<PAGE>
SCHEDULE 14A
(RULE 14A-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(a) OF THE SECURITIES
EXCHANGE ACT OF 1934
<TABLE>
<S> <C> <C> <C>
Filed by the Registrant /X/
Filed by a Party other than the
Registrant / /
Check the appropriate box:
/X/ Preliminary Proxy Statement / / Confidential, for Use of the
Commission Only (as permitted by
Rule 14a-6(e)(2))
/ / Definitive Proxy Statement
/ / Definitive Additional Materials
/ / Soliciting Material Pursuant to Rule 14a-11(c) or Rule 14a-12
</TABLE>
ULTRATECH STEPPER, INC.
- --------------------------------------------------------------------------------
(Name of Registrant as Specified in Its Charter)
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
/X/ No fee required.
/ / Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
(1) Title of each class of securities to which transaction applies:
-----------------------------------------------------------------------
(2) Aggregate number of securities to which transaction applies:
-----------------------------------------------------------------------
(3) Per unit price or other underlying value of transaction computed
pursuant to exchange Act Rule 0-11 (Set forth the amount on which the
filing fee is calculated and state how it was determined):
-----------------------------------------------------------------------
(4) Proposed maximum aggregate value of transaction:
-----------------------------------------------------------------------
(5) Total fee paid:
-----------------------------------------------------------------------
/ / Fee paid previously with preliminary materials.
/ / Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
-----------------------------------------------------------------------
(2) Form, Schedule or Registration Statement No.:
-----------------------------------------------------------------------
(3) Filing Party:
-----------------------------------------------------------------------
(4) Date Filed:
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<PAGE>
LOGO
------------------------
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD JUNE 3, 1998
------------------------
To the Stockholders of ULTRATECH STEPPER, INC.:
NOTICE IS HEREBY GIVEN that the Annual Meeting of Stockholders of Ultratech
Stepper, Inc., a Delaware corporation (the "Company"), will be held on
Wednesday, June 3, 1998, at 10:00 a.m. local time, at the Beverly Heritage
Hotel, 1820 Barber Lane, Milpitas, CA 95035, for the following purposes, as more
fully described in the Proxy Statement accompanying this Notice:
1. To elect three directors to serve for the ensuing two years until the
expiration of their terms in 2000 and to elect one director to serve for
the ensuing year until the expiration of his term in 1999, or until their
successors are elected and qualified;
2. To approve the amendment to the Company's Amended and Restated
Certificate of Incorporation to increase the number of authorized shares
of common stock thereunder from 30,000,000 shares to 40,000,000 shares;
3. To ratify the appointment of Ernst & Young LLP as independent auditors
of the Company for the fiscal year ending December 31, 1998; and
4. To transact such other business as may properly come before the meeting
or any adjournment or postponement thereof, including the election of any
director if any of the above nominees is unable to serve or for good
cause will not serve.
Only stockholders of record at the close of business on April 9, 1998 are
entitled to notice of and to vote at the Annual Meeting. The stock transfer
books will not be closed between the record date and the date of the meeting. A
list of stockholders entitled to vote at the Annual Meeting will be available
for inspection at the executive offices of the Company.
All stockholders are cordially invited to attend the meeting in person.
Whether or not you plan to attend, please sign and return the enclosed proxy as
promptly as possible in the envelope enclosed for your convenience. Should you
receive more than one proxy because your shares are registered in different
names and addresses, each proxy should be signed and returned to assure that all
your shares will be voted. You may revoke your proxy at any time prior to the
Annual Meeting. If you attend the Annual Meeting and vote by ballot, your proxy
will be revoked automatically and only your vote at the Annual Meeting will be
counted.
Sincerely,
/s/ Arthur W. Zafiropoulo
Arthur W. Zafiropoulo
CHAIRMAN OF THE BOARD, CHIEF EXECUTIVE
OFFICER
AND PRESIDENT
April 27, 1998
YOUR VOTE IS VERY IMPORTANT, REGARDLESS OF THE NUMBER OF SHARES YOU OWN.
PLEASE READ THE ATTACHED PROXY STATEMENT CAREFULLY, COMPLETE, SIGN AND DATE
THE ENCLOSED PROXY CARD AS PROMPTLY AS POSSIBLE AND RETURN IT IN THE ENCLOSED
ENVELOPE.
<PAGE>
ULTRATECH STEPPER, INC.
3050 ZANKER ROAD
SAN JOSE, CALIFORNIA 95134
------------------------
PROXY STATEMENT
FOR THE ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON JUNE 3, 1998
------------------------
GENERAL
The enclosed proxy ("Proxy") is solicited on behalf of the Board of
Directors of Ultratech Stepper, Inc., a Delaware corporation (the "Company"),
for use at the Annual Meeting of Stockholders to be held on June 3, 1998 (the
"Annual Meeting"). The Annual Meeting will be held at 10:00 a.m. at the Beverly
Heritage Hotel, 1820 Barber Lane, Milpitas, CA 95035. These proxy solicitation
materials were mailed on or about April 27, 1998 to all stockholders entitled to
vote at the Annual Meeting.
VOTING
The specific proposals to be considered and acted upon at the Annual Meeting
are summarized in the accompanying Notice and are described in more detail in
this Proxy Statement. On April 9, 1998, the record date for determination of
stockholders entitled to notice of and to vote at the Annual Meeting,
shares of the Company's common stock, $.001 par value ("Common Stock"), were
issued and outstanding. No shares of the Company's preferred stock were
outstanding. Each stockholder is entitled to one vote for each share of Common
Stock held by such stockholder on April 9, 1998.
All votes will be tabulated by the inspector of election appointed for the
meeting who will separately tabulate affirmative and negative votes, abstentions
and broker non-votes. Directors are elected by a plurality vote. Proposal Two,
the amendment to the Amended and Restated Certificate of Incorporation
increasing the number of authorized shares of Common Stock, requires the
affirmative vote of the holders of a majority of the outstanding shares of
voting capital stock. Proposal Three, the ratification of Ernst & Young LLP as
the Company's independent auditors for the fiscal year ending December 31, 1998,
will be decided by the affirmative vote of the holders of a majority of shares
present in person or represented by proxy and entitled to vote on such matter.
With regard to the election of directors, votes may be cast in favor of or
withheld from each nominee; votes that are withheld will be excluded entirely
from the vote and will have no effect. Abstentions with respect to any matter
other than the election of directors will be treated as shares present or
represented and entitled to vote on that matter and will thus have the same
effect as negative votes. If shares are not voted by the broker who is the
record holder of the shares, or if shares are not voted in other circumstances
in which proxy authority is defective or has been withheld with respect to any
matter, these non-voted shares are deemed not to be present or represented for
purposes of determining whether stockholder approval of that matter has been
obtained.
REVOCABILITY OF PROXIES
You may revoke or change your Proxy at any time before the Annual Meeting by
filing with the Secretary of the Company at the Company's principal executive
offices, a notice of revocation or another signed proxy with a later date. You
may also revoke your proxy by attending the Annual Meeting and voting in person.
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SOLICITATION
The Company will bear the entire cost of solicitation, including the
preparation, assembly, printing and mailing of this Proxy Statement, the proxy
and any additional soliciting materials furnished to stockholders. The Company
has retained the services of Beacon Hill Partners, Inc. ("Beacon") to assist in
the solicitation of proxies. Beacon will receive a fee from the Company of
approximately $2,500, plus out-of-pocket expenses. Copies of solicitation
materials will be furnished to brokerage houses, fiduciaries, and custodians
holding shares in their names that are beneficially owned by others so that they
may forward this solicitation material to such beneficial owners. In addition,
the Company may reimburse such persons for their costs in forwarding the
solicitation materials to such beneficial owners. The original solicitation of
proxies by mail may be supplemented by a solicitation by telephone, telegram, or
other means by directors, officers or employees. Such individuals, however, will
not be compensated by the Company for those services. Except as described above,
the Company does not presently intend to solicit proxies other than by mail.
DEADLINE FOR RECEIPT OF STOCKHOLDER PROPOSALS
Proposals of stockholders of the Company that are intended to be presented
by such stockholders at the Company's 1998 Annual Meeting must be received no
later than December 21, 1998, in order that they may be included in the proxy
statement and form of proxy relating to that meeting.
MATTERS TO BE CONSIDERED AT ANNUAL MEETING
PROPOSAL ONE -- ELECTION OF DIRECTORS
GENERAL
On July 23, 1993, the Board of Directors and stockholders of the Company
approved the Company's Amended and Restated Certificate of Incorporation to
provide for a classified Board of Directors consisting of two classes of
directors each serving staggered two-year terms. The Amended and Restated
Certificate of Incorporation became effective on October 6, 1993 and was amended
in 1995 by the stockholders to give effect to an increase in the number of
authorized shares of Common Stock. The Board of Directors has selected three
nominees for election for the term ending upon the 2000 Annual Stockholders
Meeting and one nominee for election for the term ending upon the 1999 Annual
Stockholders Meeting, all of whom are current directors of the Company. The
names of the persons who are nominees for director, the terms of their proposed
directorship, and their positions and offices with the Company as of April 9,
1998 are set forth below. Each person nominated for election has agreed to serve
if elected, and management has no reason to believe that any of the nominees
will be unavailable to serve. In the event any of the nominees are unable or
decline to serve as a director at the time of the Annual Stockholders Meeting,
the proxies will be voted for any nominee who may be designated by the present
Board of Directors to fill the vacancy. Unless otherwise instructed, the proxy
holders will vote the proxies received by them FOR the nominees named below. The
four candidates receiving the highest number of affirmative votes of the shares
represented and voting on this particular matter at the Annual Stockholders
Meeting will be elected directors of the Company, to serve for their respective
terms or until their successors have been elected and qualified.
NOMINEES FOR TERM ENDING UPON THE 2000 ANNUAL STOCKHOLDERS MEETING
ARTHUR W. ZAFIROPOULO, 58, founded the Company in September 1992. He has
served as Chief Executive Officer and Chairman of the Board of Directors of the
Company since March 1993. Mr. Zafiropoulo served as President of the Company
from March 1993 to March 1996 and has served as President since May 1997.
Between September 1990 and March 1993, he was President of the Ultratech Stepper
Division of General Signal Corporation ("General Signal"). From February 1989 to
September 1990, Mr. Zafiropoulo was President of General Signal's Semiconductor
Equipment Group International, a
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<PAGE>
semiconductor equipment company. From August 1980 to February 1989, Mr.
Zafiropoulo was President and Chief Executive Officer of Drytek, Inc., a plasma
dry-etch company that he founded in August 1980, and which was sold to General
Signal in 1986. From July 1987 to September 1989, Mr. Zafiropoulo was also
President of Kayex, a semiconductor equipment manufacturer, which is a unit of
General Signal. Mr. Zafiropoulo is a director of RF Power Products Inc., a
manufacturer of advanced power supplies. In addition, Mr. Zafiropoulo is a
director of Semi/Sematech, an association of U.S.-owned suppliers of equipment,
materials and services to the semiconductor industry and SEMI (Semiconductor and
Equipment Materials International), an international trade association.
LARRY R. CARTER, 54, has been a Director of the Company since September
1997. Mr. Carter joined Cisco Systems, Inc. ("Cisco") in January 1995 as Vice
President, Finance and Administration and Chief Financial Officer. In July 1997
he was promoted to Senior Vice President, Finance and Chief Financial Officer.
Prior to joining Cisco, from July 1992 to January 1995, Mr. Carter was Vice
President and Corporate Controller at Advanced Micro Devices. His career also
includes four years with V.L.S.I. Technology, Inc., as Vice President, Finance
and Chief Financial Officer and two years at SGS Thompson Microelectronics, Inc.
as Vice President, Finance, Administration and Chief Financial Officer. He also
spent 19 years at Motorola, Inc. where he held a variety of financial positions,
the most recent being Vice President and Controller, M.O.S. Group. Since May
1997, Mr. Carter has served as a member of the Board of Directors of Network
Appliance, Inc. Mr. Carter holds a B.S. in Business Administration/Accounting
from Arizona State University.
JOEL F. GEMUNDER, 58, has been a Director of the Company since October 1997.
Mr. Gemunder has been President and a member of the Board of Directors of
Omnicare, Inc., a pharmacy services provider, since July 1981. He has also
served as a Director of Chemed Corporation, a specialty services company, since
1977. Mr. Gemunder holds an A.B. from the City College of New York in Business
and an M.B.A. from the University of Chicago.
NOMINEE FOR DIRECTOR FOR TERM ENDING UPON THE 1999 ANNUAL STOCKHOLDERS MEETING
TOMMY GEORGE, 58, has served as a Director of the Company since October
1997. From April 1993 through May 1997, Mr. George served as the President of
Motorola SPS ("Motorola"). From June 1986 through April 1993, Mr. George served
as the Assistant General Manager of Motorola. Mr. George also served as a
Director at Echelon Corporation, a control network solutions provider, from
April 1993 through May 1997 and has served as a Director of FSI International
since January 1998.
CONTINUING DIRECTORS FOR TERM ENDING UPON THE 1999 ANNUAL STOCKHOLDERS MEETING
GREGORY HARRISON, 64, has served as a Director of the Company since May
1993. Since 1986, he has served as President of G. Harrison & Company, a
management consulting firm. From 1969 to 1986, Mr. Harrison served in various
operating management positions, most recently as Vice President and Corporate
Officer, at National Semiconductor Corporation.
KENNETH LEVY, 55, has served as a Director of the Company since May 1993.
Mr. Levy has served as Chairman of the Board of Directors of KLA-Tencor
Corporation since May 1997. From 1975 until April 30, 1997, he was Chairman of
the Board and Chief Executive Officer of KLA Instruments Corporation ("KLA"), a
manufacturer of yield management semiconductor equipment, which he co-founded.
Mr. Levy has also served as a Director of Integrated Process Equipment
Corporation, a manufacturer of semiconductor processing equipment for chemical,
mechanical, planarization and cleaning of advanced integrated circuits since May
1995 and NetWork Peripherals, Inc., a developer and manufacturer of high
performance networking solutions since March 1993.
3
<PAGE>
BOARD COMMITTEES AND MEETINGS
During the fiscal year ended December 31, 1997, the Board of Directors held
five meetings and acted by unanimous written consent on five occasions. The
Board of Directors has an Audit Committee and a Compensation Committee. During
the respective term of his service on the Board, each of the directors attended
or participated in 75% or more of the aggregate of (i) the total number of
meetings of the Board of Directors and (ii) the total number of meetings held by
all committees of the Board on which he served during the past fiscal year.
The Compensation Committee currently consists of two directors, Mr. Harrison
and Mr. Gemunder. During the 1997 fiscal year, Joseph Parkinson also served on
the Compensation Committee until his resignation from the Board on September 2,
1997. The Compensation Committee is primarily responsible for approving the
Company's general compensation policies and setting compensation levels for the
Company's executive officers. The Compensation Committee also has sole and
exclusive authority to administer the Company's 1993 Stock Option/Stock Issuance
Plan. The Compensation Committee held five meetings during the past fiscal year
and acted by unanimous written consent on eight occasions.
The Audit Committee currently consists of two directors, Messrs. Carter and
Levy, and is primarily responsible for approving the services performed by the
Company's independent auditors and reviewing their reports regarding the
Company's accounting practices and systems of internal accounting controls. The
Audit Committee held five meetings during the last fiscal year.
DIRECTOR COMPENSATION
During the 1997 fiscal year, each non-employee Board member was paid an
annual cash retainer fee of $10,000, received an additional $1,000 for
attendance at each Board meeting and $500 for attendance at each meeting of any
Board committee of which he was a member. The Company did not reimburse any
non-employee Board member for expenses incurred in connection with his
attendance at such Board and committee meetings.
Pursuant to the Automatic Option Grant Program in effect under the Company's
1993 Stock Option/ Stock Issuance Plan (the "1993 Plan"), Messrs. Carter,
Gemunder and George each received an option to purchase 12,000 shares of the
Company's Common Stock upon their initial appointment to the Board on October
28, 1997. Each such option has an exercise price equal to the fair market value
per share of Common Stock on the applicable grant date (September 4, 1997 for
Mr. Carter and October 28, 1997 for Messrs. Gemunder and George). The exercise
price for each option determined on such a basis is $28.75 per share. The
options each have a maximum term of ten (10) years measured from the grant date,
subject to earlier termination upon the optionee's cessation of Board service.
Each such option is immediately exercisable for all of the option shares, but
any shares purchased under the option will be subject to repurchase by the
Company, at the exercise price paid per share, upon the optionee's cessation of
Board service prior to vesting in those shares. The shares will vest as follows:
(i) fifty percent (50%) of the shares will vest upon completion of one (1) year
of Board service measured from the grant date and (ii) the remaining shares will
vest in three (3) successive equal annual installments upon completion of each
of the next three (3) years of Board service thereafter.
In addition, each of the non-employee Board members continuing to serve as a
non-employee Board member on the date of 1997 Annual Stockholders Meeting
(Messrs. Harrison and Levy) received at the time an option grant for 4,000
shares with an exercise price of $20.75 per share, the fair market value per
share of the Common Stock on the grant date. Each option has a maximum term of
ten (10) years measured from the grant date, subject to the earlier termination
upon the optionee's cessation of Board service. The option is immediately
exercisable for all the option shares. However, any shares purchased under the
option will be subject to repurchase by the Company, at the option exercise
price paid per share, upon the optionee's cessation of Board service prior to
vesting in those shares. The shares subject to each
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<PAGE>
4,000-share grant will vest upon the optionee's completion of one (1) year of
Board service measured from the grant date.
The shares subject to each option granted under the Automatic Option Grant
Program will immediately vest upon an acquisition of the Company by merger or
asset sale or upon certain other changes in control or ownership of the Company.
Upon the successful completion of a hostile tender offer for more than 50% of
the Company's outstanding Common Stock, each automatic option grant may be
surrendered to the Company in return for a cash distribution from the Company in
an amount per surrendered option share equal to the excess of (i) the highest
reported price per share of Common Stock paid in the tender offer over (ii) the
option exercise price payable per share.
RECOMMENDATION OF THE BOARD OF DIRECTORS
The Board recommends that the stockholders vote FOR the election of each of
the above nominees.
PROPOSAL TWO -- APPROVAL OF AN AMENDMENT TO THE
RESTATED CERTIFICATE OF INCORPORATION
The present capital structure of the Company authorizes 30,000,000 shares of
Common Stock, par value $0.001 and 2,000,000 shares of preferred stock, par
value $0.001 ("Preferred Stock"). Additionally, 350,000 shares are designated as
Series A Preferred Stock, none of which are issued and outstanding. The Board
believes this capital structure is inadequate for the present and future needs
of the Company. Therefore the Board has unanimously approved the amendment to
the Company's Amended and Restated Certificate of Incorporation to increase the
number of shares of Common Stock authorized for issuance from 30,000,000 shares
to 40,000,000 shares. The Board believes this capital structure more
appropriately reflects the present and future needs of the Company and
recommends that the Company's stockholders approve such amendment and
restatement. On April 3, 1998, 20,863,521 shares of Common Stock were issued and
outstanding and 21,697,121 shares of Common Stock were outstanding on a fully
diluted basis, assuming the conversion of the outstanding shares of the
Company's Series A Preferred Stock and exercise of all outstanding options. In
addition, the Company currently has 1,235,421 shares of Common Stock available
for grant under the Company's 1993 Stock Option/Stock Issuance Plan and 268,000
shares reserved for issuance under the Company's 1995 Employee Stock Purchase
Plan.
PURPOSE OF AUTHORIZING ADDITIONAL COMMON STOCK
Authorizing an additional 10,000,000 shares of Common Stock would give the
Board of Directors the express authority, without further action of the
stockholders, to issue such Common Stock from time to time as the Board of
Directors deems necessary. The Board of Directors believes it is necessary to
have the ability to issue such additional shares of Common Stock for general
corporate purposes. The additional authorized shares may be used for
acquisitions of businesses, product lines or technologies which complement or
expand the Company's current business and will also allow the Company to have
Common Stock available for issuance in connection with any future designation
and issuance of preferred stock convertible into Common Stock, equity
financings, stock dividends or distributions, issuance of options pursuant to
the Company's 1993 Stock Option/Stock Issuance Plan and issuances of Common
Stock pursuant to the Company's Employee Stock Purchase Plan without further
action by the stockholders. The additional Common Stock would be available for
issuance by the Board from time to time without future action by the
stockholders, unless such action were specifically required by applicable law or
rules of any stock exchange or quotation system on which the Company's
securities may then be listed.
The proposed increase in the authorized number of shares of Common Stock
could have a number of effects on the Company's stockholders depending upon the
exact nature and circumstances of any actual issuances of authorized but
unissued shares. The increase could have an anti-takeover effect, in that
additional shares could be issued (within the limits imposed by applicable law
or the rules of any stock
5
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exchange or quotation system on which the Company's securities may then be
listed) in one or more transactions that could make a change in control or
takeover of the Company more difficult. For example, additional shares could be
issued by the Company so as to dilute the stock ownership or voting rights of
persons seeking to obtain control of the Company. Similarly, the issuance of
additional shares to certain persons allied with the Company's management could
have the effect of making it more difficult to remove the Company's current
management by diluting the stock ownership or voting rights of persons seeking
to cause such removal. In addition, an issuance of additional shares by the
Company could have a dilutive effect on the potential realizable value of a
stockholder's investment. In the absence of a proportionate increase in the
Company's earnings and book value, an increase in the aggregate number of
outstanding shares of the Company caused by the issuance of the additional
shares would dilute the earnings per share and book value per share of all
outstanding shares of the Company's Common Stock. If such factors were reflected
in the price per share of Common Stock, the potential realizable value of a
stockholder's investment could be adversely affected. The Common Stock carries
no preemptive rights to purchase additional shares.
VOTE REQUIRED FOR STOCKHOLDER APPROVAL
The affirmative vote of the holders of a majority of the outstanding shares
of the Company's voting capital stock is required for approval of the amendment
to the Amended and Restated Certificate of Incorporation to increase the number
of authorized shares of Common Stock issuable thereunder from 30,000,000 shares
to 40,000,000 shares.
RECOMMENDATION
The Board of Directors recommends that the stockholders vote IN FAVOR OF the
amendment and restatement of the Company's Restated Certificate of
Incorporation.
PROPOSAL THREE -- RATIFICATION OF INDEPENDENT AUDITORS
The Board of Directors has appointed the firm of Ernst & Young LLP,
independent auditors for the Company during the fiscal year ended December 31,
1997, to serve in the same capacity for the fiscal year ending December 31,
1998, and is asking the stockholders to ratify this appointment. The affirmative
vote of a majority of the shares represented and voting at the Annual Meeting is
required to ratify the selection of Ernst & Young LLP as the Company's
independent auditors.
In the event the stockholders fail to ratify the appointment, the Board of
Directors will reconsider its selection. Even if the selection is ratified, the
Board of Directors in its discretion may direct the appointment of a different
independent auditing firm at any time during the year if the Board of Directors
believes that such a change would be in the best interests of the Company and
its stockholders.
Representatives of Ernst & Young LLP are expected to be present at the
Annual Meeting and will have the opportunity to make a statement if they desire
to do so, and will be available to respond to appropriate questions.
RECOMMENDATION OF THE BOARD OF DIRECTORS
The Board of Directors recommends that the stockholders vote FOR the
ratification of the selection of Ernst & Young LLP to serve as the Company's
independent auditors for the fiscal year ending December 31, 1998.
OTHER MATTERS
The Company knows of no other matters that will be presented for
consideration at the Annual Meeting. If any other matters properly come before
the Annual Meeting, it is the intention of the persons
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named in the enclosed form of Proxy to vote the shares they represent as the
Board of Directors recommends. Discretionary authority with respect to such
other matters is granted by the execution of the enclosed Proxy.
OWNERSHIP OF SECURITIES
The following table sets forth certain information known to the Company with
respect to the beneficial ownership of the Company's Common Stock as of February
28, 1998 (unless otherwise stated in the footnotes) by (i) all persons who are
or who may be deemed beneficial owners of five percent (5%) or more of the
Company's Common Stock, (ii) each director of the Company, (iii) the Named
Executive Officers (as defined below) and (iv) all current directors and
executive officers as a group. Unless otherwise indicated, each of the security
holders has sole voting and investment power with respect to the shares
beneficially owned, subject to community property laws, where applicable.
<TABLE>
<CAPTION>
SHARES OF PERCENTAGE OF
COMMON STOCK SHARES BENEFICIALLY
NAME AND ADDRESS OF BENEFICIAL OWNER BENEFICIALLY OWNED(#) OWNED (1)
- ------------------------------------------------------------------------ --------------------- ---------------------
<S> <C> <C>
Arthur W. Zafiropoulo................................................... 1,740,719 8.3%
Ultratech Stepper, Inc.
3050 Zanker Road
San Jose, CA 95134
Daniel H. Berry (2)..................................................... 267,571 1.3%
William G. Leunis, III (3).............................................. 215,950 *
Kenneth Levy (4)........................................................ 55,800 *
Gregory Harrison (5).................................................... 8,000 *
Larry R. Carter (6)..................................................... 12,000 *
Joel Gemunder (7)....................................................... 13,000 *
Tommy George (8)........................................................ 12,000 *
FMR Corp................................................................ 2,679,100 12.7%
82 Devonshire Street
Boston, MA 02109
All current directors and executive officers as a group
(8 persons) (9)......................................................... 2,325,040 11.0%
</TABLE>
- ------------------------
* Less than one percent of the outstanding Common Stock.
(1) Percentage of ownership is based on 20,853,608 shares of Common Stock issued
and outstanding on February 28, 1998. This percentage also takes into
account the Common Stock to which such individual or entity has the right to
acquire beneficial ownership within sixty (60) days after February 28, 1998,
including, but not limited to, through the exercise of options; however,
such Common Stock will not be deemed outstanding for the purpose of
computing the percentage owned by any other individual or entity. Such
calculation is required by Rule 13d-3(1)(i) under the Securities Exchange
Act of 1934, as amended.
(2) Includes 118,400 shares of the Company's Common Stock subject to options
which are currently exercisable or which will become exercisable within 60
days after February 28, 1998.
(3) Includes 91,300 shares of the Company's Common Stock subject to options
which are currently exercisable or which will become exercisable within 60
days after February 28, 1998.
7
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(4) Consists of 55,800 shares of the Company's Common Stock subject to options
which are currently exercisable or which will become exercisable within 60
days after February 28, 1998.
(5) Consists of 8,000 shares of the Company's Common Stock subject to options
which are currently exercisable or which will become exercisable within 60
days after February 28, 1998.
(6) Consists of 12,000 shares of the Company's Common Stock subject to options
which are currently exercisable or which will become exercisable within 60
days after February 28, 1998.
(7) Includes 12,000 shares of the Company's Common Stock subject to options
which are currently exercisable or which will become exercisable within 60
days after February 28, 1998.
(8) Consists of 12,000 shares of the Company's Common Stock subject to options
which are currently exercisable or which will become exercisable within 60
days after February 28, 1998.
(9) Includes 309,500 shares of the Company's Common Stock subject to options
which are currently exercisable or which will become exercisable within 60
days after February 28, 1998.
8
<PAGE>
EXECUTIVE COMPENSATION AND RELATED INFORMATION
EXECUTIVE COMPENSATION
SUMMARY COMPENSATION
The following table provides certain summary information concerning the
compensation earned, by the Company's Chief Executive Officer and each of the
other executive officers of the Company whose salary and bonus for the 1997
fiscal year was in excess of $100,000 (collectively, the "Named Executive
Officers"), for services rendered in all capacities to the Company and its
subsidiaries for the last three fiscal years. With the exception of Mr. Schram,
no executive officer who would otherwise have been included in such table on the
basis of salary and bonus earned for the 1997 fiscal year resigned or terminated
employment during that fiscal year.
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
LONG-TERM COMPENSATION AWARDS
ANNUAL COMPENSATION ------------------------------------
(2) NUMBER
-------------------- RESTRICTED OF SECURITIES ALL OTHER
SALARY BONUS STOCK AWARDS UNDERLYING OPTIONS COMPENSATION
NAME AND PRINCIPAL POSITION YEAR ($) ($) ($) (#) ($)(3)
- ------------------------------------------- --------- --------- --------- --------------- ------------------- -------------
<S> <C> <C> <C> <C> <C> <C>
Arthur W. Zafiropoulo (1) 1997 310,000 16,936 0 -- 7,160
Chairman of the Board, 1996 314,010 76,862 0 -- 76,862
Chief Executive Officer 1995 212,410 119,146 0 -- 119,146
and President
Daniel H. Berry 1997 178,365 10,687 0 50,000 1,768
Senior Vice President, 1996 175,000 34,888 0 -- 34,888
Sales and Service 1995 174,774 76,825 0 -- 76,825
William G. Leunis, III 1997 163,942 6,030 0 50,000 567
Senior Vice President, 1996 150,000 29,309 0 -- 29,309
Finance, Chief Financial 1995 121,136 42,575 0 -- 47,575
Officer, Secretary and
Treasurer
James L. Schram (4) 1997 120,285 -- 0 -- --
Former President 1996 242,308 59,298 0 -- --
1995 -- -- 0 -- --
</TABLE>
- ------------------------
(1) Mr. Zafiropoulo served as President of the Company until March 1996 and
reassumed the position in May 1997.
(2) Includes compensation deferred by the Named Executive Officer under the
Company's Section 401(k) Plan and Section 125 Cafeteria Benefit Plan.
(3) Represents for each Named Executive Officer the sum of the following two
amounts: (i) the individual's allocable share of the profit-sharing
contribution made by the Company to the Section 401(k) Plan for the 1997
fiscal year and (ii) 50% of the bonus earned for the 1997 fiscal year under
the Company's Executive Incentive Plan but subject to deferred payout. The
deferred portion will be distributed in four equal annual installments,
together with interest at the prime rate during the deferral period, in each
of the 1998 through 2001 calendar years, provided the Named Executive
9
<PAGE>
Officer continues in the Company's service. The amounts for each of the
years 1995 through 1997 are set forth below:
<TABLE>
<CAPTION>
DEFERRED PORTION
PROFIT-SHARING OF EXECUTIVE
CONTRIBUTION TO INCENTIVE PLAN
SECTION 401(k) PLAN BONUS
NAMED EXECUTIVE OFFICER ($) ($)
- ------------------------------------------------------------------- ------------------- -------------------
<S> <C> <C>
Mr. Zafiropoulo
1997............................................................. 0 0
1996............................................................. 4,168 63,802
1995............................................................. 8,984 110,162
Mr. Berry
1997............................................................. 0 0
1996............................................................. 4,168 29,331
1995............................................................. 7,534 69,291
Mr. Leunis
1997............................................................. 0 0
1996............................................................. 4,168 25,141
1995............................................................. 5,222 37,353
Mr. Schram
1997............................................................. 0 0
1996............................................................. 4,168 50,000
1995............................................................. -- --
</TABLE>
(4) Mr. Schram resigned from the Company on May 5, 1997.
STOCK OPTIONS
The following table provides information on the option grants made to the
Named Executive Officers during the fiscal year ended December 31, 1997. No
stock appreciation rights were granted to the Named Executive Officers during
that fiscal year.
OPTION/SAR GRANTS IN LAST FISCAL YEAR
<TABLE>
<CAPTION>
POTENTIAL REALIZABLE VALUE AT
ASSUMED ANNUAL RATES OF STOCK PRICE
APPRECIATION
INDIVIDUAL GRANTS FOR OPTION TERM (3)
- --------------------------------------------------------------------------------------------------------
(A) (B) (C) (D) (E) (F) (G)
NUMBER OF % OF TOTAL
SECURITIES OPTIONS
UNDERLYING GRANTED TO EXERCISE
OPTIONS GRANTED EMPLOYEES IN PRICE EXPIRATION 5% 10%
NAME (#)(1) FISCAL YEAR ($/SH)(2) DATE ($) ($)
- --------------------- --------------- ------------- ----------- -------------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
Arthur W.
Zafiropoulo........ -- -- -- -- -- --
Daniel H. Berry...... 50,000 4.9% 17.50 04/24/07 550,279 1,394,523
William G. Leunis,
III................ 50,000 4.9% 17.50 04/24/07 550,279 1,394,523
James L. Schram
(4)................ -- -- -- -- -- --
</TABLE>
- ------------------------
(1) The grants to Mr. Berry and Mr. Leunis were made on April 25, 1997. Each
option has a maximum term of ten (10) years measured from such grant date,
subject to earlier termination upon the optionee's cessation of service with
the Company. The shares subject to each option will vest and become
exercisable as follows: (i) twenty-four percent (24%) of the option shares
upon the optionee's completion of twelve (12) months service measured from
the grant date, and (ii) the remaining shares in a series of thirty-eight
(38) successive equal monthly installments upon the optionee's completion of
10
<PAGE>
each additional month of service thereafter. The shares subject to each
option will immediately vest in full in the event the Company is acquired by
a merger or asset sale, unless the option is assumed by the acquiring
entity.
(2) The exercise price may be paid in cash, in shares of the Company's Common
Stock valued at fair market value on the exercise date or through a cashless
exercise procedure involving a same-day sale of the purchased shares. The
Company may also finance the option exercise by loaning the optionee
sufficient funds to pay the exercise price for the purchased shares,
together with any federal and state income tax liability incurred by the
optionee in connection with such exercise.
(3) There can be no assurance provided to the option holder or any other holder
of the Company's securities that the actual stock price appreciation over
the ten (10)-year option term will be at the assumed 5% and 10% annual rates
of compounded stock price appreciation or at any other defined level.
(4) Mr. Schram resigned from the Company on May 5, 1997.
OPTION EXERCISES AND HOLDINGS
The following table sets forth certain information concerning option
exercises and holdings for the fiscal year ended December 31, 1997 with respect
to each of the Named Executive Officers. No stock appreciation rights were
exercised by the Named Executive Officers during such fiscal year, and no stock
appreciation rights were held by them at the end of such fiscal year.
AGGREGATE OPTION EXERCISES IN LAST FISCAL YEAR
AND FISCAL YEAR-END OPTION VALUES
<TABLE>
<CAPTION>
NUMBER OF SECURITIES
UNDERLYING UNEXERCISED VALUE OF UNEXERCISED
SHARES OPTIONS AT FISCAL YEAR IN-THE-MONEY OPTIONS AT
ACQUIRED ON VALUE END (#) FISCAL YEAR-END (3)
EXERCISE REALIZED ---------------------------- ------------------------------
NAME (#) ($)(1) EXERCISABLE (2) UNEXERCISABLE EXERCISABLE($) UNEXERCISABLE($)
- ------------------------------- ----------- ------------ ------------- ------------- ------------- ---------------
<S> <C> <C> <C> <C> <C> <C>
Arthur W. Zafiropoulo.......... -- -- -- -- -- --
Daniel H. Berry................ 12,500 299,750 117,600 61,600 2,180,640 140,500
William G. Leunis, III......... -- -- 90,500 61,600 1,643.383 140,500
James L. Schram (4)............ 47,500 569,969 32,500 -- 60,938 --
</TABLE>
- ------------------------
(1) Equal to the fair market value of the securities underlying the option on
the exercise date, minus the exercise price paid for those securities.
(2) Such options are immediately exercisable but subject to the repurchase by
the Company of unvested shares. Vesting in the shares will occur in a series
of successive equal monthly installments over the optionee's period of
service.
(3) Equal to the fair market value of the securities underlying the option at
fiscal year-end ($19.875 per share), less the exercise price payable for
those securities.
(4) Mr. Schram resigned from the Company on May 5, 1997.
EMPLOYMENT CONTRACTS, TERMINATION OF EMPLOYMENT AGREEMENTS AND CHANGE OF CONTROL
None of the Company's executive officers have employment agreements with the
Company, and their employment may be terminated at any time at the discretion of
the Board of Directors. However, the Compensation Committee of the Board of
Directors has the authority as plan administrator of the Company's 1993 Plan to
provide for accelerated vesting of any shares of Common Stock subject to
outstanding options held by the Chief Executive Officer and the Company's other
executive officers and any unvested shares actually held by those individuals
under the 1993 Plan, in the event their employment
11
<PAGE>
were to be terminated (whether involuntarily or through a forced resignation)
following (i) an acquisition of the Company by merger or asset sale or (ii) a
change in control of the Company effected through a successful tender offer for
more than 50% of the Company's outstanding Common Stock or through a change in
the majority of the Board as a result of one or more contested elections for
Board membership.
COMPENSATION COMMITTEE REPORT
The Compensation Committee of the Board of Directors is responsible for
establishing the base salary and incentive cash bonus programs to be in effect
for the Company's executive officers and administering certain other
compensation programs for such individuals, subject to review by the full Board.
The Compensation Committee also has the exclusive responsibility for the
administration of the Company's 1993 Stock Option/Stock Issuance Plan (the "1993
Plan") under which grants may be made to executive officers and other key
employees.
COMPENSATION PHILOSOPHY
The fundamental policy of the Compensation Committee is to provide the
Company's executive officers and other key employees with competitive
compensation opportunities based upon their contribution to the financial
success of the Company and their personal performance. It is the Compensation
Committee's objective to have a substantial portion of each officer's
compensation contingent upon the Company's performance as well as upon the
officer's own level of performance. Accordingly, the compensation package for
each executive officer and key employee is comprised of three elements: (i) base
salary which reflects individual performance and is designed primarily to be
competitive with salary levels in effect at a select group of companies with
which the Company competes for executive talent, (ii) annual variable
performance awards payable in cash and tied to the Company's achievement of
financial performance milestones, and (iii) long-term stock-based incentive
awards which strengthen the mutuality of interests between the executive
officers and the Company's stockholders. As an executive officer's level of
responsibility increases, it is the intent of the Compensation Committee to have
a greater portion of the executive officer's total compensation be dependent
upon Company performance and stock price appreciation rather than base salary.
In carrying out these objectives, the Compensation Committee takes the
following factors into consideration:
- The estimated level of compensation paid to executive officers in similar
positions by other companies within and outside the Company's industry which
compete with the Company for executive personnel.
- The individual performance of each executive officer, together with his
job knowledge and skills, demonstrated teamwork and adherence to the Company's
core values.
- The individual's level of responsibility and authority relative to other
positions within the Company.
- Corporate performance relative to competitors and business conditions and
the progress of the Company in meeting financial goals and objectives.
SPECIFIC FACTORS
The primary factors which the Compensation Committee considered in
establishing the components of each executive officer's compensation package for
the 1997 fiscal year are summarized below. The Compensation Committee may,
however, in its discretion apply different factors, particularly different
measures of financial performance, in setting executive compensation for future
fiscal years.
* BASE SALARY. The base salary levels for the executive officers was
established for the 1997 fiscal year on the basis of the following factors:
personal performance, the estimated salary levels in effect for
12
<PAGE>
similar positions at a select group of companies within and outside the
Company's industry with which the Company competes for executive talent, and
internal comparability considerations. The Compensation Committee also relied
upon specific compensation surveys for comparative compensation purposes. The
Compensation Committee made its decisions as to the appropriate market level of
base salary for each executive officer on the basis of its understanding of the
salary levels in effect for similar positions at those companies with which the
Company competes for executive talent. Base salaries will be reviewed on an
annual basis, and adjustments will be made in accordance with the factors
indicated above.
* PROFIT SHARING PLAN. The Company annually distributes a profit sharing
bonus to all eligible employees, including the executive officers, based on the
level of the Company's operating earnings for the fiscal year in comparison to
the targeted levels established by the Compensation Committee at the start of
the year. One-half of the distribution is paid as a current cash bonus, and the
remainder is contributed on the individual's behalf to his or her profit-sharing
account under the Company's Section 401(k) Plan for subsequent distribution
following his or her termination of employment. Accordingly, the bonuses under
the profit sharing plan are tied solely to the Company's success in achieving
the targeted levels of operating earnings. For the 1997 fiscal year, no
employees, including the executive officers, received a distribution.
* ANNUAL INCENTIVE COMPENSATION. Each executive officer may also earn an
incentive bonus each fiscal year on the basis of the Company's achievement of
certain performance milestones established by the Compensation Committee at the
start of that year. For fiscal year 1997, the performance milestones were based
on the Company's operating earnings. Accordingly, this element of executive
compensation is also earned on the basis of the achievement of certain specific
objectives. No executive officers received an incentive bonus for the 1997
fiscal year.
It is the Compensation Committee's estimate (on the basis of 1997 surveys of
1996 executive compensation) that the total cash compensation earned by the
Company's executive officers for the 1997 fiscal year was in the 10th percentile
of the total cash compensation earned by the executive officers in comparable
positions at the principal companies with which the Company competes for
executive talent.
* EQUITY INCENTIVES. Equity incentives are provided primarily through
stock option grants under the 1993 Plan. The grants are designed to align the
interests of each executive officer with those of the stockholders and provide
each individual with a significant incentive to manage the Company from the
perspective of an owner with an equity stake in the business. Each grant allows
the individual to acquire shares of the Company's Common Stock at a fixed price
per share (the market price on the grant date) over a specified period of time
(up to 10 years). The shares subject to each option generally vest in
installments over approximately a fifty-month period, contingent upon the
executive officer's continued employment with the Company. Accordingly, the
option will provide a return to the executive officer only if the executive
officer remains employed by the Company during the applicable vesting period,
and then only if the market price of the underlying shares appreciates over the
option term.
The number of shares subject to each option grant will be set at a level
intended to create a meaningful opportunity for stock ownership based on the
officer's current position with the Company, the base salary associated with
that position, the size of comparable awards made to individuals in similar
positions within the industry, the individual's potential for increased
responsibility and promotion over the option term, and the individual's personal
performance in recent periods. The Compensation Committee will also take into
account the executive officer's existing holdings of the Company's Common Stock
and the number of vested and unvested options held by that individual in order
to maintain an appropriate level of equity incentive. However, the Compensation
Committee does not intend to adhere to any specific guidelines as to the
relative option holdings of the Company's executive officers.
Because of Mr. Zafiropoulo's significant holdings of the Company's Common
Stock by reason of the restricted stock issuances and stock option grants made
to him prior to the completion of the initial public offering of the Company's
Common Stock, the Compensation Committee did not believe it necessary to provide
him with any additional equity incentives during the 1997 fiscal year. However,
as set forth under
13
<PAGE>
"Executive Compensation and Related Information -- Stock Options," the
Compensation Committee did grant to each of Messrs. Berry and Leunis options to
purchase 50,000 shares of Common Stock in the 1997 fiscal year.
CEO COMPENSATION
In setting the compensation payable to the Company's Chief Executive
Officer, Mr. Arthur W. Zafiropoulo, for the 1997 fiscal year, the Compensation
Committee has sought to be competitive with the peer group companies, while at
the same time tying a significant percentage of his compensation to Company
performance. It is the Committee's intent to provide Mr. Zafiropoulo with a
level of stability and certainty each year with respect to base salary and not
to have this particular component of compensation affected to any significant
degree by Company performance factors. Because the Company did not achieve the
operating earnings target for the 1997 fiscal year, Mr. Zafiropoulo did not
receive any profit-sharing or other incentive awards for such year. In addition,
by reason of his substantial holdings of the Company's Common Stock, the
Compensation Committee decided not to award Mr. Zafiropoulo any equity
incentives during that year.
For the 1997 fiscal year, the Compensation Committee believes (on the basis
of 1997 surveys of 1996 executive compensation) that the total cash compensation
earned by Mr. Zafiropoulo was at the 10th percentile of the total cash
compensation earned by chief executive officers at the principal companies with
which the Company competes for executive talent.
COMPLIANCE WITH INTERNAL REVENUE CODE SECTION 162(m)
Section 162(m) of the Internal Revenue Code, enacted in 1993, generally
disallows a tax deduction to publicly held companies for compensation exceeding
$1 million paid to certain of the corporation's executive officers. The
limitation applies only to compensation which is not considered to be
performance-based. The non-performance based compensation to be paid to the
Company's executive officers for the 1997 fiscal year did not exceed the $1
million limit per officer, nor is it expected that the non-performance based
compensation to be paid to the Company's executive officers for fiscal 1998 will
exceed that limit. The Company's 1993 Plan is structured so that any
compensation deemed paid to an executive officer in connection with the exercise
of option grants made under that plan will qualify as performance-based
compensation and will therefore not be subject to the $1 million limitation.
Because it is very unlikely that the cash compensation payable to any of the
Company's executive officers in the foreseeable future will approach the $1
million limit, the Compensation Committee has decided at this time not to take
any other action to limit or restructure the elements of cash compensation
payable to the Company's executive officers. The Compensation Committee will
reconsider this decision should the individual compensation of any executive
officer ever approach the $1 million level.
The Compensation Committee believes that the executive compensation policies
and programs in effect for the Company's executive officers provide an
appropriate level of total remuneration which properly aligns the Company's
performance and the interests of the Company's stockholders with competitive and
equitable executive compensation in a balanced and reasonable manner, for both
the short and long-term.
<TABLE>
<S> <C>
Joel F. Gemunder Gregory Harrison
Member of Compensation Committee Member and Chairman, Compensation Committee
</TABLE>
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
No member of the Compensation Committee is a former or current officer or
employee of the Company or any of its subsidiaries. No executive officer of the
Company serves as a member of the board of directors or compensation committee
of any entity which has one or more executive officers serving as a member of
the Company's Board of Directors or Compensation Committee.
14
<PAGE>
STOCK PERFORMANCE GRAPH
The graph depicted below reflects a comparison of the cumulative total
return (change in stock price plus reinvestment of dividends) of the Company's
Common Stock assuming $100 invested as of September 29, 1993 with the cumulative
total returns of the Nasdaq Stock Market Index and the Hambrecht & Quist
Semiconductor Index.
COMPARISON OF CUMULATIVE TOTAL RETURNS (1)(2)(3)
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
ULTRATECH STEPPER,
INC. THE NASDAQ STOCK MARKET (US) HAMBRECHT & QUIST SEMICONDUCTOR INDEX
<S> <C> <C> <C>
Sept. 29, 1993 $100.000 $100.000 $100.000
Dec. 31, 1993 $98.000 $101.986 $88.753
Mar. 31, 1994 $136.000 $97.680 $100.273
Jun. 30, 1994 $102.667 $93.113 $94.203
Sept.30, 1994 $192.000 $100.822 $102.949
Dec.31, 1994 $202.667 $99.672 $108.696
Mar. 31, 1995 $259.333 $108.361 $131.325
Jun. 30, 1995 $376.000 $124.292 $184.732
Sept.30, 1995 $450.667 $139.263 $208.774
Dec. 31, 1995 $274.667 $140.962 $151.693
Mar. 31, 1996 $188.000 $147.537 $143.263
Jun. 30, 1996 $200.000 $159.560 $137.308
Sept.30, 1996 $196.000 $165.254 $155.870
Dec. 31, 1996 $253.333 $173.376 $196.459
Mar. 31, 1997 $236.000 $163.979 $220.798
Jun. 30, 1997 $244.000 $194.036 $249.004
Sept.30, 1997 $362.667 $226.859 $311.285
Dec. 31, 1997 $212.000 $212.755 $207.191
</TABLE>
- ------------------------
(1) The graph covers the period from September 29, 1993, the date the Company's
initial public offering commenced, through the fiscal year ended December
31, 1997.
(2) No cash dividends have been declared on the Company's Common Stock.
(3) Stockholder returns over the indicated period should not be considered
indicative of future stockholder returns.
NOTWITHSTANDING ANYTHING TO THE CONTRARY SET FORTH IN ANY OF THE COMPANY'S
PREVIOUS FILINGS UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR THE SECURITIES
EXCHANGE ACT OF 1934, AS AMENDED, WHICH MIGHT INCORPORATE FUTURE FILINGS MADE BY
THE COMPANY UNDER THOSE STATUTES, NEITHER THE PRECEDING COMPENSATION COMMITTEE
REPORT ON EXECUTIVE COMPENSATION NOR THE STOCK PRICE PERFORMANCE GRAPH WILL BE
INCORPORATED BY REFERENCE INTO ANY OF THOSE PRIOR FILINGS, NOR WILL SUCH REPORT
OR GRAPH BE INCORPORATED BY REFERENCE INTO ANY FUTURE FILINGS MADE BY THE
COMPANY UNDER THOSE STATUTES.
CERTAIN TRANSACTIONS
The Company's Amended and Restated Certificate of Incorporation and Bylaws
provide for indemnification of all directors and officers. In addition, each
director and officer of the Company has entered into a separate indemnification
agreement with the Company.
The Board of Directors has adopted a policy that all material transactions
with affiliates will be on terms no less favorable to the Company than those
available from unaffiliated third parties and will be approved by a majority of
the disinterested members of the Board of Directors.
15
<PAGE>
COMPLIANCE WITH SECTION 16(a) OF THE SECURITIES EXCHANGE ACT OF 1934
Section 16(a) of the Securities Exchange Act of 1934 requires the Company's
directors, executive officers and any persons who are the beneficial owners of
more than ten percent of the Company's Common Stock to file reports of ownership
and changes in ownership with the SEC. Such directors, officers and greater than
ten percent beneficial stockholders are required by SEC regulations to furnish
the Company with copies of all Section 16(a) forms they file.
Based solely on its review of the copies of such forms received by it and
written representations from reporting persons for the 1997 fiscal year, the
Company believes that all of the Company's executive officers, directors and
greater than ten percent beneficial stockholders complied with all applicable
Section 16(a) filing requirements for the 1997 fiscal year, except that Mr.
Carter was late in filing a Form 3 relating to his appointment to the Board of
Directors on September 4, 1997 and a Form 4 relating to his receipt on September
4, 1997 of an option to purchase 12,000 shares of the Company's Common Stock.
The Form 3 and Form 4 reports were filed on October 24, 1997 and October 27,
1997, respectively.
ANNUAL REPORT
A copy of the Annual Report of the Company for the fiscal year ended
December 31, 1997 has been mailed concurrently with this Proxy Statement to all
stockholders entitled to notice of and to vote at the Annual Meeting. Except for
"Executive Officers of the Registrant" from Part I of the Company's Annual
Report on Form 10-K for the fiscal year ended December 31, 1997, the Annual
Report is not incorporated into this Proxy Statement and is not considered proxy
solicitation material.
The Board of Directors of
Ultratech Stepper, Inc.
Dated: April 27, 1998
16
<PAGE>
AMENDED AND RESTATED
CERTIFICATE OF INCORPORATION
OF
ULTRATECH STEPPER, INC.
A Delaware corporation
(Pursuant to Sections 242 and 245
of the Delaware General Corporation Law)
ULTRATECH STEPPER, INC., a corporation organized and existing under
and by virtue of the General Corporation Law of the State of Delaware,
originally incorporated on September 21, 1992, under the name UTS Acquisition
Corporation, hereby certifies as follows:
ONE: The Amended and Restated Certificate of Incorporation of said
corporation shall be further amended to read in full as follows:
ARTICLE I
The name of the corporation is Ultratech Stepper, Inc.
ARTICLE II
The address of the registered office of this corporation in the
State of Delaware is 32 Loockerman Square, Suite L-100 in the City of Dover,
County of Kent. The name of its registered agent at such address is The
Prentice-Hall Corporation System, Inc.
ARTICLE III
The nature of the business or purposes to be conducted or promoted
is to engage in any lawful act or activity for which corporations may be
organized under the General Corporation Law of Delaware.
ARTICLE IV
This corporation is authorized to issue two classes of stock to be
designated common stock ("Common Stock") and preferred stock ("Preferred
Stock"). The number of shares of Common Stock authorized to be issued is
Twenty Million (20,000,000), par value $0.001 per share, and the number of
shares of Preferred Stock authorized to be issued is Two Million (2,000,000),
par value $0.001 per share.
The Preferred Stock may be issued from time to time in one or more
series, without further stockholder approval. The Board of Directors is
hereby authorized, in the resolution or resolutions adopted by the Board of
Directors providing for the issue of any wholly unissued series of Preferred
Stock, within the limitations and restrictions stated in this Amended and
Restated Certificate of Incorporation, to fix or alter the dividend rights,
dividend rate, conversion rights, voting rights, rights and terms of
redemption (including sinking fund
<PAGE>
provisions), the redemption price or prices, and the liquidation preferences
of any wholly unissued series of Preferred Stock, and the number of shares
constituting any such series and the designation thereof, or any of them, and
to increase or decrease the number of shares of any series subsequent to the
issue of shares of that series, but not below the number of shares of such
series then outstanding. In case the number of shares of any series shall be
so decreased, the shares constituting such decrease shall resume the status
which they had prior to the adoption of the resolution originally fixing the
number of shares of such series.
ARTICLE V
Except as otherwise provided in this Amended and Restated
Certificate of Incorporation, in furtherance and not in limitation of the
powers conferred by statute, the Board of Directors is expressly authorized
to make, repeal, alter, amend, and rescind any or all of the Bylaws of this
corporation.
ARTICLE VI
At each annual meeting of stockholders, directors of the
corporation shall be elected to hold office until the expiration of the term
for which they are elected, and until their successors have been duly elected
and qualified; except that if any such election shall not be so held, such
election shall take place at a stockholders' meeting called and held in
accordance with the Delaware General Corporation Law. The directors of the
corporation shall be divided into two classes as nearly equal in size as is
practicable, hereby designated Class I and Class II. The term of office of
the initial Class I directors shall expire at the next succeeding annual
meeting of stockholders and the term of office of the initial Class II
directors shall expire at the second succeeding annual meeting of
stockholders. For the purposes hereof, the initial Class I and Class II
directors shall be those directors so nominated and elected at the next
annual meeting of stockholders after the filing of this Amended and Restated
Certificate of Incorporation. At each annual meeting of stockholders
thereafter, directors to replace those of a Class whose terms expire at such
annual meeting shall be elected to hold office until the second succeeding
annual meeting and until their respective successors shall have been duly
elected and qualified. If the number of directors is hereafter changed, any
newly created directorships or decrease in directorships shall be so
apportioned among the classes as to make all classes as nearly equal in
number as is practicable.
The number of directors which constitute the whole board of
directors of the corporation shall be designated in the bylaws of the
corporation. Vacancies occurring on the board of directors for any reason
may be filled by vote of a majority of the remaining members of the board of
directors, although less than a quorum, at any meeting of the board of
directors. A person so elected by the board of directors to fill a vacancy
shall hold office until the next succeeding annual meeting of stockholders of
the corporation and until his or her successor shall have been duly elected
and qualified.
2
<PAGE>
ARTICLE VII
Elections of directors need not be by written ballot unless the
Bylaws of this corporation shall so provide.
ARTICLE VIII
Meetings of stockholders may be held within or without the State of
Delaware, as the Bylaws may provide. The books of this corporation may be
kept (subject to any provision contained in the statutes) outside the State
of Delaware at such place or places as may be designated from time to time by
the Board of Directors or in the Bylaws of this corporation.
ARTICLE IX
A director of this corporation shall not be personally liable to
this corporation or its stockholders for monetary damages for breach of
fiduciary duty as a director, except for liability (i) for any breach of the
director's duty of loyalty to the corporation or its stockholders, (ii) under
Section 174 of the Delaware General Corporation Law, or (iii) for any
transaction from which the director derived any improper personal benefit.
If the Delaware General Corporation Law is amended after approval by the
stockholders of this Article IX to authorize corporation action further
eliminating or limiting the personal liability of directors, then the
liability of a director of this corporation shall be eliminated or limited to
the fullest extent permitted by the Delaware General Corporation Law as so
amended.
Any repeal or modification of the foregoing provisions of this
Article IX by the stockholders of the corporation shall not adversely affect
any right or protection of a director of this corporation existing at the
time of such repeal or modification.
ARTICLE X
No action required to be taken or which may be taken at any annual
or special meeting of the stockholders of the corporation may be taken
without a meeting, and the power of stockholders to consent in writing,
without a meeting, to the taking of any action is specifically denied.
ARTICLE XI
This corporation reserves the right to amend, alter, change or
repeal any provision contained in this Amended and Restated Certificate of
Incorporation, in the manner now or hereafter prescribed by statute, and all
rights conferred upon stockholders herein are granted subject to this
reservation.
* * * *
3
<PAGE>
TWO: The Amended and Restated Certificate of Incorporation as set
forth above has been duly adopted by this corporation's Board of Directors
and stockholders in accordance with the provisions of Section 242 of the
General Corporation Law of the State of Delaware.
IN WITNESS WHEREOF, ULTRATECH STEPPER, INC. has caused its
corporate seal to be hereunto affixed and this Amended and Restated
Certificate of Incorporation to be signed by its President and attested to by
its Secretary this 30th day of September, 1993.
ULTRATECH STEPPER, INC.
/s/ Arthur W. Zafiropoulo
-------------------------------------
Arthur W. Zafiropoulo, President
ATTEST
/s/ William G. Leunis, III
- -------------------------------------
William G. Leunis, III, Secretary
4
<PAGE>
CERTIFICATE OF AMENDMENT OF THE AMENDED AND
RESTATED CERTIFICATE OF INCORPORATION OF
ULTRATECH STEPPER, INC.
Ultratech Stepper, Inc., a corporation organized and existing under the
General Corporation Law of the State of Delaware (the "Corporation") DOES
HEREBY CERTIFY:
FIRST: That the Board of Directors of the Corporation duly adopted a
resolution setting forth a proposed amendment to the Amended and Restated
Certificate of Incorporation of the Corporation and declaring said amendment
advisable and directing that said amendment be submitted to the stockholders
of said Corporation entitled to vote in respect thereof for their approval.
The resolution setting forth said amendment is a follows:
RESOLVED, that the Amended and Restated Certificate of Incorporation of
the Corporation be amended by changing Article IV thereof so that, as
amended, said provision shall be and read in its entirety as follows:
ARTICLE IV
This corporation is authorized to issue two classes of stock to be
designated common stock ("Common Stock") and preferred stock ("Preferred
Stock"). The number of shares of Common Stock authorized to be issued is
Thirty Million (30,000,000), par value $0.001 per share, and the number of
shares of Preferred Stock authorized to be issued is Two Million (2,000,000),
par value $0.001 per share.
The Preferred Stock may be issued from time to time in one or more
series, without further stockholder approval. The Board of Directors is
hereby authorized, in the resolution or resolutions adopted by the Board of
Directors providing for the issue of any wholly unissued series of Preferred
Stock, within the limitations and restrictions stated in this Amended and
Restated Certificate of Incorporation, to fix or alter the divided rights,
dividend rate, conversion rights, voting rights, rights and terms of
redemption (including sinking fund provisions), the redemption price or
prices, and the liquidation preferences of any wholly unissued series of
Preferred Stock, and the number of shares constituting any such series and
the designation thereof, or any of them, and to increase or decrease the
number of shares of
<PAGE>
any series subsequent to the issue of shares of that series, but not below
the number of shares of such series then outstanding. In case the number of
shares of any series shall be so decreased, the shares constituting such
decrease shall resume the status which they had prior to the adoption of the
resolution originally fixing the number of shares of such series.
SECOND: That thereafter said amendment was duly adopted in accordance
with the provisions of Section 242 of the General Corporation Law of the
State of Delaware.
2
<PAGE>
IN WITNESS WHEREOF, this Certificate of Amendment of the Amended and
Restated Certificate of Incorporation has been signed by the President and
the Secretary of the Corporation this 17th day of May, 1995.
ULTRATECH STEPPER, INC.
By: /s/ Arthur W. Zafiropoulo
----------------------------------
Arthur W. Zafiropoulo, President
ATTEST:
By: /s/ William G. Leunis, III
-------------------------------
William G. Leunis, III,
Secretary
<PAGE>
CERTIFICATE OF DESIGNATION
of
SERIES A JUNIOR PARTICIPATING PREFERRED STOCK
of
ULTRATECH STEPPER, INC.
(Pursuant to Section 151 of the
Delaware General Corporation Law)
-----------------------------------
Ultratech Stepper, Inc., a corporation organized and existing under the
General Corporation Law of the State of Delaware (hereinafter called the
"Corporation"), hereby certifies that the following resolution was adopted by
the Board of Directors of the Corporation as required by Section 151 of the
General Corporation Law at a meeting duly called and held on January 28, 1997:
RESOLVED, that pursuant to the authority granted to and vested in the
Board of Directors of the Corporation (hereinafter called the "Board of
Directors" or the "Board") in accordance with the provisions of the
Certificate of Incorporation, the Board of Directors hereby creates a series
of Preferred Stock, par value $.001 per share (the "Preferred Stock"), of the
Corporation and hereby states the designation and number of shares, and fixes
the relative rights, preferences, and limitations thereof as follows:
Series A Junior Participating Preferred Stock:
Section 1. DESIGNATION AND AMOUNT. The shares of such series shall be
designated as "Series A Junior Participating Preferred Stock" (the "Series A
Preferred Stock") and the number of shares constituting the Series A
Preferred Stock shall be Three Hundred Fifty Thousand (350,000). Such number
of shares may be increased or decreased by resolution of the Board of
Directors; PROVIDED, that no decrease shall reduce the number of shares of
Series A Preferred Stock to a number less than the number of shares then
outstanding plus the number of shares reserved for issuance upon the exercise
of outstanding options, rights or warrants or upon the conversion of any
outstanding securities issued by the Corporation which are convertible into
Series A Preferred Stock.
<PAGE>
Section 2. DIVIDENDS AND DISTRIBUTIONS.
(A) Subject to the rights of the holders of any shares of any
series of Preferred Stock (or any similar stock) ranking prior and
superior to the Series A Preferred Stock with respect to dividends, the
holders of shares of Series A Preferred Stock, in preference to the
holders of the Common Stock, par value $.001 per share (the "Common
Stock"), of the Corporation, and of any other junior stock, shall be
entitled to receive, when, as and if declared by the Board of Directors
out of funds legally available for the purpose, quarterly dividends
payable in cash on the first day of March, June, September and December
in each year (each such date being referred to herein as a "Quarterly
Dividend Payment Date"), commencing on the first Quarterly Dividend
Payment Date after the first issuance of a share or fraction of a share
of Series A Preferred Stock, in an amount per share (rounded to the
nearest cent) equal to, subject to the provision for adjustment
hereinafter set forth, 100 times the aggregate per share amount of all
cash dividends, and 100 times the aggregate per share amount (payable in
kind) of all non-cash dividends or other distributions, other than a
dividend payable in shares of Common Stock or a subdivision of the
outstanding shares of Common Stock (by reclassification or otherwise),
declared on the Common Stock since the immediately preceding Quarterly
Dividend Payment Date or, with respect to the first Quarterly Dividend
Payment Date, since the first issuance of any share or fraction of a
share of Series A Preferred Stock. In the event the Corporation shall
at any time declare or pay any dividend on the Common Stock payable in
shares of Common Stock, or effect a subdivision or combination or
consolidation of the outstanding shares of Common Stock (by
reclassification or otherwise than by payment of a dividend in shares of
Common Stock) into a greater or lesser number of shares of Common Stock,
then in each such case the amount to which holders of shares of Series A
Preferred Stock were entitled immediately prior to such event under
clause (b) of the preceding sentence shall be adjusted by multiplying
such amount by a fraction, the numerator of which is the number of
shares of Common Stock outstanding immediately after such event and the
denominator of which is the number of shares of Common Stock that were
outstanding immediately prior to such event.
(B) The Corporation shall declare a dividend or distribution on
the Series A Preferred Stock as provided in paragraph (A) of this
Section immediately after it declares a dividend or distribution on the
Common Stock (other than a dividend payable in shares of Common Stock).
(C) Dividends shall begin to accrue and be cumulative on
outstanding shares of Series A Preferred Stock from the Quarterly
Dividend Payment Date next preceding the date of issue of such shares,
unless the date of issue of such shares is prior to the record date for
the first Quarterly Dividend Payment Date, in which case dividends on
such shares shall begin to accrue from the date of issue of such shares,
or unless the date of issue is a Quarterly Dividend Payment Date or is a
date after the record date for the determination of holders of shares of
Series A Preferred Stock entitled to receive a quarterly dividend and
before such Quarterly Dividend Payment Date, in either of which
2
<PAGE>
events such dividends shall begin to accrue and be cumulative from such
Quarterly Dividend Payment Date. Accrued but unpaid dividends shall not
bear interest. Dividends paid on the shares of Series A Preferred Stock
in an amount less than the total amount of such dividends at the time
accrued and payable on such shares shall be allocated pro rata on a
share-by-share basis among all such shares at the time outstanding. The
Board of Directors may fix a record date for the determination of
holders of shares of Series A Preferred Stock entitled to receive
payment of a dividend or distribution declared thereon, which record
date shall be not more than 60 days prior to the date fixed for the
payment thereof.
Section 3. VOTING RIGHTS. The holders of shares of Series A Preferred
Stock shall have the following voting rights:
(A) Subject to the provision for adjustment hereinafter set
forth, each share of Series A Preferred Stock shall entitle the holder
thereof to 100 votes on all matters submitted to a vote of the
stockholders of the Corporation. In the event the Corporation shall at
any time declare or pay any dividend on the Common Stock payable in
shares of Common Stock, or effect a subdivision or combination or
consolidation of the outstanding shares of Common Stock (by
reclassification or otherwise than by payment of a dividend in shares of
Common Stock) into a greater or lesser number of shares of Common Stock,
then in each such case the number of votes per share to which holders of
shares of Series A Preferred Stock were entitled immediately prior to
such event shall be adjusted by multiplying such number by a fraction,
the numerator of which is the number of shares of Common Stock
outstanding immediately after such event and the denominator of which is
the number of shares of Common Stock that were outstanding immediately
prior to such event.
(B) Except as otherwise provided herein, in any other Certificate
of Designation creating a series of Preferred Stock or any similar
stock, or by law, the holders of shares of Series A Preferred Stock and
the holders of shares of Common Stock and any other capital stock of the
Corporation having general voting rights shall vote together as one
class on all matters submitted to a vote of stockholders of the
Corporation.
(C) Except as set forth herein, or as otherwise provided by law,
holders of Series A Preferred Stock shall have no special voting rights
and their consent shall not be required (except to the extent they are
entitled to vote with holders of Common Stock as set forth herein) for
taking any corporate action.
3
<PAGE>
Section 4. CERTAIN RESTRICTIONS.
(A) Whenever quarterly dividends or other dividends or distributions
payable on the Series A Preferred Stock as provided in Section 2 are in
arrears, thereafter and until all accrued and unpaid dividends and
distributions, whether or not declared, on shares of Series A Preferred Stock
outstanding shall have been paid in full, the Corporation shall not:
(i) declare or pay dividends, or make any other distributions, on
any shares of stock ranking junior (either as to dividends or upon
liquidation, dissolution or winding up) to the Series A Preferred Stock;
(ii) declare or pay dividends, or make any other distributions, on
any shares of stock ranking on a parity (either as to dividends or upon
liquidation, dissolution or winding up) with the Series A Preferred Stock,
except dividends paid ratably on the Series A Preferred Stock and all such
parity stock on which dividends are payable or in arrears in proportion to
the total amounts to which the holders of all such shares are
then entitled;
(iii) redeem or purchase or otherwise acquire for consideration
shares of any stock ranking junior (either as to dividends or upon
liquidation, dissolution or winding up) to the Series A Preferred Stock,
provided that the Corporation may at any time redeem, purchase or otherwise
acquire shares of any such junior stock in exchange for shares of any
stock of the Corporation ranking junior (either as to dividends or upon
dissolution, liquidation or winding up) to the Series A Preferred Stock;
or
(iv) redeem or purchase or otherwise acquire for consideration any
shares of Series A Preferred Stock, or any shares of stock ranking on a
parity with the Series A Preferred Stock, except in accordance with a
purchase offer made in writing or by publication (as determined by the
Board of Directors) to all holders of such shares upon such terms as
the Board of Directors, after consideration of the respective annual
dividend rates and other relative rights and preferences of the
respective series and classes, shall determine in good faith will
result in fair and equitable treatment among the respective series
or classes.
(B) The Corporation shall not permit any subsidiary of the Corporation
to purchase or otherwise acquire for consideration any shares of stock of the
Corporation unless the Corporation could, under paragraph (A) of this Section
4, purchase or otherwise acquire such shares at such time and in such manner.
4
<PAGE>
Section 5. REACQUIRED SHARES. Any shares of Series A Preferred Stock
purchased or otherwise acquired by the Corporation in any manner whatsoever
shall be retired and cancelled promptly after the acquisition thereof. All
such shares shall upon their cancellation become authorized but unissued
shares of Preferred Stock and may be reissued as part of a new series of
Preferred Stock subject to the conditions and restrictions on issuance set
forth herein, in the Certificate of Incorporation, or in any other
Certificate of Designation creating a series of Preferred Stock or any
similar stock or as otherwise required by law.
Section 6. LIQUIDATION, DISSOLUTION OR WINDING UP. Upon any liquidation,
dissolution or winding up of the Corporation, no distribution shall be made
(1) to the holders of shares of stock ranking junior (either as to dividends
or upon liquidation, dissolution or winding up) to the Series A Preferred
Stock unless, prior thereto, the holders of shares of Series A Preferred
Stock shall have received $100 per share, plus an amount equal to accrued and
unpaid dividends and distributions thereon, whether or not declared, to the
date of such payment, provided that the holders of shares of Series A
Preferred Stock shall be enti-tled to receive an aggregate amount per share,
subject to the provision for adjustment hereinafter set forth, equal to 100
times the aggregate amount to be distributed per share to holders of shares
of Common Stock, or (2) to the holders of shares of stock ranking on a parity
(either as to dividends or upon liquidation, dissolution or winding up) with
the Series A Preferred Stock, except distributions made ratably on the Series
A Preferred Stock and all such parity stock in proportion to the total
amounts to which the holders of all such shares are entitled upon such
liquidation, dissolution or winding up. In the event the Corporation shall
at any time declare or pay any dividend on the Common Stock payable in shares
of Common Stock, or effect a subdivision or combination or consolidation of
the outstanding shares of Common Stock (by reclassification or otherwise than
by payment of a dividend in shares of Common Stock) into a greater or lesser
number of shares of Common Stock, then in each such case the aggregate amount
to which holders of shares of Series A Preferred Stock were entitled
immediately prior to such event under the proviso in clause (1) of the
preceding sentence shall be adjusted by multiplying such amount by a fraction
the numerator of which is the number of shares of Common Stock outstanding
immediately after such event and the denominator of which is the number of
shares of Common Stock that were outstanding immediately prior to such event.
Section 7. CONSOLIDATION, MERGER, ETC. In case the Corporation shall
enter into any consolidation, merger, combination or other transaction in
which the shares of Common Stock are exchanged for or changed into other
stock or securities, cash and/or any other property, then in any such case
each share of Series A Preferred Stock shall at the same time be similarly
exchanged or changed into an amount per share, subject to the provision for
adjustment hereinafter set forth, equal to 100 times the aggregate amount of
stock, securities, cash and/or any other property (payable in kind), as the
case may be, into which or for which each share of Common Stock is changed or
exchanged. In the event the Corporation shall at any time declare or pay any
dividend on the Common Stock payable in shares of Common Stock, or effect a
subdivision or combination or consolidation of the outstanding shares of
Common Stock (by reclassification or otherwise than by payment of a dividend
in shares of Common Stock) into a greater or lesser number of shares of
Common Stock, then in each such case the amount set forth
5
<PAGE>
in the preceding sentence with respect to the exchange or change of
shares of Series A Preferred Stock shall be adjusted by multiplying such
amount by a fraction, the numerator of which is the number of shares of
Common Stock outstanding immediately after such event and the denominator of
which is the number of shares of Common Stock that were outstanding
immediately prior to such event.
Section 8. NO REDEMPTION. The shares of Series A Preferred Stock shall
not be redeemable.
Section 9. RANK. The Series A Preferred Stock shall rank, with respect
to the payment of dividends and the distribution of assets, junior to all
series of any other class of the Corporation's Preferred Stock.
Section 10. AMENDMENT. The Certificate of Incorporation of the
Corporation shall not be amended in any manner which would materially alter
or change the powers, preferences or special rights of the Series A Preferred
Stock so as to affect them adversely without the affirmative vote of the
holders of at least a majority of the outstanding shares of Series A
Preferred Stock, voting together as a single class.
IN WITNESS WHEREOF, this Certificate of Designation is executed on
behalf of the Corporation by its Chairman, President and Chief Executive
Officer and attested to by its Secretary this 13th day of February, 1997.
/s/Arthur W. Zafiropoulo
----------------------------
Name: Arthur W. Zafiropoulo
Title: Chairman, President and
Chief Executive Officer
Attest:
/s/William G. Leunis, III
- --------------------------
William G. Leunis, III
Secretary
6
<PAGE>
CERTIFICATE OF AMENDMENT OF THE AMENDED AND
RESTATED CERTIFICATE OF INCORPORATION OF
ULTRATECH STEPPER, INC.
Ultratech Stepper, Inc., a corporation organized and existing under the
General Corporation Law of the State of Delaware (the "Corporation") DOES
HEREBY CERTIFY:
FIRST: That the Board of Directors of the Corporation duly adopted a
resolution setting forth a proposed amendment to the Amended and Restated
Certificate of Incorporation of the Corporation and declaring said amendment
advisable and directing that said amendment be submitted to the stockholders
of said Corporation entitled to vote in respect thereof for their approval.
The resolution setting forth said amendment is as follows:
RESOLVED, that the Amended and Restated Certificate of Incorporation of
the Corporation be amended by changing Article IV thereof so that, as
amended, said provision shall be and read in its entirety as follows:
ARTICLE IV
This corporation is authorized to issue two classes of stock to be
designated common stock ("Common Stock") and preferred stock ("Preferred
Stock"). The number of shares of Common Stock authorized to be issued is
Forty Million (40,000,000), par value $0.001 per share, and the number of
shares of Preferred Stock authorized to be issued is Two Million (2,000,000),
par value $0.001 per share.
The Preferred Stock may be issued from time to time in one or more
series, without further stockholder approval. The Board of Directors is
hereby authorized, in the resolution or resolutions adopted by the Board of
Directors providing for the issue of any wholly unissued series of Preferred
Stock, within the limitations and restrictions stated in this Amended and
Restated Certificate of Incorporation, to fix or alter the divided rights,
dividend rate, conversion rights, voting rights, rights and terms of
redemption (including sinking fund provisions), the redemption price or
prices, and the liquidation preferences of any wholly unissued series of
Preferred Stock, and the number of shares constituting any such series and
the designation thereof, or any of them, and to increase or decrease the
number of shares of any series subsequent to the issue of shares of that
series, but not below the number of shares
<PAGE>
of such series then outstanding. In case the number of shares of any series
shall be so decreased, the shares constituting such decrease shall resume the
status which they had prior to the adoption of the resolution originally
fixing the number of shares of such series.
SECOND: That thereafter said amendment was duly adopted in accordance
with the provisions of Section 242 of the General Corporation Law of the
State of Delaware.
2
<PAGE>
IN WITNESS WHEREOF, this Certificate of Amendment of the Amended and
Restated Certificate of Incorporation has been signed by the President and
the Secretary of the Corporation this _____ day of April, 1998.
ULTRATECH STEPPER, INC.
By:
------------------------------------
Arthur W. Zafiropoulo, President
ATTEST:
By:
-------------------------------
William G. Leunis, III,
Secretary
