**Exhibit 10.1**

 

**EMPLOYMENTAGREEMENT BETWEEN**

**DAVIDD. GLASS AND**

**VEECOINSTRUMENTS INC**.

 

December 17, 2009

 

David D. Glass

5 Elliston Ct.

Exton, PA  19341

 

Dear Dave:

 

We are very pleased toextend our offer to you to join Veeco Instruments Inc. (“Veeco” or the “Company”)as Executive Vice President and Chief Financial Officer, reporting to JohnPeeler, Chief Executive Officer.  In thiscapacity, you will be responsible for the management of Veeco’s finance,accounting, treasury and information technology functions.  The work location for this position is ourheadquarters office in Plainview, NY.

 

The elements of our offerare as follows:

 

·                  Your bi-weeklybase salary will be $13,846.16, which when annualized is equal to$360,000.  The Company’s regular payday isevery other Friday.

 

·                  You willparticipate in a performance-based management bonus plan, beginning in 2010. Your targetbonus will be 70% of your base earnings for the plan year (January 1through December 31); amounts payable under the plan will be pro-rated toreflect your actual start date for your first year of service.  Awards under the Plan are based on measuresof both corporate financial performance and individual goals and objectives.

 

·                  You will receive a sign-on bonus inthe gross amount of $150,000, payable in the first regular payroll followingninety (90) days after your start date. If your employment is terminated by the Company for Cause or by youwithout Good Reason (as each of those terms are defined in Annex A, attachedhereto) prior to the second anniversary of your start date, you agree toreimburse the Company for the full amount of the sign-on bonus.

 

·                  You will begranted, under the Veeco 2000 Stock Incentive Plan, effective upon your firstday of employment (the “Grant Date”):

 

·                  A restrictedstock award in the amount of 25,000 shares of Veeco Common Stock.  The restrictions on these shares will lapseover four years, with one third of the total award vesting on each anniversaryof the Grant Date, beginning with the second anniversary.

·                  A stock optionaward to purchase 50,000 shares of Veeco Common Stock.  One third of these options shall become exercisableon each of the first three anniversaries of the Grant Date.

 

·                  Veeco offers a comprehensive benefit program that issummarized in the enclosed “Total Benefit Solutions” brochure. You will beeligible to enroll in the Company’s health and welfare benefits programs on thefirst of the month next following your start date and you will be eligible toenroll in the Company’s pre-tax 401(k) savings plan on the first day ofthe calendar quarter after you commence employment.  You will also receive a monthly car allowanceof $700 and accrue vacation at the rate of*four* weeks peryear.  Additional information regardingthese benefits will be communicated to you in detail upon joining Veeco.

 

·                  You will be eligible for relocation assistance to moveyou and your family from Exton, PA to the Long Island area. Following a morecomprehensive assessment of your relocation requirements, we will enter into aseparate agreement specifying the terms of our relocation assistance.  These typically include reimbursement ofeligible expenses incurred during your relocation such as home sale andpurchase costs, shipment of household goods and temporary living allowance.  *Notwithstanding completingthis assessment, I am pleased to confirm that we will provide you with areasonable temporary living allowance to assist you with duplicate housingcosts for up to the first twelve (12) months of your employment with Veeco.* Relocation activities must be coordinated throughGraebel Relocation to be eligible for these benefits; you will be required toexecute a separate relocation agreement, provided under separate cover,specifying the terms and conditions of relocation benefits.

 

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·                  In connection with your employment,Veeco will provide you with the following separation benefits in the event ofyour termination without Cause or your resignation with Good Reason:

 

·                  A *eighteen (18) months* of salarycontinuation severance benefits; and

·                  Company-subsidized continuation of health insurance benefits underCOBRA for up to *eighteen (18) months*; and

·                  Extended stock option exercise rights for up to twelve (12) months ofthe severance period, not to exceed the expiration date of the option.

 

Receipt of these benefitswould be conditioned on your execution of a waiver and release, in a formsatisfactory to Veeco, at the time of termination, which would containnon-competition, non-solicitation and similar provisions.

 

In addition to theforgoing, effective with your employment date, you will be named a participantin the Company’s Change in Control Policy (copy enclosed) that provides forcertain benefits in the event of a change in control.

 

We are pleased to offer you this comprehensivecompensation package.  Additional informationimportant to your joining Veeco includes the following:

 

·                  *Veeco agrees to indemnify you inaccordance with the terms of the Company’s bylaws and applicable statutes forindemnification with respect to any action, suit or proceeding or other matter broughtor threatened to be brought against you by reason of the fact that you areofficer, director or employee of the Company.*

 

·                  Veeco is required by federal immigrationlaws to verify the identity and legal ability to work in the United States ofall individuals employed by the Company. This offer of employment is contingent upon your ability to demonstratevalid work authorization at the time of your employment with our firm.  Please bring proof of your eligibility tolegally work in the United States with you on your first day of work.  Refer to the enclosed I-9 form for acceptableforms of such proof (e.g.; birth certificate, resident registration card, validU.S. passport, driver’s license and Social Security Card, etc.).

 

·                  This offer of employment is contingent upon ourreceiving favorable background and reference checks, including approvedtechnology clearance for Veeco products, information and processes incompliance with U.S. Export Administration Regulations.  During your initial employment period, beforeyour technology clearance is received, you will have access only tounrestricted products, technologies and facilities.

 

·                  Our Company promotes a drug-free work environment andin that regard we have implemented a pre-employment drug screening program forjob applicants.  Information regardingthe drug screening process (along with the Fair Crediting Reporting ActDisclosure and Authorization Statement that must be completed and returned toHuman Resources before the expiration of this offer) and the participatingcollection facility closest to your home is included with this letter.  Your refusal to consent to this testing,falsification of a test or positive test results will result in denial ofemployment.  The drug screening processshould be completed within two (2) business days from the date of youracceptance of this position.  You maywish to consider whether or not you resign from any current employment until wenotify you that all facets of the pre-employment process have beensatisfactorily completed.

 

·                  As a condition of your employment, you will berequired to sign an Employee Confidentiality Agreement upon commencingemployment with Veeco.  This Agreementensures a common understanding regarding your responsibilities in this matter.

 

**Employmentat Veeco is on an at-will basis which means that employment is not for anyspecific period and either the Company or its employees can terminate theemployment relationship at any time, with or without cause or notice.  This letter constitutes all the terms of Veeco’soffer of employment and supersedes all previous conditions, whether verbal,written or implied.  The terms of thisoffer can only be changed in writing and must be signed by both the employeeand appropriate representative of Veeco. By signing this letter you are agreeing to the terms and conditionscontained in it and you agree to comply with Veeco’s Code of Business Conduct(copy enclosed).  Additionally, you agreethat these documents, taken together with our Employment Application,constitute the entire agreement and understanding between Veeco and you.  Finally, you acknowledge that any of Veeco’spolicies and procedures and benefit programs may be amended from time to timeby Veeco in its sole discretion.  Thisoffer will expire on December 21, 2009.**

** **

Dave,we are very impressed with your potential for success and we look forward tohaving you join the Veeco team at a most exciting time in the history of theCompany.  Please let me know if I can beof assistance with respect to any aspect of our offer.

 

Sincerely,

 
| /s/ Robert W. Bradshaw |   |   |
|------------------------|--------|--------|

 

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| Robert W.  Bradshaw                  |   |                |
|--------------------------------------|--------|---------------------|
| Sr. Vice President,  Human Resources |   |                |
|                                 |   |                |
| ACCEPTED AND  AGREED:                |   |                |
|                                 |   |                |
| /s/ David D. Glass                   |   |                |
| David D. Glass                       |   | Proposed Start Date |

 

Attachment: Annex A —Separation Benefits (2 pages)

 

cc: John Peeler, RobTillman

 

Annex A

 

SeparationBenefits

 

In the event you areterminated without “Cause” or you resign for “Good Reason” (each as definedbelow), the following would apply:

 

a)              Veeco will pay you *18* monthsseverance in the form of a salary continuation benefit based on your annualbase salary in effect immediately prior to such termination (but without regardto any salary reduction program then in place), less applicable deductions.

 

b)             If you are enrolled in Veeco’s medical, dental and/orvision plans, and you elect to continue coverage thereunder in accordance withthe continuation of benefits requirements of COBRA, your contribution amountfor the period during which you are receiving salary continuation benefits willbe the normal employee contribution rate. You agree to notify Veeco if you become eligible for coverage underanother group health insurance plan, whereupon Veeco’s obligation to pay for aportion of such coverage shall cease.

 

c)              Any options to purchase shares of Veeco common stockgranted to you on or after the date hereof (“Options”) which are held by youand exercisable as of the date of such termination shall remain exercisableuntil the earlier of (x) 12 months following the date of such terminationand (y) the expiration of the original term of such Options.

 

d)             In addition, if such termination or resignation occurswithin 12 months following a “Change of Control” (as defined below), anyOptions which are held by you as of the date of such termination that were notvested as of such date shall become immediately and fully vested as of suchdate.

 

Receipt of the benefitsdescribed above is conditioned upon your execution (without revocation) of ageneral release of claims in a form satisfactory to Veeco, including non-competitionand non-solicitation provisions for the duration of the period during whichsalary continuation benefits are payable as described above.

 

AdditionalProvisions

 

The Separation Benefitsdescribed herein do not alter the “at-will” nature of your employment withVeeco.  This means that your employmentmay be terminated by you or by Veeco at any time, with or without cause.  As described above, however, you may beentitled to severance benefits depending upon the circumstances of thetermination of employment.

 

As used above, thefollowing definitions shall apply:

 

“Cause” shall mean(i) your willful and substantial misconduct, (ii) your repeated,after written notice, neglect of duties or failure to perform your assignedduties, (iii) your commission of any material fraudulent act with respectto Veeco or its business, or (iv) your conviction of (or plea of nocontest to) a crime constituting a felony.

 

“Change of Control”shall mean:  (a) any person or groupof persons becomes the beneficial owner of securities representing 50 percentor more of Veeco’s outstanding voting securities, or (b) the approval byVeeco’s stockholders of one of the following:

 

(i)  Anymerger or statutory plan of exchange (“Merger”) in which Veeco would not be thesurviving corporation or pursuant to which Veeco’s voting securities would beconverted into cash, securities or other property, other than a Merger in whichthe holders of Veeco’s voting securities immediately prior to the Merger havethe same proportionate ownership of voting securities of the survivingcorporation after the Merger;

 

(ii)  AnyMerger in which the holders of outstanding voting securities of Veeco prior tosuch Merger will not, in the aggregate, own a majority of the outstanding votingsecurities of the combined entity after such Merger; or

 

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(iii)  Anysale or other transfer (in one transaction or a series of related transactions)of all or substantially all of the Veeco’s assets or the adoption of any planor proposal for Veeco’s liquidation or dissolution.

 

“Good Reason”shall mean (i) a reduction of your base salary, other than as part of asalary reduction program affecting management employees generally *or (ii) a significant reduction by the Company in total benefitsavailable to you under cash incentive, stock incentive and other employeebenefit plans (other than a reduction in benefits affecting managementemployees generally)*.

 

*Code Section 409A**. Payments in respect of your termination of employment in the eventof termination without Cause or for Good Reason, as defined in this letter, aredesignated as separate payments for purposes of the short-term deferral rules underTreasury Regulation Section 1.409A-1(b)(4)(i)(F) and the exemptionfor involuntary terminations under separation pay plans under TreasuryRegulation Section 1.409A-1(b)(9)(iii). As a result, (a) any payments that become vested as a result ofyour termination of employment without Cause or for Good Reason, that aremade on or before the 15th day of the third month of the calendar yearfollowing the calendar year of your termination of employment, and (b) anyadditional payments that are made on or before the last day of the secondcalendar year following the year of your termination of employment and do not exceedthe lesser of two times Base Salary or two times the limit under Code Section 401(a)(17)then in effect, and (c) the payment of medical expenses within theapplicable COBRA period, are exempt from the requirements of Code Section 409A.  If the Executive is designated as a “specifiedemployee” within the meaning of Code Section 409A, to the extent that anydeferred compensation payments to be made during the first six month periodfollowing your termination of employment exceed such exempt amounts, thepayments shall be withheld and the amount of the payments withheld will be paidin a lump sum, without interest, during the seventh month after yourtermination.  The Company shall identifyin writing delivered to you any payments it reasonably determines are subjectto delay under this provision.  Inno event shall the Company have any liability or obligation with respect totaxes for which you may become liable as a result of the application of Code Section 409A.*

 

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