Document:

Exhibit 4.2

 

FORM OF
WARRANT CERTIFICATE 

 

THE
SECURITIES REPRESENTED HEREBY MAY NOT BE TRANSFERRED UNLESS (I) SUCH SECURITIES HAVE BEEN REGISTERED FOR SALE PURSUANT TO THE SECURITIES
ACT OF 1933, AS AMENDED, (II) SUCH SECURITIES MAY BE SOLD PURSUANT TO RULE 144(K), OR (III) THE COMPANY HAS RECEIVED AN OPINION
OF COUNSEL REASONABLY SATISFACTORY TO IT THAT SUCH TRANSFER MAY LAWFULLY BE MADE WITHOUT REGISTRATION UNDER THE SECURITIES ACT
OF 1933 OR QUALIFICATION UNDER APPLICABLE STATE SECURITIES LAWS.

 

SUBJECT
TO THE PROVISIONS OF SECTION 10 HEREOF, THIS WARRANT SHALL BE VOID AFTER 5:00 P.M. EASTERN TIME ON [FIFTH ANNIVERSARY OF THE CLOSING
DATE] (THE “EXPIRATION DATE”).

 

No. _______

 

TEGAL
CORPORATION 

 

WARRANT
TO PURCHASE _________ SHARES OFCOMMON

STOCK, PAR VALUE $0.01 PER SHARE 

 

For
VALUE RECEIVED, _____________ (“Warrantholder”), is entitled to purchase, subject to the provisions of this Warrant,
from Tegal Corporation, a Delaware corporation (“Company”), at any time not later than 5:00 P.M., Eastern time, on
the Expiration Date (as defined above), at an exercise price per share equal to $1.00 (the exercise price in effect being herein
called the “Warrant Price”), __________ shares (“Warrant Shares”) of the Company’s Common Stock,
par value $0.01 per share (“Common Stock”). The number of Warrant Shares purchasable upon exercise of this Warrant
and the Warrant Price shall be subject to adjustment from time to time as described herein.

 

Section
1. Registration. The Company shall maintain books for the transfer and registration of the Warrant. Upon the initial issuance
of this Warrant, the Company shall issue and register the Warrant in the name of the Warrantholder.

 

Section
2. Transfers. As provided herein, this Warrant and the Warrant Shares may be transferred only pursuant to a registration
statement filed under the Securities Act of 1933, as amended (the “Securities Act”), or an exemption from such registration.
Subject to such restrictions, the Company shall transfer this Warrant from time to time upon the books to be maintained by the
Company for that purpose, upon surrender thereof for transfer properly endorsed or accompanied by appropriate instructions for
transfer and such other documents as may be reasonably required by the Company, including, if required by the Company, an opinion
of counsel to the effect that such transfer is exempt from the registration requirements of the Securities Act, to establish that
such transfer is being made in accordance with the terms hereof, and a new Warrant shall be issued to the transferee and the surrendered
Warrant shall be canceled by the Company.

 

    

     

    

 

Section
3. Exercise of Warrant. Subject to the provisions hereof, the Warrantholder may exercise this Warrant in whole or in part
at any time prior to its expiration upon surrender of the Warrant, together with delivery of the duly executed Warrant exercise
form attached hereto as Appendix A (the “Exercise Agreement”) and payment by cash, certified check or wire transfer
of funds (or, in certain circumstances, by cash-less exercise as provided below) for the aggregate Warrant Price for that number
of Warrant Shares then being purchased, to the Company during normal business hours on any business day at the Company’s
principal executive offices (or such other office or agency of the Company as it may designate by notice to the Warrantholder).
The Warrant Shares so purchased shall be deemed to be issued to the Warrantholder or the Warrantholder’s designee, as the
record owner of such shares, as of the close of business on the date on which this Warrant shall have been surrendered (or evidence
of loss, theft or destruction thereof and security or indemnity satisfactory to the Company), the Warrant Price shall have been
paid and the completed Exercise Agreement shall have been delivered. Certificates for the Warrant Shares so purchased, representing
the aggregate number of shares specified in the Exercise Agreement, shall be delivered to the Warrantholder within a reasonable
time, not exceeding three (3) business days, after this Warrant shall have been so exercised. The certificates so delivered shall
be in such denominations as may be requested by the Warrantholder and shall be registered in the name of the Warrantholder or such
other name as shall be designated by the Warrantholder, subject to the restrictions on transfer set forth in this Warrant. If this
Warrant shall have been exercised only in part, then, unless this Warrant has expired, the Company shall, at its expense, at the
time of delivery of such certificates, deliver to the Warrantholder a new Warrant representing the number of shares with respect
to which this Warrant shall not then have been exercised. As used herein, “business day” means a day, other than a
Saturday or Sunday, on which banks in New York City are open for the general transaction of business. Each exercise hereof shall
constitute the re-affirmation by the Warrantholder that the representations and warranties contained in Section 5 of the Purchase
Agreement (as defined below) are true and correct with respect to the Warrantholder as of the time of such exercise.

 

Section
4. Compliance with the Securities Act of 1933. Except as provided in the Purchase Agreement (as defined below), the Company
may cause the legend set forth on the first page of this Warrant to be set forth on each Warrant or similar legend on any security
issued or issuable upon exercise of this Warrant, unless counsel for the Company is of the opinion as to any such security that
such legend is unnecessary.

 

Section
5. Payment of Taxes. The Company will pay any documentary stamp taxes attributable to the initial issuance of Warrant Shares
issuable upon the exercise of the Warrant; provided, however, that the Company shall not be required to pay any tax or taxes which
may be payable in respect of any transfer involved in the issuance or delivery of any certificates for Warrant Shares in a name
other than that of the Warrantholder in respect of which such shares are issued, and in such case, the Company shall not be required
to issue or deliver any certificate for Warrant Shares or any Warrant until the person requesting the same has paid to the Company
the amount of such tax or has established to the Company’s reasonable satisfaction that such tax has been paid. The Warrantholder
shall be responsible for income taxes due under federal, state or other law, if any such tax is due.

 

Section
6. Mutilated or Missing Warrants. In case this Warrant shall be mutilated, lost, stolen, or destroyed, the Company shall
issue in exchange and substitution of and upon cancellation of the mutilated Warrant, or in lieu of and substitution for the Warrant
lost, stolen or destroyed, a new Warrant of like tenor and for the purchase of a like number of Warrant Shares, but only upon receipt
of evidence reasonably satisfactory to the Company of such loss, theft or destruction of the Warrant, and with respect to a lost,
stolen or destroyed Warrant, reasonable indemnity or bond with respect thereto, if requested by the Company.

 

Section
7. Reservation of Common Stock. The Company hereby represents and warrants that there have been reserved, and the Company
shall at all applicable times keep reserved until issued (if necessary) as contemplated by this Section 7, out of the authorized
and unissued shares of Common Stock, sufficient shares to provide for the exercise of the rights of purchase represented by this
Warrant. The Company agrees that all Warrant Shares issued upon due exercise of the Warrant shall be, at the time of delivery of
the certificates for such Warrant Shares, duly authorized, validly issued, fully paid and non-assessable shares of Common Stock
of the Company.

 

Section 8. Adjustments. Subject
and pursuant to the provisions of this Section 8, the Warrant Price and number of Warrant Shares subject to this Warrant shall
be subject to adjustment from time to time as set forth hereinafter.

 

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(a)       
If the Company shall, at any time or from time to time while this Warrant is outstanding, pay a dividend or make a distribution
on its Common Stock in shares of Common Stock, subdivide its outstanding shares of Common Stock into a greater number of shares
or combine its outstanding shares of Common Stock into a smaller number of shares or issue by reclassification of its outstanding
shares of Common Stock any shares of its capital stock (including any such reclassification in connection with a consolidation
or merger in which the Company is the continuing corporation), then the number of Warrant Shares purchasable upon exercise of the
Warrant and the Warrant Price in effect immediately prior to the date upon which such change shall become effective, shall be adjusted
by the Company so that the Warrantholder thereafter exercising the Warrant shall be entitled to receive the number of shares of
Common Stock or other capital stock which the Warrantholder would have received if the Warrant had been exercised immediately prior
to such event upon payment of a Warrant Price that has been adjusted to reflect a fair allocation of the economics of such event
to the Warrantholder. Such adjustments shall be made successively whenever any event listed above shall occur.

 

(b)       
If any capital reorganization, reclassification of the capital stock of the Company, consolidation or merger of the Company with
another corporation in which the Company is not the survivor, or sale, transfer or other disposition of all or substantially all
of the Company’s assets to another corporation shall be effected, then, as a condition of such reorganization, reclassification,
consolidation, merger, sale, transfer or other disposition, lawful and adequate provision shall be made whereby each Warrantholder
shall thereafter have the right to purchase and receive upon the basis and upon the terms and conditions herein specified and in
lieu of the Warrant Shares immediately theretofore issuable upon exercise of the Warrant, such shares of stock, securities or assets
as would have been issuable or payable with respect to or in exchange for a number of Warrant Shares equal to the number of Warrant
Shares immediately theretofore issuable upon exercise of the Warrant, had such reorganization, reclassification, consolidation,
merger, sale, transfer or other disposition not taken place, and in any such case appropriate provision shall be made with respect
to the rights and interests of each Warrantholder to the end that the provisions hereof (including, without limitation, provision
for adjustment of the Warrant Price) shall thereafter be applicable, as nearly equivalent as may be practicable in relation to
any shares of stock, securities or assets thereafter deliverable upon the exercise hereof. The Company shall not effect any such
consolidation, merger, sale, transfer or other disposition unless prior to or simultaneously with the consummation thereof the
successor corporation (if other than the Company) resulting from such consolidation or merger, or the corporation purchasing or
otherwise acquiring such assets or other appropriate corporation or entity shall assume the obligation to deliver to the Warrantholder,
at the last address of the Warrantholder appearing on the books of the Company, such shares of stock, securities or assets as,
in accordance with the foregoing provisions, the Warrantholder may be entitled to purchase, and the other obligations under this
Warrant. The provisions of this paragraph (b) shall similarly apply to successive reorganizations, reclassifications, consolidations,
mergers, sales, transfers or other dispositions.

 

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(c)       
In case the Company shall fix a payment date for the making of a distribution to all holders of Common Stock (including any such
distribution made in connection with a consolidation or merger in which the Company is the continuing corporation) of evidences
of indebtedness or assets (other than cash dividends or cash distributions payable out of consolidated earnings or earned surplus
or dividends or distributions referred to in Section 8(a)), or subscription rights or warrants, the Warrant Price to be in effect
after such payment date shall be determined by multiplying the Warrant Price in effect immediately prior to such payment date by
a fraction, the numerator of which shall be the total number of shares of Common Stock outstanding multiplied by the Market Price
(as defined below) per share of Common Stock immediately prior to such payment date, less the fair market value (as determined
by the Company’s Board of Directors in good faith) of said assets or evidences of indebtedness so distributed, or of such
subscription rights or warrants, and the denominator of which shall be the total number of shares of Common Stock outstanding multiplied
by such Market Price per share of Common Stock immediately prior to such payment date. “Market Price” as of a particular
date (the “Valuation Date”) shall mean the following: (a) if the Common Stock is then listed on a national stock exchange,
the closing sale price of one share of Common Stock on such exchange on the last trading day prior to the Valuation Date; (b) if
the Common Stock is then quoted on the Nasdaq National Market System or the Nasdaq SmallCap Market (in either case, “Nasdaq”),
the National Association of Securities Dealers, Inc. OTC Bulletin Board (the “Bulletin Board”) or such similar exchange
or association, the closing sale price of one share of Common Stock on Nasdaq, the Bulletin Board or such other exchange or association
on the last trading day prior to the Valuation Date or, if no such closing sale price is available, the average of the high bid
and the low asked price quoted thereon on the last trading day prior to the Valuation Date; or (c) if the Common Stock is not then
listed on a national stock exchange or quoted on Nasdaq, the Bulletin Board or such other exchange or association, the fair market
value of one share of Common Stock as of the Valuation Date, shall be determined in good faith by the Board of Directors of the
Company and the Warrantholder. If the Common Stock is not then listed on a national securities exchange, the Bulletin Board or
such other exchange or association, the Board of Directors of the Company shall respond promptly, in writing, to an inquiry by
the Warrantholder prior to the exercise hereunder as to the fair market value of a share of Common Stock as determined by the Board
of Directors of the Company. In the event that the Board of Directors of the Company and the Warrantholder are unable to agree
upon the fair market value in respect of subpart (c) hereof, the Company and the Warrantholder shall jointly select an appraiser,
who is experienced in such matters. The decision of such appraiser shall be final and conclusive, and the cost of such appraiser
shall be borne equally by the Company and the Warrantholder. Such adjustment shall be made successively whenever such a payment
date is fixed.

 

(d)       
An adjustment to the Warrant Price shall become effective immediately after the payment date in the case of each dividend or distribution
and immediately after the effective date of each other event which requires an adjustment.

 

(e)       
In the event that, as a result of an adjustment made pursuant to this Section 8, the Warrantholder shall become entitled to receive
any shares of capital stock of the Company other than shares of Common Stock, the number of such other shares so receivable upon
exercise of this Warrant shall be subject thereafter to adjustment from time to time in a manner and on terms as nearly equivalent
as practicable to the provisions with respect to the Warrant Shares contained in this Warrant.

 

(f)       
Except as provided in subsection (g) hereof, if and whenever the Company shall issue or sell, or is, in accordance with any of
subsections (f)(l) through (f)(7) hereof, deemed to have issued or sold, any shares of Common Stock for no consideration or for
a consideration per share less than the Warrant Price in effect immediately prior to the time of such issue or sale, then and in
each such case (a “Trigger Issuance”) the then-existing Warrant Price, shall be reduced, as of the close of
business on the effective date of the Trigger Issuance, to a price determined as follows:

 

	 	 
	 	Adjusted Warrant Price = (A x B) + D

                                             A+C 

 

	 	where 

	 	"A" equals the number of shares of Common Stock outstanding, including Additional
Shares of Common Stock (as defined below) deemed to be issued hereunder, immediately preceding such Trigger Issuance; 

	 	“B”equals the Warrant Price in effect immediately preceding such Trigger
Issuance; 

	 	"C" equals the number of Additional Shares of Common Stock issued or deemed issued hereunder as a result of the Trigger Issuance; and 

	 	"D" equals the aggregate consideration, if any, received or deemed to be received by the Company upon such Trigger Issuance; 

 

provided, however, that in no event shall the Warrant Price
after giving effect to such Trigger Issuance be greater than the Warrant Price in effect prior to such Trigger Issuance.

 

For
purposes of this subsection (f), “Additional Shares of Common Stock” shall mean all shares of Common Stock issued by
the Company or deemed to be issued pursuant to this subsection (f), other than Excluded Issuances (as defined in subsection (g)
hereof).

 

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For
purposes of this subsection (f), the following subsections (f)(l) to (f)(8) shall also be applicable:

 

	 	(f)(1)       
Issuance of Rights or Options. In case at any time the Company shall in any manner grant (directly and not by assumption in a
merger or otherwise) any warrants or other rights to subscribe for or to purchase, or any options for the purchase of, Common
Stock or any stock or security convertible into or exchangeable for Common Stock (such warrants, rights or options being called
“Options” and such convertible or exchangeable stock or securities being called “Convertible Securities”)
whether or not such Options or the right to convert or exchange any such Convertible Securities are immediately exercisable, and
the price per share for which Common Stock is issuable upon the exercise of such Options or upon the conversion or exchange of
such Convertible Securities (determined by dividing (i) the sum (which sum shall constitute the applicable consideration) of (x)
the total amount, if any, received or receivable by the Company as consideration for the granting of such Options, plus (y) the
aggregate amount of additional consideration payable to the Company upon the exercise of all such Options, plus (z), in the case
of such Options which relate to Convertible Securities, the aggregate amount of additional consideration, if any, payable upon
the issue or sale of such Convertible Securities and upon the conversion or exchange thereof, by (ii) the total maximum number
of shares of Common Stock issuable upon the exercise of such Options or upon the conversion or exchange of all such Convertible
Securities issuable upon the exercise of such Options) shall be less than the Warrant Price in effect immediately prior to the
time of the granting of such Options, then the total number of shares of Common Stock issuable upon the exercise of such Options
or upon conversion or exchange of the total amount of such Convertible Securities issuable upon the exercise of such Options shall
be deemed to have been issued for such price per share as of the date of granting of such Options or the issuance of such Convertible
Securities and thereafter shall be deemed to be outstanding for purposes of adjusting the Warrant Price. Except as otherwise provided
in subsection 8(f)(3), no adjustment of the Warrant Price shall be made upon the actual issue of such Common Stock or of such
Convertible Securities upon exercise of such Options or upon the actual issue of such Common Stock upon conversion or exchange
of such Convertible Securities. 

 

	 	(f)(2)        Issuance of Convertible Securities.
In case the Company shall in any manner issue (directly and not by assumption in a merger or otherwise) or sell any Convertible
Securities, whether or not the rights to exchange or convert any such Convertible Securities are immediately exercisable, and
the price per share for which Common Stock is issuable upon such conversion or exchange (determined by dividing (i) the sum (which
sum shall constitute the applicable consideration) of (x) the total amount received or receivable by the Company as consideration
for the issue or sale of such Convertible Securities, plus (y) the aggregate amount of additional consideration, if any, payable
to the Company upon the conversion or exchange thereof, by (ii) the total number of shares of Common Stock issuable upon the conversion
or exchange of all such Convertible Securities) shall be less than the Warrant Price in effect immediately prior to the time of
such issue or sale, then the total maximum number of shares of Common Stock issuable upon conversion or exchange of all such Convertible
Securities shall be deemed to have been issued for such price per share as of the date of the issue or sale of such Convertible
Securities and thereafter shall be deemed to be outstanding for purposes of adjusting the Warrant Price, provided that (a) except
as otherwise provided in subsection 8(f)(3), no adjustment of the Warrant Price shall be made upon the actual issuance of such
Common Stock upon conversion or exchange of such Convertible Securities and (b) no further adjustment of the Warrant Price shall
be made by reason of the issue or sale of Convertible Securities upon exercise of any Options to purchase any such Convertible
Securities for which adjustments of the Warrant Price have been made pursuant to the other provisions of subsection 8(f). 

 

	 	(f)(3)       
Change in Option Price or Conversion Rate. Upon the happening of any of the following events, namely, if the purchase price provided
for in any Option referred to in subsection 8(f)(l) hereof, the additional consideration, if any, payable upon the conversion
or exchange of any Convertible Securities referred to in subsections 8(f)(l) or 8(f)(2), or the rate at which Convertible Securities
referred to in subsections 8(f)(l) or 8(f)(2) are convertible into or exchangeable for Common Stock shall change at any time (including,
but not limited to, changes under or by reason of provisions designed to protect against dilution), the Warrant Price in effect
at the time of such event shall forthwith be readjusted to the Warrant Price which would have been in effect at such time had
such Options or Convertible Securities still outstanding provided for such changed purchase price, additional consideration or
conversion rate, as the case may be, at the time initially granted, issued or sold. On the termination of any Option for which
any adjustment was made pursuant to this subsection 8(f) or any right to convert or exchange Convertible Securities for which
any adjustment was made pursuant to this subsection 8(f) (including without limitation upon the redemption or purchase for consideration
of such Convertible Securities by the Company), the Warrant Price then in effect hereunder shall forthwith be changed to the Warrant
Price which would have been in effect at the time of such termination had such Option or Convertible Securities, to the extent
outstanding immediately prior to such termination, never been issued. 

 

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	 	(f)(4)        Stock Dividends. Subject to the provisions of this Section 8(f), in case the Company shall declare a dividend or make any other distribution upon any stock of the Company (other than the Common Stock) payable in Common Stock, Options or Convertible Securities, then any Common Stock, Options or Convertible Securities, as the case may be, issuable in payment of such dividend or distribution shall be deemed to have been issued or sold without consideration. 

 

	 	(f)(5)        Consideration for Stock. In case any shares of Common Stock, Options or Convertible Securities shall be issued or sold for cash, the consideration received therefor shall be deemed to be the net amount received by the Company therefor, after deduction therefrom of any expenses incurred or any underwriting commissions or concessions paid or allowed by the Company in connection therewith. In case any shares of Common Stock, Options or Convertible Securities shall be issued or sold for a consideration other than cash, the amount of the consideration other than cash received by the Company shall be deemed to be the fair value of such consideration as determined in good faith by the Board of Directors of the Company, after deduction of any expenses incurred or any underwriting commissions or concessions paid or allowed by the Company in connection therewith. In case any Options shall be issued in connection with the issue and sale of other securities of the Company, together comprising one integral transaction in which no specific consideration is allocated to such Options by the parties thereto, such Options shall be deemed to have been issued for such consideration as determined in good faith by the Board of Directors of the Company. If Common Stock, Options or Convertible Securities shall be issued or sold by the Company and, in connection therewith, other Options or Convertible Securities (the “Additional Rights”) are issued, then the consideration received or deemed to be received by the Company shall be reduced by the fair market value of the Additional Rights (as determined using the Black-Scholes option pricing model or another method mutually agreed to by the Company and the Warrantholder). The Board of Directors of the Company shall respond promptly, in writing, to an inquiry by the Warrantholder as to the fair market value of the Additional Rights. In the event that the Board of Directors of the Company and the Warrantholder are unable to agree upon the fair market value of the Additional Rights, the Company and the Warrantholder shall jointly select an appraiser, who is experienced in such matters. The decision of such appraiser shall be final and conclusive, and the cost of such appraiser shall be borne evenly by the Company and the Warrantholder. 

 

	 	(f)(6)        Record Date. In case the Company shall take a record of the holders of its Common Stock for the purpose of entitling them (i) to receive a dividend or other distribution payable in Common Stock, Options or Convertible Securities or (ii) to subscribe for or purchase Common Stock, Options or Convertible Securities, then such record date shall be deemed to be the date of the issue or sale of the shares of Common Stock deemed to have been issued or sold upon the declaration of such dividend or the making of such other distribution or the date of the granting of such right of subscription or purchase, as the case may be. 

 

	 	(f)(7)        Treasury Shares. The number of shares of Common Stock outstanding at any given time shall not include shares owned or held by or for the account of the Company or any of its wholly-owned subsidiaries, and the disposition of any such shares (other than the cancellation or retirement thereof) shall be considered an issue or sale of Common Stock for the purpose of this subsection (f). 

 

	 	(f)(8)       
Nasdaq Limitation. Notwithstanding any other provision in Section 8(f) to the contrary, if a reduction in the Warrant Price pursuant
to Section 8(f) (other than as set forth in this clause (f)(8)) would require the Company to obtain stockholder approval of the
transactions contemplated by the Purchase Agreement pursuant to Nasdaq Marketplace Rule 4350(i) and such stockholder approval
has not been obtained, (i) the Warrant Price shall be reduced to the maximum extent that would not require stockholder approval
under such Rule, and (ii) the Company shall use its commercially reasonable efforts to obtain such stockholder approval as soon
as reasonably practicable, including by calling a special meeting of stockholders to vote on such Warrant Price adjustment. This
provision shall not restrict the number of shares of Common Stock which a Warrantholder may receive or beneficially own in order
to determine the amount of securities or other consideration that such Holder may receive in the event of a transaction contemplated
by Section 8 of this Warrant. 

 

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(g)       
Anything herein to the contrary notwithstanding, the Company shall not be required to make any adjustment of the Warrant Price
in the case of the issuance of (A) capital stock, Options or Convertible Securities issued to directors, officers, employees or
consultants of the Company in connection with their service as directors of the Company, their employment by the Company or their
retention as consultants by the Company pursuant to an equity compensation program approved by the Board of Directors of the Company
or the compensation committee of the Board of Directors of the Company, (B) shares of Common Stock issued upon the conversion or
exercise of Options or Convertible Securities issued prior to the date hereof, provided such securities are not amended after the
date hereof to increase the number of shares of Common Stock issuable thereunder or to lower the exercise or conversion price thereof,
(C) securities issued pursuant to that certain Purchase Agreement dated June __, 2005, among the Company and the Investors named
therein (the “Purchase Agreement”) and securities issued upon the exercise or conversion of those securities, and (D)
shares of Common Stock issued or issuable by reason of a dividend, stock split or other distribution on shares of Common Stock
(but only to the extent that such a dividend, split or distribution results in an adjustment in the Warrant Price pursuant to the
other provisions of this Warrant) (collectively, “Excluded Issuances”).

 

(h)       
Upon any adjustment to the Warrant Price pursuant to Section 8(f) above, the number of Warrant Shares purchasable hereunder shall
be adjusted by multiplying such number by a fraction, the numerator of which shall be the Warrant Price in effect immediately prior
to such adjustment and the denominator of which shall be the Warrant Price in effect immediately thereafter.

 

Section
9. Fractional Interest. The Company shall not be required to issue fractions of Warrant Shares upon the exercise of this
Warrant. If any fractional share of Common Stock would, except for the provisions of the first sentence of this Section 9, be deliverable
upon such exercise, the Company, in lieu of delivering such fractional share, shall pay to the exercising Warrantholder an amount
in cash equal to the Market Price of such fractional share of Common Stock on the date of exercise.

 

Section
10. Extension of Expiration Date. If the Company fails to cause any Registration Statement covering Registrable Securities
(unless otherwise defined herein, capitalized terms are as defined in the Registration Rights Agreement relating to the Warrant
Shares (the “Registration Rights Agreement”)) to be declared effective prior to the applicable dates set forth therein,
or if any of the events specified in Section 2(c)(ii) of the Registration Rights Agreement occurs, and the Blackout Period (whether
alone, or in combination with any other Blackout Period) continues for more than 60 days in any 12 month period, or for more than
a total of 90 days, then the Expiration Date of this Warrant shall be extended one day for each day beyond the 60-day or 90-day
limits, as the case may be, that the Blackout Period continues.

 

Section
11. Benefits. Nothing in this Warrant shall be construed to give any person, firm or corporation (other than the Company
and the Warrantholder) any legal or equitable right, remedy or claim, it being agreed that this Warrant shall be for the sole and
exclusive benefit of the Company and the Warrantholder.

 

Section
12. Notices to Warrantholder. Upon the happening of any event requiring an adjustment of the Warrant Price, the Company
shall promptly give written notice thereof to the Warrantholder at the address appearing in the records of the Company, stating
the adjusted Warrant Price and the adjusted number of Warrant Shares resulting from such event and setting forth in reasonable
detail the method of calculation and the facts upon which such calculation is based. Failure to give such notice to the Warrantholder
or any defect therein shall not affect the legality or validity of the subject adjustment.

 

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Section
13. Identity of Transfer Agent. The Transfer Agent for the Common Stock is Registrar & Transfer Company. Upon the appointment
of any subsequent transfer agent for the Common Stock or other shares of the Company’s capital stock issuable upon the exercise
of the rights of purchase represented by the Warrant, the Company will mail to the Warrantholder a statement setting forth the
name and address of such transfer agent.

 

Section
14. Notices. Unless otherwise provided, any notice required or permitted under this Warrant shall be given in writing and
shall be deemed effectively given as hereinafter described (i) if given by personal delivery, then such notice shall be deemed
given upon such delivery, (ii) if given by telex or facsimile, then such notice shall be deemed given upon receipt of confirmation
of complete transmittal, (iii) if given by mail, then such notice shall be deemed given upon the earlier of (A) receipt of such
notice by the recipient or (B) three days after such notice is deposited in first class mail, postage prepaid, and (iv) if given
by an internationally recognized overnight air courier, then such notice shall be deemed given one business day after delivery
to such carrier. All notices shall be addressed as follows: if to the Warrantholder, at its address as set forth in the Company’s
books and records and, if to the Company, at the address as follows, or at such other address as the Warrantholder or the Company
may designate by ten days’ advance written notice to the other:

 

If
to the Company:

Tegal Corporation

2201 South McDowell Boulevard

Petaluma, California 94954

Attention: Chief Executive Officer

Fax: (707) 763-0415

 

With a copy to:

Latham & Watkins LLP

135 Commonwealth Drive

Menlo Park, California 94025

Attention: Christopher Kaufman and William
Davisson

Fax: (650) 463-2600

 

Section
15. Registration Rights. The initial Warrantholder is entitled to the benefit of certain registration rights with respect
to the shares of Common Stock issuable upon the exercise of this Warrant as provided in the Registration Rights Agreement, and
any subsequent Warrantholder may be entitled to such rights.

 

Section
16. Successors. All the covenants and provisions hereof by or for the benefit of the Warrantholder shall bind and inure
to the benefit of its respective successors and assigns hereunder.

 

Section
17. Governing Law; Consent to Jurisdiction; Waiver of Jury Trial. This Warrant shall be governed by, and construed in accordance
with, the internal laws of the State of New York, without reference to the choice of law provisions thereof. The Company and, by
accepting this Warrant, the Warrantholder, each irrevocably submits to the exclusive jurisdiction of the courts of the State of
New York located in New York County and the United States District Court for the Southern District of New York for the purpose
of any suit, action, proceeding or judgment relating to or arising out of this Warrant and the transactions contemplated hereby.
Service of process in connection with any such suit, action or proceeding may be served on each party hereto anywhere in the world
by the same methods as are specified for the giving of notices under this Warrant. The Company and, by accepting this Warrant,
the Warrantholder, each irrevocably consents to the jurisdiction of any such court in any such suit, action or proceeding and to
the laying of venue in such court. The Company and, by accepting this Warrant, the Warrantholder, each irrevocably waives any objection
to the laying of venue of any such suit, action or proceeding brought in such courts and irrevocably waives any claim that any
such suit, action or proceeding brought in any such court has been brought in an inconvenient forum. EACH OF THE COMPANY AND,
BY ITS ACCEPTANCE HEREOF, THE WARRANTHOLDER HEREBY WAIVES ANY RIGHT TO REQUEST A TRIAL BY JURY IN ANY LITIGATION WITH RESPECT TO
THIS WARRANT AND REPRESENTS THAT COUNSEL HAS BEEN CONSULTED SPECIFICALLY AS TO THIS WAIVER.

 

    8 

     

    

 

Section
18. Cashless Exercise. Notwithstanding any other provision contained herein to the contrary, from and after the first anniversary
of the Closing Date (as defined in the Purchase Agreement) and so long as the Company is required under the Registration Rights
Agreement to have effected the registration of the Warrant Shares for sale to the public pursuant to a Registration Statement (as
such term is defined in the Registration Rights Agreement), if the Warrant Shares may not be freely sold to the public for any
reason (including, but not limited to, the failure of the Company to have effected the registration of the Warrant Shares or to
have a current prospectus available for delivery or otherwise, but excluding the period of any Allowed Delay (as defined in the
Registration Rights Agreement), the Warrantholder may elect to receive, without the payment by the Warrantholder of the aggregate
Warrant Price in respect of the shares of Common Stock to be acquired, shares of Common Stock equal to the value of this Warrant
or any portion hereof by the surrender of this Warrant (or such portion of this Warrant being so exercised) together with the Net
Issue Election Notice annexed hereto as Appendix B duly executed, at the office of the Company. Thereupon, the Company shall issue
to the Warrantholder such number of fully paid, validly issued and nonassessable shares of Common Stock as is computed using the
following formula:

 

	 	 
	 	X = Y (A - B)

             A 

 

	 	where 

	 	X = the number of shares of Common Stock which the Warrantholder has then requested
be issued to the Warrantholder; 

	 	Y = the total number of shares of Common Stock covered by this Warrant which the Warrantholder has surrendered at such time for cash-less exercise (including both shares to be issued to the Warrantholder and shares to be canceled as payment therefor); 

	 	A = the "Market Price" of one share of Common Stock as at the time the net
issue election is made; and 

	 	B = the Warrant Price in effect under this Warrant at the time the net issue election
is made. 

Section
19. No Rights as Stockholder. Prior to the exercise of this Warrant, the Warrantholder shall not have or exercise any rights
as a stockholder of the Company by virtue of its ownership of this Warrant.

 

Section
20. Amendment; Waiver. This Warrant is one of a series of Warrants of like tenor issued by the Company pursuant to the Purchase
Agreement and initially covering an aggregate of 17,307,692 shares (subject to stockholder approval) of Common Stock (collectively,
the “Company Warrants”). Any term of this Warrant may be amended or waived (including the adjustment provisions
included in Section 8 of this Warrant) upon the written consent of the Company and the holders of Company Warrants representing
at least 50% of the number of shares of Common Stock then subject to all outstanding Company Warrants (the “Majority Holders”);
provided, that (x) any such amendment or waiver must apply to all Company Warrants; and (y) the number of Warrant Shares
subject to this Warrant, the Warrant Price and the Expiration Date may not be amended, and the right to exercise this Warrant may
not be altered or waived, without the written consent of the Warrantholder.

 

    9 

     

    

 

Section
21. Section Headings. The section headings in this Warrant are for the convenience of the Company and the Warrantholder
and in no way alter, modify, amend, limit or restrict the provisions hereof.

 

IN
WITNESS WHEREOF, the Company has caused this Warrant to be duly executed, as of the ____ day of July, 2005.

 

	 	TEGAL CORPORATION
	 	 	 
	 	By:	 
	 	 	Name: Thomas R. Mika
	 	 	Title: President and Chief Executive Officer

 

 

    10 

     

    

 

APPENDIX A

TEGAL CORPORATION

WARRANT EXERCISE FORM

To Tegal Corporation:

 

The
undersigned hereby irrevocably elects to exercise the right of purchase represented by the within Warrant (“Warrant”)
for, and to purchase thereunder by the payment of the Warrant Price and surrender of the Warrant, _______________ shares of Common
Stock (“Warrant Shares”) provided for therein, and requests that certificates for the Warrant Shares be issued as follows:

 

_______________________________

Name

________________________________

Address

________________________________

________________________________

Federal Tax ID or Social Security No.

 

	 	and delivered by	 (certified mail to the above address, or
	 	 	(electronically
	 	 	(provide DWAC Instructions:___________________),
or
	 	 	(other (specify): __________________________________________).

 

and, if the number of Warrant Shares shall not be all the Warrant
Shares purchasable upon exercise of the Warrant, that a new Warrant for the balance of the Warrant Shares purchasable upon exercise
of this Warrant be registered in the name of the undersigned Warrantholder or the undersigned’s Assignee as below indicated
and delivered to the address stated below.

 

Dated: ___________________, ____

 

Note: The signature must correspond with 

the name of the Warrantholder as written

on the first page of the Warrant in every

particular, without alteration or enlargement 

or any change whatever, unless the Warrant

has been assigned.

 

 

Signature:______________________

 

______________________________

Name (please print)

 

______________________________

______________________________

Address

 

______________________________

Federal Identification or

Social Security No.

 

Assignee:

_______________________________

_______________________________

_______________________________

 

 

 

 

    11 

     

    

 

APPENDIX B

TEGAL CORPORATION

NET ISSUE ELECTION NOTICE

 

To: Tegal Corporation

 

Date:[_________________________]

 

The
undersigned hereby elects under Section 18 of this Warrant to surrender the right to purchase [____________] shares of Common
Stock pursuant to this Warrant and hereby requests the issuance of [_____________] shares of Common Stock. The certificate(s) for
the shares issuable upon such net issue election shall be issued in the name of the undersigned or as otherwise indicated below.

 

_____________________________

Signature

 

_____________________________

Name for Registration

 

_____________________________

Mailing Address

 

 

    12Exhibit 10.9

 

[DEFERRAL PERMITTED]

 

TEGAL CORPORATION

 

2007 INCENTIVE AWARD PLAN

 

RESTRICTED STOCK UNIT AWARD GRANT NOTICE
AND 

RESTRICTED STOCK UNIT AWARD AGREEMENT

 

Tegal Corporation,
a Delaware corporation (the "Company"), pursuant to its 2007 Incentive Award Plan (the "Plan"),
hereby grants to the holder listed below ("Participant"), an award of restricted stock units ("Restricted
Stock Units" or "RSUs") with respect to the number of shares of the Company's common stock,
par value $0.01 (the "Shares"). This award for Restricted Stock Units (this "RSU Award")
is subject to all of the terms and conditions as set forth herein and in the Restricted Stock Unit Award Agreement attached
hereto as Exhibit A (the "Restricted Stock Unit Agreement") and the Plan, each of which are incorporated
herein by reference. Unless otherwise defined herein, the terms defined in the Plan shall have the same defined meanings in this
Grant Notice and the Restricted Stock Unit Agreement.

 

	Participant:	Thomas Mika
	 	 
	Grant Date:	November 5, 2010
	 	 
	Vesting Commencement

 Date:	November 5, 2010
	 	 
	Total Number of RSUs

 Subject to Award:	350,000
shares
	 	 
	Vesting Schedule:	The RSU Award
shall vest 38,489 on November 5, 2010, 87,500 vesting on November 5, 2011, 87,500 vesting on November 5, 2012, 87,500 vesting
on November 5, 2013, and 49,011 vesting on November 5, 2014
	 	 
	Distribution
Schedule:	The RSUs shall
be distributable in accordance with Section 2.1(c) of the Restricted Stock Unit Agreement.

  

By his or her signature
and the Company's signature below, Participant agrees to be bound by the terms and conditions of the Plan, the Restricted Stock
Unit Agreement and this Grant Notice. The Participant has reviewed the Restricted Stock Unit Agreement, the Plan and this Grant
Notice in their entirety, has had an opportunity to obtain the advice of counsel prior to executing this Grant Notice and fully
understands all provisions of this Grant Notice, the Restricted Stock Unit Agreement and the Plan. Participant hereby agrees to
accept as binding, conclusive and final all decisions or interpretations of the Administrator of the Plan upon any questions arising
under the Plan, this Grant Notice or the Restricted Stock Unit Agreement.

 

	TEGAL CORPORATION

	 	PARTICIPANT

	 	 	 	 	 
	By:	/s/ Christine T. Hergenrother	 	By:	/s/ Thomas R. Mika
	Print Name:	Christine T. Hergenrother	 	Print Name:	Thomas R. Mika
	Title: 	Vice President & CFO	 	 	 
	Address:	 	 	Address:	 
	 	 	 	 	 

 

 

     

     

    

 

EXHIBIT A

 

TO RESTRICTED STOCK UNIT AWARD GRANT
NOTICE

TEGAL CORPORATION

RESTRICTED STOCK UNIT AWARD AGREEMENT

 

Pursuant to the Restricted
Stock Unit Award Grant Notice (the "Grant Notice") to which this Restricted Stock Unit Award Agreement
(this "Agreement") is attached, Tegal Corporation, a Delaware corporation (the "Company"),
has granted to Participant the right to receive the number of Restricted Stock Units under the Company's 2007 Incentive
Award Plan (the "Plan"), with respect to the number of shares of the Company's common stock, par value
$0.01 (the "Stock").

 

ARTICLE
I.

 

GENERAL

 

1.1Definitions.
All capitalized terms used in this Agreement without definition shall have the meanings ascribed in the Plan and the Grant Notice.

 

(a)"Administrator"
shall mean the Board of Directors or the Committee responsible for conducting the general administration of the Plan in
accordance with Article 13 of the Plan; provided that if Participant is a Non-Employee Director, "Administrator" shall
mean the Board of Directors.

 

(b)"Termination
of Consultancy" shall mean the time when the engagement of the Participant as a Consultant to the Company or a Subsidiary
is terminated for any reason, with or without cause, including, but not by way of limitation, by resignation, discharge, death
or retirement, but excluding: (a) terminations where there is a simultaneous employment or continuing employment of the Participant
by the Company or any Subsidiary, and (b) terminations where there is a simultaneous reestablishment of a consulting relationship
or continuing consulting relationship between the Participant and the Company or any Subsidiary. The Administrator, in its absolute
discretion, shall determine the effect of all matters and questions relating to Termination of Consultancy, including, but not
by way of limitation, the question of whether a particular leave of absence constitutes a Termination of Consultancy. Notwithstanding
any other provision of the Plan, the Company or any Subsidiary has an absolute and unrestricted right to terminate a Consultant's
service at any time for any reason whatsoever, with or without cause, except to the extent expressly provided otherwise in writing.

 

(c)"Termination
of Directorship" shall mean the time when the Participant, if he or she is or becomes an Independent Director, ceases
to be a Director for any reason, including, but not by way of limitation, a termination by resignation, failure to be elected,
death or retirement. The Board, in its sole and absolute discretion, shall determine the effect of all matters and questions relating
to Termination of Directorship with respect to Independent Directors.

 

(d)"Termination
of Employment" shall mean the time when the employee-employer relationship between the Participant and the Company
or any Subsidiary is terminated for any reason, with or without cause, including, but not by way of limitation, a termination by
resignation, discharge, death, disability or retirement; but excluding: (a) terminations where there is a simultaneous reemployment
or continuing employment of the Participant by the Company or any Subsidiary, and (b) terminations where there is a simultaneous
establishment of a consulting relationship or continuing consulting relationship between the Participant and the Company or any
Subsidiary. The Administrator, in its absolute discretion, shall determine the effect of all matters and questions relating to
Termination of Employment, including, but not by way of limitation, the question of whether a particular leave of absence constitutes
a Termination of Employment.

 

    	A-1

     

    

 

(e)"Termination
of Services" shall mean the last to occur of a Participant's Termination of Consultancy, Termination of Directorship
or Termination of Employment, as applicable. A Participant shall not be deemed to have a Termination of Services merely because
of a change in the capacity in which the Participant renders service to the Company or any Subsidiary (i.e., a Participant who
is an Employee becomes a Consultant) or a change in the entity for which the Participant renders such service (i.e., an Employee
of the Company becomes an Employee of a Subsidiary), unless following such change in capacity or service the Participant is no
longer serving as an Employee, Director or Consultant of the Company or any Subsidiary.

 

1.2Incorporation
of Terms of Plan. The RSU Award and this Agreement are subject to the Plan, the terms and conditions of which are incorporated
herein by reference. In the event of any inconsistency between the Plan and this Agreement, the terms of the Plan shall control.

 

ARTICLE
II.

 

AWARD OF RESTRICTED STOCK UNITS

 

2.1Award
of Restricted Stock Units.

 

(a)Award.
In consideration of Participant's agreement to remain in the service or employ of the Company or one of its affiliates, and for
other good and valuable consideration, the Company hereby grants to Participant the right to receive the number of RSUs set forth
in the Grant Notice, subject to all of the terms and conditions set forth in this Agreement, the Grant Notice and the Plan (the
"RSU Award"). Each RSU represents the right to receive one Share. Participant is an Employee, a member
of the Board of Directors or other Service Provider. Prior to actual issuance of any Shares, the RSUs and the RSU Award represent
an unsecured obligation of the Company, payable only from the general assets of the Company.

 

(b)Vesting.
The RSUs subject to the RSU Award shall vest in accordance with the Vesting Schedule set forth in the Grant Notice. Unless and
until the RSUs have vested in accordance with the vesting schedule set forth in the Grant Notice, Participant will have no right
to any distribution with respect to such RSUs. In the event of Participant's Termination of Services prior to the vesting of all
of the RSUs, any unvested RSUs will terminate automatically without any further action by the Company and be forfeited without
further notice and at no cost to the Company.

 

(c)Distribution
of Stock.

 

(i)Stock shall
be distributed to Participant (or in the event of Participant's death, to his or her estate) with respect to such Participant's
vested Restricted Stock Units granted to Participant pursuant to this Restricted Stock Unit Agreement, subject to the terms and
provisions of the Plan and this Restricted Stock Unit Agreement, commencing following the earliest to occur of the following events
(each, a "Distribution Event"):

 

(1)Participant's
"separation from service" within the meaning of Section 409A(2)(A)(i) of the Code and the Treasury Regulations thereunder;
provided, however, that if Participant is a "specified employee" at the time of Participant's "separation
from service," the "Distribution Event" for purposes of this Section 2.3(a)(i) shall be the date that is six months
after Participant's "separation from service" (or, if earlier, the date of Participant's death). For purposes of this
Section 2.3(a)(i), Participant shall be a "specified employee" if Participant is a key employee (as defined in Section
416(i) of the Code without regard to paragraph (5) thereof) of the Company and any stock of the Company is publicly-traded on an
established securities market or otherwise, as determined under Section 409A(a)(2)(B)(i) of the Code and the Treasury Regulations
thereunder;

 

(2)The
date Participant becomes "disabled" within the meaning of Section 409A(2)(C) of the Code and the Treasury Regulations
thereunder;

 

(3)Participant's
death;

 

    	A-2

     

    

 

(4)The
date immediately prior to a Change in Control, so long as such "Change in Control" constitutes a change in the ownership
or effective control of the Company, or in the ownership of a substantial portion of the assets of the Company within the meaning
of Section 409A(2)(A)(v) of the Code and the Treasury Regulations thereunder; or

 

(5)November
5, 2014.

 

(ii)Subject to
Sections 2.1(c)(i) and 2.2, following a Distribution Event, the Stock issuable with respect to Participant's vested Restricted
Stock Units shall be distributed to him or her in a lump sum within ten (10) days.

 

(iii)All distributions
shall be made by the Company in the form of whole shares of Common Stock.

 

(iv)Notwithstanding
the foregoing, shares of Common Stock shall be issuable pursuant to a Restricted Stock Unit at such times and upon such events
as are specified in this Agreement only to the extent issuance under such terms will not cause the Restricted Stock Units or the
shares of Common Stock issuable pursuant to the Restricted Stock Units to be includible in the gross income of Participant under
Section 409A of the Code prior to such times or the occurrence of such events, as permitted by the Code and the regulations and
other guidance thereunder.

 

(d)General.
Stock issued under the RSU Award shall be issued to Participant or Participant's beneficiaries, as the case may be, at the sole
discretion of the Administrator, in either (A) uncertificated form, with the Shares recorded in the name of Participant in the
books and records of the Company's transfer agent with appropriate notations regarding the restrictions on transfer imposed pursuant
to this Agreement; or (B) certificate form.

 

2.2Unforeseeable
Emergency.

 

(a)If
Participant experiences an Unforeseeable Emergency (as defined below), Participant may petition the Administrator for the right
to receive a partial or full distribution of the shares of Common Stock distributable with respect to his or her vested Restricted
Stock Units under this Agreement. If, in the sole discretion of the Administrator, Participant's petition is approved, the Unforeseeable
Emergency shall be deemed a "Distribution Event" with respect to the number of shares of Common Stock distributable with
respect to Participant's vested Restricted Stock Units as are approved for distribution by the Administrator. Participant shall
then be entitled to receive such Stock pursuant to Section 2.1(c)(ii).

 

(b)For
purposes of this Section 2.2, an "Unforeseeable Emergency" shall mean a severe financial hardship to Participant
resulting from an illness or accident of Participant, Participant's spouse, or a dependent (as defined in Section 152(a) of the
Code) of Participant, loss of Participant's property due to casualty, or other similar extraordinary and unforeseeable circumstances
arising as a result of events beyond the control of Participant. The Fair Market Value of the Stock distributed to Participant
with respect to the Unforeseeable Emergency may not exceed the amounts necessary to satisfy such Unforeseeable Emergency plus amounts
necessary to pay taxes reasonably anticipated as a result of the distribution, after taking into account the extent to which such
Unforeseeable Emergency is or may be relieved through reimbursement or compensation by insurance or otherwise or by liquidation
of Participant's assets (to the extent liquidation of such assets would not itself cause severe financial hardship), as determined
under the Treasury Regulations under Section 409A(a)(2)(B)(ii) of the Code.

 

2.3Changes
to Form or Time of Distribution. Except as provided in Section 2.2, neither the time nor form of distribution of Stock with
respect to the Restricted Stock Units under this Restricted Stock Unit Agreement may be changed, except as may be permitted by
the Administrator in accordance with Article 12 of the Plan and Section 409A of the Code and the Treasury Regulations thereunder.

 

    	A-3

     

    

 

2.4Tax
Withholding; Conditions to Issuance of Certificates. Notwithstanding any other provision of this Agreement (including, without
limitation, Section 2.1(b) hereof):

 

(a)No
new certificate shall be delivered to Participant or his legal representative unless and until Participant or his legal representative
shall have paid to the Company the full amount of all federal and state withholding or other taxes applicable to the taxable income
of Participant resulting from the vesting of the RSUs or the distribution of Shares issuable therunder, or other taxable event
related to the Restricted Stock Units. The Administrator may permit Participant to satisfy the tax withholding obligations using
any of the methods prescribed in the Plan as determined in the sole discretion of the Administrator.

 

(b)The
Company shall not be required to issue or deliver any certificate or certificates for any Shares prior to the fulfillment of all
of the following conditions: (A) the admission of the Shares to listing on all stock exchanges on which such Shares are then listed,
(B) the completion of any registration or other qualification of the Shares under any state or federal law or under rulings or
regulations of the U.S. Securities and Exchange Commission or other governmental regulatory body, which the Administrator shall,
in its sole and absolute discretion, deem necessary and advisable, (C) the obtaining of any approval or other clearance from any
state or federal governmental agency that the Administrator shall, in its absolute discretion, determine to be necessary or advisable
and (D) the lapse of any such reasonable period of time following the date the RSUs vest as the Administrator may from time to
time establish for reasons of administrative convenience.

 

ARTICLE
III.

 

OTHER PROVISIONS

 

3.1RSU
Award and Interests Not Transferable. This RSU Award and the rights and privileges conferred hereby, including the RSUs awarded
hereunder, shall not be liable for the debts, contracts or engagements of 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.

 

3.2Rights
as Shareholder. Neither the Participant nor any person claiming under or through the Participant shall have any of the rights
or privileges of a shareholder of the Company in respect of any Shares issuable hereunder unless and until certificates representing
such Shares (which may be in uncertificated form) will have been issued and recorded on the books and records of the Company or
its transfer agents or registrars, and delivered to the Participant (including through electronic delivery to a brokerage account).
After such issuance, recordation and delivery, the Participant shall have all the rights of a shareholder of the Company, including
with respect to the right to vote the Shares and the right to receive any cash or share dividends or other distributions paid to
or made with respect to the Shares; provided, however, that at the discretion of the Company, and prior to the delivery
of Shares, Participant may be required to execute a shareholders agreement in such form as shall be determined by the Company.

 

3.3Not
a Contract of Employment or other Service Relationship. Nothing in this Agreement or in the Plan shall confer upon Participant
any right to continue to serve as an employee or other service provider of the Company or any of its affiliates.

 

3.4Governing
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.

 

    	A-4

     

    

 

3.5Conformity
to Securities Laws. Participant acknowledges that the Plan and this Agreement are intended to conform to the extent necessary
with all provisions of the Securities Act and the Exchange Act, and any and all regulations and rules promulgated thereunder by
the U.S. 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.

 

3.6Amendment,
Suspension and Termination. To the extent permitted by the Plan, this Agreement 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 of Directors, provided, that,
except as may otherwise be provided by the Plan, no amendment, modification, suspension or termination of this Agreement shall
adversely effect the Award in any material way without the prior written consent of Participant.

 

3.7Notices.
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 Participant to his address
shown in the Company records, and to the Company at its principal executive office.

 

3.8Successors
and Assigns. The Company may assign any of its rights under this Agreement to single or multiple assignees, and this Agreement
shall inure to the benefit of the successors and assigns of the Company. Subject to the restrictions on transfer herein set forth,
this Agreement shall be binding upon Participant and his or her heirs, executors, administrators, successors and assigns.

 

3.9Section
409A. Notwithstanding any other provision of the Plan, this Agreement or the Grant Notice, the Plan, this Agreement and the
Grant Notice shall be interpreted in accordance with, and incorporate the terms and conditions required by, Section 409A of the
Code (together with any Department of Treasury regulations and other interpretive guidance issued thereunder, including without
limitation any such regulations or other guidance that may be issued after the date hereof, "Section 409A"). The
Administrator may, in its discretion, adopt such amendments to the Plan, this Agreement or the Grant Notice or adopt other policies
and procedures (including amendments, policies and procedures with retroactive effect), or take any other actions, as the Administrator
determines are necessary or appropriate to comply with the requirements of Section 409A.

 

    	A-5

     

    

 

[deferral
permitted]

 

Tegal
Corporation

 

2007
INCENTIVE AWARD PLAN

RESTRICTED STOCK UNIT AWARD GRANT NOTICE AND

RESTRICTED STOCK UNIT AWARD AGREEMENT

 

Tegal Corporation,
a Delaware corporation (the “Company”), pursuant to its 2007 Incentive Award Plan (the “Plan”),
hereby grants to the holder listed below (“Participant”), an award of restricted stock units (“Restricted
Stock Units” or “RSUs”) with respect to the number of shares of the Company’s common
stock, par value $0.01 (the “Shares”). This award for Restricted Stock Units (this “RSU Award”)
is subject to all of the terms and conditions as set forth herein and in the Restricted Stock Unit Award Agreement attached hereto
as Exhibit A (the “Restricted Stock Unit Agreement”) and the Plan, each of which are incorporated
herein by reference. Unless otherwise defined herein, the terms defined in the Plan shall have the same defined meanings in this
Grant Notice and the Restricted Stock Unit Agreement.

 

	Participant:	Christine Hergenrother
	 	 
	Grant Date:	November 5, 2010
	 	 
	Vesting Commencement Date:	November 5, 2014
	 	 
	Total Number of RSUs Subject to Award:	215,181                                     shares
	 	 
	Vesting Schedule:	The RSU Award shall vest 16,495 on November 5, 2010, 53,795 vesting on November 5, 2011, 53,795 vesting on November 5, 2012, 53,795 vesting on November 5, 2013, and 37,301 vesting on November 5, 2014
	 	 
	Distribution Schedule:	The RSUs shall be distributable in accordance with Section 2.1(c) of the Restricted Stock Unit Agreement.

 

By his or her signature
and the Company’s signature below, Participant agrees to be bound by the terms and conditions of the Plan, the Restricted
Stock Unit Agreement and this Grant Notice. The Participant has reviewed the Restricted Stock Unit Agreement, the Plan and this
Grant Notice in their entirety, has had an opportunity to obtain the advice of counsel prior to executing this Grant Notice and
fully understands all provisions of this Grant Notice, the Restricted Stock Unit Agreement and the Plan. Participant hereby agrees
to accept as binding, conclusive and final all decisions or interpretations of the Administrator of the Plan upon any questions
arising under the Plan, this Grant Notice or the Restricted Stock Unit Agreement.

 

	TEGAL CORPORATION

	 	PARTICIPANT

	 	 	 	 	 
	By:	/s/ Thomas R. Mika	 	By:	/s/ Christine T. Hergenrother
	Print Name:	Thomas R. Mika	 	Print Name:	Christine T. Hergenrother
	Title: 	 President & CEO	 	 	 
	Address:	 	 	Address:	 
	 	 	 	 	 

 

 

    	  

     

    

 

EXHIBIT
A

TO RESTRICTED STOCK UNIT AWARD GRANT NOTICE

TEGAL CORPORATION

RESTRICTED STOCK UNIT AWARD AGREEMENT

 

Pursuant to the Restricted
Stock Unit Award Grant Notice (the “Grant Notice”) to which this Restricted Stock Unit Award Agreement
(this “Agreement”) is attached, Tegal Corporation, a Delaware corporation (the “Company”),
has granted to Participant the right to receive the number of Restricted Stock Units under the Company’s 2007 Incentive Award
Plan (the “Plan”), with respect to the number of shares of the Company’s common stock, par value
$0.01 (the “Stock”).

 

ARTICLE
I.

 

general

 

1.1Definitions.
All capitalized terms used in this Agreement without definition shall have the meanings ascribed in the Plan and the Grant Notice.

 

(a)“Administrator”
shall mean the Board of Directors or the Committee responsible for conducting the general administration of the Plan in accordance
with Article 13 of the Plan; provided that if Participant is a Non-Employee Director, “Administrator” shall mean the
Board of Directors

 

(b)“Termination
of Consultancy” shall mean the time when the engagement of the Participant as a Consultant to the Company or a Subsidiary
is terminated for any reason, with or without cause, including, but not by way of limitation, by resignation, discharge, death
or retirement, but excluding: (a) terminations where there is a simultaneous employment or continuing employment of the Participant
by the Company or any Subsidiary, and (b) terminations where there is a simultaneous re-establishment of a consulting relationship
or continuing consulting relationship between the Participant and the Company or any Subsidiary. The Administrator, in its absolute
discretion, shall determine the effect of all matters and questions relating to Termination of Consultancy, including, but not
by way of limitation, the question of whether a particular leave of absence constitutes a Termination of Consultancy. Notwithstanding
any other provision of the Plan, the Company or any Subsidiary has an absolute and unrestricted right to terminate a Consultant’s
service at any time for any reason whatsoever, with or without cause, except to the extent expressly provided otherwise in writing.

 

(c)“Termination
of Directorship” shall mean the time when the Participant, if he or she is or becomes an Independent Director, ceases
to be a Director for any reason, including, but not by way of limitation, a termination by resignation, failure to be elected,
death or retirement. The Board, in its sole and absolute discretion, shall determine the effect of all matters and questions relating
to Termination of Directorship with respect to Independent Directors.

 

(d)“Termination
of Employment” shall mean the time when the employee-employer relationship between the Participant and the Company
or any Subsidiary is terminated for any reason, with or without cause, including, but not by way of limitation, a termination by
resignation, discharge, death, disability or retirement; but excluding: (a) terminations where there is a simultaneous reemployment
or continuing employment of the Participant by the Company or any Subsidiary, and (b) terminations where there is a simultaneous
establishment of a consulting relationship or continuing consulting relationship between the Participant and the Company or any
Subsidiary. The Administrator, in its absolute discretion, shall determine the effect of all matters and questions relating to
Termination of Employment, including, but not by way of limitation, the question of whether a particular leave of absence constitutes
a Termination of Employment.

 

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(e)“Termination
of Services” shall mean the last to occur of a Participant’s Termination of Consultancy, Termination of Directorship
or Termination of Employment, as applicable. A Participant shall not be deemed to have a Termination of Services merely because
of a change in the capacity in which the Participant renders service to the Company or any Subsidiary (i.e., a Participant who
is an Employee becomes a Consultant) or a change in the entity for which the Participant renders such service (i.e., an Employee
of the Company becomes an Employee of a Subsidiary), unless following such change in capacity or service the Participant is no
longer serving as an Employee, Director or Consultant of the Company or any Subsidiary.

 

1.2Incorporation
of Terms of Plan. The RSU Award and this Agreement are subject to the Plan, the terms and conditions of which are incorporated
herein by reference. In the event of any inconsistency between the Plan and this Agreement, the terms of the Plan shall control.

 

ARTICLE
II.

 

award of restricted stock units 

 

2.1Award
of Restricted Stock Units.

 

(a)Award.
In consideration of Participant’s agreement to remain in the service or employ of the Company or one of its affiliates, and
for other good and valuable consideration, the Company hereby grants to Participant the right to receive the number of RSUs set
forth in the Grant Notice, subject to all of the terms and conditions set forth in this Agreement, the Grant Notice and the Plan
(the “RSU Award”). Each RSU represents the right to receive one Share. Participant is an
Employee, a member of the Board of Directors or other Service Provider. Prior to actual issuance of any Shares, the RSUs and the
RSU Award represent an unsecured obligation of the Company, payable only from the general assets of the Company.

 

(b)Vesting.
The RSUs subject to the RSU Award shall vest in accordance with the Vesting Schedule set forth in the Grant Notice. Unless and
until the RSUs have vested in accordance with the vesting schedule set forth in the Grant Notice, Participant will have no right
to any distribution with respect to such RSUs. In the event of Participant’s Termination of Services prior to the vesting
of all of the RSUs, any unvested RSUs will terminate automatically without any further action by the Company and be forfeited without
further notice and at no cost to the Company.

 

(c)Distribution
of Stock.

 

(i)Stock shall
be distributed to Participant (or in the event of Participant’s death, to his or her estate) with respect to such Participant’s
vested Restricted Stock Units granted to Participant pursuant to this Restricted Stock Unit Agreement, subject to the terms and
provisions of the Plan and this Restricted Stock Unit Agreement, commencing following the earliest to occur of the following events
(each, a “Distribution Event”):

 

(1)Participant’s “separation
from service” within the meaning of Section 409A(2)(A)(i) of the Code and the Treasury Regulations thereunder; provided,
however, that if Participant is a “specified employee” at the time of Participant’s “separation
from service,” the “Distribution Event” for purposes of this Section 2.3(a)(i) shall be the date that is six
months after Participant’s “separation from service” (or, if earlier, the date of Participant’s death).
For purposes of this Section 2.3(a)(i), Participant shall be a “specified employee” if Participant is a key employee
(as defined in Section 416(i) of the Code without regard to paragraph (5) thereof) of the Company and any stock of the Company
is publicly-traded on an established securities market or otherwise, as determined under Section 409A(a)(2)(B)(i) of the Code and
the Treasury Regulations thereunder;

 

(2)The date Participant becomes
“disabled” within the meaning of Section 409A(2)(C) of the Code and the Treasury Regulations thereunder;

 

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(3)Participant’s death;

 

(4)The date immediately prior
to a Change in Control, so long as such “Change in Control” constitutes a change in the ownership or effective control
of the Company, or in the ownership of a substantial portion of the assets of the Company within the meaning of Section 409A(2)(A)(v)
of the Code and the Treasury Regulations thereunder; or

 

(5)November 5, 2014.

 

(ii)Subject to
Sections 2.1(c)(i) and 2.2, following a Distribution Event, the Stock issuable with respect to Participant’s vested Restricted
Stock Units shall be distributed to him or her in a lump sum within ten (10) days.

 

(iii)All distributions
shall be made by the Company in the form of whole shares of Common Stock.

 

(iv)Notwithstanding
the foregoing, shares of Common Stock shall be issuable pursuant to a Restricted Stock Unit at such times and upon such events
as are specified in this Agreement only to the extent issuance under such terms will not cause the Restricted Stock Units or the
shares of Common Stock issuable pursuant to the Restricted Stock Units to be includible in the gross income of Participant under
Section 409A of the Code prior to such times or the occurrence of such events, as permitted by the Code and the regulations and
other guidance thereunder.

 

(d)General.
Stock issued under the RSU Award shall be issued to Participant or Participant’s beneficiaries, as the case may be, at the
sole discretion of the Administrator, in either (A) uncertificated form, with the Shares recorded in the name of Participant in
the books and records of the Company’s transfer agent with appropriate notations regarding the restrictions on transfer imposed
pursuant to this Agreement; or (B) certificate form.

 

2.2Unforeseeable
Emergency.

 

(a)If
Participant experiences an Unforeseeable Emergency (as defined below), Participant may petition the Administrator for the right
to receive a partial or full distribution of the shares of Common Stock distributable with respect to his or her vested Restricted
Stock Units under this Agreement. If, in the sole discretion of the Administrator, Participant’s petition is approved, the
Unforeseeable Emergency shall be deemed a “Distribution Event” with respect to the number of shares of Common Stock
distributable with respect to Participant’s vested Restricted Stock Units as are approved for distribution by the Administrator.
Participant shall then be entitled to receive such Stock pursuant to Section 2.1(c)(ii).

 

(b)For
purposes of this Section 2.2, an “Unforeseeable Emergency” shall mean a severe financial hardship to
Participant resulting from an illness or accident of Participant, Participant’s spouse, or a dependent (as defined in Section
152(a) of the Code) of Participant, loss of Participant’s property due to casualty, or other similar extraordinary and unforeseeable
circumstances arising as a result of events beyond the control of Participant. The Fair Market Value of the Stock distributed to
Participant with respect to the Unforeseeable Emergency may not exceed the amounts necessary to satisfy such Unforeseeable Emergency
plus amounts necessary to pay taxes reasonably anticipated as a result of the distribution, after taking into account the extent
to which such Unforeseeable Emergency is or may be relieved through reimbursement or compensation by insurance or otherwise or
by liquidation of Participant’s assets (to the extent liquidation of such assets would not itself cause severe financial
hardship), as determined under the Treasury Regulations under Section 409A(a)(2)(B)(ii) of the Code.

 

2.3Changes
to Form or Time of Distribution. Except as provided in Section 2.2, neither the time nor form of distribution of Stock with
respect to the Restricted Stock Units under this Restricted Stock Unit Agreement may be changed, except as may be permitted by
the Administrator in accordance with Article 12 of the Plan and Section 409A of the Code and the Treasury Regulations thereunder.

 

    	A-3

     

    

 

2.4Tax
Withholding; Conditions to Issuance of Certificates. Notwithstanding any other provision of this Agreement (including, without
limitation, Section 2.1(b) hereof):

 

(a)No
new certificate shall be delivered to Participant or his legal representative unless and until Participant or his legal representative
shall have paid to the Company the full amount of all federal and state withholding or other taxes applicable to the taxable income
of Participant resulting from the vesting of the RSUs or the distribution of Shares issuable therunder, or other taxable event
related to the Restricted Stock Units. The Administrator may permit Participant to satisfy the tax withholding obligations using
any of the methods prescribed in the Plan as determined in the sole discretion of the Administrator.

 

(b)The
Company shall not be required to issue or deliver any certificate or certificates for any Shares prior to the fulfillment
of all of the following conditions: (A) the admission of the Shares to listing on all stock exchanges on which such Shares are
then listed, (B) the completion of any registration or other qualification of the Shares under any state or federal law or under
rulings or regulations of the U.S. Securities and Exchange
Commission or other governmental regulatory body, which the Administrator shall, in its sole and absolute discretion, deem
necessary and advisable, (C) the obtaining of any approval or other clearance from any state or federal governmental agency that
the Administrator shall, in its absolute discretion, determine to be necessary or advisable and (D) the lapse of any such reasonable
period of time following the date the RSUs vest as the Administrator may from time to time establish for reasons of administrative
convenience.

 

ARTICLE
III.

 

other provisions 

 

3.1RSU
Award and Interests Not Transferable. This RSU Award and the rights and privileges conferred hereby, including the RSUs awarded
hereunder, shall not be liable for the debts, contracts or engagements of 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.

 

3.2Rights
as Shareholder. Neither the Participant nor any person claiming under or through the Participant shall have any of the rights
or privileges of a shareholder of the Company in respect of any Shares issuable hereunder unless and until certificates representing
such Shares (which may be in uncertificated form) will have been issued and recorded on the books and records of the Company or
its transfer agents or registrars, and delivered to the Participant (including through electronic delivery to a brokerage account).
After such issuance, recordation and delivery, the Participant shall have all the rights of a shareholder of the Company, including
with respect to the right to vote the Shares and the right to receive any cash or share dividends or other distributions paid to
or made with respect to the Shares; provided, however, that at the discretion of the Company, and prior to the delivery
of Shares, Participant may be required to execute a shareholders agreement in such form as shall be determined by the Company.

 

3.3Not
a Contract of Employment or other Service Relationship. Nothing in this Agreement or in the Plan shall confer upon Participant
any right to continue to serve as an employee or other service provider of the Company or any of its affiliates.

 

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3.4Governing
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.

 

3.5Conformity
to Securities Laws. Participant acknowledges that the Plan and this Agreement are intended to conform to the extent necessary
with all provisions of the Securities Act and the Exchange Act, and any and all regulations and rules promulgated thereunder by
the U.S. 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.

 

3.6Amendment,
Suspension and Termination. To the extent permitted by the Plan, this Agreement 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 of Directors, provided,
that, except as may otherwise be provided by the Plan, no amendment, modification, suspension or termination of this Agreement
shall adversely effect the Award in any material way without the prior written consent of Participant.

 

3.7Notices.
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 Participant to his address
shown in the Company records, and to the Company at its principal executive office.

 

3.8Successors
and Assigns. The Company may assign any of its rights under this Agreement to single or multiple assignees, and this Agreement
shall inure to the benefit of the successors and assigns of the Company. Subject to the restrictions on transfer herein set forth,
this Agreement shall be binding upon Participant and his or her heirs, executors, administrators, successors and assigns.

 

3.9Section
409A. Notwithstanding any other provision of the Plan, this Agreement or the Grant Notice, the Plan, this Agreement and the
Grant Notice shall be interpreted in accordance with, and incorporate the terms and conditions required by, Section 409A of the
Code (together with any Department of Treasury regulations and other interpretive guidance issued thereunder, including without
limitation any such regulations or other guidance that may be issued after the date hereof, “Section 409A”).
The Administrator may, in its discretion, adopt such amendments to the Plan, this Agreement or the Grant Notice or adopt other
policies and procedures (including amendments, policies and procedures with retroactive effect), or take any other actions, as
the Administrator determines are necessary or appropriate to comply with the requirements of Section 409A.

 

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