierof his or her death, resignation or removal, and may be removed with or withoutcause at any time by the Chief Executive Officer.  The remuneration of each such officer shallbe approved by the Board.  Each Membermay suggest one or more candidates for such other officers, which suggestionsthe Chief Executive Officer shall consider in good faith, and, if the ChiefExecutive Officer rejects such suggestions, the Chief Executive Officer shall,if so requested, explain his or her reasons for the rejection.  Each Member shall, if so requested by theChief Executive Officer, reasonably assist the Chief Executive Officer inlocating candidates for positions with the Company within the ranks of theMember’s employees and in recruiting such candidates to join the Company.

(d)           Unlessmutually agreed by the Members, commencing no later than ninety (90) days afterthe Effective Date, each officer of the Company (including the Chief ExecutiveOfficer), and each other employee of the Company that has or will be be transferredto the Company from either Cymer or Zeiss SMT or their respective Affiliates,shall be a full-time employee of the Company and devote 100% of such person’sfull professional and business-related time to the Company.  Unless mutually agreed by the Members, noofficer of the Company shall be permitted to participate in any compensationprogram of either Member, *provided* thatnothing in this provision shall prohibit any officer from retaining andexercising any stock options granted to such officer prior to becoming anofficer of the Company or participating in any health and welfare benefitsplans of a Member provided to the officer pursuant to an AdministrativeServices Agreement.

Section 6.03.          *Business Plan. *(a)The Company will be subject to and managed in accordance with a Business Plan(the “**Business Plan**”) which will cover arolling period of [ . . . ***  . . .] Budget Years and will be revisedannually.   Such initial Business Planwill remain in effect until modified or superseded by the Board in accordancewith the terms hereof.  The Business Planwill include, without limitation:

(i)            the long-term objectives of theCompany in light of its then current strategic, competitive and technologyposition, the Product roadmap and the broad Areas of Responsibility of eachMember;

(ii)           a schedule or timetable with adescription of all milestones (including technical milestones, businessmilestones and financial milestones) and/or Deliverable due dates;

(iii)          a schedule of “**Gate**Reviews”to be held by the Board in accordance with a product development process, whichshall be prepared by the Chief Executive Officer of the Company and approved bythe Board, during which Gate Reviews the Board will determine whethermilestones and/or Deliverable due dates have been met or achieved;

 

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(iv)          a Work Plan for the Members, theSuppliers and the Company with respect to each distinct area of inquiry (eachsuch area, a “**Project**”) containing with respectto such Project (1) the identity of the project managers for the Project and/orthe manner in which they will be selected; (2) a description of anyperformance, status and operational reports to be generated during the Project;(3) quality criteria for assessing the performance of the Suppliers and theCompany, as the case may be, during such Project including, but not limited to,performance criteria for milestones, classifications of the severity of errorsor failures, and response processes for the correction of any such errors orfailures; and (4) any other terms and conditions agreed upon by the Board withrespect to a Project;

(v)           a Work Plan for the Company withrespect to its Area of Responsibility with respect to each Project;

(vi)          financial projections (includingprojected balance sheet, income statement and cash flow, as well as projectedAnnual Maximum Required Funding Contributions) for each of the [ . . . ***  . . .] Budget Years covered by the BusinessPlan;

(vii)         the Annual Maximum Required FundingContribution for the next Budget Year, which shall cover the Company’s expectedfunding requirements for the period ending [ . . . ***  . . .] months after the beginning of suchBudget Year); and

(viii)        performance metrics for the Company forthe next Budget Year for use in assessing the performance of the ChiefExecutive Officer.

(b)           Withrespect to each Budget Year after 2005, the Chief Executive Officer willdevelop and present to the Board no later than [ . . . ***  . . .] of each year a proposed revised andupdated Business Plan that has been rolled forward for another year.  For the avoidance of doubt, unless a newBusiness Plan is approved by the Board, the Company will be subject to andmanaged in accordance with the then current Business Plan as in effect from timeto time.

(c)           Duringany Budget Year for which the Board has not approved a revised Business Plan by[ . . . ***  . . .], the Annual Maximum Required FundingContribution for such Budget Year shall be established as follows:

(i)            Each Member shall not later than [ ... . ***  . . .] notify the Chief Executive Officer andthe other Member in writing of its proposal for the Annual Maximum RequiredFunding Contribution for such Budget Year; *provided* thatneither Member’s proposal may be [ . . . ***  . . .] than [ . . . ***  . . .]% or [ . . . ***  . . .] than [ . . . ***  . . .]% of the [ . . . ***  . . .] of (A) the [ . . . ***  . . .] for such [ . . . ***  . . .] as specified in the [ . . . ***  . . .] by the [ . . . ***  . . .], or (B) the [ . . . ***  . . .] as specified in the [ . . . ***  . . .] proposed by the [ . . . ***  . . .].

(ii)           The issue shall be immediatelyescalated for expedited resolution by the Chairman of the board of directors(or equivalent officer) of each Member as provided in Section 12.10(a).

 

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(iii)          If the matter is not resolved by [. ... ***  . . .] of any year, then the Member proposingthe [. . . ***  . . .] Annual Maximum Required FundingContribution for such Budget Year shall have the option, at its election, bynotice given no later than [. . . ***  . . .] of the following year either (A) toestablish the [. . . ***  . . .] amount as the Annual Maximum RequiredFunding Contribution for such Budget Year and to agree to pay, as an additionalcapital contribution to the Company, the difference between the amounts lastproposed by each Member, and upon such payment the paying Member’s PercentageInterest shall be increased to a percentage equal to the [. . . ***  . . .] of (x) the [. . . ***  . . .] of the [. . . ***  . . .] by the [. . . ***  . . .] since [. . . ***  . . .] the Company (including pursuant to [... . ***  . . .], [. . . ***  . . .] by (y) the [. . . ***  . . .] of the [. . . ***  . . .] by [. . . ***  . . .] (including pursuant to [. . . ***  . . .] since [. . . ***  . . .] the Company, and the [. . . ***  . . .] Percentage Interest shall be [. . . ***  . . .] accordingly), or (B) to establish theAnnual Maximum Required Funding Contribution for such Budget Year as an amountequal to [. . . ***  . . .] of the amounts proposed by eachMember.

Section 6.04.          *Company Actions Requiring Consent of Members*The followingactions may not be taken by the Company without obtaining the consent of all ofthe Members:

(a)           anyamendment of this Agreement, any other Joint Venture Document or the Company’sArticles of Association;

(b)           issuanceof any new shares or admission of any new Members (and each Member agrees togrant such consent for admission of a Permitted Transferee);

(c)           redemptionor repurchase of any shares;

(d)           authorizingor committing the Company to a change in the scope of the Business;

(e)           takingany actions in respect of the dissolution or liquidation or winding-up of theCompany (except as permitted pursuant to Section 11.05(b)) or the filing oracquiescing to the filing of a petition in respect of the Company underbankruptcy or insolvency laws, or the making of any assignment for the benefitof creditors;

(f)            anymerger, consolidation, reorganization (including conversion) or other businesscombination involving the Company or any of its Affiliates (other than of awholly owned Affiliate with or into another wholly owned Affiliate) or anyacquisition of the Company or any of its Affiliates by another entity by meansof any transaction or series of related transactions or the sale of all orsubstantially all of the assets of the Company; or

(g)           allmatters requiring Members’ approval under the Act.

Section 6.05.          *Meetings of Board. *(a)*Regular Meetings*.  The Board shall hold regular meetings atleast quarterly, rotating between a location in the United States determined byCymer and a location in Germany determined by Zeiss LOB, or such other locationas determined by the Board.  Writtennotice of each meeting shall state the place, 

 

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dateand hour of such meetings, and include an agenda of matters to be considered atthe meeting.  Notice shall be given inthe manner prescribed herein not fewer than seven days nor more than 60 daysbefore the date thereof.

(b)           *Special Meetings*.  Inaddition, any Director may, on at least five business days’ prior writtennotice to the other Directors, call a special meeting of the Board, specifying inreasonable detail in such notice the purpose of such meeting.

(c)           *Quorum*.  The presenceof three Directors shall constitute a quorum for the transaction of business ata duly noticed meeting of the Board.  Ifa quorum shall fail to be present for such a meeting, then any Director mayprovide a supplemental notice to the other Directors rescheduling such meetingat least 48 hours after such supplemental notice.  For the avoidance of doubt, a quorum shall berequired at such rescheduled meeting.

(d)           *Objections*. Attendance of a Director at a meeting shall constitute a waiver ofnotice of such meeting, except if such Director attends the meeting for theexpress purpose of objecting, at the beginning of the meeting, to the transactionof business at such meeting because the meeting has not been validly called,noticed or convened.

(e)           *Chair of Meeting*. Prior to each meeting, one of the Directors shall be designated as leadDirector to serve as chair of the meeting. The lead Director shall rotate from meeting to meeting between aDirector designated by Zeiss LOB and a Director designated by Cymer.

(f)            *Taking Decisions*. Except where this Agreement specifically provides otherwise, anydecision taken at a meeting of the Board shall require the consent of [. . . ***  . . .] of all Directors participating at aduly convened meeting at which a quorum is present (in person or by proxy),provided that such [. . . ***  . . .] vote must always include the vote of[. . . ***  . . .] except that the requirement that themajority include [. . . ***  . . .] shall no longer apply and decisions ofthe Board shall require only the consent of a majority of the Directorsparticipating at a duly convened meeting at which a quorum is present (inperson or by proxy) in the event that (I) each Member is entitled to designatea number of Directors that is in proportion to its Percentage Interest as setforth in Section 10.02(b)(ii) of this Agreement or (II) one Member is entitledto designate all the Directors (save for the Chief Executive Officer) pursuantto Section 11.03.

(g)           *Expenses*.  Each Membershall pay all reasonable travel and other expenses of the Directors designatedby such Member in connection with participating in meetings of the Board.

Section 6.06.          *Decision by Consent. *Anydecision required or permitted to be taken by the Board or the Members, eitherat a meeting or otherwise, may be taken without a meeting if all Directors orMembers consent thereto in writing.  Anysuch decision of the Board, taken without a meeting, must be confirmed inwriting by all Directors.  Any suchdecision of the Members, taken without a meeting, shall be confirmed in writingby all the Members.

 

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Section 6.07.          *Telephonic Meetings. *Directorsmay participate in a meeting of the Board by means of conference telephone orsimilar communications equipment by means of which all persons participating inthe meeting can hear each other, and such participation in a meeting shallconstitute presence in person at the meeting.

Section 6.08.          *Nature of Obligations among Members. *Except as otherwise provided in this Agreement or by writtenagreement among the Members, no Director shall have any authority to act for orassume any obligation or responsibility on behalf of any Member or the Company,and no Member shall have any authority to act for or assume any obligation orresponsibility on behalf of any other Member or the Company.

ARTICLE7 ACCOUNTING AND TAX MATTERS

Section 7.01.          *Fiscal Year/Independent Auditors. *The fiscal year of the Company (the “**Fiscal Year**”)shall end on December 31st of each year. The Members shall select the Company’s independent auditors, which shallbe a recognized international accounting firm.

Section 7.02.          *Books and Records. *(a)The Company shall keep, including through bookkeeping services renderedpursuant to the Administrative Services Agreement, adequate books and recordsat its principal office.  Such books andrecords shall include a current list of the full name and last known business,residence or mailing address of each Member, originals of this Agreement, andany amendments thereto (and any signed powers of attorney pursuant to which anysuch document was executed), a copy of the Company’s national and other taxreturns and reports, if any, and annual financial statements of the Company,for the [. . . ***  . . .] ([. . . ***  . . .]) most recent [. . . ***  . . .], and resolutions passed by the Boardand the Members.  The Company’s books ofaccount and business records shall be filed and preserved for a period of atleast [. . . ***  . . .] ([. . . ***  . . .]) [. . . ***  . . .] or such longer period as required bylaw.

(b)           The Company shall permit each Memberand its officers, agents and representatives, upon reasonable advance noticeand during normal business hours and such other times as any such Member mayreasonably request, to:  (i) visit andinspect any of the properties of the Company; (ii) examine the corporate andfinancial records of the Company and make copies thereof or extracts therefrom,and (iii) discuss the affairs, finances, and accounts of the Company with theDirectors, officers, employees, and independent accountants of the Company.  In addition, the Company shall require itsindependent accountants to make available to the Members copies of all reports,investigations and work papers prepared by such accountants during the courseof any audit of the Company or otherwise, *provided* thatthe Members may be required to enter into the standard form of agreementcustomarily required by such independent accountants as a condition to accessto such material.  Any Member may, at itsown expense, request and obtain a separate audit of the Company’s books by itsown accountant, *provided* that such separate auditis not made more frequently than [. . . ***  . . .] in each Fiscal Year and that at least[. . . ***  . . .] ([. . . ***  . . .]) [. . . ***  . . .] prior written notice of such request isgiven to the Chief Executive Officer. The Chief Executive Officer shall cause the Company’s officers andemployees to cooperate with such Member’s accountant in the execution andpreparation of such audit, including providing customary certifications to suchMember’s accountant.

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Section 7.03.          *Financial Reports. *The Company, at its expense, shallprovide or cause to be provided to each Member, no later than thirty days afterthe close of each of the first three quarters of the Company’s Fiscal Year, andno later than ninety days after the end of each such Fiscal Year, a financialreport of the business and operations of the Company prepared in accordancewith GAAP and FRS consistently applied, relating to such period, which reportshall include (i) a balance sheet as at the end of such period, (ii) astatement of income (loss) containing actual operating performance vs. budgetedoperating performance for the current period and the year-to-date, and (iii) acash flows statement (including sources and uses of funds) for the currentperiod and the year-to-date, and in each case a comparison of the period thenended with the corresponding period in the Fiscal Year immediately precedingsuch periods, which, in the case of the report furnished after the close of theFiscal Year, shall be audited by the Company’s independent certified publicaccountants, and which, in the case of the reports furnished after each of thefirst three quarters of the Company’s Fiscal Year, shall be unaudited and shallnot include any notes thereto.  Inaddition, the quarterly financial statements shall be accompanied by (x) astatement of changes in Members’ equity containing a detail of capitalcontributions, distributions and income/loss allocations for each of theMembers and in total, for the current period and the year-to-date, and (y) ananalysis, in reasonable detail, of the variance between the Company’s operatingresults and the corresponding amounts in the then current annual Budget.  The quarterly financial reports may in eachcase be subject to normal year-end adjustments. In addition, the Members shall be entitled to any other financialinformation, including monthly management reports in the form produced by theCompany, that the Members may reasonably request.

Section 7.04.          *Tax Matters. *TheCompany and its Affiliates shall abide by the tax law and regulations in eachjurisdiction in which it operates and shall cooperate with the Members toprovide documents and information that either Member may need to file its owntax returns in any jurisdiction.

ARTICLE8 CERTAIN COVENANTS

Section8.01.          *PressRelease. *Upon the EffectiveDate or such other time as may be mutually agreed, Cymer and Zeiss SMT shallissue a mutually agreed joint press release, announcing the formation of theCompany and their collaboration under this Agreement.

Section8.02.          *Non-Competition. *In order to ensure the requisitelevel of dedication to enable the Company to offer the most competitiveproducts in the marketplace, until such time as a Member ceases to be, directlyor through an Affiliate, a Member of the Company (at which time such Member andits Affiliates may become subject to the non-compete covenant set forth inSection 11.02(b)) or the Company is dissolved, neither such Member nor any ofits Affiliates shall engage, either directly or indirectly, as a principal forits own account or solely or jointly with others, or as a stockholder in anycorporation or joint stock association, in any business engaged in the Business(other than the Company or as contemplated by the Joint VentureDocuments).  For the avoidance of doubt,without limiting the generality of the foregoing covenant, it is acknowledgedand agreed that until such time as a Member ceases to be, directly or throughan Affiliate, a Member of the Company (at which time such Member and itsAffiliates may become subject to the non-compete covenant set forth in Section11.02(b))

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or the Company isdissolved, neither such Member nor any of its Affiliates shall knowingly supplyservices, products or components for use in products or services competitivewith the Business or the Products of the Company; *provided*,however, that if neither IMT nor any Person under its control continues to actas supplier of Stages (as defined in the Supply Agreement) or other products tothe Supplier or an Affiliate of the Supplier under the Zeiss Supply Agreement,IMT and any Person under its control shall cease to be subject to the foregoingcovenant [. . . ***  . . .] after the date IMT and any personunder its control ceased to act as a supplier.

ARTICLE9 EXCULPATION AND INDEMNIFICATION

Section 9.01.          *Exculpation and Indemnification. *Each Member agrees that it shall vote its shares in theCompany and take all other necessary action in its capacity as a shareholder ofthe Company (including, to the extent permissible pursuant to applicable law,causing the Company to call a special meeting of Members) to provide for (a)the elimination of the liability of each Director on the Board to the maximumextent permitted by applicable law (and each Member hereby irrevocably waivesany right to pursue and agrees to vote its shares and take all other necessaryaction in its capacity as a shareholder of the Company not to pursue any sucheliminated liability) and (b) indemnification of each Director on the Board foracts on behalf of the Company, if any, to the maximum extent permitted byapplicable law.

ARTICLE10 DISPOSITION OF INTERESTS

Section 10.01.        *General. *(a) NoMember may Transfer all or any part of its Interest, and no Member Parent mayTransfer its direct or indirect interest in a Member that is its Affiliate(each a “**Transfer of an Interest**”), without theconsent of the other Member, except that no consent shall be required for (andthe non-Transferring Member shall give any consent that may be required undermandatory Singapore company law to effect) the direct or indirect Transfer bythe Member of the entirety of a Member’s Interest or by a Member Parent of theentirety of its interest in a Member that is its Affiliate to:

(i)            any Affiliate of such Member; or

(ii)           withrespect to any Transfer [. . . ***  . . .], any other Person if (x) such otherPerson is not a competitor of the other Member or Member Parent and (y) theaggregate purchases by the Company and its Affiliates of Products containingCore Components (as such terms are defined in the Supply Agreement between therelevant Member or its Affiliate and the Company) from the relevant Member orits Affiliate under the Supply Agreement during the last four fiscal quartersof the Company for which financial statements are available accounted for notmore than [. . . ***  . . .]% of the Company’s aggregate cost of(A) the bill of materials for goods sold and (B) system integration during thesame period (each of the transferees referred to in clauses (i) and (ii) abovea “**Permitted Transferee**”); and noPermitted Transferee may Transfer any or all of its Interest, except theentirety of its Interest to another Permitted Transferee.  In the event a Member transfers its Interestto an Affiliate, such Affiliate shall, unless otherwise

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agreed by the other Member, assume all of thetransferring Member’s obligations under this Agreement and such Member herebyagrees to irrevocably and unconditionally guarantee to the Company and theother Member the timely payment and performance by such Affiliate of suchMember’s obligations thereunder for so long as such transferee remains anAffiliate of the transferring Member.

(b)           AnyTransfer of an Interest that is not made in compliance with the provisions ofthis Agreement shall be void, and the Company shall not recognize any suchTransfer.  Any purported or attemptedtransfer of any Interest that is not made in compliance with the provisions ofthis Agreement shall constitute a material breach of this Agreement.  Notwithstanding anything else containedherein, no Transfer shall be made except in compliance with applicable law.

(c)           Forthe avoidance of doubt, the provisions of this Article 10 shall not apply toany Transfer of any direct or indirect interest in a Member that could bedeemed to occur as a result of a change of control involving the relevantMember Parent.

Section 10.02.        *Non-affiliate Transfers. *(a)Prior to any Transfer of an Interest permitted under Section 10.01(a)(ii)above, the Member or Member Parent, as the case may be, who proposes toTransfer its Interest (the “**Transferring Member**”)(such transferee, the “**Proposed Transferee**”and such transfer, a “**Non-Affiliate Transfer**”)shall give the other Member (the “**Non-Transferring Member**”)written notice of its intention, describing the Proposed Transferee, the priceand the terms and conditions of the proposed Transfer.  The Non-Transferring Member shall have a [. ... ***  . . .] to purchase the Transferring Member’sInterest at [. . . ***  . . .] and upon [. . . ***  . . .] by the Proposed Transferee.  The Non-Transferring Member shall have thirty(30) days from the receipt of such notice to agree to purchase the TransferringMember’s Interest by giving written notice to the Transferring Member.  If the Non-Transferring Member fails toexercise its [. . . ***  . . .] under this Section 10.02(a), theTransferring Member shall have thirty (30) days thereafter to sell its Interestto the Proposed Transferee at a price and upon terms and conditions [. . . ***  . . .] to the Proposed Transferee thanspecified in the Transferring Member’s notice to the Non-Transferring Member ofthe proposed Transfer.  If theTransferring Member does not sell its Interest to the Proposed Transfereeduring such thirty (30) day period, the Transferring Member shall notthereafter Transfer its Interest, without first offering such Interest to theNon-Transferring Member in the manner provided above.

(b)           Followingthe consummation of a Transfer of an Interest either (x) to a ProposedTransferee pursuant to a Non-Affiliate Transfer or (y) to the Non-TransferringMember upon the exercise of such Member’s [. . . ***  . . .] pursuant to Section 10.02(a) above:

(i)            theTransferring Member and its Affiliates shall be subject to the non-competecovenant set forth in Section 11.02(b) as if the Transferring Member were theTriggering Party; *provided* that the Non-CompetePeriod shall begin on the date of the [. . . ***  . . .] of the Transfer and end on the [. . . ***  . . .] of the [. . . ***  . . .] of such [. . . ***  . . .] or the [. . . ***  . . .] of the [. . . ***  . . .]; and

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(ii)           (A) the Directors of the TransferringMember shall be automatically removed from the Board and (B) if theTransferring Member is [. . . ***  . . .] or one of its Affiliates, then (1)each Member shall be entitled to designate a number of Directors that is inproportion to its Percentage Interest (three Directors for a 60% PercentageInterest, two Directors for a 40% Percentage Interest) and the Chief ExecutiveOfficer shall cease to be a Director, (2) actions by or decisions of the Boardshall no longer require approval by [. . . ***  . . .] but shall only require approval of [... . ***  . . .] of the Directors participating at aduly convened meeting at which a quorum is present (in person or by proxy) and(3) Section 6.04(g) shall cease to be in force and effect.

Section 10.03.        *Recognition of Transfers. *(a)  Prior to any Transfer of its Interest aspermitted by this Article 10, the Member transferring such Interest shall givewritten notice of such Transfer to the other Member and to the Company.  Upon receipt of such written notice, theCompany shall notify the transferee of the transfer restrictions contained inthis Agreement.

(b)           Notransferee shall be admitted to the Company as a Member unless the Transfer waspermitted hereby.  Subject to theforegoing, each such transferee, as a condition to its admission as a Member,shall execute and deliver to the Company such instruments, in form andsubstance satisfactory to the Members, as the Members shall reasonably deemnecessary or desirable to confirm the agreement of such transferee to be boundby all the terms and provisions of this Agreement (as it may be amended inconnection with the admission of such transferee as a Member).  The Members agree to amend this Agreement tothe extent necessary to reflect the transfer and admission of the new Memberand to continue the Company without dissolution.  Upon execution of such instruments, thetransferee shall be admitted to the Company as a Member.  Immediately following the admission of thetransferee to the Company as a Member, the Member who has thereby transferredall of its Interest shall cease to be a Member of the Company.  The transferee, as a Member of the Company,and the other Member are hereby authorized to, and shall, continue the businessof the Company without dissolution.

(c)           Anytransferee who is admitted to the Company as a Member shall succeed to therights and powers (including distribution preferences), and be subject to therestrictions and liabilities, of the transferor Member to the extent of theInterest transferred.

ARTICLE11 TERMINATION, DISSOLUTION AND LIQUIDATION

Section 11.01.        *Term. *The term of theCompany shall continue until the Company is dissolved pursuant to this Article.

Section 11.02.        *Triggering Events. *(a) Within the first 15 days ofeach [. . . ***  . . .] (beginning in [. . . ***  . . .]) either Member (such Member, the “**Triggering Party**”) may, for convenience, notify the otherMember (the “**Non-Triggering Party**”) in writingof its election to treat such notice as a notice of a “**TriggeringEvent**.”

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Uponreceipt of a notice of a Triggering Event, the Non-Triggering Party will notifythe Triggering Party in writing within 15 days of the Non-Triggering Party’sexercise of one of the following options:

(i)            purchase the Triggering Party’sInterest at a [. . . ***  . . .] ([. . . ***  . . .]); *provided* thatthe Triggering Party shall remain liable for any Required Funding Contributionsfor the Fiscal Year in which the Triggering Event occurs, pro-rated for theperiod from the beginning of such Fiscal Year to the Triggering Event, and *provided further* that the Triggering Party shall be entitledto receive, in addition to the cash purchase price, any royalties if and aspayable to it pursuant to the Intellectual Property Agreement; or

(ii)           dissolve and commence winding up ofthe Company pursuant to Section 11.05(b).

Uponreceipt by the Triggering Party, such notice shall be final and irrevocable,unless otherwise agreed by the Triggering Party.

(b)           Ifthe Non-Triggering Party has exercised its option (i) pursuant to Section11.02(a), then effective from the consummation of the purchase of theTriggering Party’s Interest by the Non-Triggering Party, the Triggering Partyand its Affiliates shall not for a period beginning on the date of such [. . . ***  . . .] and ending on the [. . . ***  . . .] of the [. . . ***  . . .] of such [. . . ***  . . .] or the [. . . ***  . . .] of the [. . . ***  . . .] (the “**Non-CompetePeriod**”) engage, either directly or indirectly, as a principal forits own account or solely or jointly with others, or as a stockholder in anycorporation or joint stock association, in any business engaged in the Business(other than the Company).  For theavoidance of doubt, without limiting the foregoing covenant, it is acknowledgedand agreed that neither the Triggering Party nor any of its Affiliates shallknowingly supply services, products or components for use in products orservices competitive with the Business or the Products of the Company duringthe Non-Compete Period (other than to the Company and its Affiliates and theNon-Triggering Party).

(c)           Ifthe Non-Triggering Party exercises its option (ii) pursuant to Section 11.02(a),(A) the Intellectual Property Rights of the Company shall be distributed to theMembers as joint owners of an equal undivided interest therein with no duty toaccount to the other party and (B) each Member shall be entitled to receive, assoon as possible and in any event within 30 days after the exercise of suchoption by the Non-Triggering Party, copies of source code, documentation andother materials as may be necessary to continue to develop the Products.

Section 11.03.        *Breach under thisAgreement or Event of Default under Supply Agreements.* If a material breach of this Agreement,including without limitation any failure by a Member to pay its RequiredFunding Contributions when due, or an Event of Default (as defined in theSupply Agreements) on the part of the Supplier that is an Affiliate of suchMember occurs and remains unremedied for a period of 30 days following noticethereof from the non-defaulting Member and is continuing, in addition to, andwithout prejudice to, any and all other remedies, the non-defaulting Membermay, at its option, either (A) treat such default as a “Triggering Event”pursuant to Section

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11.02(a) except that the non-defaulting Member shallbe treated as the Non-Triggering Party and the defaulting Member shall betreated as the Triggering Party thereunder or (B) remove the two Directors onthe Board designated by the defaulting Member and designate two Directorsselected by the non-defaulting Member in its sole discretion to replace suchremoved Directors to serve until such time as the material breach or Event ofDefault has been remedied by the defaulting Member.  In addition to replacement of such removedDirectors, if the breach is non-payment of a Required Funding Contribution, thenwithout limiting the non-defaulting Member’s other rights under this Agreement,(A) the non-defaulting Member shall have the right, in its sole discretion, topay the defaulting Member’s Required Funding Contribution and (B) thenon-defaulting Member’s Percentage Interest shall be increased to a percentageequal to the quotient of (x) the sum of the cumulative contributions paid bythe non-defaulting Member since inception of the Company (including pursuant tothis Section 11.03), divided by (y) the sum of the cumulative contributionspaid by both Members (including pursuant to this Section 11.03) since inceptionof the Company, and the other Member’s Percentage Interest shall be reducedaccordingly; *provided* that if the materialbreach by the defaulting Member is willful, occurs at any time [. . . ***  . . .] and remains unremedied for a period of30 days following notice thereof from the non-defaulting Member and iscontinuing, in addition to, and without prejudice to, any and all otherremedies (including pursuant to the first part of this Section 11.03), the non-defaulting Member may treat such breach as a “Triggering Event” pursuant toSection 11.02(a) except that the willfully defaulting Member shall be treatedas the Triggering Party thereunder and *provided* thatthe purchase price for the willfully defaulting Member’s Interest shall be $1,and *provided further* that the willfullydefaulting Member shall remain liable for its share of all Required FundingContributions for the Fiscal Year in which the breach occurs.

Section 11.04.        *Change of Control. *(a) *Changeof Control at Parent Level. *If,through a transaction or series of transactions, a Member Parent of a Member isacquired by, or comes otherwise under the control of, a competitor or MajorCustomer of the other Member Parent, the other Member may treat such event as a“Triggering Event” pursuant to Section 11.02(a), except that such other Membershall be treated as the Non-Triggering Party and the Member whose Member Parentis affected by such event shall be treated as the Triggering Partythereunder.  As used in this Section11.04, “**Major Customer**” means, with respect toany Member Parent from time to time, a customer that (i) accounts for in excessof [. . . ***  . . .]% of the consolidated revenues of suchMember Parent during the preceding twelve (12) months for which financialstatements are available or (ii) is of material strategic significance to thefuture development of the consolidated business of such Member Parent due to anexpected share of such Member Parent’s consolidated revenues in excess of [. ... ***  . . .]% during any twelve (12) month periodwithin the next [. . . ***  . . .] based upon the projected revenues insuch Member Parent’s then current business plan, in each case as shall havebeen certified to the other Member Parent by the chief executive officer ofsuch Member Parent prior to any relevant transaction.

(b)           *Supplier and CompanyInterest No Longer Affiliates. *If,as a result of a transaction or series of transactions other than a Transfer ofan Interest to a Permitted Transferee pursuant to Section 10.01(a), a Supplierceases to be an Affiliate of a Member without becoming an Affiliate of a Personthat, as a result of such transaction or series of transactions, becomes aMember or an Affiliate of a Member, then the Member that was

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not an Affiliate of such Supplier immediately prior tosuch transaction or series of transactions may treat such event (a “**Triggering Separation**”) as a “Triggering Event” pursuant toSection 11.02(a), except that such Member shall be treated as theNon-Triggering Party and the other Member shall be treated as the TriggeringParty thereunder.

(c)           *Joint Transfer of Supplier and Company Interest*.  Notwithstanding any other provision of thisArticle 11 or Article 10, any Transfer of an Interest by a Member or MemberParent, in a transaction or series of transactions, that does not result in aTriggering Separation shall be permitted at all times, whether or not to aPermitted Transferee, as long as the transferee is not a competitor or MajorCustomer of the Member Parent of the other Member, subject to compliance withthis Section 11.04(c).  In connectionwith any Transfer permitted under this Section 11.04(c), (x) the other Membershall have a [. . . ***  . . .] with respect to the Interest andinterest in or assets of the Supplier to be Transferred, and any other assetsto be transferred as part of such transaction or series of transactions, suchright to be exercised in the manner set forth in Section 10.02(a), (y) thetransferring Member or Member Parent, as the case may be, and its Affiliatesshall be subject to the non-compete covenant set forth in Section 11.02(b) asif the transferring Member were the Triggering Party; *provided*that the Non-Compete Period shall begin on the date of the [. . . ***  . . .] of the Transfer and end on the [. . . ***  . . .] of the [. . . ***  . . .] of such [. . . ***  . . .] or the [. . . ***  . . .] of the [. . . ***  . . .], and (z) if as a result of suchTransfer, the transferring Member and the Supplier are no longer Affiliates of[. . . ***  . . .], the composition and voting of theBoard and voting of the Members shall be modified as set forth in Section10.02(b)(ii).  The provisions of thisSection 11.04(c) shall not apply to any Transfer of any direct or indirectinterest in a Member that could be deemed to occur as a result of a change ofcontrol involving the relevant Member Parent.

Section 11.05.        *Liquidating Events. *TheCompany shall dissolve (and where applicable each Member agrees to vote itsshares in favor of such dissolution) and commence winding up upon the first tooccur of any of the following events (each a “**LiquidatingEvent**”):

(a)           uponthe unanimous written agreement of the Members to dissolve and wind up theCompany; and

(b)           uponthe exercise of the Non-Triggering Party of its option (ii) upon notice of aTriggering Event in accordance with Section 11.02(a).

Section 11.06.        *Winding Up.  *Upon the occurrence of aLiquidating Event, the Company shall continue solely for the purposes ofwinding up its affairs in an orderly manner, distributing its IntellectualProperty Rights, liquidating its assets, and satisfying the claims of itscreditors and Members, and no Member shall take any action that is inconsistentwith, or not necessary to or appropriate for, the winding up of the Company’sbusiness and affairs; *provided* thatall covenants contained in this Agreement and obligations provided for in thisAgreement shall continue to be fully binding upon the Members until such timeas the assets or property or the proceeds from the sale thereof has beendistributed pursuant to this Article and the Company has terminated.  The Member with the greater PercentageInterest, or in the case of a Liquidating Event pursuant to Section 11.05(b),the Non-Triggering Party, shall be responsible for

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overseeing the winding up of the Company.  Such party (the “**Liquidator**”)shall take full account of the Company’s assets and liabilities, and except asotherwise required by law, the Company’s affairs shall be wound up in anorderly manner in accordance with the following procedures:

(a)           (A)the Intellectual Property Rights of the Company shall be distributed to theMembers as joint owners of an equal undivided interest therein with no duty toaccount to the other party and (B) each Member shall be entitled to receive, assoon as possible and in any event within 30 days after the Liquidating Event,copies of source code, documentation and other materials as may be necessary tocontinue to develop the Products.

(b)           Tothe extent that the Liquidator determines that any or all of the assets of theCompany (other than the Intellectual Property Rights provided for in Section11.06(a) above) shall be sold, such assets shall be sold as promptly aspossible, but in a business-like manner so as not to involve undue sacrifice,and the proceeds thereof shall be used first to satisfy any liabilities of theCompany and then shall be distributed to the Members in accordance with theirPercentage Interests.

Section 11.07.        *Rights of Members. *Exceptas otherwise provided in this Agreement, each Member shall look solely to theassets of the Company for the return of its capital contributions and shallhave no right or power to demand or receive property other than cash from theCompany.

ARTICLE12 MISCELLANEOUS

Section 12.01.        *Notices. *All notices,requests and other communications to any party or to the Company shall be inwriting (including facsimile or similar writing) and shall be given:

if to the Company,to such address as the Company shall notify the other parties hereto as soon aspossible after its formation;

if to Cymer, to:

Cymer, Inc.17075 Thornmint CourtSan Diego, CA 92127-1712 USAAttn:  Chief Financial OfficerFax No.: (858) 385-6090

with a copy to:

Cooley Godward LLPFive Palo Alto Square3000 El Camino RealPalo Alto, CA 94306-2155 USAAttn: Gary H. MooreFax No.: (650) 849-7400

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if to Zeiss LOB, to:

Carl Zeiss Laser Optics Beteiligungsgesellschaft mbHRudolf-Eber-Strasse 273447 Oberkochen, GermanyAttention: Joseph FatumFacsimile No: 011-49-7364-208100Telephone No.: [. . . ***  . . .]

if to Zeiss SMT, to:

Carl Zeiss SMT AGRudolf-Eber-Strasse 273447 Oberkochen, GermanyAttention: Dr. Hermann GerlingerFacsimile No: 011-49-7364-208100Telephone No.: [. . . ***  . . .]

or to such otheraddress or facsimile number as any such party may hereafter specify for thepurpose by notice to the other parties. Each such notice, request or other communication shall be effective whenreceived at the address specified in this Section 12.01, or such other addressor facsimile number as such party may hereafter specify for the purpose bynotice to the other parties hereto.  Allsuch notices, requests and other communications shall be deemed received on thedate of receipt by the recipient thereof if received prior to 5:00 p.m. in theplace of receipt and such day is a business day in the place of receipt.  Otherwise, any such notice, request orcommunication shall be deemed not to have been received until the nextsucceeding business day in the place of receipt.

Section 12.02.        *Amendments; No Waivers. *(a)Any provision of this Agreement may be amended or waived if, and only if, suchamendment or waiver is in writing and signed, in the case of an amendment, byeach Member, or in the case of a waiver, by the Member against whom the waiveris to be effective.

(b)           Nofailure or delay by any party in exercising any right, power or privilegehereunder shall operate as a waiver thereof nor shall any single or partialexercise thereof preclude any other or further exercise thereof or the exerciseof any other right, power or privilege. The rights and remedies herein provided shall be cumulative and notexclusive of any rights or remedies provided by law.

Section 12.03.        *Expenses. *All costsand expenses incurred by the parties hereto in connection with this Agreementshall be paid by the party incurring such cost or expense.

Section 12.04.        *Zeiss SMT*[. . . ***  . . .]*. *For so long as Zeiss LOB iscontrolled by Zeiss SMT, Zeiss SMT [. . . ***  . . .] by Zeiss LOB of Zeiss LOB’sobligations under this Agreement.

Section 12.05.        *Successors andAssigns. *This Agreement ispersonal to the Members and may not be assigned or otherwise transferred by aMember except to a transferee of such Member’s Interest in connection with atransfer permitted by and made in accordance with the terms hereof.  Any purported assignment or other transfer in

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violation of this Agreement shall be null andvoid.  The provisions of this Agreementshall be binding upon and inure to the benefit of the parties hereto and theirrespective permitted successors and assigns. This Agreement is for the sole benefit of the parties hereto and, exceptas otherwise contemplated herein, nothing herein expressed or implied shallgive or be construed to give any Person, other than the parties hereto, anylegal or equitable rights hereunder.

Section 12.06.        *Headings. *Headingsare for ease of reference only and shall not form a part of this Agreement.

Section 12.07.        *Entire Agreement. *ThisAgreement and any documents referred to herein or therein, constitutes the entireagreement of the Members with respect to the subject matter hereofProvided however that nothing herein shall affect the full force and effect ofthe Original JV Agreement until this Agreement comes into effect on theEffective Date.

Section 12.08.        *Governing Law. *ThisAgreement shall be governed by, and construed under, the laws of [. . . ***  . . .] (without regard to conflicts of lawsprinciples).

Section 12.09.        *Waiver of Jury Trial. *EACHOF THE PARTIES HERETO HEREBY IRREVOCABLY WAIVES ANY AND ALL RIGHT TO TRIAL BYJURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATED TO THIS AGREEMENT OR THETRANSACTIONS CONTEMPLATED HEREBY.

Section 12.10.        *Dispute Resolution; Arbitration. *(a) Any dispute, controversy or claim arising out of or inconnection with this Agreement, or any of the Joint Venture Documents, or thealleged breach, termination or invalidity thereof, may be escalated, at therequest of either Member, to the Chairman of the board of directors (orequivalent officer) of each Member for resolution.  In the event of such a request, the Chairmenshall meet, either in person or by telephone, within thirty (30) days after thedate of such request in order to discuss and attempt to resolve such dispute,controversy or claim by mutual agreement.

(b)           Anydispute, controversy or claim arising out of or in connection with thisAgreement or the alleged breach, termination or invalidity thereof that is notsettled by the dispute resolution process set forth in Section 12.10(a) orotherwise by the joint agreement of the Parties shall be finally settled underRules of Arbitration of the International Chamber of Commerce by threearbitrators appointed in accordance with the said Rules.  Unless otherwise agreed by the Parties, sucharbitration shall take place in [. . . ***  . . .] Any award rendered by the arbitrators will be final and binding on theparties, and judgment upon the award may be entered in the [. . . ***  . . .], or any other court havingjurisdiction over the award or having jurisdiction over the parties or theirassets.  The arbitration agreementcontained in this Section 12.10 will not be construed to deprive any court ofits jurisdiction to grant provisional relief (including by injunction or order ofattachment) in aid of arbitration proceedings or enforcement of an award.

Section 12.11.        *Counterparts;Effectiveness. *This Agreementmay be signed in any number of counterparts, each of which shall be deemed anoriginal.  This Agreement

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shall become effective only after and subject to eachparty having received a counterpart hereof signed by each of the other parties.

Section 12.12.        *Severability. *If anyterm, provision, covenant or restriction of this Agreement is held by a courtof competent jurisdiction or other authority to be invalid, void orunenforceable, the remainder of the terms, provisions, covenants andrestrictions of this Agreement shall remain in full force and effect and shallin no way be affected, impaired or invalidated so long as the economic or legalsubstance of the transactions contemplated hereby is not affected in any mannermaterially adverse to any party.  Uponsuch a determination, the parties shall negotiate in good faith to modify thisAgreement so as to effect the original intent of the parties as closely aspossible in an acceptable manner in order that the transactions contemplatedhereby be consummated as originally contemplated to the fullest extentpossible.

Section 12.13.        *Further Assurances; Singapore Corporate Documents. *The Members will execute anddeliver such further instruments and do such further acts and things as may berequired to carry out the intent and purpose of this Agreement.  In particular, and without limiting the generalityof the foregoing, each Member agrees (i) that the Company’s Memorandum andArticles of Association and other Singapore corporate legal documents(collectively, the “**Singapore CorporateDocuments**”) shall at all times contain provisions as may benecessary or appropriate to give effect and facilitate the provisions of thisAgreement, (ii) that in the event of any inconsistency between the SingaporeCorporate Documents and this Agreement, this Agreement shall prevail and (iii)to take such actions with respect to its shares or in its capacity as ashareholder of the Company, including voting its shares at a shareholdersmeeting and adopting any changes to the Singapore Corporate Documents, all tobe consistent with and in accordance with the terms of this Agreement.

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IN WITNESSWHEREOF, the parties hereto have entered into this Agreement as of the date setforth above.

 
|        | **TCZ GMBH**                     |
|--------|----------------------------------|
|   | ** **                       |
|   | By:                              |   | /s/ Brian C. Klene |
|   |                             |   | Name: Brian C. Klene |
|   |                             |   | Title:   President and CEO |
|   |                             |   |   |
|   |                             |   |   |
|   | **CYMER, INC.**                  |
|   |                             |   |   |
|   | By:                              |   | /s/ Nancy J. Baker |
|   |                             |   | Name: Nancy J. Baker |
|   |                             |   | Title:   Sr. Vice President and CFO |
|   |                             |   |   |
|   |                             |   |   |
|   | **CARL ZEISS LASER OPTICS**      |
|   | **BETEILIGUNGSGESELLSCHAFT MBH** |
|   |                             |   |   |
|   | By:                              |   | /s/ Axel Jaeger |
|   |                             |   | Name: Axel Jaeger |
|   |                             |   | Title:   Managing Director |
|   |                             |   |   |
|   |                             |   |   |
|   | **CARL ZEISS SMT AG**            |
|   |                             |   |   |
|   | By:                              |   | /s/ H. Gerlinger |
|   |                             |   | Name: Dr. Hermann Gerlinger |
|   |                             |   | Title:   CEO |
|   |                             |   |   |
|   | By:                              |   | /s/ ppa. Stephan Müller |
|   |                             |   | Name: Stephan Müller |
|   |                             |   | Title:   Director |
|   |                             |   |   |
|   |                             |   |   |
|   | **TCZ PTE. LTD.**                |
|   |                             |   |   |
|   | By:                              |   | /s/ Brian C. Klene |
|   |                             |   | Name: Brian C. Klene |
|   |                             |   | Title:   President and CEO |
|   |                             |   |   |

 

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