Exhibit 10.1


    EXHIBIT
      10.1

      


      MASTER
        RESTRICTED STOCK AWARD AGREEMENT

      TERMS
        AND CONDITIONS

      


      (For
        Grants of Restricted Stock to

      Employees
        and Non-Employee Directors)

      


      This
        Master Restricted Stock Award Agreement (this “Master Agreement” or “Agreement”)
        is entered into between you (the “Participant” named below) and Cree, Inc., a
        corporation formed under the laws of the State of North Carolina (the
“Company”).

      


      This
        Agreement states the terms and conditions that govern shares of common stock
        of
        the Company (“Shares”) that the Company may from time to time grant to you
        subject to a risk of forfeiture and related restrictions for a specified
        period
        of time (“Restricted Stock”). Grants of Restricted Stock governed by this
        Agreement will be made under the Company’s 2004 Long-Term Incentive Compensation
        Plan (the “Plan”). The number of Shares and the vesting schedule applicable to
        each Restricted Stock Award will be stated in a Notice of Grant issued by
        the
        Company, the form of which is incorporated in this Agreement by reference.
        A
        Notice of Grant, together with the terms and conditions set forth in this
        Agreement and the Plan, constitute the entire agreement between you and the
        Company with respect to the Restricted Stock described in the Notice of
        Grant.

      


      Unless
        otherwise specified in a Notice of Grant or agreed to in writing by you and
        the
        Company, this Master Agreement will apply to all Restricted Stock granted
        to you
        under the Plan on and after the effective date stated below. This Agreement
        is
        subject to and will be construed in accordance with the Plan. Unless otherwise
        defined in this Agreement or a Notice of Grant, capitalized terms used in
        this
        Agreement and defined in the Plan will have the same meaning as defined in
        the
        Plan.

      


      Please
        indicate that you have read and agree to the terms and conditions of this
        Agreement by signing below and returning the signed copy to the Company at
        its
        principal offices in Durham, North Carolina. By your signature below, you
        agree
        to be bound by the provisions of this Agreement and the Plan and Notices
        of
        Grant applicable to Awards of Restricted Stock to which this Agreement applies.
        Upon receipt by the Company of a copy of this Agreement signed by you, this
        Agreement will be effective as of the first date on which the Company issued
        or
        issues Shares to you pursuant to a Restricted Stock Award. 

      


       

      


      
        	
                CREE,
                  INC.

              	 	
                PARTICIPANT:

              
	 	 	 	 	 
	
                By:

              	 	 	 	 
	 	
                [Name]

              	 	
                Signature

              	 
	 	
                [Title]

              	 	
                Print
                  Name:

              	 


      

      


       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      
        
          Cree,
            Inc. Master Restricted Stock Award

          Agreement
            Terms and Conditions

          


        



      
        	1.  	
                Grants
                  of Awards.

              


      

      


      
        	 	
                (a)

              	
                Subject
                  to the terms and conditions contained in this
                  Agreement, the Notice of Grant applicable to the Award and the
                  Plan, the
                  Company may, from time to time in its discretion, grant you Restricted
                  Stock. 

              


      

      


      
        	 	
                (b)

              	
                The
                  Shares issued pursuant to an Award of Restricted Stock will be
                  registered
                  in your name. The Shares will be evidenced by one or more certificates
                  delivered to and deposited with the Secretary of the Company as
                  escrow
                  agent or, at the discretion of the Company, may be held in a restricted
                  book entry account in lieu of issuing a certificate or certificates.
                  Such
                  certificates or such book entry shares are to be held by the escrow
                  agent
                  until the Restricted Stock vests, at which time the escrow agent
                  will
                  release the vested Shares; provided, however, that a portion of
                  the Shares
                  may be surrendered in payment of required withholding taxes in
                  accordance
                  with Section 8(b) below, unless alternative procedures for the
                  payment of
                  required withholding taxes are established by the Company.
                  

              


      

      


      
        	2.  	
                Vesting.
                  Restricted Stock will vest in accordance with the schedule set
                  out on the
                  corresponding Notice of Grant. All Restricted Stock will become
                  fully
                  vested, to the extent not already vested, upon your Termination
                  of Service
                  on account of your death or
                  Disability.

              


      

       

      
        	3.  	
                Forfeiture
                  of Restricted Stock upon Termination of Service. Except as
                  otherwise provided in this Agreement or the Plan, upon your Termination
                  of
                  Service you will forfeit all Restricted Stock that is not vested
                  as of the
                  date of your Termination of Service.


              


      

      


      
        	4.  	
                Forfeiture
                  of Restricted Stock upon Section 83(b) Election. As
                  permitted under section 15.6 of the Plan, each grant of Restricted
                  Stock
                  is conditioned upon and subject to your not making an election
                  under
                  Section 83(b) of the Code with respect to such Restricted Stock.
                  If you
                  make an election under Section 83(b) of the Code with respect to
                  any
                  Restricted Stock, you will forfeit such Restricted
                  Stock.

              


      

      


      
        	5.  	
                Forfeiture
                  of Restricted Stock for Awards Not Timely Accepted. Each
                  grant of Restricted Stock is conditioned upon and subject to your
                  accepting the Award by signing and delivering to the Company the
                  corresponding Notice of Grant not later than the date specified
                  in such
                  Notice or, if no date is specified, not later than the first date
                  Shares
                  would otherwise vest pursuant to the Award. If the Company issues
                  Restricted Stock pursuant to an Award prior to your acceptance
                  of the
                  Award, and if you fail to accept the Award by signing and delivering
                  to
                  the Company the corresponding Notice of Grant within the time described
                  above, you will forfeit such Restricted
                  Stock.

              


      

      


      
        	6.  	
                Tolling
                  in the Event of Delayed Disability Determinations. If you
                  incur a Termination of Service and a determination as to whether
                  the
                  Termination of Service is on account of your Disability is outstanding
                  at
                  the time of the Termination of Service, the forfeiture of Restricted
                  Stock
                  which is not then vested will be tolled for the period beginning
                  on the
                  date of your Termination of Service and ending on the date on which
                  the
                  determination is made whether your Termination of Service was on
                  account
                  of your Disability. If it is determined that your Termination of
                  Service
                  occurred on account of your Disability, you will become fully vested
                  in
                  such Restricted Stock on the date on such determination. If it
                  is
                  determined that your Termination of Service did not occur on account
                  of
                  your Disability, then you will forfeit such Restricted Stock on
                  the date
                  of such determination.

              


      

      


      
        	7.  	
                Settlement
                  of Restricted Stock. As soon as administratively practicable
                  following the vesting of a portion of a Restricted Stock Award,
                  the
                  Company shall deliver to you (or, in the event of your death, to
                  your
                  estate or, if the Committee establishes a beneficiary designation
                  procedure pursuant to Section 11 of the Plan, to any beneficiary
                  that you
                  have designated pursuant to such procedure) one or more certificates
                  for
                  the vested Shares.

              


      


      
        
          
          

        

        
          -
            2
            -

          
            

          

        

        
          
          

          
            Cree,
              Inc. Master Restricted Stock Award

            Agreement
              Terms and Conditions

            


          

        

      


      


      
        	8.  	
                Responsibility
                  for Taxes. 

              


      

      


      
        	 	
                (a)

              	
                Regardless
                  of any action the Company takes with respect to
                  Tax-Related Items, you acknowledge that the ultimate liability
                  for
                  reporting and/or payment of all Tax-Related Items legally due by
                  or from
                  you is and remains your responsibility and that the Company (1) makes
                  no representations or undertakings regarding the treatment of any
                  Tax-Related Items in connection with any aspect of any Restricted
                  Stock,
                  including the grant, vesting or release of any Restricted Stock,
                  the
                  subsequent sale of Shares and the receipt of any dividends pursuant
                  to
                  Shares; and (2) does not commit to structure the terms of
                  the grant
                  or any aspect of Restricted Stock to reduce or eliminate your liability
                  for Tax-Related Items.

              


      

      


      
        	 	
                (b)

              	
                Prior
                  to vesting of Restricted Stock, you agree to pay or make adequate
                  arrangements satisfactory to the Company to satisfy all withholding
                  and
                  payment on account obligations of the Company related to such vesting.
                  If
                  permissible under applicable law, the Company shall satisfy this
                  condition
                  pursuant to the withholding of Shares consistent with the “Share
                  Withholding” provisions under section 13.2 of the Plan. The Company, in
                  its discretion, may authorize alternative arrangements, including,
                  if
                  permissible under applicable law, the Company’s selling or arranging for
                  sale Shares that you acquire under the Plan or allowing you to
                  deliver to
                  the Company already vested and owned Shares having a fair market
                  value
                  equal to the minimum amount required to be withheld. In any event,
                  to the
                  extent this condition is not otherwise satisfied, you authorize
                  your
                  Employer under the Plan to withhold all applicable Tax-Related
                  Items
                  legally payable by you from your wages or other cash compensation
                  paid to
                  you by the Employer and you agree to pay to your Employer the amount
                  of
                  any Tax-Related Items the Employer is required to withhold as a
                  result of
                  Restricted Stock awarded to you under the Plan that cannot be satisfied
                  by
                  the other means described above.

              


      

      


      
        	 	
                (c)

              	
                The
                  Company may refuse to honor the vesting of Restricted Stock and
                  refuse to release restrictions on the Shares if you fail to comply
                  with
                  your obligations in connection with the Tax-Related Items as described
                  in
                  this section.



      

      


      
        	9.  	
                Transfer
                  of Restricted Stock. Restricted Stock and any rights under
                  Restricted Stock may not be assigned, pledged as collateral or
                  otherwise
                  transferred, except as permitted by the Plan, nor may Restricted
                  Stock or
                  such rights be subject to attachment, execution or other judicial
                  process
                  until the Restricted Stock becomes vested pursuant to Section 2
                  above and
                  the corresponding Notice of Grant. In the event of any attempt
                  to assign,
                  pledge or otherwise dispose of Restricted Stock which is not then
                  vested,
                  or any rights under such Restricted Stock, except as permitted
                  by the
                  Plan, or in the event of the levy of any attachment, execution
                  or similar
                  judicial process upon the rights or interests with respect to Restricted
                  Stock which is not then vested, the Committee may in its discretion,
                  upon
                  notice to you, cause you to forfeit such Restricted
                  Stock.

              


      

      


      
        	10.  	
                Rights
                  Prior to Vesting of Shares of Restricted
                  Stock.

              


      

      


      
        	 	
                (a)

              	
                You
                  will have at all times all rights as a shareholder with respect
                  to your
                  Restricted Stock, including, but not limited to, voting rights
                  and rights
                  to receive dividends, except for the right to transfer the Restricted
                  Stock as set forth in Section 7 above; provided, however, that
                  any
                  dividends on such Restricted Stock will be automatically deferred
                  and
                  reinvested in additional Restricted Stock subject to the same restrictions
                  as the underlying Restricted Stock.

              


      

      


      
        	 	
                (b)

              	
                In
                  the event of a change in capitalization within the meaning of Section
                  4.3
                  of the Plan, the number and class of Shares or other securities
                  that you
                  are entitled to pursuant to this Agreement and a Notice of Grant
                  shall be
                  appropriately adjusted or changed as determined by the Committee
                  to
                  reflect the change in capitalization, provided that any such additional
                  Shares or additional or different shares of securities shall remain
                  subject to the restrictions in this Agreement and the applicable
                  Notice of
                  Grant. 

              


      


      
        
          
          

        

        
          -
            3
            -

          
            

          

        

        
          
          

          
            Cree,
              Inc. Master Restricted Stock Award

            Agreement
              Terms and Conditions

            


          

        

      


      


      
        	11.  	
                Definitions.
                  The following definitions apply under this
                  Agreement:

              


      

      


      
        	 	
                (a)

              	
                “Tax-Related
                  Items” means any or all income tax, social insurance tax, payroll tax,
                  payment on account or other tax-related withholding that may be
                  applicable
                  to Awards under this Agreement by law or regulation of any governmental
                  authority, whether federal, state or local, domestic or
                  foreign.

              


      

      


      
        	 	
                (b)

              	
                “Termination
                  of Service” means the discontinuance of your relationship with the Company
                  as an employee of the Company or other Employer or as a member
                  of the
                  board of directors of Cree, Inc. Except as determined otherwise
                  by the
                  Committee, you will not be deemed to have incurred a Termination
                  of
                  Service if the capacity in which you provide services to the Company
                  changes (for example, you change from being a non-employee director
                  to
                  being an employee) or if you transfer employment among the various
                  entities constituting the Employer, so long as there is no interruption
                  in
                  your provision of services to the Company or other Employer as
                  an employee
                  or as a non-employee member of the board of directors of Cree,
                  Inc. The
                  Committee, in its discretion, will determine whether you have incurred
                  a
                  Termination of Service. You will not be deemed to have incurred
                  a
                  Termination of Service during a period for which you are on military
                  leave, sick leave, or other leave of absence approved by the
                  Employer.

              


      

      


      
        	12.  	
                Provisions
                  of the Plan. The provisions of the Plan are
                  incorporated by reference in this Agreement as if set out in full
                  in this
                  Agreement. To the extent that any conflict may exist between any
                  other
                  provision of this Agreement and a provision of the Plan, the Plan
                  provision will control. All decisions of the Committee with respect
                  to the
                  interpretation, construction and application of the Plan or this
                  Agreement
                  shall be final, conclusive and binding upon you and the Company.
                  

              


      

      


      
        	13.  	
                Cancellation
                  and Rescission. If you engage in any Detrimental Activity
                  prior to or within one (1) year after vesting of any Shares of
                  Restricted
                  Stock, the Committee in its discretion may rescind the issuance
                  of such
                  Shares upon notice to you within two (2) years after such vesting.
                  In the
                  event of such rescission, you will be obligated to pay to the Company
                  the
                  amount of any gain realized from the Restricted Stock, in such
                  manner and
                  on such terms and conditions as the Company may require, and the
                  Company
                  will be entitled to set-off against the amount of any such gain
                  any amount
                  the Company or an Employer owes to you. For purposes of this section,
                  “Detrimental Activity” shall have the meaning defined in Section 14.4(b)
                  of the Plan.

              


      

      


      
        	14.  	
                Data
                  Privacy. By signing this Agreement, you explicitly and
                  unambiguously consent to the collection, use and transfer, in electronic
                  or other form, of your personal data as described below by and
                  among, as
                  applicable, your Employer, the Company and its subsidiaries and
                  affiliates
                  for the exclusive purpose of implementing, administering and managing
                  your
                  participation in the Plan.

              


      

      


      You
        understand that the Employer holds or may hold certain personal information
        about you, including, but not limited to, your name, home address and telephone
        number, date of birth, social insurance number or other identification number,
        salary, nationality, position title, any shares of stock or directorships
        held
        in the Company, details of all Restricted Stock or any other entitlement
        to
        Shares of stock awarded, canceled, exercised, vested, unvested or outstanding
        in
        your favor, for the purpose of implementing, administering and managing the
        Plan
        (“Data”). You understand that Data may be transferred to any third parties
        assisting in the implementation, administration and management of the Plan,
        that
        these recipients may be located in your country or elsewhere, and that the
        recipient’s country may have different data privacy laws and protections than
        your country. You understand that you may request a list with the names and
        addresses of any potential recipients of the Data by contacting the Company's
        Stock Plan Administrator. You authorize the recipients to receive, possess,
        use,
        retain and transfer the Data, in electronic or other form, for the purposes
        of
        implementing, administering and managing your participation in the Plan,
        including any requisite transfer of such Data as may be required to a broker
        or
        other third party with whom you may elect to deposit any Shares of stock
        acquired pursuant to this Agreement. You understand that Data will be held
        pursuant to this Agreement only as long as is necessary to implement, administer
        and manage your participation in the Plan. You understand that you may, at
        any
        time, view Data, request additional information about the storage and processing
        of Data, require any necessary amendments to Data or refuse or withdraw the
        consents above, in any case without cost, by contacting in writing the Company's
        Stock Plan Administrator. You acknowledge, however, that refusing or withdrawing
        your consent may affect your ability to participate in the Plan.



      
        
          
          

        

        
          -
            4
            -

          
            

          

        

        
          
          

          
            Cree,
              Inc. Master Restricted Stock Award

            Agreement
              Terms and Conditions

            


          

        

      


      


      
        	15.  	
                Language. If
                  you have received this Agreement or any other document related
                  to the Plan
                  translated into a language other than English and the translated
                  version
                  is different than the English version, the English version will
                  control.

              


      

       

      
        	16.  	
                Electronic
                  Delivery. The Company may, in its sole discretion, decide
                  to
                  deliver any documents related to the Restricted Stock granted under
                  this
                  Agreement by electronic means or to request your consent to participate
                  in
                  the Plan by electronic means. By signing this Agreement, you consent
                  to
                  receive such documents by electronic delivery and, if requested,
                  to agree
                  to participate in the Plan through an on-line or electronic system
                  established and maintained by the Company or another third party
                  designated by Company.

              


      

       

      
        	17.  	
                General.
                  

              


      

      


      
        	 	
                (a)

              	
                Nothing
                  in this Agreement will be construed as constituting a commitment,
                  agreement or understanding of any kind that the Company or any
                  other
                  Employer will continue your service relationship nor to limit or
                  restrict
                  either party’s right to terminate the service relationship.
                  

              


      

      


      
        	 	
                (b)

              	
                This
                  Agreement shall be binding upon and inure to the benefit of the
                  parties
                  and their respective successors and permitted assigns. You may
                  not assign
                  any rights under this Agreement without the written consent of
                  the
                  Company, which it may withhold in its sole discretion; any such
                  attempted
                  assignment without the Company's written consent shall be void.
                  The
                  Company may assign its rights under this Agreement at any time
                  upon notice
                  to you.

              


      

      


      
        	 	
                (c)

              	
                Notices
                  under this Agreement must be in writing and delivered either by
                  hand or by
                  certified mail (return receipt requested and first-class postage
                  prepaid),
                  in the case of the Company, addressed to its principal executive
                  offices
                  to the attention of the Stock Plan Administrator, and, in your
                  case, to
                  your address as shown on the Employer’s
                  records.

              


      

      


      
        	 	
                (d)

              	
                This
                  Agreement shall be governed by and construed in accordance with
                  the laws
                  of the State of North Carolina as if made and to be performed wholly
                  within such State.

              


      

      


      
        	 	
                (e)

              	
                No
                  amendment or modification of this Agreement shall be valid unless
                  the same
                  is in writing and signed by you and by an authorized officer of
                  the
                  Company. If any provision of this Agreement is held to be invalid
                  or
                  unenforceable, such determination shall not affect the other provisions
                  of
                  the Agreement and the Agreement shall be construed as if the invalid
                  or
                  unenforceable provision were omitted and a valid and enforceable
                  provision, as nearly comparable as possible, substituted in its
                  place.

              


      

      


      
        	 	
                (f)

              	
                This
                  Agreement, including the corresponding Notice(s) of Grant and the
                  Plan,
                  set forth all of the promises, agreements and understandings between
                  you
                  and Company relating to Restricted Stock Awards evidenced by this
                  Agreement. This Agreement, including the corresponding Notice of
                  Grant and
                  the Plan, supersede any and all prior agreements or understandings,
                  whether oral or written, with respect to the Restricted Stock Award
                  evidenced by this Agreement and such Notice, unless otherwise specified
                  in
                  the corresponding Notice of Grant.

              


      

      


      
        	 	
                (g)

              	
                Shares
                  issued pursuant to an award of Restricted Stock may be
                  subject to such stop-transfer orders and other restrictions as
                  the
                  Committee may deem advisable under applicable law or the rules
                  and
                  regulations of the Securities and Exchange Commission or any stock
                  exchange or trading system upon which the common stock of the Company
                  is
                  listed, and the Committee may cause a legend or legends to be placed
                  on
                  any such certificates or the stock records of the Company to make
                  appropriate reference to such
                  restrictions.

              


      

      


      
        	 	
                (h)

              	
                You
                  agree that any and all Restricted Stock issued to you pursuant
                  to the
                  Plan, even if later forfeited, serves as additional, valuable
                  consideration for your obligations, if any, undertaken in any existing
                  agreement between you and the Company and/or other Employer regarding
                  confidential information, noncompetition, nonsolicitation or similar
                  covenants.

              


      


      
        
          
          

        

        
          -
            5
            -

          
            

          

        

        
          
          

          
            Cree,
              Inc. Master Restricted Stock Award

            Agreement
              Terms and Conditions

            


          

        

      


      


      
        	 	
                (i)

              	
                You
                  acknowledge, represent and warrant to the Company, and agree with
                  the
                  Company, that (i) except for information provided in the Company’s filings
                  with the Securities and Exchange Commission and in the Company’s current
                  prospectus relating to the Plan, you have not relied and will not
                  rely
                  upon the Committee, the Company, an Employer or any employee or
                  agent of
                  the Company or an Employer in determining whether to accept Restricted
                  Stock, or in connection with any disposition of Shares obtained
                  pursuant
                  to a Restricted Stock Award, or with respect to any tax consequences
                  related to the grant of Restricted Stock or the disposition of
                  Shares
                  obtained pursuant to a Restricted Stock Award; and (ii) you will
                  seek from
                  your own professional advisors such investment, tax and other advice
                  as
                  you believe necessary.

              


      

      


      
        	 	
                (j)

              	
                You
                  acknowledge that you may incur a substantial tax liability as a
                  result of
                  vesting of Restricted Stock. You assume full responsibility for
                  all such
                  consequences and the filing of all tax returns and related elections
                  you
                  may be required or find desirable to file. If you are required
                  to make any
                  valuation of Shares obtained pursuant to a Restricted Stock Award
                  under
                  any federal, state or other applicable tax law, and if the valuation
                  affects any tax return or election of the Company or the Employer
                  or
                  affects the Company’s financial statement reporting, you agree that the
                  Company may determine the value and that you will observe any
                  determination so made by the Company in all tax returns
                  and elections
                  filed by you.

              


      

      


      
        	 	
                (k)

              	
                You
                  acknowledge that copies of the Plan and Plan prospectus are available
                  upon
                  written or telephonic request to the Company’s Stock Plan
                  Administrator.

              


      

      


      
        	18.  	
                Severability.
                  The provisions of this Agreement are severable and if any one or
                  more
                  provisions is determined to be illegal or otherwise unenforceable,
                  in
                  whole or in part, the remaining provisions shall nevertheless be
                  binding
                  and enforceable.

              


      

    

     

    
 

    
      
        
        

      

      
        -
          6
          -

        
          

        

      

      
        
        

      

    

     

     

    

      
        	 	
                 

                NOTICE
                  OF GRANT

                (Employee
                  - Restricted Stock Award)

              
	
                Company:

              	
                Participant:

              	 
	
                Cree,
                  Inc.

              	
                Award
                  Number:

              	 
	
                4600
                  Silicon Drive

              	
                Award
                  Plan:

              	
                2004
                  Long-Term Incentive Compensation Plan

              
	
                Durham,
                  NC 27703

              	
                Award
                  Type:

              	
                Restricted
                  Stock

              
	
                Tax
                  I.D. 56-1572719

              	
                Grant
                  Date:

              	 
	 	
                Number
                  Shares:

              	 
	 	
                Purchase
                  Price:

              	
                -
                  $0 -

              
	 	
                Restriction
                  Period:

              	
                Grant
                  Date through ______________

              
	 	
                Vesting
                  Schedule:

              	 
	 	 	 


      



     

    Dear
      Participant:

     

    I
      am
      pleased to inform you that Cree, Inc. (the “Company”) has awarded you
      ___________ shares of restricted stock (“Restricted Stock”) pursuant to the
      Cree, Inc. 2004 Long-Term Incentive Compensation Plan (the “Plan”) effective
      __________ (the “Grant Date”). The Award is governed by the Plan, terms of the
      Master Restricted Stock Award Agreement between you and the Company and this
      Notice of Grant.

     

    If
      not
      previously vested or forfeited, the Restricted Stock will vest in installments
      on the dates set out below provided you are then serving as an employee of
      the
      Company or a related Employer under the Plan or as a member of the Board of
      Directors of the Company: 

    


    [Vesting
      Schedule]

    


    If
      you
      incur a Termination of Service before the end of the Restriction Period, you
      will forfeit all Shares of Restricted Stock that are not then vested in
      accordance with your Master Restricted Stock Award Agreement, this Notice of
      Grant and the Plan.

     

    This
      Award and any other Awards granted under the Plan as of the Grant Date are
      intended to fulfill any and all agreements, obligations or promises, whether
      legally binding or not, previously made by the Company or any Employer under
      the
      Plan to grant you Restricted Stock. By signing below, you accept such Awards,
      along with all prior awards received by you, in full satisfaction of any such
      agreement, obligation or promise.

     

    This
      Award is subject to the condition that you sign and return this Notice of Grant,
      and the accompanying stock power, to the Company not later than
      __________________________.

     

     

    
      	 CREE,
              INC.	 	 Accepted and agreed
              to:
	 	 	 	 
	
              By:

            	 	 	 
	
            	
              [Name]

            	 	
              [Name]

            
	
            	
              [Title]

            	 	 


    

     

     

    
      
        
        

      

      
        -
          7
          -

        
          

        

      

      
        
        

      

    

     

     

     

    
      
        	 	
                 

                NOTICE
                  OF GRANT

                (Outside
                  Director - Restricted Stock Award)

              
	
                Company:

              	
                Participant:

              	 
	
                Cree,
                  Inc.

              	
                Award
                  Number:

              	 
	
                4600
                  Silicon Drive

              	
                Award
                  Plan:

              	
                2004
                  Long-Term Incentive Compensation Plan

              
	
                Durham,
                  NC 27703

              	
                Award
                  Type:

              	
                Restricted
                  Stock

              
	
                Tax
                  I.D. 56-1572719

              	
                Grant
                  Date:

              	 
	 	
                Number
                  Shares:

              	 
	 	
                Purchase
                  Price:

              	
                -
                  $0 -

              
	 	
                Restriction
                  Period:

              	
                Grant
                  Date through ______________

              
	 	
                Vesting
                  Schedule:

              	 
	 	 	 


      

       

      Dear
        ________________:

       

       

      I
        am
        pleased to inform you that Cree, Inc. (the “Company”) has awarded you
        ___________ shares of restricted stock (“Restricted Stock”) pursuant to the
        Cree, Inc. 2004 Long-Term Incentive Compensation Plan (the “Plan”) effective
        __________ (the “Grant Date”). The Award is governed by the Plan, terms of the
        Master Restricted Stock Award Agreement between you and the Company and this
        Notice of Grant. 

       

      If
        not
        previously vested or forfeited, the Restricted Stock will vest on _____________
        provided you are then serving as a member of the Board of Directors of the
        Company or as an employee of the Company or a related Employer under the
        Plan.
        If you incur a Termination of Service before the end of the Restriction Period,
        you will forfeit all Shares of Restricted Stock that are not then vested
        in
        accordance with your Master Restricted Stock Award Agreement, this Notice
        of
        Grant and the Plan.

       

      This
        Award and any other Awards granted under the Plan as of the Grant Date are
        intended to fulfill any and all agreements, obligations or promises, whether
        legally binding or not, previously made by the Company or any Employer under
        the
        Plan to grant you Restricted Stock. By signing below, you accept such Awards,
        along with all prior awards received by you, in full satisfaction of any
        such
        agreement, obligation or promise.

       

      This
        Award is subject to the condition that you sign and return this Notice of
        Grant,
        and the accompanying stock power, to the Company not later than
        __________________________.

       

       

      
         

        
          	
                   CREE,
                    INC.

                	 	 Accepted
                  and agreed to:
	 	 	 	 
	
                  By:

                	 	 	 
	
                	
                  [Name]

                	 	
                  [Name]

                
	
                	
                  [Title]

                	 	 


        

         

         

        
          
            
            

          

          
            -
              8
              -