Exhibit 10.3


RESTRICTED
STOCK AGREEMENT


THIS AGREEMENT (the “Agreement”)
is entered into as of ___________, 2005 (the “Award Date”) by and
between Veeco Instruments Inc., a Delaware corporation (the “Company”)
and ____________, an employee of the Company, hereinafter referred to as the “Participant.”


WHEREAS, the Company has
adopted the Veeco Instruments Inc. 2000 Stock Incentive Plan (as it may be
amended from time to time, the “Plan”), the terms of which are hereby
incorporated by reference and made a part of this Agreement; and


WHEREAS, Section 8 of the
Plan provides for the issuance of awards of the Company’s common stock, par
value $0.01 per share (“Common Stock”), subject to certain restrictions
(“Restricted Stock”); and


WHEREAS, the Committee
defined in Section 2 of the Plan (the “Committee”) has determined that
it would be to the advantage and in the best interest of the Company and its
stockholders to award shares of Restricted Stock to the Participant pursuant to
the terms and conditions set forth herein; and


NOW, THEREFORE, in
consideration of the mutual covenants herein contained and other good and
valuable consideration, receipt of which is hereby acknowledged, the parties
hereto do hereby agree as follows:


ARTICLE I


DEFINITIONS


 


Section
1.1             In General.  Capitalized terms used but not defined herein
shall have the meanings assigned to such terms in the Plan.  In addition, wherever the following term is
used in this Agreement, it shall have the meaning specified below, unless the
context clearly indicates otherwise.


Section
1.2             “Restrictions”
shall mean the restrictions on sale or other transfer set forth in Section 4.2
and the exposure to forfeiture set forth in Section 3.1.


ARTICLE
II.

RESTRICTED STOCK  AWARD


Section
2.1             Award of
Restricted Stock.  In consideration
of the Participant’s agreement to remain in the employ of the Company, in
exchange for the promises contained herein, and for other good and valuable
consideration which the Committee has determined exceeds the aggregate par
value of the shares of Common Stock subject to the Award (as defined below), as
of the Award Date, the Company issues to the Participant the number of shares
of Restricted Stock set forth on the signature page hereof (the “Award”).


Section
2.2             Award Subject to
Plan.  The Award granted hereunder is
subject to the terms and provisions of the Plan, including without limitation
Section 8 thereof.


 


 





















 


ARTICLE III.

RESTRICTIONS


Section 3.1             Forfeiture;
Repurchase Right.


(a)           Unless
otherwise provided by written agreement between the Company and Participant,
any Award which is not vested upon the Participant’s termination of employment
with the Company (as determined in good faith by the Committee) shall thereupon
be forfeited immediately and without any further action by the Company.


(b)           Upon
termination of employment of a Participant, the Company shall have the right,
but not the obligation, to purchase any Restricted Stock then held by such
Participant at a cash price per share equal to the price paid by the
Participant for such Restricted Stock; provided that no such right of
repurchase shall exist in the event of a Normal Termination (as defined in the
Plan).


Section 3.2             Vesting
and Lapse of Restrictions.  Subject
to Sections 3.1 and 3.3, the Restrictions shall lapse with respect to the
Restricted Stock subject to the Award as follows: 


	
  Date:

  	
   

  	
  Restrictions Shall

  Lapse with Respect to:

  
	
  First
  Anniversary of Award Date

  	
   

  	
  One-third
  of the Award

  
	
  Second
  Anniversary of Award Date

  	
   

  	
  One-third
  of the Award

  
	
  Third
  Anniversary of Award Date

  	
   

  	
  One-third
  of the Award

  



 


provided, in each case, that the
Participant remains continuously employed in active service by the Company from
the Award Date through such vesting date.


Section 3.3             Lapse
of Restrictions Upon Certain Events. 
Notwithstanding Section 3.2, but subject to Section 3.1, in the event
that Participant has entered into a written agreement with the Company prior to
or concurrently with the grant of the Award hereunder which provides for the
acceleration of vesting of stock options issued by the Company to Participant
(a “Prior Option Agreement”), then, upon the occurrence of an event which
triggers the acceleration of vesting of stock options under the Prior Option
Agreement, the Award will become vested and the Restrictions with regard
thereto shall lapse.


Section 3.4             Legend.  Until such time as Restrictions have lapsed,
the Company may, at any time, place legends referencing the Restrictions and
any applicable federal and/or state securities laws restrictions on
certificates representing shares of Restricted Stock issued pursuant to this
Agreement.  The legend may include the
following:


“THE SECURITIES
REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO RESTRICTIONS SET FORTH IN THE
AWARD AGREEMENT BETWEEN THE CORPORATION AND THE REGISTERED HOLDER, A COPY OF
WHICH IS ON FILE AT THE PRINCIPAL OFFICE OF THE CORPORATION.”


 


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Section 3.5             Payment
of Taxes; Issuance of Shares.


(a)           Participant understands, acknowledges
and agrees that the value of the Restricted Stock is subject to state and
federal income taxes and certain rules which require the Company to withhold
amounts necessary to pay these taxes. 
Participant hereby authorizes the Company to reduce the number of shares of Restricted Stock delivered to
Participant at the time the restrictions lapse by the number of shares of Restricted
Stock required to satisfy the tax withholding requirements (based on the fair
market value of shares at such time). 
Such shares of Restricted Stock shall be returned to the Company.  Participant’s acknowledgement and acceptance
of these tax withholding provisions are conditions precedent to the right of
Participant to receive the Restricted Stock under the Plan and this Agreement.


(b)           In lieu of the reduction of shares
delivered described in paragraph (a) above, Participant may pay to the Company
the amount of tax required to be withheld in cash, by check or in other form
satisfactory to the Company.  Such
payment must be made by the date on which the Restrictions lapse or such later
date as is established by the Company (not to exceed 15 days after the date on
which the Restrictions lapse).


(c)           The Shares will be deposited directly
into Participant’s brokerage account with the Company’s approved broker when
vested and the applicable withholding obligations have been satisfied.


Section 3.6             Certain
Changes in Capitalization.  If the
shares of the Company’s Common Stock as a whole are increased, decreased,
changed into or exchanged for a different number or kind of shares or
securities of the Company, whether through merger, consolidation,
reorganization, recapitalization, reclassification, stock dividend, stock
split, combination of shares, exchange of shares, change in corporate structure
or the like, the Committee, in its sole discretion, shall have the discretion
and power to determine and to make effective provision for acceleration of the
time or times at which any Restrictions shall lapse or be removed.  In addition, in the case of the occurrence of
any event described in this Section 3.6, the Committee, subject to the
provisions of the Plan and this Agreement, shall make an appropriate and
proportionate adjustment in the number and kind of shares of Restricted Stock,
to the end that after such event the Participant’s proportionate interest shall
be maintained as before the occurrence of such event.  Any such adjustment made by the Committee
shall be final and binding upon the Participant, the Company and all other
interested persons. In the event that the Participant receives any new or
additional or different shares or securities by reason of any transaction or
event described in this Section 3.6, such new or additional or different shares
or securities which are attributable to the Participant in his capacity as the
registered owner of the Restricted Stock then subject to Restrictions, shall be
considered to be Restricted Stock and shall be subject to all of the
Restrictions.


Section 3.7             Section
83(b) Election.  Participant
understands that Section 83(a) of the Code taxes as ordinary income the
difference between the amount, if any, paid for the shares of Common Stock and
the Fair Market Value of such shares at the time the Restrictions on such
shares lapse.  Participant understands
that, notwithstanding the preceding sentence, Participant may elect to be taxed
at the time of the Award Date, rather that at the time the Restrictions lapse,
by filing an election under Section 83(b) of the Code (an “83(b)
Election”) with the Internal Revenue Service within 30 days of the Award
Date. In the event Participant files an 83(b) Election, Participant will
recognize ordinary income in an amount equal to the 


 


 


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difference between the
amount, if any, paid for the shares of Common Stock and the Fair Market Value
of such shares as of the Award Date. Participant further understands that an
additional copy of such 83(b) Election form should be filed with his or her
federal income tax return for the calendar year in which the date of this
Agreement falls.  Participant
acknowledges that the foregoing is only a summary of the effect of United
States federal income taxation with respect to the award of Restricted Stock
hereunder, and does not purport to be complete. PARTICIPANT FURTHER ACKNOWLEDGES
THAT THE COMPANY IS NOT RESPONSIBLE FOR FILING THE PARTICIPANT’S 83(b)
ELECTION, AND THE COMPANY HAS DIRECTED PARTICIPANT TO SEEK INDEPENDENT ADVICE
REGARDING THE APPLICABLE PROVISIONS OF THE CODE, THE INCOME TAX LAWS OF ANY
MUNICIPALITY, STATE OR FEDERAL GOVERNMENT OR FOREIGN COUNTRY IN WHICH
PARTICIPANT MAY RESIDE, AND THE TAX CONSEQUENCES OF PARTICIPANT’S DEATH.


ARTICLE
IV.

OTHER PROVISIONS


Section 4.1             Book
Entry; Escrow.  The Shares
representing the Restricted Stock will be held in book-entry or global
certificate form.  If the Company instead
chooses to issue share certificates representing the Restricted Stock, the
certificates for the Restricted Stock shall be deposited in escrow with the
Secretary or Assistant Secretary of the Company or such other escrow holder as
the Company may appoint; provided, however,
that in no event shall the Participant retain physical custody of any
certificates representing unvested Restricted Stock issued to him.  The deposited certificates shall remain in
escrow until all of the Restrictions lapse or shall have been removed.


Section
4.2             Restricted Stock
Not Transferable.  No Restricted
Stock or any interest or right therein or part thereof shall be liable for the
debts, contracts or engagements of the Participant or his successors in
interest or shall be subject to disposition by transfer, alienation,
anticipation, pledge, encumbrance, assignment or any other means whether such
disposition be voluntary or involuntary or by operation of law by judgment,
levy, attachment, garnishment or any other legal or equitable proceedings
(including bankruptcy), and any attempted disposition thereof shall be null and
void and of no effect; provided, however,
that this Section 4.2 shall not prevent transfers by will or by applicable laws
of descent and distribution.


Section 4.3             Rights
as Stockholder.  Except as otherwise
provided herein, upon issuance of the shares of Restricted Stock pursuant to
Section 4.1, the Participant shall have all the rights of a stockholder with
respect to said shares, subject to the Restrictions herein, including the right
to vote the shares and to receive all dividends or other distributions paid or
made with respect to the shares or Restricted Stock; provided, however, that any and all shares of Common Stock received by the Participant
with respect to such Restricted Stock as a result of stock dividends, stock
splits or any other form of recapitalization shall also be subject to the
Restrictions until the Restrictions on the underlying shares of Restricted
Stock lapse or are removed pursuant to this Agreement.


Section
4.4             Not a Contract of
Employment.  Nothing in this
Agreement or in the Plan shall confer upon the Participant any right to
continue in the employ of the Company or any of its Subsidiaries or shall
interfere with or restrict in any way the rights of the Company or its
Subsidiaries, which are hereby expressly reserved, to discharge the Participant
at any time for


 


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 any reason whatsoever, with or without cause,
except as may otherwise be provided by any written agreement entered into by
and between the Company and the Participant.


Section 4.5             Governing
Law.   The laws of the State of
Delaware shall govern the interpretation, validity, administration, enforcement
and performance of the terms of this Agreement regardless of the law that might
be applied under principles of conflicts of laws.


Section
4.6             Conformity to
Securities Laws.  The Participant
acknowledges that the Plan and this Agreement are intended to conform to the
extent necessary with all provisions of the Securities Act of 1933, as amended,
and the Securities Exchange Act of 1934, as amended (the “Exchange Act”),
and any and all regulations and rules promulgated thereunder by the Securities
and Exchange Commission, including without limitation Rule 16b-3 under the
Exchange Act.  Notwithstanding anything
herein to the contrary, the Plan shall be administered, and the Awards are
granted, only in such a manner as to conform to such laws, rules and
regulations.  To the extent permitted by
applicable law, the Plan and this Agreement shall be deemed amended to the
extent necessary to conform to such laws, rules and regulations.


Section
4.7             Amendment,
Suspension and Termination.  The
Awards may be wholly or partially amended or otherwise modified, suspended or
terminated at any time or from time to time by the Committee or the Board, provided that, except as may otherwise
be provided by the Plan, neither the amendment, suspension nor termination of
this Agreement shall, without the consent of the Participant, alter or impair
any rights or obligations under any Award.


Section
4.8             Notices.  Notices required or permitted hereunder shall
be given in writing and shall be deemed effectively given upon personal
delivery or upon deposit in the United States mail by certified mail, with
postage and fees prepaid, addressed to the Participant to his address shown in
the Company records, and to the Company at its principal executive office.


Section
4.9             Severability.
The invalidity or unenforceability of any paragraph or provision of this
Agreement shall not affect the validity or enforceability of any other
paragraph or provision, and all other provisions shall remain in full force and
effect.  If any provision of this
Agreement is held to be excessively broad, then such provision shall be
reformed and construed by limiting and reducing it so as to be enforceable to
the maximum extent permitted by law.


Section
4.10           Certain Provisions
Applicable to Participants Employed at International Locations.  The Company will assess its requirements
regarding tax, social insurance and any other payroll tax (“Tax-Related Items”)
withholding and reporting in connection with the shares of Restricted Stock.  These requirements may change from time to
time as laws or interpretations change. 
Regardless of the actions of the Company in this regard, Participant
hereby acknowledges and agrees that the ultimate liability for any and all Tax-Related
Items is and remains his or her responsibility and liability and that the
Company makes no representations nor undertakings regarding treatment of any
Tax-Related Items in connection with any aspect of the grant of Restricted
Stock and do not commit to structure the terms of the grant or any aspect of
the Restricted Stock to reduce or eliminate the Participant’s liability
regarding Tax-Related Items.  In the
event that the Company must withhold any Tax-Related Items as a result of the
grant or vesting of the Restricted Stock, Participant agrees to make
arrangements satisfactory to the Company to satisfy all withholding
requirements.  Participant 


 


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authorizes the Company to
withhold all applicable Tax-Related Items legally due from the Participant from
his or her wages or other cash compensation paid him or her by the Company.


Section
4.11           Data Privacy.  By entering into this
Agreement and as a condition of the grant of the Restricted Stock, Participant
consents to the collection, use and transfer of personal data as described in
this Section.  Participant understands
that the Company and its subsidiaries hold certain personal information about
the Participant, including the Participant’s name, home address and telephone
number, date of birth, social security number or identification number, salary,
nationality, job title, any shares of stock or directorships held in the
Company, details of all options or any other entitlement to shares of stock
(restricted or otherwise) awarded, cancelled, exercised, vested, unvested or
outstanding in Participant’s favor, for the purpose of managing and
administering the Plan (“Data”). 
Participant further understands that the Company and/or its subsidiaries
will transfer Data amongst themselves as necessary for the purpose of
implementation, administration and management of Participant’s participation in
the Plan, and that the Company and/or any of its subsidiaries may each further
transfer Data to any third parties assisting the Company in the implementation,
administration and management of the Plan (“Data Recipients”).  Participant understands that these Data
Recipients may be located in the Participant’s country of residence, the
European Economic Area, or elsewhere throughout the world, such as the United States.  Participant authorizes the Data Recipients to
receive, possess, use, retain and transfer the Data, in electronic or other
form, for the purposes of implementing, administering and managing
Participant’s participation in the Plan, including any transfer of such Data,
as may be required for the administration of the Plan and/or the subsequent
holding of shares on the Participant’s behalf, to a broker or other third party
with whom Participant may elect to deposit any shares of stock acquired upon vesting
of the shares of Restricted Stock. 
Participant understands that he or she may, at any time, review the
Data, require any necessary amendments to it or withdraw the consent herein in
writing by contacting the Company. 
Withdrawal of consent may, however, affect Participant’s ability to
participate in the Plan.


[signature
page follows]


 


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IN WITNESS WHEREOF, this
Agreement has been executed and delivered by the parties hereto.


	
   

  	
  VEECO
  INSTRUMENTS INC.

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
  Signed:

  	
   

  
	
   

  	
  [Participant’s
  Typed Name]

  
	
   

  	
   

  
	
   

  	
   

  
	
  Aggregate number of
  shares of Restricted Stock subject to the Award:

  	
   

  	
   

  	
   

  
	
   

  	
   

  
						



 


 


 


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