**Exhibit 10.3**

 

***EXECUTIVEOFFICER MASTER FORM***

 

**ULTRATECH,  INC.**

** **

**RESTRICTED STOCK UNIT ISSUANCE AGREEMENT**

 

**RECITALS**

 

A.            TheBoard has adopted the Plan for the purpose of retaining the services ofselected Employees and consultants and other independent advisors who provideservices to the Corporation (or any Parent or Subsidiary).

 

B.            Participantis to render valuable services to the Corporation (or a Parent or Subsidiary),and this Agreement is executed pursuant to, and is intended to carry out thepurposes of, the Plan in connection with the Corporation’s issuance of sharesof Common Stock to the Participant under the Stock Issuance Program.

 

C.            Allcapitalized terms in this Agreement shall have the meaning assigned to them inthe attached Appendix A.

 

**NOW, THEREFORE**,it is hereby agreed as follows:

 

1.             **Grant ofRestricted Stock Units.** The Corporation hereby awards to theParticipant, as of the Award Date, Restricted Stock Units under the Plan. EachRestricted Stock Unit which vests during the Participant’s period of Serviceshall entitle the Participant to receive one share of Common Stock on the specifiedissuance date. The number of shares of Common Stock subject to the awardedRestricted Stock Units, the applicable vesting schedule for those shares,the date on which those vested shares shall become issuable to Participant andthe remaining terms and conditions governing the award (the “Award”) shall beas set forth in this Agreement.

 

**AWARDSUMMARY**

 

Award Date:                                                         ,200    

 

Number of SharesSubject to Award:                                       shares of Common Stock (the “Shares”)

 

Vesting Schedule:                TheShares shall vest in a series of                    (    ) successive equal                     installmentsupon the Participant’s completion of each             of Service over the                  (     )-year period measured from                       .However, the Shares may be subject to accelerated vesting in whole or in part inaccordance with the provisions of Paragraphs 4 and 6 of this Agreement.

 

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Issuance Schedule               The Sharesin which the Participant vests in accordance with the foregoing Vesting Schedule willbecome issuable on the date (the “Issue Date”) upon which occurs the ***earliest***of the following dates orevents: (i)                  ,20   , (ii) the date of the Participant’s Separation fromService or (iii) the closing date of a Change in Control. The actualissuance of the Shares shall be subject to the Corporation’s collection of allapplicable Withholding Taxes and shall be effected on the applicable Issue Dateor as soon as administratively practicable thereafter, but in no event laterthan the close of the calendar year in which such Issue Date occurs or (iflater) the fifteenth (15th) day of the third calendar month following suchIssue Date. The procedures pursuant to which the applicable Withholding Taxesare to be collected are set forth in Paragraph 8 of this Agreement.

 

2.             **LimitedTransferability.** Prior to actual receipt of the Shares whichvest and become issuable hereunder, the Participant may not transfer anyinterest in the Award or the underlying Shares. Any Shares which vest hereunderbut which otherwise remain unissued at the time of the Participant’s death may betransferred pursuant to the provisions of the Participant’s will or the laws ofinheritance or to the Participant’s designated beneficiary or beneficiaries ofthis Award. The Participant may also direct the Corporation to issue thestock certificates for any Shares which in fact vest and become issuable underthe Award during his or her lifetime to one or more designated family membersor a trust established for the Participant and/or his or her family members.The Participant may make such a beneficiary designation or certificatedirective at any time by filing the appropriate form with the PlanAdministrator or its designee.

 

3.             **Cessationof Service.** Except as otherwise provided in Paragraph 4 below,should the Participant cease Service for any reason prior to vesting in one ormore Shares subject to this Award, then the Award will be immediately cancelledwith respect to those unvested Shares, and the number of Restricted Stock Unitswill be reduced accordingly. The Participant shall thereupon cease to have anyright or entitlement to receive any Shares under those cancelled units. Shouldthe Participant’s Service terminate by reason of a Termination for Cause, thenthis Award will be immediately cancelled with respect to all the RestrictedStock Units subject to such Award, whether vested or unvested at the time, andthe Participant shall thereupon cease to have any right or entitlement toreceive any Shares under this Award and the cancelled Restricted Stock Units.

 

4.             **AcceleratedVesting**. The following special vesting acceleration provisionsshall be in effect for the Award and shall be in addition to the vestingacceleration provisions of Paragraph 6 of this Agreement:

 

(a)           Should the Participantterminate Service by reason of Retirement(1) or should the Participant’sService terminate at or after attainment of age sixty-five (65) by

 

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(1) Not applicable to grants made to the Chief Executive Officer.

 

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reasonof death, Disability or Involuntary Termination (other than a Termination for Cause),then all the Shares at the time subject to this Award shall immediately vest.

 

(b)           Should the Participant’sService terminate prior to attainment of age sixty-five (65) by reason of hisor her death, Disability or Involuntary Termination (other than a Terminationfor Cause), then the Participant shall immediately vest in the additionalnumber of Shares (not to exceed one hundred percent (100%) of the unvestedShares at that time) equal to the ***greater*** of (i) twenty-fivepercent of the total Shares subject to this Award or (ii) the additionalnumber of Shares (if any) in which the Participant would have been vested atthe time of such termination had the Shares subject to this Award vested in a series of             (        ) successive equal                  installments over the duration of the VestingSchedule.

 

(c)           The Shares which veston an accelerated basis pursuant to this Paragraph 4, together with any otherShares in which the Participant is at the time vested, shall be issued on thedate of the Participant’s Separation from Service or as soon asadministratively practicable thereafter, subject to the Corporation’scollection of the applicable Withholding Taxes, but in no event later than theclose of the calendar year in which such Separation from Service occurs or (iflater) the fifteenth (15th) day of the third calendar month following the dateof such Separation from Service.

 

5.             **StockholderRights and Dividend Equivalents**

 

(a)           The holder of thisAward shall not have any stockholder rights, including voting or dividendrights, with respect to the Shares subject to the Award until the Participantbecomes the record holder of those Shares following their actual issuance uponthe Corporation’s collection of the applicable Withholding Taxes.

 

(b)           Notwithstanding theforegoing, should any dividend or other distribution, whether regular orextraordinary and whether payable in cash, securities or other property, bedeclared and paid on the outstanding Common Stock while one or more Sharesremain subject to this Award (i.e., those Shares are not otherwise issued andoutstanding for purposes of entitlement to the dividend or distribution), thena special book account shall be established for the Participant and creditedwith a phantom  dividend equal to theactual dividend or distribution which would have been paid on the Shares at thetime subject to this Award had those Shares been issued and outstanding andentitled to that dividend or distribution. The phantom dividend equivalents socredited shall vest at the same time as the Shares to which they relate andshall be distributed to the Participant (in the same form the actualdividend or distribution was paid to the holders of the Common Stock entitledto that dividend or distribution) concurrently with the issuance of those Shareson the applicable Issue Date. However, each such distribution shall be subjectto the Corporation’s collection of the Withholding Taxes applicable to thatdistribution.

 

6.             **Change ofControl.**

 

(a)           Any Restricted StockUnits subject to this Award at the time of a Change in Control will vestimmediately prior to the closing of that Change in Control. The

 

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Sharessubject to those vested units, together with any other Shares in which theParticipant is at that time vested, will be issued on the Issue Date triggeredby the Change in Control (or otherwise converted into the right to receive thesame consideration per share of Common Stock payable to the other stockholdersof the Corporation in consummation of that Change in Control and distributed atthe same time as such stockholder payments), subject to the Corporation’scollection of the applicable Withholding Taxes pursuant to the provisions ofParagraph 8.

 

(b)           This Agreement shallnot in any way affect the right of the Corporation to adjust, reclassify,reorganize or otherwise change its capital or business structure or to merge,consolidate, dissolve, liquidate or sell or transfer all or any part ofits business or assets.

 

7.             **Adjustmentin Shares.** Should any change be made to the Common Stock byreason of any stock split, stock dividend, recapitalization, combination ofshares, exchange of shares or other change affecting the outstanding CommonStock as a class without the Corporation’s receipt of consideration,appropriate adjustments shall be made to the total number and/or class ofsecurities issuable pursuant to this Award in order to reflect such change andthereby preclude a dilution or enlargement of benefits hereunder.

 

8.             **Collectionof Withholding Taxes.**

 

(a)           The Corporation shallcollect the employee portion of the FICA taxes (Social Security and Medicare) withrespect to the Shares at the time those Shares vest hereunder. The FICA taxesshall be based on the Fair Market Value of the Shares on their vesting date. TheCorporation shall also collect the employee portion of the FICA taxes withrespect to any phantom dividends at the time those phantom dividends vesthereunder. The FICA taxes shall be based on the cash amount and the fair marketvalue of any other property underlying the phantom dividends on the vestingdate. Unless the Participant delivers a separate check payable to theCorporation in the amount of the FICA taxes required to be withheld from theParticipant, the Corporation shall withhold those taxes from the Participant’swages. However, if the Participant is at the time an executive officer of theCorporation, then such withholding taxes must be collected from the Participantthrough delivery of his or her separate check not later than the vesting date.

 

(b)           The Corporation shallcollect the federal, state and local income taxes required to be withheld withrespect to the distribution of the phantom dividend equivalents to theParticipant by withholding a portion of that distribution equal to the amountof those taxes, with the cash portion of the distribution to be the firstportion so withheld. Until such time as the Corporation provides theParticipant with notice to the contrary, the Corporation shall collect the federal,state and local income taxes required to be withheld with respect to the issuanceof the vested Shares hereunder through an automatic Share withholding procedurepursuant to which the Corporation will withhold, at the time of such issuance, aportion of the  Shares with a Fair MarketValue (measured as of the issuance date) equal to the amount of those taxes  (the “Share Withholding Method”); ***provided, however***, that the amount of any Shares sowithheld shall not exceed the amount necessary to satisfy the Corporation’srequired tax withholding obligations using the minimum statutory withholdingrates for federal and state tax purposes that are

 

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applicableto supplemental taxable income. Participant shall be notified in writing in theevent such Share Withholding Method is no longer available.

 

(c)           Should any Shares bedistributed at time the Share Withholding Method is not available, then the federal,state and local income taxes required to be withheld with respect to thoseShares shall be collected from the Participant through either of the followingalternatives:

 

•              theParticipant’s delivery of his or her separate check payable to the Corporationin the amount of such Withholding Taxes, or

 

•              theuse of the proceeds from a next-day sale of the Shares issued to theParticipant, provided and only if (i) such a sale is permissible under theCorporation’s trading policies governing the sale of Common Stock, (ii) theParticipant makes an irrevocable commitment, on or before the Issue Date forthose Shares, to effect such sale of the Shares and (iii) the transactionis not otherwise deemed to constitute a prohibited loan under Section 402of the Sarbanes-Oxley Act of 2002.

 

(d)           Except asotherwise provided in Paragraph 6 and Paragraph 8(b), the settlement of allRestricted Stock Units which vest under the Award shall be made solely inshares of Common Stock. In no event, however, shall any fractional shares beissued. Accordingly, the total number of shares of Common Stock to be issued pursuantto the Award shall, to the extent necessary, be rounded down to the next wholeshare in order to avoid the issuance of a fractional share.

 

9.             **Deferred Issue Date.** Notwithstandingany provision to the contrary in this Agreement, no Shares which becomeissuable by reason of the Participant’s Separation from Service shallactually  be issued to a Participantprior to the ***earlier*** of (i) theexpiration of the six (6)-month period measured from the date of his or herSeparation from Service or (ii) the date of his or her death, if  the Participant is deemed at the time of suchSeparation from Service to be a “key employee” within the meaning of that termunder Code Section 416(i) ***and*** suchdelayed issuance is otherwise required in order to avoid a prohibiteddistribution under Code Section 409A(a)(2). Upon the expiration of theapplicable Code Section 409A(a)(2) deferral period, all Sharesdeferred pursuant to this Paragraph 9 shall be issued in a lump sum to the Participant.

 

10.           **BenefitLimit.**In the event the vesting and issuance of the Sharessubject to this Award would otherwise constitute a parachute payment under CodeSection 280G, then the vesting and issuance of those Shares shall besubject to reduction to the extent necessary to assure that the number of Shares which vest and are issued under thisAward will be limited to the ***greater*** of (i)  thenumber of Shares which can vest and be issued without triggering a parachutepayment under Code Section 280G or (ii)  the maximum number ofShares which can vest and be issued under this Award so as to provide theParticipant with the greatest after-tax amount of such vested and issued Sharesafter taking into account any excise tax the Participant may incur underCode Section 4999 with respect to those Shares and any other benefits orpayments to which the Participant may be entitled in connection with anychange in control or ownership of the Corporation or the subsequent terminationof the Participant’s Service.

 

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**[10.****         BenefitLimit.**In the event the vesting and issuance of the Shares subject tothis Award would constitute a parachute payment under Code Section 280G,the Participant shall become entitled to the tax gross-up payment providedunder Section 8.3 of his Employment Agreement, to the extent suchagreement in effect at that time. Otherwise, the vesting and issuance of thoseShares shall be subject to reduction to the extent necessary  to assure that the number of Shares whichvest and are issued under this Award will be limited to the ***greater*** of (i)  the numberof Shares which can vest and be issued without triggering a parachute paymentunder Code Section 280G or (ii)  the maximum number of Shareswhich can vest and be issued under this Award so as to provide the Participantwith the greatest after-tax amount of such vested and issued Shares aftertaking into account any excise tax the Participant may incur under Code Section 4999with respect to those Shares and any other benefits or payments to which theParticipant may be entitled in connection with any change in control orownership of the Corporation or the subsequent termination of the Participant’sService.]  ALTERNATIVE

 

11.           **Compliance with Laws and Regulations.**The issuance of shares of Common Stock pursuant to the Award shall be subjectto compliance by the Corporation and Participant with all applicablerequirements of law relating thereto and with all applicable regulations of anystock exchange (or the Nasdaq National Market, if applicable) on which theCommon Stock may be listed for trading at the time of such issuance.

 

12.           **Notices.** Any notice required to begiven or delivered to the Corporation under the terms of this Agreement shallbe in writing and addressed to the Corporation at its principal corporateoffices. Any notice required to be given or delivered to Participant shall bein writing and addressed to Participant at the address indicated belowParticipant’s signature line on this Agreement. All notices shall be deemedeffective upon personal delivery or upon deposit in the U.S. mail, postageprepaid and properly addressed to the party to be notified.

 

13.           **Successors and Assigns.** Except tothe extent otherwise provided in this Agreement, the provisions of thisAgreement shall inure to the benefit of, and be binding upon, the Corporationand its successors and assigns and Participant, Participant’s assigns, thelegal representatives, heirs and legatees of Participant’s estate and anybeneficiaries of the Award designated by Participant.

 

14.           **Construction.** This Agreement andthe Award evidenced hereby are made and granted pursuant to the Plan and are inall respects limited by and subject to the terms of the Plan. All decisions ofthe Plan Administrator with respect to any question or issue arising under thePlan or this Agreement shall be conclusive and binding on all persons having aninterest in the Award.

 

15.           **Governing Law.** The interpretation,performance and enforcement of this Agreement shall be governed by the laws ofthe State of California without resort to that State’s conflict-of-laws rules.

 

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16.           **Employment at Will.** Nothing in thisAgreement or in the Plan shall confer upon Participant any right to continue inService for any period of specific duration or interfere with or otherwiserestrict in any way the rights of the Corporation (or any Parent or Subsidiaryemploying or retaining Participant) or of Participant, which rights are herebyexpressly reserved by each, to terminate Participant’s Service at any time forany reason, with or without cause.

 

**IN WITNESS WHEREOF**, theparties have executed this Agreement on the day and year first indicated above.

 
| ** ** | **ULTRATECH, INC.** |
|------------|--------------------------|
|       |                     |
|       |                     |
|       | By:                      |   |   |
|       | Title:                   |   |   |
|       | ** **               |
|       | ** **               |
|       | **PARTICIPANT**          |
|       |                     |
|       |                     |
|       | Signature:               |   |   |
|       | Address:                 |   |   |
|       |                     |   |   |

 

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**APPENDIX A**

**DEFINITIONS**

** **

The following definitionsshall be in effect under the Agreement:

 

A.            **Agreement** shall mean thisRestricted Stock Unit Issuance Agreement.

 

B.            **Award** shall mean the award of RestrictedStock Units made to the Participant pursuant to the terms of this Agreement.

 

C.            **Award Date** shall mean the date the RestrictedStock Units are awarded to Participant pursuant to the Agreement and shall bethe date indicated in Paragraph 1 of the Agreement.

 

D.            **Board** shall mean the Corporation’sBoard of Directors.

 

E.             **Change in Control** shall mean achange in ownership or control of the Corporation effected through any of thefollowing transactions:

 

(i)            a mergeror consolidation in which the Corporation is not the surviving entity and inwhich securities possessing more than fifty percent (50%) of the total combinedvoting power of the Corporation’s outstanding securities are transferred toperson or persons different from the persons holding those securitiesimmediately prior to such merger or consolidation,

 

(ii)           the sale,transfer or other disposition of all or substantially all of the assets of theCorporation in complete liquidation or dissolution of the Corporation, or

 

(iii)          anyreverse merger in which the Corporation is the surviving entity but in whichsecurities possessing more than fifty percent (50%) of the total combinedvoting power of the Corporation’s outstanding securities are transferred toperson or persons different from the persons holding those securitiesimmediately prior to such merger.

 

(iv)          theacquisition, directly or indirectly by any person or related group of persons(other than the Corporation or a person that directly or indirectly controls,is controlled by, or is under common control with, the Corporation), ofbeneficial ownership (within the meaning of Rule 13d-3 of the 1934 Act) ofsecurities possessing more than fifty percent (50%) of the total combinedvoting power of the Corporation’s outstanding securities pursuant to a tenderor exchange offer made directly to the Corporation’s stockholders, or

 

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(v)           a changein the composition of the Board over a period of twelve (12) consecutive monthsor less such that a majority of the Board members ceases, by reason of one ormore contested elections for Board membership, to be comprised of individualswho either (A) have been Board members continuously since the beginning ofsuch period or (B) have been elected or nominated for election as Boardmembers during such period by at least a majority of the Board membersdescribed in clause (A) who were still in office at the time the Boardapproved such election or nomination.

 

F.             **Code** shall mean the InternalRevenue Code of 1986, as amended.

 

G.            **Common Stock** shall mean shares ofthe Corporation’s common stock.

 

H.            **Corporation** shall mean Ultratech, Inc.,a Delaware corporation, and any successor corporation to all or substantiallyall of the assets or voting stock of Ultratech, Inc. which shall byappropriate action adopt the Plan.

 

I.              **Disability** shall mean theParticipant’s inability, because of physical or mental illness or injury, toperform his customary duties as an executive officer of the Corporation,with or without reasonable accommodation, and the continuation of such disabledcondition for a period of one hundred eighty (180) continuous days asdetermined by an approved medical doctor. For purposes hereof, an approvedmedical doctor shall mean a doctor selected by the Corporation and theParticipant. If the Corporation and the Participant cannot agree on a medicaldoctor, each shall select a medical doctor and the two doctors shall select athird who shall be the approved medical doctor for this purpose.

 

J.             **Employee** shall mean an individualwho is in the employ of the Corporation (or any Parent or Subsidiary), subjectto the control and direction of the employer entity as to both the work to beperformed and the manner and method of performance.

 

K.            **EmploymentAgreement** shall mean the written employment agreement betweenthe Corporation and the Participant in effect on the Award Date.

 

L.             **Fair Market Value** per share ofCommon Stock on any relevant date shall be determined in accordance with thefollowing provisions:

 

(i)            Ifthe Common Stock is not at the time listed or admitted to trading on any Stock Exchangebut is traded on the Nasdaq National Market, the Fair Market Value shall be theclosing selling price per share on the date in question, as such price isreported by the National Association of Securities Dealers on the NasdaqNational Market or any successor system. If there is no 

 

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reported closing sellingprice for the Common Stock on the date in question, then the closing sellingprice on the last preceding date for which such quotation exists shall bedeterminative of Fair Market Value.

 

(ii)           Ifthe Common Stock is at the time listed or admitted to trading on any Stock Exchange,then the Fair Market Value shall be the closing selling price per share on thedate in question on that Stock Exchange, as such price is officially quoted inthe composite tape of transactions on such exchange. If there is no reportedsale of Common Stock on such Stock Exchange on the date in question, then theFair Market Value shall be the closing selling price on the exchange on thelast preceding date for which such quotation exists.

 

M.           **InvoluntaryTermination**shall mean the termination of the Participant’sService which occurs by reason of:

 

(i)            suchindividual’s involuntary dismissal or discharge by the Corporation (or anyParent or Subsidiary) for reasons other than a Termination for Cause,  or

 

(ii)           suchindividual’s voluntary resignation following any of the following eventswithout the Participant’s written consent: (A) any reduction in theaggregate level of the Participant’s annual rate of base salary, except areduction that is part of a program applicable to all of the Corporation’sofficers to reduce expenses; (B) the failure by the Corporation or any Parentor Subsidiary (or any successor to the Corporation) to comply with any materialterms of the Employment Agreement or any other material agreement between theParticipant and the Corporation or any Parent or Subsidiary (or any successorto the Corporation); (C) any material reduction in the nature or scope ofthe Participant’s duties, title, function, authority or responsibilities,subject to any limitations specified in the Employment Agreement(2); or (D) arequirement that the Participant relocate his principal office to a locationthat is more than sixty (60) miles from the location of his principal office determinedas of the date specified in the Employment Agreement; provided, however,that none of the events specified above shall constitute grounds for anInvoluntary Termination unless the Participant shall have notified the Corporationin writing describing the events which constitute grounds for such InvoluntaryTermination and the Corporation shall have failed to cure such event withinthirty (30) days after the Corporation’s receipt of such written notice.

 

N.            **1934 Act** shall mean the SecuritiesExchange Act of 1934, as amended from time to time.

 

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(2) For grants made to the Chief Executive Officer, the languagewill be as follows:  “(C) anymaterial reduction in the nature or scope of the Participant’s duties, title,function, authority or responsibilities (including, for example, theParticipant’s directly reporting to anyone other than the Board.”

 

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O.            **Participant** shall mean the personto whom the Award is made pursuant to the Agreement.

 

P.             **Parent** shall mean any corporation(other than the Corporation) in an unbroken chain of corporations ending withthe Corporation, provided each corporation in the unbroken chain (other thanthe Corporation) owns, at the time of the determination, stock possessing fiftypercent (50%) or more of the total combined voting power of all classes ofstock in one of the other corporations in such chain.

 

Q.            **Plan** shall mean the Corporation’s 1993Stock Option/Stock Issuance Plan, as amended and restated.

 

R.            **Plan Administrator** shall meaneither the Board or a committee of the Board acting in its capacity asadministrator of the Plan.

 

S.             **RestrictedStock Unit** shall mean each unit subject to this Award whichshall entitle the Participant to receive one share of Common Stock under thePlan at a designated time following the vesting of that unit.

 

T.            **Retirement**shall mean the Participant’s voluntary termination from Service on or after hisor her attainment of age sixty five (65) other than in connection with aTermination for Cause event

 

U.            **Separationfrom Service** shall mean the Participant’s termination of Serviceunder circumstances which are deemed to constitute a separation from servicewithin the meaning of Code Section 409A and the applicable TreasuryRegulations thereunder.

 

V.            **Service** shall mean the Participant’sperformance of services for the Corporation (or any Parent or Subsidiary) inthe capacity of an Employee, a non-employee member of the board of directors ora consultant or independent advisor. For purposes of this Agreement,Participant shall be deemed to cease Service immediately upon the occurrence ofthe either of the following events: (i) Participant no longer performsservices in any of the foregoing capacities for the Corporation (or any Parentor Subsidiary) or (ii) the entity for which Participant performs suchservices ceases to remain a Parent or Subsidiary of the Corporation, eventhough Participant may subsequently continue to perform services forthat entity. Service shall not be deemed to cease during a period of militaryleave, sick leave or other personal leave approved by the Corporation; ***provided, however***, that except to the extent otherwiserequired by law or expressly authorized by the Plan Administrator or theCorporation’s written leave of absence policy, no Service credit shall be givenfor vesting purposes for any period the Participant is on a leave of absence.

 

W.           **Stock Exchange** shall mean theAmerican Stock Exchange or the New York Stock Exchange.

 

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X.            **Subsidiary** shall mean any corporation(other than the Corporation) in an unbroken chain of corporations beginningwith the Corporation, provided each corporation (other than the lastcorporation) in the unbroken chain owns, at the time of the determination,stock possessing fifty percent (50%) or more of the total combined voting powerof all classes of stock in one of the other corporations in such chain.

 

Y.            **Termination for Cause** shall meanthe termination of the Participant’s Service by the Corporation (or any Parentor Subsidiary)  for one or more of thefollowing reasons:

 

(i)            theParticipant’s repeated failure to perform any essential duty of his or herposition other than due to Disability or such illness or injury as would resultin Disability if it continued for the one hundred eighty (180)-day periodspecified in the Disability definition above;

 

(ii)           theParticipant’s commission of any act that constitutes gross misconduct and isinjurious to the Corporation or any Parent or Subsidiary or any successor tothe Corporation;

 

(iii)          theParticipant’s conviction of or pleading guilty or *nolocontendere* to any felony involving theft, embezzlement, dishonestyor moral turpitude;

 

(iv)          theParticipant’s commission of any act of fraud against, or the misappropriationof property belonging to, the Corporation or any Parent or Subsidiary or anysuccessor to the Corporation;

 

(v)           theParticipant’s commission of any act of dishonesty in connection with his or herresponsibilities as an employee that is intended to result in his or herpersonal enrichment or the personal enrichment of his or her family or others; or

 

(vi)          theParticipant’s material breach of the Employment Agreement he or she may haveat the time with the Corporation or any other agreement between the Participantand the Corporation or any Parent or Subsidiary or successor to theCorporation.

 

Z.            **Withholding Taxes** shall mean (i) theemployee portion of the federal, state and local employment taxes required tobe withheld by the Corporation in connection with the vesting of the shares ofCommon Stock under the Award and any phantom dividend equivalents relating tothose shares and (ii) the federal, state and local income taxes requiredto be withheld by the Corporation in connection with the issuance of thosevested shares and the distribution of any phantom dividend equivalents relatingto such shares.

 

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