Exhibit 10.1


 





 


1 Terminal Drive, Plainview,
New York 11803 · Phone (516)
677-0200 · Fax (516) 719-1219 · Internet www.veeco.com


 


September 20,
2010


 


Dr. Mark
R. Munch


 


Re:
Green Acres Transaction / Retention Incentive Arrangement


 


Dear
Mark:


 


As
you know, Veeco Instruments Inc. (“Veeco” or the “Company”) recently signed a
definitive agreement for the sale of its Metrology business (the “Green Acres”
transaction).  You are a valued member of
the Veeco team whose contributions were and are considered critical to the
continued operations and the effective marketing, sale, transition and
integration of Green Acres.  In this
connection, we are pleased to confirm the following incentives, offered to you
as a means of securing your continued service to Veeco through the deal closing
date (your “Continued Employment”) and your assistance with the transition and
integration of the business to the buyer and to provide you additional
financial security during and after this period.


 


1.               Transaction Incentive.  In exchange for (i) your Continued
Employment with Veeco and (ii) provided that the Green Acres transaction
is closed and generates sale proceeds of $180 million or more, you will receive
a Transaction Incentive based on the value of the deal.  The Transaction Incentive amount is based on
a formula tied to the value of the deal. The following examples are provided as
a reference.


 


	
  Deal Sale Proceeds

  	
   

  	
  Transaction Incentive

  	
   

  
	
  $250 million:

  	
   

  	
  $

  	
  1,440,000

  	
   

  
	
  $229 million:

  	
   

  	
  $

  	
  1,137,600

  	
   

  
	
  $200 million:

  	
   

  	
  $

  	
  720,000

  	
   

  
	
  $180 million:

  	
   

  	
  $

  	
  540,000

  	
   

  



 


 


The
actual Transaction Incentive will be determined between the amounts shown above
and calculated based on the actual value of the deal.  Payment of the Transaction Incentive, if
earned, will be made in a single lump sum within thirty (30) days of the deal
closing date.


 


The
Transaction Incentive will expire if the Green Acres transaction is not closed
on or before July 1, 2011.


 


2.               Equity Incentive.  In exchange for (i) your Continued
Employment with Veeco, and (ii) provided that the Green Acres transaction
is closed and generates sale proceeds of $200 million or more, then on the
closing date of the transaction, you will receive an equity incentive (the “Equity
Incentive”) that will provide for:


 


·                  The acceleration of vesting,
by twelve (12) months, of any then current, outstanding and unvested Veeco
equity award, and


 

















 


·                  A period of twelve (12)
months, not to exceed the original term of the stock option award, during which
any outstanding, vested stock options may be exercised.


 


Additionally,
provided that (i) you accept a comparable offer of employment (a “Comparable
Offer”), as that term is defined below, with the acquiring entity (the “Acquirer”),
and (ii) you remain in the Acquirer’s employment for a period of at least
six (6) months following the closing date, then on the six (6) month
anniversary of the closing date you will receive an additional equity incentive
(the “Additional Equity Incentive”) that will provide for:


 


·                  The acceleration of vesting
of any current and outstanding Veeco equity award remaining unvested at such
time, and


·                  A period of six (6) months,
not to exceed the original term of the stock option award, during which any
such outstanding, vested stock options may be exercised.


 


For
purposes of this Additional Equity Incentive, a Comparable Offer is defined as
any offer of employment by the Acquirer that does not trigger the Good Reason
provisions contained in the Company’s Senior Executive Change in Control
Policy.


 


The
Equity Incentive and Additional Equity Incentive will expire if the Green Acres
transaction is not closed on or before July 1, 2011.


 


3.               Management
Bonus.  As a participant in the Veeco
Management Bonus Plan, you will be entitled to receive pro-rated management
bonus awards, if earned (the “Earned Bonuses”), for the year in which your
Veeco employment terminates as a direct result of the sale of the Green Acres
transaction.  Payment of Earned Bonuses
will be made no later than the time at which bonuses are paid to Veeco’s bonus
plan participants generally.


 


4.               Senior
Executive Change in Control Policy.  You are a participant in the Veeco Sr.
Executive Change in Control Policy (the “CIC Policy”).  In accordance with the terms and conditions
of the CIC Policy, if you accept employment with the Acquirer, then you may be
entitled to certain severance benefits in the event of your termination of
employment in connection with or during the eighteen (18) month period
following a Group Change in Control.  For
purposes of the CIC Policy, the Green Acres transaction qualifies as a Group
Change in Control.  In the event you
qualify for and are paid benefits hereunder and later qualify for similar
benefits under the CIC Policy, you agree that no benefits will be payable under
the CIC Policy which are duplicative of the benefits payable hereunder.


 


5.               Eligibility / Requirements.  In order to receive the benefits described
herein, you must:


 


·                  Except as may be otherwise specified herein,
remain employed by the Company (or the Acquirer, as the case may be) until such
benefit is earned, and


·                  Devote your full-time working hours to your
employment with the Company (or the Acquirer, as the case may be), and


·                  Perform your job responsibilities and any
other duties that may be assigned in connection with the Green Acres
transaction and transition in good faith and to the best of your abilities, and


 


2

















 


·                  Execute (and not revoke) a general release of
claims in a form satisfactory to Veeco (provided that you do not have to
release claims for payments or benefits to be provided hereunder at a future
date).


 


6.               Employee at Will.  You and Veeco acknowledge that you are an
employee at will.  Nothing herein shall
be deemed to be an employment agreement or in any way create an obligation of
Veeco to offer or provide employment to you or for you to remain an employee of
Veeco.


 


7.               Tax Withholding.  Veeco shall be entitled to withhold from the
payments to be made hereunder all federal, state and local taxes that employers
are required by law to withhold therefrom.


 


8.               Amendment; Waiver.  The provisions of this Agreement may not be
modified, amended or waived except in writing signed by both parties
hereto.  The waiver of compliance with
any provision of this Agreement shall not operate as a waiver of any other
provision of this Agreement or of any subsequent breach of this Agreement.


 


9.               Cause. “Cause” shall
mean (i) failure to carry out your duties, responsibilities and
obligations as an employee, including your obligations under this Agreement, (ii) insubordination,
(iii) the commission of an act of theft, fraud or embezzlement or (iv) the
commission of a crime punishable by imprisonment.


 


10.         Entire Agreement.  This Agreement sets forth the entire
agreement between the parties pertaining to the subject matter herein and
supersedes any and all prior agreements or understandings between the parties
pertaining to such subject matters.


 


11.         Severability.  Should any provision of this Agreement be
declared illegal or unenforceable by any court of competent jurisdiction and
cannot be modified to be enforceable, such provision shall immediately become
null and void, leaving the remainder of this agreement in full force and
effect.


 


12.         Governing Law.  This Agreement shall be governed by and
interpreted in accordance with the laws of the State of California, without
regard to the choice of law provisions thereof.


 


Mark,
we sincerely appreciate your contributions to Veeco and look forward to your
support through this transition.  Please
sign the acknowledgment below and return it to Veeco no later than the close of
business on September 24, 2010, when this offer will expire if not
previously accepted.


 


	
  VEECO INSTRUMENTS INC.

  	
  ACKNOWLEDGED
  AND AGREED:

  
	
   

  	
   

  	
   

  
	
  By:

  	
  /s/
  Robert W. Bradshaw

  	
   

  	
  Signed:

  	
  /s/
  Mark R. Munch

  
	
  Name:

  	
  Robert
  W. Bradshaw

  	
   

  	
  Name:

  	
  Mark
  R. Munch

  
	
  Title:

  	
  Sr.
  Vice President, Human Resources

  	
   

  	
  Date:

  	
  September
  23, 2010

  



 


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