fy2009-8k12_2008severanceex.htm


    
       

      EXHIBIT
10.1

      Tegal
Corporation

       

      Executive
Severance Plan

      (and
Summary Plan Description)

       

       

      This
Executive Severance Plan (the “Plan”)
sets forth the terms of severance benefits for certain employees of Tegal
Corporation (the “Company”)
in the event of a termination of employment with the Company under the
circumstances described below.  For purposes of this Plan, “Company”
will include any Subsidiary of the Company (as defined below) and any successor
to substantially all of the business, shares or assets of the
Company.

       

      The Plan
is an employee welfare benefit plan subject to the Employee Retirement Income
Security Act of 1974, as amended (“ERISA”).  This
Plan document is also the summary plan description of the
Plan.  References in the Plan to “You” or “Your” are references to an
employee of the Company.

       

      1. Eligibility and
Participation.  Subject to the eligibility requirements set
forth in this Section 1 and the other terms and conditions of this Plan, the
Company shall provide severance benefits under this Plan to the individuals set
forth on Appendix
A.  The Plan Administrator (as defined below) may add or delete
individuals from Appendix
A at any time, in its sole discretion.  In order to be eligible
for benefits under this Plan, you must, immediately prior to your date of
termination, be a full-time employee of the Company who is not subject to
disciplinary action or on a formal performance improvement plan.  You
will be considered a full-time employee of the Company if you are on a
Company-approved leave of absence immediately prior to your date of termination
and you were employed full-time immediately prior to the commencement of
such leave.  You will not be eligible for
benefits under this Plan if you are a party to any individual Employment
Agreement approved by the Board or a committee thereof in effect as of the date
of your termination.

       

      2. Severance
Benefit.  If you are a participant in the Plan, and you are
discharged from employment by the Company without Cause (as defined below),
subject to your compliance with Sections 3 and 4, you will receive the benefits
set forth below:

       

      (a)           Accrued
Obligations.  On the date your employment terminates, you will
receive a lump sum payment in cash for (i) your fully earned but unpaid base
salary, through the date of termination, at the rate then in effect, and (ii)
your accrued but unused vacation through the date of termination.

       

      (b)           Base Salary Severance
Benefit.  You will receive a severance benefit (your “Base Salary
Severance Benefit”) equal to your Base Salary for the Severance Period
(as defined below).  The Base Salary Severance Benefit shall be paid
in equal installments over the Severance Period on the regular payroll dates of
the Company and subject to applicable tax withholding, beginning no later than
60 days following the date of your termination of employment.  For
purposes of Section 409A of the Internal Revenue Code of 1986, as amended (the
“Code”)
(including, without limitation, for purposes of Treasury Regulation Section
1.409A-2(b)(2)(iii)), your right to receive the foregoing installment payments
shall be treated as a right to receive a series of separate payments and,
accordingly, each installment payment shall at all times be considered a
separate and distinct payment.

       

      Your
“Base
Salary” will be the rate of your base salary from the Company as in
effect on the date of your termination of employment with the
Company.  For this purpose, your base salary will not include any
bonus, incentive compensation, benefits or expense reimbursements or equity
awards.

       

      The
“Severance
Period” will be 6 months, unless your discharge by the Company without
Cause occurs within 12 months following a Change in Control (as defined below),
in which case the Severance Period will be 12 months.

       

      In no event will you receive benefits
under this Plan in the event of a termination of your employment as a result of
your death or disability.

      


      3. Release Prior to Payment of
Benefits.  Prior to the payment of any benefits under this
Plan, and as a condition to such payment, you will be required to execute a
waiver and release of claims agreement (the “Release”)
in form and substance acceptable to the Company.  Such Release will
specifically relate to all of your rights and claims in existence at the time of
such execution and will confirm your obligations under the Company’s
Confidential Information Policy (as defined below).

       

      As
specified in the applicable Release, you will have a certain number of calendar
days to consider whether to execute such Release, and you may revoke such
Release within 7 calendar days after execution.  You must execute the
Release and not revoke the Release in order to be entitled to benefits under
this Plan.  With respect to each participant in the Plan, his or her
“Release
Effective Date” will be the day upon which the 7 day revocation period
applicable to such Release expires without a revocation of such Release by the
participant.

       

      Your
Release Effective Date must be within 55 days following the date of your
termination of employment.  If your Release Effective Date does not
occur within 55 days of your termination of employment, you will not be entitled to
benefits under this Plan.

       

      4. Restrictive
Covenants.

       

      
        	
                (a)

              	
                You
      acknowledge that you have executed and are subject to the provisions of
      all Company policies regarding confidential information and ethics
      including, but not limited to the Confidential & Proprietary
      Information and Intellectual Property/Property Rights policy, (the “Confidential
      Information Policy”).

              


      

       

      
        	
                (b)

              	
                While
      you are employed by the Company, and for any period after the date of your
      termination of employment with the Company during which you are receiving
      severance benefits pursuant to this Plan, you agree that you will not
      recruit, encourage or solicit any person who is an employee or contractor
      of the Company or any entity affiliated with the Company (the “Affiliated
      Entity”) to leave the Company’s or Affiliated Entity’s employ or
      service for any reason, or interfere in any material manner with
      employment or service relationships at the time existing between the
      Company or Affiliated Entity and the subject employee or contractor
      (except as may be required in any bona fide termination decision regarding
      any Company or Affiliated Entity employee) in order to induce such
      employee or contractor of the Company to accept other employment or a
      consulting agreement with any other person or
  entity.

              


      

       

      
        	
                (c)

              	
                If
      you breach or threaten to commit a breach of any of the provisions of this
      Section 4, the Company shall have the right to cease all payments to
      you under Section 2, in addition to any other rights and remedies
      available to the Company under law or in
equity.

              


      

       

      5. Effective Date of Plan;
Amendment. This Plan will be effective as of  December 15,
2008 (the “Effective
Date”), and shall continue until the earlier of (a) the date it is
terminated by the Compensation Committee of the Board or (b) the date on which
all benefits payable under the Plan have been paid.  The Compensation
Committee of the Board will have the power to amend or terminate this Plan from
time to time in its sole and absolute discretion; provided, however, that no
such termination or amendment shall impair your rights to benefits under the
terms and conditions of the Plan, as in effect prior to such termination or
amendment, without your written consent.

       

      6. Claims
Procedures.

       

      (a) Normally,
you do not need to present a formal claim to receive benefits payable under this
Plan.

       

      (b) If any
person (the “Claimant”)
believes that benefits are being denied improperly, that the Plan is not being
operated properly, that fiduciaries of the Plan have breached their duties, or
that the Claimant’s legal rights are being violated with respect to the Plan,
the Claimant must file a formal claim, in writing, with the Plan Administrator
(as defined in Section 7(a) below).  This requirement applies to all
claims that any Claimant has with respect to the Plan, including claims against
fiduciaries and former fiduciaries, except to the extent the Plan Administrator
determines, in its sole discretion, that it does not have the power to grant all
relief reasonably being sought by the Claimant.

       

      (c) A formal
claim must be filed within 90 days after the date the Claimant first knew or
should have known of the facts on which the claim is based, unless the Plan
Administrator in writing consents otherwise.  The Plan Administrator
will provide a Claimant, on request, with a copy of the claims procedures
established under subsection (d).

       

      (d) The Plan
Administrator has adopted procedures for considering claims (which are set forth
in Appendix B), which it
may amend from time to time, as it sees fit.  These procedures will
comply with all applicable legal requirements.  These procedures may
provide that final and binding arbitration will be the ultimate means of
contesting a denied claim (even if the Plan Administrator or its delegates have
failed to follow the prescribed procedures with respect to the
claim).  The right to receive benefits under this Plan is contingent
on a Claimant using the prescribed claims procedures to resolve any
claim.

       


      
        
          
             

          

           


        

        
           


          
            

          

        

        
           


        

      


      7. Plan
Administration.

       

      (a) The Plan
will be administered by the Compensation Committee of the Board and/or its
delegate which will be one or more senior officers of the Company (the “Plan
Administrator”).  The Plan Administrator is responsible for the
general administration and management of the Plan and will have all powers and
duties necessary to fulfill its responsibilities, including, but not limited to,
the discretion to interpret and apply the Plan and to determine all questions
relating to eligibility for benefits.  The Plan will be interpreted in
accordance with its terms and their intended meanings.  All actions
taken and all determinations made in good faith by the Plan Administrator or by
Plan fiduciaries will be final and binding on all persons claiming any interest
in or under the Plan.

       

      (b) If, due
to errors in drafting, any Plan provision does not accurately reflect its
intended meaning, as demonstrated by consistent interpretations or other
evidence of intent, or as determined by the Plan Administrator in its sole
discretion, the provision will be considered ambiguous and will be interpreted
by the Plan Administrator and all Plan fiduciaries in a fashion consistent with
its intent, as determined in the sole discretion of the Plan
Administrator.  The Plan Administrator will amend the Plan
retroactively to cure any such ambiguity.

       

      (c) No Plan
fiduciary will have the authority to answer questions about any pending or final
business decision of the Company or any affiliate that has not been officially
announced, to make disclosures about such matters, or even to discuss them, and
no person will rely on any unauthorized, unofficial disclosure. Thus, before a
decision is officially announced, no fiduciary is authorized to tell any person,
for example, that he or she will or will not be laid off or that the Company
will or will not offer exit incentives in the future. Nothing in this subsection
will preclude any fiduciary from fully participating in the consideration,
making, or official announcement of any business decision.

       

      (d) This
Section may not be invoked by any person to require the Plan to be interpreted
in a manner inconsistent with its interpretation by the Plan Administrator or
other Plan fiduciaries.

       

      8. Superseding Plan. This
Plan (a) will be the only plan with respect to which benefits may be provided to
you as a result of your discharge by the Company without Cause and (b) will
supersede any other plan previously adopted by the Company with respect to
severance benefits payable to you.  Any of your rights hereunder will
be in addition to any rights you may otherwise have under benefit plans or
agreements of the Company (other than severance plans or agreements) to which
you are a party or in which you are a participant, including, but not limited
to, any Company-sponsored employee benefit plans and equity incentive award
plans and any awards made thereunder.

       

      9. Limitation on Employee
Rights. This
Plan will not give any employee the right to be retained in the service of the
Company, nor will it interfere with or restrict the right of the Company to
discharge or otherwise terminate the employee.

       

      10.            No Third-Party
Beneficiaries. This
Plan will not give any rights or remedies to any person other than eligible
employees and the Company.

       

      11.            Successors.  This
Plan shall be binding upon and inure to the benefit of the successors of the
Company.

       

      12. Governing Law and Venue. This
Plan is a welfare plan subject to ERISA and it will be interpreted,
administered, and enforced in accordance with that law.  To the extent
that state law is applicable, the statutes and common law of the State of
California, excluding any that mandate the use of another jurisdiction’s laws,
will apply.  Any suit brought hereon shall be brought in the federal
courts sitting in the Northern District of California, and you hereby waive any
claim or defense that such forum is not convenient or proper.

       

      13.            Miscellaneous. Where
the context so indicates, the singular will include the plural and vice
versa.  Titles are provided herein for convenience only and are not to
serve as a basis for interpretation or construction of the
Plan.  Unless the context clearly indicates to the contrary, a
reference to a statute or document will be construed as referring to any
subsequently enacted, adopted, or executed counterpart.

       

      14. Notice.  For
purposes of this Plan, notices and all other communications provided for in this
Plan will be in writing and will be deemed to have been duly given when
delivered or mailed by United States certified or registered mail, return
receipt requested, postage prepaid, addressed to the Company at its primary
office location and to an employee at such employee’s last known address as
listed on the Company’s records, provided that all notices to the Company will
be directed to the attention of its Secretary, or to such other address as
either party may have furnished to the other in writing in accordance herewith,
except that notice of change of address will be effective only upon
receipt.

       

      15. Withholding.  The
Company will be entitled to withhold from any payments or deemed payments to you
hereunder any amount of withholding required by law.

       

      16. Additional
Information.  As a participant in the Plan, you are entitled to
certain rights and protections under ERISA, as described in Appendix C.

       

      17. Section 409A of the
Code.

       

      (a) Notwithstanding
anything herein to the contrary, to the extent any payments to you pursuant to
Section 2 are treated as non-qualified deferred compensation subject to Section
409A of the Code, then (a) no amount shall be payable pursuant to such section
unless your termination of employment constitutes a “separation from service”
with the Company (as such term is defined in Treasury Regulation Section
1.409A-1(h) and any successor provision thereto) (a “Separation from
Service”), and (b) if you, at the time of your Separation from Service,
are determined by the Company to be a “specified employee” for purposes of
Section 409A(a)(2)(B)(i) of the Code and the Company determines that delayed
commencement of any portion of the termination benefits payable to you pursuant
to this Plan is required in order to avoid a prohibited distribution under
Section 409A(a)(2)(B)(i) of the Code (any such delayed commencement, a “Payment
Delay”), then such portion of your termination benefits described in
Section 2 shall not be provided to you prior to the earlier of (i) the
expiration of the six-month period measured from the date of your Separation
from Service, (ii) the date of your death or (iii) such earlier date as is
permitted under Section 409A.  Upon the expiration of the applicable
Code Section 409A(a)(2)(B)(i) deferral period, all payments deferred pursuant to
a Payment Delay shall be paid in a lump sum to you within 30 days following such
expiration, and any remaining payments due under this Plan shall be paid as
otherwise provided herein.  The determination of whether you are a
“specified employee” for purposes of Section 409A(a)(2)(B)(i) of the Code as of
the time of your Separation from Service shall made by the Company in accordance
with the terms of Section 409A of the Code and applicable guidance thereunder
(including without limitation Treasury Regulation Section 1.409A-1(i) and any
successor provision thereto).

       

      (b) Notwithstanding
Section 17(a), to the maximum extent permitted by applicable law, amounts
payable to you pursuant to Section 2 shall be made in reliance upon Treasury
Regulation Section 1.409A-1(b)(9) (with respect to separation pay plans) or
Treasury Regulation Section 1.409A-1(b)(4) (with respect to short-term
deferrals).

       

      (c)           To
the extent the payments and benefits under this Plan are subject to Section 409A
of the Code, this Plan shall be interpreted, construed and administered in a
manner that satisfies the requirements of Sections 409A(a)(2), (3) and (4) of
the Code and the Treasury Regulations thereunder (and any applicable transition
relief under Section 409A of the Code).

       

      18. Definitions. For
purposes of this Plan, the following terms will have the following
meanings:

       

      (a)           “Board”
means the board of directors of Tegal Corporation.

       

      (b)           “Cause”
means that, in the reasonable determination of the Company, you:

       

      (i)           have willfully engaged in an
act or omission which is in bad faith and to the detriment of the Company, or
have engaged in misconduct, gross negligence, or willful malfeasance, in each
case that causes material harm to the Company;

       

      
        	
                (ii)

              	
                have
      materially breached any agreement between you and the Company, including
      Company policies and practices;

              


      

      


      (iii)           have
habitually neglected or materially failed to perform your duties (other than any
such failure resulting solely from your physical or mental disability or
incapacity) after a written demand for substantial performance is delivered to
you which identifies the manner in which the Company believes that you have not
performed your duties;

       

      
        	
                (iv)

              	
                have
      been convicted of a felony or any crime involving moral turpitude, have
      used drugs or alcohol in a way that either interferes with the performance
      of your duties or compromises the integrity or reputation of the Company,
      or have engaged in any act of dishonesty involving the Company;
      or

              


      

      


      
        	
                (v)

              	
                have
      disclosed Company confidential information not required by your duties, or
      have committed commercial bribery, or perpetration of
    fraud;

              


      

      


      
        	
                 
      

              	
                provided, however, that you shall
      have at least forty-five (45) calendar days to cure, if curable, any of
      the events which could lead to your termination for
  Cause.

              


      

      


      (c)           “Change in
Control” means and includes each of the following:

       

                 (i)           A
transaction or series of transactions (other than an offering of the Company’s
common stock to the general public through a registration statement filed with
the Securities and Exchange Commission) whereby any “person” or related “group”
of “persons” (as such terms are used in Sections 13(d) and 14(d)(2) of the
Securities Exchange Act of 1934, as amended (the “Exchange
Act”)) (other than the Company, any of its subsidiaries, an employee
benefit plan maintained by the Company or any of its subsidiaries or a “person”
that, prior to such transaction, directly or indirectly controls, is controlled
by, or is under common control with, the Company) directly or indirectly
acquires beneficial ownership (within the meaning of Rule 13d-3 under the
Exchange Act) of securities of the Company possessing more than 50% of the total
combined voting power of the Company’s securities outstanding immediately after
such acquisition; or

       

      (ii)           During
any period of two consecutive years, individuals who, at the beginning of such
period, constitute the Board together with any new director(s) (other than a
director designated by a person who shall have entered into an agreement with
the Company to effect a transaction described in clause (i) above or clause (ii)
below whose election by the Board or nomination for election by the Company’s
stockholders was approved by a vote of at least two-thirds of the directors then
still in office who either were directors at the beginning of the two-year
period or whose election or nomination for election was previously so approved,
cease for any reason to constitute a majority thereof; or 

       

      (iii)           The
consummation by the Company (whether directly involving the Company or
indirectly involving the Company through one or more intermediaries) of
(x) a merger, consolidation, reorganization, or business combination or
(y) a sale or other disposition of all or substantially all of the
Company’s assets in any single transaction or series of related transactions or
(z) the acquisition of assets or stock of another entity, in each case
other than a transaction:

       

      (A)           Which
results in the Company’s voting securities outstanding immediately before the
transaction continuing to represent (either by remaining outstanding or by being
converted into voting securities of the Company or the person that, as a result
of the transaction, controls, directly or indirectly, the Company or owns,
directly or indirectly, all or substantially all of the Company’s assets or
otherwise succeeds to the business of the Company (the Company or such person,
the “Successor
Entity”)) directly or indirectly, at least a majority of the combined
voting power of the Successor Entity’s outstanding voting securities immediately
after the transaction, and 

       

      (B)           After
which no person or group beneficially owns voting securities representing 50% or
more of the combined voting power of the Successor Entity; provided, however, that no
person or group shall be treated for purposes of this clause (B) as beneficially
owning 50% or more of combined voting power of the Successor Entity solely as a
result of the voting power held in the Company prior to the consummation of the
transaction; or

       

      (iv)           The
Company’s stockholders approve a liquidation or dissolution of the
Company.

       

      
        	
                 
      

              	
                The
      Plan Administrator will have full and final authority, which will be
      exercised in its discretion, to determine conclusively whether a Change in
      Control of the Company has occurred pursuant to the above definition, and
      the date of the occurrence of such Change in Control and any incidental
      matters relating thereto.

              


      

       

      


      * * * *
*

       


      
        
          
             

          

           


        

        
           


          
            

          

        

        
           


        

      


      Executed
at Petaluma, California, effective as of December 18, 2008.

       

      Tegal Corporation

      


      


      By:                                                                

      Name: Thomas R Mika

      Title: President and CEO

      


      



      
        
          
             

          

           


        

        
           


          
            

          

        

        
           


        

      


      


      Appendix
A

       

      Eligible
Employees

       

      


       

      Steve
Selbrede, Chief Technology Officer, VP Research & Development

      


      Paul
Werbaneth, Vice President Marketing & Applications

      


      Scott Brown, Vice President
North American Sales


      
        
          
             

          

           


        

        
           


          
            

          

        

        
           


        

      


      Appendix
B

       

      Detailed
Claims Procedures

       

       

      1.           Claims
Procedure.

       

      (a)           Initial Claims.  All claims will
be presented to the Plan Administrator in writing.  Within 90 days
after receiving a claim, a claims official appointed by the Plan Administrator
will consider the claim and issue his or her determination thereon in
writing.  The claims official may extend the determination period for
up to an additional 90 days by giving the Claimant written
notice.  The initial claim determination period can be extended
further with the consent of the Claimant.  Any claims that the
Claimant does not pursue in good faith through the initial claims stage will be
treated as having been irrevocably waived.

       

      (b)           Claims Decisions.  If the claim is
granted, the benefits or relief the Claimant seeks will be
provided.  If the claim is wholly or partially denied, the claims
official will, within 90 days (or a longer period, as described above), provide
the Claimant with written notice of the denial, setting forth, in a manner
calculated to be understood by the Claimant: (i) the specific reason or reasons
for the denial; (ii) specific references to the provisions on which the denial
is based; (iii) a description of any additional material or information
necessary for the Claimant to perfect the claim, together with an explanation of
why the material or information is necessary; and (iv) appropriate information
as to the steps to be taken if the Claimant wishes to submit his or her claim
for review, including the time limits applicable to such procedures, and a
statement of the Claimant’s right to bring a civil action under Section 502(a)
of ERISA following an adverse decision upon review.  If the Claimant
can establish that the claims official has failed to respond to the claim in a
timely manner, the Claimant may treat the claim as having been denied by the
claims official.

       

      (c)           Appeals of Denied Claims.  Each Claimant
will have the opportunity to appeal the claims official’s denial of a claim in
writing to an appeals official appointed by the Plan Administrator (which may be
a person, committee, or other entity).  A Claimant must appeal a
denied claim within 60 days after receipt of written notice of denial of the
claim, or within 60 days after it was due if the Claimant did not receive it by
its due date.  The Claimant (or his or her duly authorized
representative) may review pertinent documents in connection with the appeals
proceeding and may present issues, comments and documents in writing relating to
the claim.  The review will take into account all comments, documents,
records and other information submitted by the Claimant relating to the claim,
without regard to whether such information was submitted or considered in the
initial benefit claim determination. Any claims that the Claimant does not
pursue in good faith through the appeals stage, such as by failing to file a
timely appeal request, will be treated as having been irrevocably
waived.

       

      (d)           Appeals Decisions.   The
decision by the appeals official will be made not later than 60 days after the
written appeal is received by the Plan Administrator, unless special
circumstances require an extension of time, in which case a decision will be
rendered as soon as possible, but not later than 120 days after the appeal was
filed, unless the Claimant agrees to a further extension of time.  The
appeal decision will be in writing, will be set forth in a manner calculated to
be understood by the Claimant, and will include specific reasons for the
decision, specific references to the provisions on which the decision is based,
if applicable, a statement that the Claimant is entitled to receive upon request
and free of charge reasonable access to and copies of all documents, records and
other information relevant to the Claimant’s claim for benefits, as well as a
statement of the Claimant’s right to bring an action under Section 502(a) of
ERISA.  If a Claimant does not receive the appeal decision by the date
it is due, the Claimant may deem his or her appeal to have been
denied.

       

      (e)           Procedures.  The Plan
Administrator will adopt procedures by which initial claims will be considered
and appeals will be resolved; different procedures may be established for
different claims.  All procedures will be designed to afford a
Claimant full and fair consideration of his or her claim.

       

      


       


      
        
          
             

          

           


        

        
           


          
            

          

        

        
           


        

      


      Appendix
C

       

      Additional
Information

       

      Rights
under ERISA

       

       

      As a
participant in the Plan, you are entitled to certain rights and protections
under ERISA.  ERISA provides that all Plan participants will be
entitled to:

       

      Receive Information About
Your Plan and Benefits

       

      1.           Examine,
without charge, at the Plan Administrator’s office and at certain Company
offices, all Plan documents including collective bargaining agreements, if any,
and copies of all documents filed by the Plan with the U.S. Department of Labor,
and available at the Public Disclosure Room of the Employee Benefits Security
Administration, such as annual reports and Plan descriptions.

       

      2.           Obtain,
upon written request to the Plan Administrator, copies of documents governing
the operation of the Plan, including collective bargaining agreements and copies
of the latest annual report (Form 5500 Series), if any, and updated summary plan
description.  The Plan Administrator may make a reasonable charge for
the copies.

       

      3.           Obtain
upon written request to the Plan Administrator information as to whether a
particular employer or employer organization is a sponsor of the Plan and the
address of any employer or employer organization that is a plan
sponsor.  Your beneficiaries also have a right to obtain this
information upon written request to the Plan Administrator.

       

      4.           Receive
a summary of the Plan’s annual financial report, if any.  The Plan
Administrator is required by law to furnish each participant with a copy of any
summary annual report.

       

      5.           Receive
a written explanation of why a claim for benefits has been denied, in whole or
in part, and a review and reconsideration of the claim.

       

      6.           Continue
health care coverage for yourself, spouse or dependent if there is a loss of
coverage as a result of a qualifying event.  You or your dependents
may have to pay for such coverage.  Review this Plan and summary plan
description on the rules governing your COBRA continuation coverage
rights.

       

      Prudent Actions by Plan
Fiduciaries

       

      In
addition to creating rights for Plan participants, ERISA imposes duties upon the
people who are responsible for the operation of the employee benefit plan. The
people who operate your Plan, called “fiduciaries” of the Plan, have a duty to
do so prudently and in the interest of you and other Plan participants and
beneficiaries.  No one, including the Company, your union, or any
other person, may fire you or otherwise discriminate against you in any way to
prevent you from obtaining a welfare benefit or exercising your right under
ERISA.  However, this rule neither guarantees continued employment,
nor affects the Company’s right to terminate your employment for other
reasons.

       

      Enforce Your
Rights

       

      If your
claim for a welfare benefit is denied or ignored, in whole or in part, you have
a right to know why this was done, to obtain copies of documents relating to the
decision without charge, and to appeal any denial, all within certain time
schedules.

       

      Under
ERISA, there are steps you can take to enforce the above rights.  For
instance, if you request a copy of plan documents or the latest annual report
from the Plan and do not receive them within thirty (30) days, you may file suit
in a Federal court.  In such a case, the court may require the Plan
Administrator to provide the materials and pay you up to $110 a day until you
receive the materials, unless the materials were not sent because of reasons
beyond the control of the Plan Administrator.  If you have a claim for
benefits which is denied or ignored, in whole or in part, you may file suit in a
state or Federal court.  In addition, if you disagree with the Plan’s
decision or lack thereof concerning the qualified status of a domestic relations
order or a medical child support order, you may file suit in Federal
court.  If it should happen that Plan fiduciaries misuse the Plan’s
money, or if you are discriminated against for asserting your rights, you may
seek assistance from the U.S. Department of Labor, or you may file suit in a
federal court.  The court will decide who should pay court costs and
legal fees.  If you are successful, the court may order the person you
have sued to pay these costs and fees.  If you lose, the court may
order you to pay these costs and fees, for example, if it finds your claim is
frivolous.

       

      Assistance with Your
Questions

       

      If you
have any questions about your Plan, you should contact the Plan
Administrator.  If you should have any questions about this statement
or about your rights under ERISA, or if you need assistance in obtaining
documents from the Plan Administrator, you should contact the nearest office of
the Employee Benefits Security Administration, U. S. Department of
Labor, listed in your telephone directory or the Division of Technical
Assistance and Inquires, Employee Benefits Security Administration, U. S.
Department of Labor, 200 Constitution Avenue N. W., Washington, D. C.
20210.  You may also obtain certain publications about your rights and
responsibilities under ERISA by calling the publications hotline of the Employee
Benefits Security Administration.

       


      
        
          
            


             

          

           


        

        
           


          
            

          

        

        
           


        

      


      
        	
                Administrative
      Information

                 

              
	
                Name
      of Plan:

              	
                The
      Tegal Corporation Executive Severance Plan

              
	
                Plan
      Administrator:

              	
                Compensation
      Committee of the

                Board
      of Directors of Tegal Corporation

                2201
      S. McDowell Boulevard

                Petaluma,
      CA  94954

                Tel:
      707-763-5600

              
	
                Type
      of Administration:

              	
                Self-Administered

              
	
                Type
      of Plan:

              	
                Severance
      Pay Employee Welfare Benefit Plan

              
	
                Employer
      Identification Number:

              	
                68-0370244

              
	
                Direct
      Questions Regarding the Plan to:

              	
                Chief
      Financial Officer

                Tegal
      Corporation

                2201
      S. McDowell Boulevard

                Petaluma,
      CA  94954

                Tel:
      707-763-5600

              
	
                Agent
      for Service of Legal Process:

              	
                Chief
      Financial Officer

                Tegal
      Corporation

                2201
      S. McDowell Boulevard

                Petaluma,
      CA  94954

                Tel:
      707-763-5600

                Service
      of Legal Process may also be made upon the Plan
    Administrator

              
	
                Plan
      Year:

              	
                Calendar
      Year

              
	
                Plan
      Number:

              	
                5__