<PAGE> 1
As filed with the Securities and Exchange Commission on December 27, 1999
Registration No. 333-______
================================================================================
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM S-8
REGISTRATION STATEMENT
Under
The Securities Act of 1933
ULTRATECH STEPPER, INC.
(Exact name of registrant as specified in its charter)
DELAWARE 94-3169580
(State or other jurisdiction (IRS Employer Identification No.)
of incorporation or organization)
3050 ZANKER ROAD, SAN JOSE, CALIFORNIA 95134
(Address of principal executive offices) (Zip Code)
ULTRATECH STEPPER, INC.
1998 SUPPLEMENTAL STOCK OPTION/STOCK ISSUANCE PLAN
(Full title of the Plan)
ARTHUR W. ZAFIROPOULO
CHAIRMAN OF THE BOARD AND CHIEF EXECUTIVE OFFICER
ULTRATECH STEPPER, INC.
3050 ZANKER ROAD, SAN JOSE, CALIFORNIA 95134
(Name and address of agent for service)
(408) 321-8835
(Telephone number, including area code, of agent for service)
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
=====================================================================================================================
Proposed Proposed
Title of Amount Maximum Maximum
Securities to be Offering Aggregate Amount of
to be Registered(1) Price Offering Registration
Registered per Share(2) Price(2) Fee
- ------------------------------ -------------- ------------ --------- ------------
<S> <C> <C> <C> <C>
1998 Supplemental Stock 400,000 shares $17.4375 $6,975,000 $1,841.40
Option/Stock Issuance Plan
Common Stock, $0.001 par value
=====================================================================================================================
</TABLE>
(1) This Registration Statement shall also cover any additional shares of
Common Stock which become issuable under the Ultratech Stepper, Inc. 1998
Supplemental Stock Option/Stock Issuance Plan by reason of any stock
dividend, stock split, recapitalization or other similar transaction
effected without the Registrant's receipt of consideration which results
in an increase in the number of the outstanding shares of Registrant's
Common Stock.
(2) Calculated solely for purposes of this offering under Rule 457(h) of the
Securities Act of 1933, as amended, (the "1933 Act"), on the basis of the
average of the high and low selling prices per share of Registrant's
Common Stock on December 23, 1999 as reported by the Nasdaq National
Market.
================================================================================
<PAGE> 2
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
Item 3. Incorporation of Documents by Reference
Ultratech Stepper, Inc. (the "Registrant") hereby incorporates by
reference into this Registration Statement the following documents previously
filed with the Securities and Exchange Commission (the "Commission"):
(a) The Registrant's Annual Report on Form 10-K for the fiscal
year ended December 31, 1998, filed with the Commission on
March 31, 1999;
(b) The Corporation's Quarterly Reports on form 10-Q for the
fiscal quarters ended March 31, 1999; June 30, 1999; and
September 30, 1999, respectively filed with the Commission
on May 14, 1999; August 13, 1999; and November
12, 1999, respectively, and;
(c) The Registrant's Registration Statement No. 0-22248 on
Form 8-A, filed with the Commission on August 13, 1993 and
subsequently amended on February 27, 1997, pursuant to
Section 12 of the Securities and Exchange Act of 1934, as
amended (the "1934 Act"), in which there is described the
terms, rights and provisions applicable to the
Registrant's outstanding Common Stock.
All reports and definitive proxy or information statements filed
pursuant to Section 13(a), 13(c), 14 or 15(d) of the 1934 Act after the date of
this Registration Statement and prior to the filing of a post-effective
amendment which indicates that all securities offered hereby have been sold or
which deregisters all securities then remaining unsold shall be deemed to be
incorporated by reference into this Registration Statement and to be a part
hereof from the date of filing of such documents. Any statement contained in a
document incorporated or deemed to be incorporated by reference herein shall be
deemed to be modified or superseded for purposes of this Registration Statement
to the extent that a statement contained in any subsequently filed document
which also is deemed to be incorporated by reference herein modifies or
supersedes such statement. Any such statement so modified or superseded shall
not be deemed, except as so modified or superseded, to constitute a part of this
Registration Statement.
Item 4. Description of Securities
Not applicable.
Item 5. Interests of Named Experts and Counsel
Not applicable.
Item 6. Indemnification of Directors and Officers
The Registrant's Amended and Restated Certificate of
Incorporation limits the liability of directors to the maximum extent permitted
by the Delaware General Corporation Law ("Delaware Law"). Delaware Law provides
that directors of a corporation will not be personally liable for monetary
damages for breach of their fiduciary duties as directors, except for liability
for (i) any breach of their duty of loyalty to the corporation or its
stockholders, (ii) acts or omissions not in good faith or that involve
intentional misconduct or a knowing violation of law, (iii) unlawful payments of
dividends or unlawful stock repurchases or redemptions as provided in Section
174 of the Delaware General Corporation Law or (iv) any transaction from which
the director derives an improper personal benefit.
II-1
<PAGE> 3
The Registrant's Bylaws provide that the Registrant shall
indemnify its directors and may indemnify its officers, employees and other
agents to the fullest extent permitted by law. The Registrant believes that
indemnification under its Bylaws covers at least negligence and gross negligence
on the part of an indemnified party in connection with the defense of any action
or proceeding arising out of such party's status or service as a director,
officer, employee or other agent of the Registrant upon an undertaking by such
party to repay such advances if it is ultimately determined that such party is
not entitled to indemnification.
The Registrant has entered into separate indemnification
agreements with each of its directors and officers. These agreements require the
Registrant, among other things, to indemnify such director or officer against
certain expenses (including attorneys' fees), judgments, fines and settlement
amounts paid by such individual in connection with any action, suit or
proceeding arising out of such individual's status or service as a director or
officer of the Registrant (other than expenses arising from willful misconduct
or conduct that is knowingly fraudulent or deliberately dishonest) and to
advance expenses incurred by such individual in connection with any proceeding
against such individual with respect to which such individual may be entitled to
indemnification by the Registrant. The Registrant believes that its Certificate
of Incorporation and Bylaw provisions and indemnification agreements are
necessary to attract and retain qualified persons as directors and officers.
Item 7. Exemption from Registration Claimed
Not applicable.
Item 8. Exhibits
<TABLE>
<CAPTION>
Exhibit Number Exhibit
-------------- -------
<S> <C>
4 Instruments Defining Rights of Shareholders. Reference is made
to Registrant's Registration Statement No. 0-22248 on Form 8-A
which is incorporated herein by reference pursuant to Item
3(c).
5 Opinion and Consent of Brobeck, Phleger & Harrison LLP.
23.1 Consent of Ernst & Young LLP, Independent Auditors.
23.2 Consent of Brobeck, Phleger & Harrison LLP is contained in
Exhibit 5.
24 Power of Attorney. Reference is made to page II-4 of this
Registration Statement.
99.1 Ultratech Stepper, Inc. 1998 Supplemental Stock Option/Stock
Issuance Plan.
</TABLE>
Item 9. Undertakings
A. The undersigned Registrant hereby undertakes: (1) to file,
during any period in which offers or sales are being made, a post-effective
amendment to this Registration Statement (i) to include any prospectus required
by Section 10(a)(3) of the 1933 Act, (ii) to reflect in the prospectus any facts
or events arising after the effective date of the Registration Statement (or the
most recent post-effective amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the information set forth in the
Registration Statement, and (iii) to include any material information with
respect to the plan of distribution not previously disclosed in the Registration
Statement or any material change to such information in the Registration
Statement; provided, however, that clauses (1)(i) and (1)(ii) shall not apply if
the information required to be included in a post-effective amendment by those
paragraphs is contained in periodic reports filed by the Registrant pursuant to
Section 13 or Section 15(d) of the 1934 Act that are incorporated by reference
into the Registration Statement; (2) that for the purpose of determining any
liability under the 1933 Act, each such post-effective amendment shall be deemed
to be a new registration statement relating to the securities offered therein
and the offering of such securities at that time shall be deemed to be the
initial bona fide offering thereof; and (3) to remove from registration by means
of a post-effective amendment any of the securities being registered which
remain unsold at the termination of the Registrant's 1998 Supplemental Stock
Option/Stock Issuance Plan.
B. The undersigned Registrant hereby undertakes that, for
purposes of determining any liability under the 1933 Act, each filing of the
Registrant's annual report pursuant to Section 13(a) or Section 15(d) of the
1934 Act that is incorporated by reference into the Registration Statement shall
be deemed to be a new registration statement relating to the securities offered
therein, and the offering of such securities at that time shall be deemed to be
the initial bona fide offering thereof.
II-2
<PAGE> 4
C. Insofar as indemnification for liabilities arising under the
1933 Act may be permitted to directors, officers or controlling persons of the
Registrant pursuant to the indemnification provisions summarized in Item 6 above
or otherwise, the Registrant has been informed that, in the opinion of the
Commission, such indemnification is against public policy as expressed in the
1933 Act, and is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by the
Registrant of expenses incurred or paid by a director, officer or controlling
person of the Registrant in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling person in
connection with the securities being registered, the Registrant will, unless in
the opinion of its counsel the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the question whether such
indemnification by it is against public policy as expressed in the 1933 Act and
will be governed by the final adjudication of such issue.
II-3
<PAGE> 5
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as
amended, the Registrant certifies that it has reasonable grounds to believe that
it meets all of the requirements for filing on Form S-8 and has duly caused this
Registration Statement to be signed on its behalf by the undersigned, thereunto
duly authorized, in the City of San Jose, State of California, on this 27th day
of December, 1999.
ULTRATECH STEPPER, INC.
By: /s/ ARTHUR W. ZAFIROPOULO
--------------------------
Arthur W. Zafiropoulo
Chairman of the Board and
Chief Executive Officer
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS:
That the undersigned officers and directors of Ultratech Stepper,
Inc., a Delaware corporation, do hereby constitute and appoint Arthur W.
Zafiropoulo and Bruce R. Wright, and each of them, the lawful attorneys and
agents, with full power and authority to do any and all acts and things and to
execute any and all instruments which said attorneys and agents, and any one of
them, determine may be necessary or advisable or required to enable said
corporation to comply with the Securities Act of 1933, as amended, and any rules
or regulations or requirements of the Securities and Exchange Commission in
connection with this Registration Statement. Without limiting the generality of
the foregoing power and authority, the powers granted include the power and
authority to sign the names of the undersigned officers and directors in the
capacities indicated below to this Registration Statement, to any and all
amendments, both pre-effective and post-effective, and supplements to this
Registration Statement, and to any and all instruments or documents filed as
part of or in conjunction with this Registration Statement or amendments or
supplements thereof, and each of the undersigned hereby ratifies and confirms
all that said attorneys and agents, or any of them, shall do or cause to be done
by virtue hereof. This Power of Attorney may be signed in several counterparts.
IN WITNESS WHEREOF, each of the undersigned has executed this
Power of Attorney as of the date indicated.
Pursuant to the requirements of the Securities Act of 1933, as
amended, this Registration Statement has been signed below by the following
persons in the capacities and on the dates indicated.
<TABLE>
<CAPTION>
SIGNATURES TITLE DATE
- ---------- ----- ----
<S> <C> <C>
/s/ ARTHUR W. ZAFIROPOULO Chairman of the Board and Chief December 27, 1999
- ------------------------- Executive Officer (Principal
Arthur W. Zafiropoulo Executive Officer)
/s/ BRUCE R. WRIGHT Senior Vice President, Finance, December 27, 1999
- ------------------------- Chief Financial Officer, Secretary
Bruce R. Wright and Treasurer (Principal Financial
and Accounting Officer)
</TABLE>
II-4
<PAGE> 6
<TABLE>
<CAPTION>
SIGNATURES TITLE DATE
- ---------- ----- ----
<S> <C> <C>
/s/ GREGORY HARRISON Director December 27, 1999
- -------------------------
Gregory Harrison
/s/ KENNETH LEVY Director December 27, 1999
- -------------------------
Kenneth Levy
/s/ LARRY R. CARTER Director December 27, 1999
- -------------------------
Larry R. Carter
Director
- -------------------------
Joel F. Gemunder
/s/ TOMMY GEORGE Director December 27, 1999
- -------------------------
Tommy George
</TABLE>
II-5
<PAGE> 7
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C.
EXHIBITS
TO
FORM S-8
UNDER
SECURITIES ACT OF 1933
ULTRATECH STEPPER, INC.
<PAGE> 8
EXHIBIT INDEX
<TABLE>
<CAPTION>
Exhibit Number Exhibit
-------------- -------
<S> <C>
4 Instruments Defining Rights of Shareholders. Reference is made
to Registrant's Registration Statement No. 0-22248 on Form 8-A
which is incorporated herein by reference pursuant to Item
3(c).
5 Opinion and Consent of Brobeck, Phleger & Harrison LLP.
23.1 Consent of Ernst & Young LLP, Independent Auditors.
23.2 Consent of Brobeck, Phleger & Harrison LLP is contained in
Exhibit 5.
24 Power of Attorney. Reference is made to page II-4 of this
Registration Statement.
99.1 Ultratech Stepper, Inc. 1998 Supplemental Stock Option/Stock
Issuance Plan.
</TABLE>
<PAGE> 1
EXHIBIT 5
Opinion and Consent of Brobeck, Phleger & Harrison LLP
December 27, 1999
ULTRATECH STEPPER, INC.
3050 Zanker Road
San Jose, California 95134
Re: Ultratech Stepper, Inc.
Registration Statement for Registration
of 400,000 Shares of Common Stock
Ladies and Gentlemen:
We have acted as counsel to Ultratech Stepper, Inc., a Delaware
corporation (the "Company"), in connection with the registration on Form S-8
(the "Registration Statement") under the Securities Act of 1933, as amended, of
400,000 shares of the Company's common stock and related stock options for
issuance (the "Shares") under the Company's 1998 Supplemental Stock Option/Stock
Issuance Plan (the "Supplemental Plan").
This opinion is being furnished in accordance with the
requirements of Item 8 of Form S-8 and Item 601(b)(5)(i) of Regulation S-K.
We have reviewed the Company's charter documents and the
corporate proceedings taken by the Company in connection with the establishment
of the Supplemental Plan. Based on such review, we are of the opinion that if,
as and when the Shares are issued and sold (and the consideration therefor
received) pursuant to (a) the provisions of option agreements duly authorized
under the Supplemental Plan, and in accordance with the Registration Statement
or (b) duly authorized direct stock issuances in accordance with the provisions
of the Supplemental Plan and the Registration Statement, such Shares will be
duly authorized, legally issued, fully paid and non-assessable.
We consent to the filing of this opinion letter as Exhibit 5 to
the Registration Statement.
This opinion letter is rendered as of the date first written
above and we disclaim any obligation to advise you of facts, circumstances,
events or developments which hereafter may be brought to our attention and which
may alter, affect or modify the opinion expressed herein. Our opinion is
expressly limited to the matters set forth above and we render no opinion,
whether by implication or otherwise, as to any other matters relating to the
Company, the Supplemental Plan and the Shares issuable under such plan.
Very truly yours,
BROBECK, PHLEGER & HARRISON LLP
<PAGE> 1
EXHIBIT 23.1
Consent of Ernst & Young LLP, Independent Auditors
We consent to the incorporation by reference in the Registration Statement on
Form S-8 pertaining to the 1998 Supplemental Stock Option/Stock Issuance Plan of
Ultratech Stepper, Inc of our report dated January 29, 1999 with respect to the
consolidated financial statements of Ultratech Stepper, Inc. incorporated by
reference in its Annual Report on Form 10-K for the year ended December 31,
1998, and the related financial statement schedule included therein, filed with
the Securities and Exchange Commission.
ERNST & YOUNG LLP
San Jose, California
December 23, 1999
<PAGE> 1
EXHIBIT 99.1
1998 Supplemental Stock Option/Stock Issuance Plan
<PAGE> 2
ULTRATECH STEPPER, INC.
SUPPLEMENTAL STOCK OPTION/STOCK ISSUANCE PLAN
(AMENDED AND RESTATED AS OF OCTOBER 19, 1999)
ARTICLE ONE
GENERAL
A. This Supplemental Stock Option/Stock Issuance Plan is intended
to promote the interests of Ultratech Stepper, Inc., a Delaware corporation, by
authorizing an additional reserve of shares of the Corporation's common stock
for issuance through long-term option grants or direct stock issuances to
individuals in the employ of the Corporation (or any Parent or Subsidiary) who
are NOT: (i) officers of the Corporation, (ii) employees with the title of Vice
President, General Manager or (iii) members of the Board.
B. The Plan became effective immediately upon adoption by the
Board on October 20, 1998.
C. The Plan shall supplement the authorized share reserve under
the Corporation's 1993 Stock Option/Stock Issuance Plan, and share issuances
under this Plan shall not reduce or otherwise affect the number of shares of the
Corporation's common stock available for issuance under the 1993 Stock
Option/Stock Issuance Plan. In addition, share issuances under the 1993 Stock
Option/Stock Issuance Plan shall not reduce or otherwise affect the number of
shares of the Corporation's common stock available for issuance under this Plan.
Capitalized terms shall have the meanings assigned to such terms
in the attached Appendix.
I. STRUCTURE OF THE PLAN
A. The Plan shall be divided into two (2) separate equity
programs:
(i) the Option Grant Program under which eligible persons may,
at the discretion of the Plan Administrator, be granted options to
purchase shares of Common Stock, and
(ii) the Stock Issuance Program under which eligible persons
may, at the discretion of the Plan Administrator, be issued shares of
Common Stock directly, either through the immediate purchase of such
shares or as a bonus for services rendered the Corporation (or any
Parent or Subsidiary) or the attainment of designated performance goals.
<PAGE> 3
II. ADMINISTRATION OF THE PLAN
A. The Plan Administrator shall have full power and discretion
(subject to the express provisions of the Plan) to establish such rules and
regulations as it may deem appropriate for the proper administration of the Plan
and to make such determinations under, and issue such interpretations of, the
provisions of the Plan and any outstanding option grants or unvested stock
issuances thereunder as it may deem necessary or advisable. Decisions of the
Plan Administrator shall be final and binding on all parties who have an
interest in the Plan or any outstanding stock option or stock issuance
thereunder.
B. The individuals serving as Plan Administrator shall serve for
such period as the Board may determine and shall be subject to removal by the
Board at any time.
C. Service as Plan Administrator shall constitute service as a
Board member, and each Board member serving as Plan Administrator shall
accordingly be entitled to full indemnification and reimbursement as a Board
member for such service. No individual serving as Plan Administrator shall be
liable for any act or omission made in good faith with respect to the Plan or
any option grant or stock issuance made under the Plan.
III. ELIGIBILITY
A. The persons eligible to participate in the Plan shall be
limited to those Employees who are NOT: (i) officers of the Corporation, (ii)
Employees with the title of Vice President, General Manager or (iii) members of
the Board.
B. The Plan Administrator shall have full authority to determine
(i) with respect to the Option Grant Program, which eligible Employees are to
receive option grants under the Plan, the time or times when the grants are to
be made, the number of shares subject to each such grant, the time or times when
each granted option is to become exercisable and the maximum term for which the
option may remain outstanding and (ii) with respect to stock issuances under the
Stock Issuance Program, which eligible persons are to receive stock issuances,
the time or times when such issuances are to be made, the number of shares to be
issued to each Participant, the vesting schedule (if any) applicable to the
issued shares and the consideration for such shares. All options granted under
the Plan shall be Non-Statutory Options.
IV. STOCK SUBJECT TO THE PLAN
A. Shares of Common Stock shall be available for issuance under
the Plan and shall be drawn from either the Corporation's authorized but
unissued shares of Common Stock or from reacquired shares of Common Stock,
including shares repurchased by the Corporation on the open market. The maximum
number of shares of Common Stock reserved for issuance over the term of the Plan
shall be limited to 800,000 shares, subject to adjustment from time to time in
accordance with the provisions of Section IV.C.
2
<PAGE> 4
B. Should one or more outstanding options under this Plan expire
or terminate for any reason prior to exercise in full, then the shares subject
to the portion of each option not so exercised shall be available for subsequent
issuance under the Plan. Unvested shares issued under the Plan and subsequently
cancelled or repurchased by the Corporation, at the original issue price paid
per share, pursuant to the Corporation's repurchase rights under the Plan shall
be added back to the number of shares of Common Stock reserved for issuance
under the Plan and shall accordingly be available for reissuance through one or
more subsequent option grants or direct stock issuances under the Plan. Should
the exercise price of an outstanding option under the Plan be paid with shares
of Common Stock, then the number of shares of Common Stock available for
issuance under the Plan shall be reduced by the gross number of shares for which
the option is exercised, and not by the net number of shares of Common Stock
actually issued to the holder of such option.
C. Should any change be made to the Common Stock issuable under
the Plan by reason of any stock split, stock dividend, recapitalization,
combination of shares, exchange of shares or other change affecting the
outstanding Common Stock as a class without the Corporation's receipt of
consideration, then appropriate adjustments shall be made to (i) the maximum
number and/or class of securities issuable under the Plan, and (ii) the number
and/or class of securities and price per share in effect under each option
outstanding under the Plan. Such adjustments to the outstanding securities are
to be effected in a manner which shall preclude the enlargement or dilution of
rights and benefits under such options. The adjustments determined by the Plan
Administrator shall be final, binding and conclusive.
3
<PAGE> 5
ARTICLE TWO
OPTION GRANT PROGRAM
I. OPTION TERMS
Options granted under the Plan shall be authorized by action of
the Plan Administrator and shall be evidenced by one or more instruments in the
form approved by the Plan Administrator; provided, however, that each such
instrument shall comply with the terms and conditions specified below. All such
granted options shall be Non-Statutory Options.
A. Exercise Price.
1. The exercise price per share shall be fixed by the Plan
Administrator but shall not be less than one hundred percent (100%) of the Fair
Market Value per share of Common Stock on the grant date.
2. Full payment of the exercise price shall become
immediately due upon exercise of the option and shall be payable in one or more
of the forms specified below:
(i) cash or check made payable to the Corporation,
(ii) shares of Common Stock held for the requisite
period necessary to avoid a charge to the Corporation's earnings
for financial reporting purposes and valued at Fair Market Value
on the Exercise Date, or
(iii) through a special sale and remittance procedure
pursuant to which the Optionee shall concurrently provide
irrevocable instructions (a) to a Corporation-designated
brokerage firm to effect the immediate sale of the purchased
shares and remit to the Corporation, out of the sale proceeds
available on the settlement date, sufficient funds to cover the
aggregate exercise price payable for the purchased shares plus
all applicable Federal, state and local income and employment
taxes required to be withheld by the Corporation in connection
with such purchase and (b) to the Corporation to deliver the
certificates for the purchased shares directly to such brokerage
firm in order to complete the sale transaction.
Except to the extent such sale and remittance procedure is
utilized, payment of the exercise price for the purchased shares must be made on
the Exercise Date.
4
<PAGE> 6
B. Exercise and Term of Options. Each option shall be exercisable
at such time or times, during such period and for such number of shares as shall
be determined by the Plan Administrator and set forth in the documents
evidencing such option. No option shall have a maximum term in excess of ten
(10) years measured from the option grant date.
C. Limited Transferability. Each option granted under the Plan
may, in connection with the Optionee's estate plan, be assigned in whole or in
part during the Optionee's lifetime to one or more members of the Optionee's
immediate family or to a trust established exclusively for one or more such
family members. The assigned portion may only be exercised by the person or
persons who acquire a proprietary interest in the option pursuant to the
assignment. The terms applicable to the assigned portion shall be the same as
those in effect for the option immediately prior to such assignment and shall be
set forth in such documents issued to the assignee as the Plan Administrator may
deem appropriate.
D. Effect of Termination of Service.
1. The following provisions shall govern the exercise of any
options held by the Optionee at the time of cessation of Service or death:
(i) Any option outstanding at the time of the Optionee's
cessation of Service for any reason shall remain exercisable for
such period of time thereafter as shall be determined by the
Plan Administrator and set forth in the documents evidencing the
option, but no such option shall be exercisable after the
expiration of the option term.
(ii) Any option exercisable in whole or in part by the
Optionee at the time of death may be subsequently exercised by
the personal representative of the Optionee's estate or by the
person or persons to whom the option is transferred pursuant to
the Optionee's will or in accordance with the laws of descent
and distribution.
(iii) Should the Optionee's Service be terminated for
Misconduct, then all outstanding options held by the Optionee
shall terminate immediately and cease to be outstanding.
(iv) During the applicable post-Service exercise period,
the option may not be exercised in the aggregate for more than
the number of shares for which the option is exercisable on the
date of Optionee's cessation of Service. Upon the expiration of
such post-Service exercise period or (if earlier) upon the
expiration of the option term, the option shall terminate and
cease to be outstanding for any otherwise exercisable shares for
which the option has not been exercised.
5
<PAGE> 7
However, the option shall, immediately upon Optionee's cessation
of Service for any reason, terminate and cease to be outstanding
with respect to any and all option shares for which the option
is not otherwise at the time exercisable.
2. The Plan Administrator shall have the discretion,
exercisable either at the time an option is granted or at any time while the
option remains outstanding, to:
(i) extend the period of time for which the option is to
remain exercisable following Optionee's cessation of Service or
death from the limited period otherwise in effect for that
option to such greater period of time as the Plan Administrator
shall deem appropriate, but in no event beyond the expiration of
the option term, and/or
(ii) permit the option to be exercised, during the
applicable post-Service exercise period, not only with respect
to the number of shares of Common Stock for which such option is
exercisable at the time of the Optionee's cessation of Service
but also with respect to one or more additional installments for
which the option would have become exercisable had the Optionee
continued in Service.
C. Stockholder Rights. No Optionee shall have any stockholder
rights with respect to any option shares until such person shall have exercised
the option and paid the exercise price for the purchased shares.
D. Repurchase Rights.
1. The Plan Administrator shall have discretion to authorize
the issuance of unvested shares of Common Stock under this Article Two. Should
the Optionee cease Service while holding such unvested shares, the Corporation
shall have the right to repurchase any or all of those unvested shares at the
option exercise price paid per share. The terms and conditions upon which such
repurchase right shall be exercisable (including the period and procedure for
exercise and the appropriate vesting schedule for the purchased shares) shall be
established by the Plan Administrator and set forth in the instrument evidencing
such repurchase rights.
2. The Plan Administrator shall have the discretionary
authority, exercisable at any time while the Corporation's repurchase right
remains outstanding, to cancel that repurchase right with respect to one or more
shares purchased or purchasable by the Optionee under this Article Two and
thereby accelerate the vesting of those shares in whole or in part at any time.
6.
<PAGE> 8
II. CORPORATE TRANSACTION/CHANGE IN CONTROL
A. Each option outstanding under the Plan at the time of a
Corporate Transaction shall automatically accelerate so that each such option
shall, immediately prior to the specified effective date for the Corporate
Transaction, become fully exercisable with respect to the total number of shares
of Common Stock at the time subject to that option and may be exercised for all
or any portion of those shares as fully-vested shares. However, an outstanding
option under the Plan shall NOT become exercisable on such an accelerated basis
if and to the extent: (i) such option is, in connection with the Corporate
Transaction, either to be assumed by the successor corporation or parent thereof
or to be replaced with a comparable option to purchase shares of the capital
stock of the successor corporation or parent thereof, (ii) such option is to be
replaced with a cash incentive program of the successor corporation which
preserves the option spread existing at the time of the Corporate Transaction on
the shares for which the option is not otherwise at that time exercisable and
provides for subsequent payout in accordance with the same vesting schedule
applicable to such option or (iii) the acceleration of such option is subject to
other limitations imposed by the Plan Administrator at the time of the option
grant. The determination of option comparability under clause (i) above shall be
made by the Plan Administrator, and its determination shall be final, binding
and conclusive.
B. All of the Corporation's outstanding repurchase rights under
this Article Two shall automatically terminate, and the shares subject to those
terminated rights shall immediately vest in full, upon the occurrence of a
Corporate Transaction, except to the extent (i) any such repurchase right is to
be assigned to the successor corporation (or parent thereof) in connection with
the Corporate Transaction or (ii) such accelerated vesting is precluded by other
limitations imposed by the Plan Administrator at the time the repurchase right
is granted.
C. The Plan Administrator shall have the discretionary authority,
exercisable either at the time the option is granted or at any time while the
option remains outstanding, to provide (upon such terms as it may deem
appropriate) for the automatic acceleration of one or more outstanding options
which are assumed or replaced in the Corporate Transaction and do not otherwise
accelerate at that time (and the termination of any outstanding repurchase
rights), in the event the Optionee's Service should subsequently terminate
within a designated period following the effective date of such Corporate
Transaction.
D. Immediately following the consummation of the Corporate
Transaction, all outstanding options under the Plan shall terminate and cease to
remain outstanding, except to the extent assumed by the successor corporation or
its parent company.
E. Each outstanding option which is assumed in connection with
the Corporate Transaction shall be appropriately adjusted, immediately after
such Corporate Transaction, to apply and pertain to the number and class of
securities which would have been issued to the Optionee, in consummation of the
Corporate Transaction, had such person exercised the option immediately prior to
the Corporate Transaction. Appropriate adjustments shall also be made to the
exercise price
7.
<PAGE> 9
payable per share, provided the aggregate exercise price payable for such
securities shall remain the same. In addition, the class and number of
securities available for issuance under the Plan following the consummation of
the Corporate Transaction shall be appropriately adjusted.
F. The Plan Administrator shall have the discretionary authority,
exercisable either at the time the option is granted or at any time while the
option remains outstanding, to provide for the automatic acceleration of one or
more outstanding options under the Plan (and the termination of one or more of
the Corporation's outstanding repurchase rights) upon the occurrence of any
Change in Control. The Plan Administrator shall also have full power and
authority to condition any such option acceleration (and the termination of any
outstanding repurchase rights) upon the subsequent termination of the Optionee's
Service within a specified period following the Change in Control. Any options
accelerated in connection with the Change in Control shall remain fully
exercisable until the expiration or sooner termination of the option term.
G. The grant of options under the Plan shall in no way affect the
right of the Corporation to adjust, reclassify, reorganize or otherwise change
its capital or business structure or to merge, consolidate, dissolve, liquidate
or sell or transfer all or any part of its business or assets.
III. CANCELLATION AND REGRANT OF OPTIONS
The Plan Administrator shall have the authority to effect, at any
time and from time to time, with the consent of the affected optionees, the
cancellation of any or all outstanding options under this Article Two and to
grant in substitution new options under the Plan covering the same or different
numbers of shares of Common Stock but with an option exercise price per share
not less than the Fair Market Value of the Common Stock on the new grant date.
8.
<PAGE> 10
ARTICLE THREE
STOCK ISSUANCE PROGRAM
I. STOCK ISSUANCE TERMS
Shares of Common Stock may be issued under the Stock Issuance
Program through direct and immediate issuances without any intervening option
grants. Each such stock issuance shall be evidenced by a Stock Issuance
Agreement which complies with the terms specified below. Shares of Common Stock
may also be issued under the Stock Issuance Program pursuant to share right
awards which entitle the recipients to receive those shares upon the attainment
of designated performance goals.
A. PURCHASE PRICE.
1. The purchase price per share of Common Stock subject to
direct issuance shall be fixed by the Plan Administrator, but shall not be less
than one hundred percent (100%) of the Fair Market Value per share of Common
Stock on the issuance date.
2. Shares of Common Stock may be issued under the Stock
Issuance Program for any of the following items of consideration which the Plan
Administrator may deem appropriate in each individual instance:
(i) cash or check made payable to the Corporation, or
(ii) past services rendered to the Corporation (or any
Parent or Subsidiary).
B. VESTING/ISSUANCE PROVISIONS.
1. Shares of Common Stock issued under the Stock Issuance
Program may, in the discretion of the Plan Administrator, be fully and
immediately vested upon issuance or may vest in one or more installments over
the Participant's period of Service or upon attainment of specified performance
objectives. Alternatively, the Plan Administrator may issue share right awards
under the Stock Issuance Program which shall entitle the recipient to receive a
specified number of shares of Common Stock upon the attainment of one or more
performance goals established by the Plan Administrator. Upon the attainment of
such performance goals, fully-vested shares of Common Stock shall be issued in
satisfaction of those share right awards.
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<PAGE> 11
2. Any new, substituted or additional securities or other
property (including money paid other than as a regular cash dividend) which the
Participant may have the right to receive with respect to his or her unvested
shares of Common Stock by reason of any stock dividend, stock split,
recapitalization, combination of shares, exchange of shares or other change
affecting the outstanding Common Stock as a class without the Corporation's
receipt of consideration shall be issued subject to (i) the same vesting
requirements applicable to the Participant's unvested shares of Common Stock and
(ii) such escrow arrangements as the Plan Administrator shall deem appropriate.
3. The Participant shall have full stockholder rights with
respect to any shares of Common Stock issued to the Participant under the Stock
Issuance Program, whether or not the Participant's interest in those shares is
vested. Accordingly, the Participant shall have the right to vote such shares
and to receive any regular cash dividends paid on such shares.
4. Should the Participant cease to remain in Service while
holding one or more unvested shares of Common Stock issued under the Stock
Issuance Program or should the performance objectives not be attained with
respect to one or more such unvested shares of Common Stock, then those shares
shall be immediately surrendered to the Corporation for cancellation, and the
Participant shall have no further stockholder rights with respect to those
shares. To the extent the surrendered shares were previously issued to the
Participant for cash consideration, the Corporation shall repay that
consideration to the Participant at the time the shares are surrendered.
5. The Plan Administrator may in its discretion waive the
surrender and cancellation of one or more unvested shares of Common Stock (or
other assets attributable thereto) which would otherwise occur upon the
cessation of the Participant's Service or the non-attainment of the performance
objectives applicable to those shares. Such waiver shall result in the immediate
vesting of the Participant's interest in the shares of Common Stock as to which
the waiver applies. Such waiver may be effected at any time, whether before or
after the Participant's cessation of Service or the attainment or non-attainment
of the applicable performance objectives.
6. Outstanding share right awards under the Stock Issuance
Program shall automatically terminate, and no shares of Common Stock shall
actually be issued in satisfaction of those awards, if the performance goals
established for such awards are not attained. The Plan Administrator, however,
shall have the discretionary authority to issue shares of Common Stock under one
or more outstanding share right awards as to which the designated performance
goals have not been attained.
10.
<PAGE> 12
II. CORPORATE TRANSACTION/CHANGE IN CONTROL
A. In the event of any Corporate Transaction, all of the
Corporation's outstanding repurchase rights under the Stock Issuance Program
shall terminate automatically and all the shares of Common Stock subject to
those terminated rights shall immediately vest in full, except to the extent (i)
those repurchase rights are to be assigned to the successor corporation (or
parent thereof) in connection with such Corporate Transaction or (ii) the Plan
Administrator imposes other limitations in the Issuance Agreement which preclude
such accelerated vesting in whole or in part.
B. The Plan Administrator shall have the discretionary authority,
exercisable either at the time the unvested shares are issued or any time while
the Corporation's repurchase rights remain outstanding under the Stock Issuance
Program, to provide that those rights shall automatically terminate in whole or
in part, and the shares of Common Stock subject to those terminated rights shall
immediately vest, upon the Participant's termination of Service within a
designated period following the effective date of any Corporate Transaction in
which those repurchase rights are assigned to the successor corporation (or
parent thereof).
C. The Plan Administrator shall have the discretionary authority,
exercisable either at the time the unvested shares are issued or any time while
the Corporation's repurchase rights remain outstanding under the Stock Issuance
Program, to provide that those rights shall automatically terminate in whole or
in part, and the shares of Common Stock subject to those terminated rights shall
immediately vest, upon the occurrence of a Change in Control. Alternatively, the
Plan Administrator may condition such accelerated vesting upon the Participant's
termination of Service within a designated period following the effective date
of any Change in Control.
III. SHARE ESCROW/LEGENDS
Unvested shares may, in the Plan Administrator's discretion, be
held in escrow by the Corporation until the Participant's interest in such
shares vests or may be issued directly to the Participant with restrictive
legends on the certificates evidencing those unvested shares.
11.
<PAGE> 13
ARTICLE FOUR
MISCELLANEOUS
I. EFFECTIVE DATE AND TERM OF PLAN
A. This Plan became effective upon approval by the Board on
October 20, 1998 and shall not be subject to stockholder approval. The Plan was
amended on October 19, 1999 to increase the number of shares of Common Stock
reserved for issuance under the Plan from 400,000 shares to 800,000 shares.
B. The Plan shall terminate upon the earlier of (i) October 19,
2008 or (ii) the date on which all shares available for issuance under the Plan
shall have been issued as fully-vested shares pursuant to option exercises or
direct stock issuances under the Plan or (iii) the termination of all
outstanding options in connection with a Corporate Transaction. If the date of
termination is determined under clause (i) above, then all option grants or
unvested stock issuances outstanding on such date shall thereafter continue to
have force and effect in accordance with the provisions of the instruments
evidencing those grants or issuances.
II. AMENDMENT OF THE PLAN
The Board has complete and exclusive power and authority to amend
or modify the Plan in any or all respects whatsoever. However, no such amendment
or modification shall adversely affect rights and obligations with respect to
stock options or unvested stock issuances at the time outstanding under the
Plan, unless the affected Optionees or Participants consent to such amendment.
III. USE OF PROCEEDS
Any cash proceeds received by the Corporation from the sale of
shares pursuant to option grants or direct stock issuances under the Plan shall
be used for general corporate purposes.
IV. REGULATORY APPROVALS
A. The implementation of the Plan, the granting of any option
under the Plan, and the issuance of Common Stock either upon the exercise of the
stock options granted hereunder or pursuant to the Stock Issuance Program shall
be subject to the Corporation's procurement of all approvals and permits
required by regulatory authorities having jurisdiction over the Plan, the stock
options granted under it and the Common Stock issued pursuant to it.
12.
<PAGE> 14
B. No shares of Common Stock or other assets shall be issued or
delivered under this Plan unless and until there shall have been compliance with
all applicable requirements of Federal and state securities laws, including the
filing and effectiveness of the Form S-8 registration statement for the shares
of Common Stock issuable under the Plan, and all applicable listing requirements
of any stock exchange (or the Nasdaq National Market, if applicable) on which
the Common Stock is then listed for trading.
V. TAX WITHHOLDING
The Corporation's obligation to deliver shares of Common Stock
upon the exercise of stock options for such shares or the direct issuance or
vesting of such shares under the Plan shall be subject to the satisfaction of
all applicable federal, state and local income and employment tax withholding
requirements.
VI. NO EMPLOYMENT/SERVICE RIGHTS
Neither the action of the Corporation in establishing the Plan,
nor any action taken by the Plan Administrator hereunder, nor any provision of
the Plan shall be construed so as to grant any individual the right to remain in
Service for any period of specific duration, and the Corporation (or any Parent
or Subsidiary employing such individual) may terminate such individual's Service
at any time and for any reason, with or without cause.
VII. MISCELLANEOUS PROVISIONS
A. The right to acquire Common Stock or other assets under the
Plan may not be assigned, encumbered or otherwise transferred by any Optionee or
Participant, except as expressly provided herein
B The provisions of the Plan relating to the exercise of options
and the vesting of shares shall be governed by the laws of the State of
California, as such laws are applied to contracts entered into and performed in
such state.
C. The provisions of the Plan shall insure to the benefit of, and
shall be binding upon, the Corporation and its successors and assigns, whether
by Corporate Transaction or otherwise, and the Participants and Optionees and
the legal representatives, heirs or legatees of their respective estates.
13.
<PAGE> 15
APPENDIX
The following definitions shall be in effect under the Plan:
A. BOARD shall mean the Corporation's Board of Directors.
B. CHANGE IN CONTROL shall mean a change in ownership or control of the
Corporation effected through either of the following transactions:
(i) the acquisition, directly or indirectly by any person or
related group of persons (other than the Corporation or a person that
directly or indirectly controls, is controlled by, or is under common
control with, the Corporation), of beneficial ownership (within the
meaning of Rule 13d-3 of the 1934 Act) of securities possessing more
than fifty percent (50%) of the total combined voting power of the
Corporation's outstanding securities pursuant to a tender or exchange
offer made directly to the Corporation's stockholders, or
(ii) a change in the composition of the Board over a period of
thirty-six (36) consecutive months or less such that a majority of the
Board members ceases, by reason of one or more contested elections for
Board membership, to be comprised of individuals who either (A) have
been Board members continuously since the beginning of such period or
(B) have been elected or nominated for election as Board members during
such period by at least a majority of the Board members described in
clause (A) who were still in office at the time the Board approved such
election or nomination.
C. CODE shall mean the Internal Revenue Code of 1986, as amended.
D. COMMON STOCK shall mean the Corporation's common stock.
E. CORPORATE TRANSACTION shall mean any of the following
stockholder-approved transactions to which the Corporation is a party:
(i) a merger or consolidation in which the Corporation is not
the surviving entity, except for a transaction the principal purpose of
which is to change the State in which the Corporation is incorporated,
(ii) the sale, transfer or other disposition of all or
substantially all of the assets of the Corporation in complete
liquidation or dissolution of the Corporation, or
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(iii) any reverse merger in which the Corporation is the
surviving entity but in which securities possessing more than fifty
percent (50%) of the total combined voting power of the Corporation's
outstanding securities are transferred to person or persons different
from the persons holding those securities immediately prior to such
merger.
F. CORPORATION shall mean Ultratech Stepper, Inc., a Delaware
corporation, and its successors.
G. EMPLOYEE shall mean an individual who is in the employ of the
Corporation (or any Parent or Subsidiary), subject to the control and direction
of the employer entity as to both the work to be performed and the manner and
method of performance.
H. EXERCISE DATE shall mean the date on which the Corporation shall have
received written notice of the option exercise.
I. FAIR MARKET VALUE per share of Common Stock on any relevant date
shall be determined in accordance with the following provisions:
- If the Common Stock is at the time traded on the Nasdaq
National Market, then the Fair Market Value shall be the closing selling
price per share of Common Stock on the date in question, as such price
is reported on the Nasdaq National Market. If there is no closing
selling price for the Common Stock on the date in question, then the
Fair Market Value shall be the closing selling price on the last
preceding date for which such quotation exists.
- If the Common Stock is at the time listed on any Stock
Exchange, then the Fair Market Value shall be the closing selling price
per share of Common Stock on the date in question on that Stock Exchange
determined by the Plan Administrator to be the primary market for the
Common Stock, as such price is officially quoted in the composite tape
of transactions on such exchange. If there is no closing selling price
for the Common Stock on the date in question, then the Fair Market Value
shall be the closing selling price on the last preceding date for which
such quotation exists.
J. MISCONDUCT shall mean the commission of any act of fraud,
embezzlement or dishonesty by the Optionee or Participant, any unauthorized use
or disclosure by such person of confidential information or trade secrets of the
Corporation (or any Parent or Subsidiary), or any other intentional misconduct
by such person adversely affecting the business or affairs of the Corporation
(or any Parent or Subsidiary) in a material manner. The foregoing definition
shall not be deemed to be inclusive of all the acts or omissions which the
Corporation (or any Parent or Subsidiary) may consider as grounds for the
dismissal or discharge of any Optionee, Participant or other person in the
Service of the Corporation (or any Parent or Subsidiary).
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<PAGE> 17
K. 1934 ACT shall mean the Securities Exchange Act of 1934, as amended.
L. NON-STATUTORY OPTION shall mean an option not intended to satisfy the
requirements of Code Section 422.
M. OPTION GRANT PROGRAM shall mean the option grant program in effect
under the Plan.
N. OPTIONEE shall mean any person to whom an option is granted under the
Plan.
O. PARENT shall mean any corporation (other than the Corporation) in an
unbroken chain of corporations ending with the Corporation, provided each
corporation in the unbroken chain (other than the Corporation) owns, at the time
of the determination, stock possessing fifty percent (50%) or more of the total
combined voting power of all classes of stock in one of the other corporations
in such chain.
P. PARTICIPANT shall mean any person who is issued shares of Common
Stock under the Stock Issuance Program.
Q. PERMANENT DISABILITY OR PERMANENTLY DISABLED shall mean the inability
of an individual to engage in any substantial gainful activity by reason of any
medically determinable physical or mental impairment expected to result in death
or to be of continuous duration of twelve (12) months or more.
R. PLAN shall mean the Corporation's Supplemental Stock Option/Stock
Issuance Plan, as set forth in this document.
S. PLAN ADMINISTRATOR shall mean the committee comprised of one or more
Board members appointed by the Board to administer the Plan.
T. SERVICE shall mean the provision of services on a periodic basis to
the Corporation (or any Parent or Subsidiary) in the capacity of an Employee or
an independent consultant or advisor, except to the extent otherwise
specifically provided in the applicable stock option agreement.
U. STOCK EXCHANGE shall mean either the American Stock Exchange or the
New York Stock Exchange.
V. STOCK ISSUANCE AGREEMENT shall mean the agreement entered into by the
Corporation and the Participant at the time of issuance of shares of Common
Stock under the Stock Issuance Program.
W. STOCK ISSUANCE PROGRAM shall mean the stock issuance program in
effect under the Plan.
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X. SUBSIDIARY shall mean any corporation (other than the Corporation) in
an unbroken chain of corporations beginning with the Corporation, provided each
corporation (other than the last corporation) in the unbroken chain owns, at the
time of the determination, stock possessing fifty percent (50%) or more of the
total combined voting power of all classes of stock in one of the other
corporations in such chain.
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