**Exhibit 10.13**

**AMENDED AND RESTATED EMPLOYMENT AGREEMENT**

**T****HIS****A****MENDED AND****R****ESTATED****E****MPLOYMENT****A****GREEMENT**(the “***Agreement***”) is madeand entered into effective as of January 2, 2007 (“***Effective Date***”) byand between **C****YMER****,********I****NC****.**, a Nevada corporation (the “***Company***”) and the Company’s **Sr. VP, Chief Financial Officer**, **N****ANCY****J********B****AKER** (the “***Employee***”).  This Agreement shall replace and supersedethat certain Employment Agreement between Employee and the Company entered intoeffective as of **March 1, 2004** (the“***Original EmploymentAgreement***”).

**R****ECITALS**

A              The Company andEmployee previously entered into the Original Employment Agreement and desireto amend and restate the Original Employment Agreement in its entirety as setforth herein, effective as of the Effective Date.

B.            The Company may fromtime to time need to address the possibility of an acquisition transaction orchange of control event.  The Board ofDirectors of the Company (the “***Board***”) recognizes that such events can be a distractionto the Employee and can cause the Employee to consider alternative employmentopportunities.  The Board has determinedthat it is in the best interests of the Company and its stockholders to assurethat the Company will have the continued dedication and objectivity of theEmployee, notwithstanding the possibility, threat or occurrence of a Change ofControl (as defined below) of the Company, although no such Change of Controlis now contemplated.

C.            The Board believesthat it is in the best interests of the Company and its stockholders to providethe Employee with an incentive to continue the Employee’s employment and tomotivate the Employee to maximize the value of the Company upon a Change ofControl for the benefit of its stockholders.

D.            The Board believesthat it is imperative to provide the Employee with certain benefits upon aChange of Control and, under certain circumstances, upon termination of theEmployee’s employment in connection with a Change of Control, which benefitsare intended to provide the Employee with financial security and providesufficient incentive and encouragement to the Employee to remain with theCompany notwithstanding the possibility of a Change of Control.

E.             To accomplish theforegoing objectives, the Board has directed the Company, upon execution ofthis Agreement by the Employee, to agree to the terms provided herein.

F.             Certain capitalizedterms used in this Agreement are defined in Section 7 below.

**A****GREEMENT**

In consideration of the mutual covenants herein contained, and inconsideration of the continuing employment of the Employee by the Company, theparties agree as follows:

1

----

**1.             Duties and Scope of Employment.** The Company shall employ the Employee in the position of **Sr. VP, Chief Financial Officer** as suchposition has been defined in terms of responsibilities and compensation as ofthe Effective Date of this Agreement; *provided,however*, that the Board shall have the right, at any time prior tothe occurrence of a Change of Control, to revise such responsibilities andcompensation as the Board in its discretion may deem necessary orappropriate.  The Employee shall complywith and be bound by the Company’s operating policies, procedures and practicesfrom time to time in effect during the Employee’s employment.  During the term of the Employee’s employmentwith the Company, the Employee shall continue to devote the Employee’s fulltime, skill and attention to the Employee’s duties and responsibilities, andshall perform them faithfully, diligently and competently, and the Employeeshall use the Employee’s best efforts to further the business of the Companyand its affiliated entities.

**2.             BaseCompensation.**  The Companyshall pay the Employee as compensation for the Employee’s services a basesalary, which as the Effective Date of this Agreement is at the annualized rateof $**375,000.00** (and which may bemodified from time to time in accordance with this Agreement, the “***Base Compensation***”).  The Base Compensation shall be paidperiodically in accordance with normal Company payroll practices.  The Board or the Compensation Committee ofthe Board shall review the Base Compensation according to normal Companypractice, but no less frequently than annually, and may in its discretionmodify the Base Compensation but may not decrease the Base Compensation belowthe dollar amount specified above, unless Employee consents to such reduction.

**3.             IncentiveCompensation. **During the termof this Agreement, the Employee shall be eligible to receive payments under theCompany’s various incentive and bonus programs as approved from time to time bythe Board or the Compensation Committee of the Board in either’s solediscretion.  Any payment payablethereunder shall be payable in accordance with the applicable program and theCompany’s normal practices and policies.

**4.             EmployeeBenefits.**  The Employeeshall be eligible to participate in the employee benefit plans and executivecompensation programs maintained by the Company applicable to other keyexecutives of the Company, including (without limitation) retirement plans,savings or profit-sharing plans, stock option, stock purchase or other equityplans, incentive bonus program, 3-year bonus program or other long-termincentive programs, bonus programs, life, disability, health, accident andother insurance programs, paid vacations, and similar plans or programs,subject in each case to the generally applicable terms and conditions of theapplicable plan or program in question and to the sole determination of theBoard or any committee administering such plan or program.

**5.             EmploymentRelationship.**  The Companyand the Employee acknowledge that the Employee’s employment is and shallcontinue to be at-will, as defined under applicable law.  If the Employee’s employment terminates forany reason, the Employee shall not be entitled to any payments, benefits,damages, awards or compensation other than as provided by this Agreement, or asmay otherwise be available in accordance with any Company plan or policyapproved by the Board.

2

----

**6.             TerminationBenefits.**

**(a)          **Subject to Sections8 and 9 below, in the event the Employee’s employment terminates as a result ofan Involuntary Termination other than for Cause upon or within eighteen (18)months after a Change of Control, then the Employee shall be entitled toreceive severance and other benefits pursuant to this Section 6.   Notwithstanding the foregoing, Employeeshall not be entitled to receive any severance or other benefits pursuant tothis Section 6 if the Board, as constituted prior to the Change in Control,determined that Employee was demoted by the Company to a position not eligiblefor an Employment Agreement prior to the Change of Control from the positionheld by Employee as of the Effective Date. The foregoing determination may be made at any time by the Board prior toa Change in Control, shall be made in the Board’s sole discretion, and shall bebinding and conclusive on all persons, including Employee.

**(i)            PayContinuation.**  The Employeeshall be entitled to monthly payments equal to (A) one-twelfth (1/12) of the greaterof the Base Compensation in effect immediately prior to the Change of Controland the Base Compensation in effect immediately prior to such termination plus(B) one-thirty-sixth (1/36) of the aggregate amounts paid to the Employee underthe Company’s bonus and incentive programs with respect to the three previouscalendar years.  Such monthly paymentsshall be paid according to the normal payroll practice of the Company for **18** months following the date of termination(the “***Termination Period***”).

**(ii)           IncentivePayments.**

**(1)          **The Employeeshall be entitled to receive a percentage of each of the Employee’s TargetIncentives for any on-going calendar period in which such terminationoccurs.  Such percentage shall equal afraction, the numerator of which shall be the number of days in such calendarperiod up to and including the date of such termination and the denominator ofwhich shall be the number of days in such calendar period.  Such amount shall be payable according to thenormal practice of the Company with respect to the payment of suchcompensation.  “Target Incentive” shallmean the maximum amount payable to the Employee at the end of a calendar periodunder any Company bonus or incentive program if all of such program’s corporateand individual performance objectives for that period are met.  “Target Incentive” does not include amountspayable under the Company’s 3-year bonus program.

**(2)          **The unvestedportion of any bonus accrued for Employee under the Company’s 3-year bonusprogram shall vest and become payable in full in a lump sum as soon asadministratively practicable following the date of termination.

**(iii)         EquityAwards.**  The unvested portion of anystock option(s) or other equity award(s) held by the Employee under the Company’sequity plans shall vest and become exercisable in full upon the date of suchtermination.  The Employee shall beentitled to exercise all of the Employee’s vested stock options until the laterof (A) the original post-termination exercise period provided in the Employee’sstock option agreement or (B) one year from the date of such termination (butnot beyond the original contractual life of the option); *provided, however*, that notwithstandingthe foregoing, with respect to each stock option granted to the Employee beforethe Effective Date of this Agreement, such stock option shall not remainexercisable beyond the later of the fifteenth (15th) day of the third (3rd)month following the date at which, or December 31 of the calendar year inwhich, the stock option would otherwise have expired if the stock option hadnot been extended, based on the terms of the stock option at

3

----

theoriginal grant date, or such later date that would not cause such option to betreated as deferred compensation under 409A of the Code (as defined below).

**(iv)          MedicalBenefits.**  Assuming theEmployee timely and accurately elects to continue his health insurance benefitsunder the Consolidated Omnibus Budget Reconciliation Act of 1985 (“COBRA”), theCompany shall pay the COBRA premiums for the Employee **[and his or her qualified beneficiaries]**untilthe earliest of (i) the end of the Termination Period, (ii) the expiration ofthe Employee’s continuation coverage under COBRA and any applicable stateCOBRA-like statute that provides mandated continuation coverage or (iii) thedate the Employee becomes eligible for health insurance benefits of asubsequent employer.

**(b)          **In the eventthe Employee voluntarily resigns employment with the Company within the 30-dayperiod beginning one year after a Change of Control, the Employee shall receivethe severance and other benefits set forth in Sections 6(a)(i)-(iv) above.

**7.             Definitionof Terms.**  Thefollowing terms referred to in this Agreement shall have the followingmeanings:

**(a)           Cause.**  “Cause” shall mean any of the following: (i)any act of personal dishonesty taken by the Employee in connection with theEmployee’s responsibilities as an employee and intended to result insubstantial personal enrichment of the Employee, (ii) conviction of a felonythat is injurious to the Company, (iii) a willful act by the Employee whichconstitutes gross misconduct and which is injurious to the Company, or (iv)continued violations by the Employee of the Employee’s obligations underSection 1 of this Agreement after there has been delivered to the Employee awritten demand for performance from the Company which describes the basis forthe Company’s belief that the Employee has not substantially performed theEmployee’s duties.

**(b)           Changeof Control.**  “Change ofControl” shall mean the occurrence of any of the following events:

**(i)           **The acquisitionby any “person” (as such term is used in Sections 13(d) and 14(d) of theExchange Act) (other than the Company or a person that directly or indirectlyis controlled by the Company) of the “beneficial ownership” (as defined in Rule13d-3 under said Act), directly or indirectly, of securities of the Companyrepresenting fifty percent (50%) or more of the total voting power representedby the Company’s then outstanding voting securities; or

**(ii)          **A change in thecomposition of the Board occurring within a two-year period, as a result ofwhich fewer than a majority of the directors are Incumbent Directors.  “Incumbent Directors” shall mean directorswho either (A) are directors of the Company as of the date hereof, or (B) areelected to the Board with the affirmative votes of at least a majority of theIncumbent Directors at the time of such election or (C) are nominated forelection to the Board by a committee of the Board, at least a majority of whosemembers are Incumbent Directors at the time of such nomination (but in eachcase shall not include an individual not otherwise an Incumbent Director whoseelection or nomination is in connection with an actual or threatened proxycontest relating to the election of directors to the Company); or

4

----

**(iii)        **A merger orconsolidation of the Company with any other corporation, other than a merger orconsolidation which would result in the voting securities of the Companyoutstanding immediately prior thereto continuing to represent (either byremaining outstanding or by being converted into voting securities of thesurviving entity) at least fifty percent (50%) of the total voting powerrepresented by the voting securities of the Company or such surviving entityoutstanding immediately after such merger or consolidation.

**(c)           Disability.**  “Disability” shall mean that the Employee hasbeen unable to substantially perform the Employee’s duties under this Agreementas the result of the Employee’s incapacity due to physical or mental illness,and such inability, at least 26 weeks after its commencement, is determined tobe total and permanent by a physician selected by the Company or its insurers;and acceptable to the Employee or the Employee’s legal representative (suchagreement as to acceptability not to be unreasonably withheld).

**(d)           ExchangeAct.**  “Exchange Act” shall mean theSecurities Exchange Act of 1934, as amended.

**(e)           InvoluntaryTermination.**  “InvoluntaryTermination” shall mean (i) without the Employee’s express written consent, thesignificant reduction of the Employee’s duties or responsibilities relative tothe Employee’s duties or responsibilities in effect immediately prior to suchreduction; *provided, however*,that a reduction in duties or responsibilities solely by virtue of the Companybeing acquired and made part of a larger entity (as, for example, when theChief Financial Officer of Company remains as such following a Change ofControl and is not made the Chief Financial Officer of the acquiringcorporation) shall not constitute an “Involuntary Termination”; (ii) withoutthe Employee’s express written consent, a substantial reduction, without goodbusiness reasons, of the facilities and perquisites (including office space andlocation) available to the Employee immediately prior to such reduction; (iii)without the Employee’s express written consent, a material reduction by theCompany in the Base Compensation or any Target Incentive of the Employee as ineffect immediately prior to such reduction, or the ineligibility of theEmployee to continue to participate in any long-term incentive plan of theCompany; (iv) a material reduction by the Company in the kind or level ofemployee benefits to which the Employee is entitled immediately prior to suchreduction with the result that the Employee’s overall benefits package issignificantly reduced; (v) the relocation of the Employee to a facility or alocation more than fifty (50) miles from the Employee’s then present location,without the Employee’s express written consent; (vi) any purported terminationof the Employee by the Company which is not effected for death or Disability orfor Cause; or (vii) the failure of the Company to obtain the assumption of thisAgreement by any Successors contemplated in Section 10 below.

**8.             Limitationon Payments.**

**(a)          **In the eventthat the severance and other benefits provided for in this Agreement orotherwise payable to the Employee (i) constitute “parachute payments” withinthe meaning of Section 280G of the Internal Revenue Code of 1986, as amended(the “Code”) and (ii) but for this Section 8 would be subject to the excise taximposed by Section 4999 of the Code, then the Employee’s termination benefitsunder Section 6 shall be payable either (i) in full, or (ii) as to such lesseramount which would result in no portion of such termination benefits beingsubject to

5

----

excisetax under Section 4999 of the Code, whichever of the foregoing amounts, takinginto account the applicable federal, state and local income taxes and theexcise tax imposed by Section 4999, results in the receipt by the Employee onan after-tax basis, of the greatest amount of termination benefits under thisAgreement, notwithstanding that all or some portion of such terminationbenefits may be taxable under Section 4999 of the Code.

**(b)          **If a reductionin the payments and benefits that would otherwise be paid or provided to theEmployee under the terms of this Agreement is necessary to comply with theprovisions of Section 8(a), the Employee shall be entitled to select whichpayments or benefits will be reduced and the manner and method of any suchreduction of such payments or  benefits(including but not limited to the number of options that would vest underSection 6(a)(iii)) subject to reasonable limitations (including, for example,express provisions under the Company’s benefit plans) so long as therequirements of Section 8(a) are met. Within thirty (30) days after the amount of any required reduction inpayments and benefits is finally determined in accordance with the provisionsof Section 8(c), the Employee shall notify the Company in writing regardingwhich payments or benefits are to be reduced. If no notification is given by the Employee, the Company will determinewhich amounts to reduce.  If, as a resultof any reduction required by Section 8(a), amounts previously paid to theEmployee exceed the amount to which the Employee is entitled, the Employee willpromptly return the excess amount to the Company.

**(c)          **Anydetermination required under this Section 8 shall be made in writing by anationally recognized accounting or consulting firm appointed by the Company,which firm shall not then be serving as accountant or auditor for or consultantto the Company or the person or entity that effected the Change in Control andwhose determinations shall be conclusive and binding upon the Employee and theCompany for all purposes.  For purposesof making the calculations required by this Section 8, such firm may makereasonable assumptions and approximations concerning applicable taxes and mayrely on reasonable, good faith interpretations concerning the application ofSections 280G and 4999 of the Code.  TheCompany and the Employee shall furnish to such firm such information anddocuments as such firm may reasonably request in order to make a determinationunder this Section 8.  The Company shallbear all costs such firm may reasonably incur in connection with anycalculations contemplated by this Section 8.

**9.             Applicationof Code Section 409A.**  Ifthe Company determines that any termination benefit provided in Section 6 failsto satisfy the distribution requirement of Section 409A(a)(2)(A) of the Code asa result of Section 409A(a)(2)(B)(i) of the Code, the payment of such benefitshall be accelerated to the minimum extent necessary so that the benefit is notsubject to the provisions of Section 409A(a)(1) of the Code.  (It is the intention of the precedingsentence to apply the short-term deferral provisions of Section 409A of theCode, and the regulations and other guidance thereunder, to the terminationbenefits, and the payment schedule as revised after the application of thepreceding sentence shall be referred to as the “Revised Payment Schedule.”)  If there is no Revised Payment Schedule thatwould avoid the application of Section 409A(a)(1) of the Code, the payment ofsuch benefits shall not be paid pursuant to a Revised Payment Schedule andinstead shall be delayed to the minimum extent necessary so that such benefitsare not subject to the provisions of Section 409A(a)(l) of the Code (*e.g.*, payments to which Employee wouldotherwise be entitled during the first six months following separation fromservice shall accumulate and be paid at the expiration of such period, 

6

----

unlessa permitted distribution event occurs during such period).  The Board or the Compensation Committee ofthe Board may attach conditions to or adjust the amounts paid pursuant to thisSection 9 to preserve, as closely as possible, the economic consequences thatwould have applied in the absence of this Section 9; *provided, however*, that no such condition or adjustmentshall result in the payments being subject to Section 409A(a)(1) of the Code.

**10.          Successors.**

**(a)           Company’sSuccessors.**  Anysuccessor to the Company (whether direct or indirect and whether by purchase,lease, merger, consolidation, liquidation or otherwise) to all or substantiallyall of the Company’s business and assets shall assume the obligations underthis Agreement and agree expressly to perform the obligations under thisAgreement in the same manner and to the same extent as the Company would berequired to perform such obligations in the absence of a succession.  For all purposes under this Agreement, theterm “Company” shall include any Successor to the Company’s business and assetswhich executes and delivers the assumption agreement described in this Section10(a) or which becomes bound by the terms of this Agreement by operation oflaw.

**(b)           Employee’sSuccessors.**  The terms ofthis Agreement and all rights of the Employee hereunder shall inure to thebenefit of, and be enforceable by, the Employee’s personal or legalrepresentatives, executors, administrators, successors, heirs, devisees andlegatees.

**11.          Notice.**  Notices and all other communicationscontemplated by this Agreement shall be in writing and shall be deemed to havebeen duly given when personally delivered or when mailed by U.S. registered orcertified mail, return receipt requested and postage prepaid. In the case ofthe Employee, mailed notices shall be addressed to him at the home addresswhich he most recently communicated to the Company in writing.  In the case of the Company, mailed noticesshall be addressed to its corporate headquarters, and all notices shall bedirected to the attention of its Secretary.

**12.          MiscellaneousProvisions.**

**(a)           Waiver.**  No provision of this Agreement shall bemodified, waived or discharged unless the modification, waiver or discharge isagreed to in writing and signed by the Employee and by an authorized officer ofthe Company (other than the Employee). No waiver by either party of any breach of, or of compliance with, anycondition or provision of this Agreement by the other party shall be considereda waiver of any other condition or provision or of the same condition orprovision at another time.

**(b)           WholeAgreement.**  Noagreements, representations or understandings (whether oral or written andwhether express or implied) which are not expressly set forth in this Agreementhave been made or entered into by either party with respect to the subjectmatter hereof.  This Agreement representsthe Company’s and the Employee’s entire understanding with respect to thesubject matter contained herein and supersedes all previous understandings,written or oral between the Company and the Employee concerning the subjectmatters of this Agreement, including but not limited to the Original EmploymentAgreement.

7

----

**(c)           Choiceof Law.**  The validity, interpretation,construction and performance of this Agreement shall be governed by the laws ofthe State of California.

**(d)           Severability.**  The invalidity or unenforceability of anyprovision or provisions of this Agreement shall not affect the validity orenforceability of any other provision hereof, which shall remain in full forceand effect.

**(e)           Arbitration.**  Any dispute or controversy arising out of,relating to or in connection with this Agreement shall be settled exclusivelyby binding arbitration in San Diego, California, in accordance with theNational Rules for the Resolution of Employment Disputes of the AmericanArbitration Association then in effect. Judgment may be entered on the arbitrator’s award in any court havingjurisdiction.  The arbitrator shall: (i)have the authority to compel adequate discovery for the resolution of thedispute and to award such relief as would otherwise be permitted by law; and(ii) issue a written arbitration decision including the arbitrator’s essentialfindings and conclusions and a statement of the award.  Both the Employee and the Company shall beentitled to all rights and remedies they would have in a court of law.  The Company shall pay all fees in excess ofthose which will be required if the dispute were decided in a court of law.

**(f)            NoAssignment of Benefits.**  Therights of any person to payments or benefits under this Agreement shall not bemade subject to option or assignment, either by voluntary or involuntaryassignment or by operation of law, including (without limitation) bankruptcy,garnishment, attachment or other creditor’s process, and any action inviolation of this Section 12(f) shall be void.

**(g)           Assignmentby Company.**  The Companymay assign its rights under this Agreement to an affiliate, and an affiliatemay assign its rights under this Agreement to another affiliate of the Companyor to the Company; *provided, however*,that no assignment shall be made if the net worth of the assignee is less thanthe net worth of the Company at the time of assignment.  In the case of any such assignment, the term “Company”when used in a section of this Agreement shall mean the corporation thatactually employs the Employee.

**(h)           Counterparts.**  This Agreement may be executed incounterparts, each of which shall be deemed an original, but all of whichtogether will constitute one and the same instrument.

**[R****EMAINDER OF THIS PAGEINTENTIONALLY LEFT BLANK****]**

 

8

----

 

**I****N W****ITNESS W****HEREOF**, each ofthe parties has executed this Agreement, in the case of the Company by its dulyauthorized officer, as of the day and year first above written.

 
| **COMPANY:**  | **CYMER, INC**     |                |
|---------------|--------------------|---------------------|
|               | By:                | /s/ Robert P. Akins |   |
|          | Title:             | CEO                 |   |
|          | Date:              | 2/23/07             |   |
| **EMPLOYEE:** | /s/ Nancy J. Baker | ** **          |
|          | **NANCY J BAKER**  |                |
|          | Date:              | 2/23/07             |   |
|               |                    |                     |  |  |

 

----