Exhibit 10.24
CYMER, INC.
EXECUTIVE OPTION, BONUS
AND
GROUP
HEALTH COVERAGE EXTENSION PROGRAM
SECTION 1.
PURPOSE
This Executive Option, Bonus and Group Health
Coverage Extension Program (the “Program”) is designed
to provide Eligible Executives (as defined herein) with certain
benefits (as described herein) as of the time at which such
Eligible Executive retires and ceases to serve the Company (as
defined herein) on a Full-Time (as defined herein) basis on the
terms and conditions set forth herein.
SECTION 2.
EFFECTIVE
DATE
This Program was adopted by the Board of
Directors of the Company on August 22, 2001 originally
effective as of December 1, 2001, and most recently amended
and restated as of November 14, 2007.
SECTION 3.
DEFINITIONS
(a)
“CAUSE”
means, with respect to a
particular Eligible Executive, the occurrence of any of the
following: (i) such Eligible Executive’s conviction of
any felony or any crime involving fraud or dishonesty which has a
material adverse effect on the Company and/or its affiliates;
(ii) such Eligible Executive’s participation (whether by
affirmative act or omission) in a fraud, act of dishonesty or other
act of misconduct against the Company and/or its affiliates;
(iii) conduct by such Eligible Executive which, based upon a
good faith and reasonable factual investigation, demonstrates such
Eligible Executive’s gross unfitness to serve; (iv) such
Eligible Executive’s violation of any fiduciary duty or duty
of loyalty owed to the Company and/or its affiliates; (v) such
Eligible Executive’s breach of any material term of any
material contract between such Eligible Executive and the Company
and/or its affiliates which has a material adverse effect on the
Company and/or its affiliates; (vi) such Eligible
Executive’s repeated violation of any material Company policy
which has a material adverse effect on the Company and/or its
affiliates; (vii) the Eligible Executive’s violation of
state or federal law in connection with the performance of the
Eligible Executive’s job which has a material adverse effect
on the Company and/or its affiliates; (viii) such Eligible
Executive’s death or Disability; or (ix) such Eligible
Executive’s repeated neglect of duties or substandard
performance that is not cured within fifteen (15) days following
notice of such neglect or deficient performance. The
determination that a termination is for Cause shall be by the
Committee, as applicable, in its sole and exclusive judgment and
discretion.
(b)
“COMMITTEE”
means the Committee
established by the Company’s Board of Directors (and any
delegatee(s) of such Committee) to administer this Program in
accordance with its terms.
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(c)
“COMPANY”
means Cymer, Inc.,
and any successor entity following a merger, reverse merger, the
sale of all or substantially all of the assets, or similar
transaction with respect to Cymer, Inc.
(d)
“DISABILITY”
means the Executive is
prevented from performing his duties to the Company by reason of
any physical or mental incapacity that results in Executive’s
satisfaction of all requirements necessary to receive benefits
under the Company’s long-term disability plan due to a total
disability.
(e)
“ELIGIBLE
EXECUTIVE” means any Executive or former Executive who the
Committee determines, in its sole and exclusive discretion,
satisfies each of the following conditions as of the Separation
Date:
(i)
is in good standing with
the Company,
(ii)
the Company does not have
grounds to terminate the Executive for Cause,
(iii)
voluntarily retires from
employment with the Company,
(iv)
either
(A) voluntarily relinquishes all options that are unvested and
unexercised as of the Separation Date and any other unvested equity
awards for which the shares subject to such awards have not yet
been issued as of the Separation Date which were granted to such
Executive within the one-year period prior to such voluntary
retirement, or B) has an individual employment agreement with the
Company that otherwise provides for full acceleration of vesting of
Executive’s unvested equity awards as of the Separation
Date.
(v)
satisfies either of the
following service conditions:
(A)
Ten (10) consecutive
Years of Service on a Full-Time basis (at least five (5) of
which were as an Executive) and the attainment of age fifty-five
(55); or
(B)
Fifteen (15) consecutive
Years of Service on a Full-Time basis (at least five (5) of
which were as an Executive) and the attainment of age fifty
(50).
(f)
“EXECUTIVE”
means an Officer, the
Chief Technical Officer, the Chief Technical Advisor or the Chief
Intellectual Property Counsel of the Company.
(g)
“FULL-TIME”
means, with respect to a
particular Eligible Executive, he or she is scheduled to work forty
(40) or more hours per week, or such hours as required by a
Committee-approved succession plan as described in subsection
4(a) herein.
(h)
“GROUP HEALTH
PLAN” means a plan offered by the Company that
provides medical, dental and/or vision coverage to the
Company’s employees, but does not include an Internal Revenue
Code Section 125 health care reimbursement plan.
(i)
“ HEALTH BENEFIT
PERIOD ” means the twelve (12) month period following the
Eligible Executive’s Separation Date.
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(j)
“OFFICER”
means, with respect to the
Company, a person who is an officer within the meaning of
Section 16 of the Securities Exchange Act of 1934, as amended,
and the rules and regulations promulgated
thereunder.
(k)
“PARTICIPANT”
means an Eligible
Executive who has fulfilled the requirements of Section 4
herein.
(l)
“SEPARATION
DATE” means the effective date of the Eligible
Executive’s retirement from Full-Time status with the
Company; provided that such retirement also qualifies as a
“separation from service” for purposes of
Section 409A(a)(2)(A)(i) of the Internal Revenue Code and
the regulations and other guidance thereunder.
(m)
“SERVICE
DATE” means the Eligible Executive’s first date
of employment with the Company.
(n)
“YEAR OF
SERVICE” means a full year (i.e., a period of twelve
complete months) of service completed by an Eligible Executive, and
“Years of Service” means, with respect to such Eligible
Executive, the number of Years of Service measured from such
Eligible Executive’s Service Date to such Eligible
Executive’s Separation Date, but excluding any monthly period
during which Executive is not employed by the Company.
SECTION 4.
DEPARTURE AND
ENTITLEMENT REQUIREMENTS
.
As
a condition to becoming a Participant and receiving any of the
benefits pursuant to this Program, the Eligible Executive must
satisfy each of the following:
(a)
Successfully complete an
approved succession planning process (the exact length and
satisfaction of which shall be determined by the Committee in its
sole and exclusive discretion) prior to such Eligible
Executive’s Separation Date to ensure a smooth transition
following such Eligible Executive’s retirement from the
Company;
(b)
Within the time period set
forth therein, but in no event later than forty-five (45) days
following termination of employment, the Eligible Executive must
provide the Company with a Release and Waiver of Claims (in the
form attached hereto as Exhibit A (the “Release and
Waiver”) or such other form of Release and Waiver as may be
required by the Company), and such Release and Waiver must become
effective in accordance with its terms; and
(c)
On or before such Eligible
Executive’s Separation Date, enter into a Consulting
Agreement with the Company (in the form attached hereto as
Exhibit B, as amended by the Company from time to time), a
copy of which shall be provided to Eligible Executives upon the
distribution of this Program.
SECTION 5.
PARTICIPATION
AND BENEFITS.
An
Eligible Executive who timely signs and returns an executed
Consulting Agreement and an effective Release and Waiver as
described in Section 4 shall become a Participant as of the
later of the effective date of the Consulting Agreement and the
Release and Waiver, and, subject to the terms and conditions of the
Consulting Agreement, shall be entitled to the
following:
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(a)
Service as a consultant to
the Company for a term of four (4) years from the Separation
Date;
(b)
Remuneration in the amount
of one thousand dollars ($1,000.00) per month during the term of
the Consulting Agreement, which amounts shall accrue and be paid on
a monthly basis within thirty (30) days of the Company’s
receipt of the monthly invoice for such consulting services;
provided, however, that no payments of such remuneration shall be
made any earlier than six (6) months after the Separation Date
to the extent necessary to satisfy the distribution requirements of
Internal Revenue Code Section 409A(a)(2)(B);
(c)
Continued vesting of stock
options and other equity awards during the term of the Consulting
Agreement pursuant to the terms and conditions of the applicable
Company stock option plan and stock option agreement (not including
the stock options and other equity awards voluntarily relinquished
as a condition to receiving benefits under this Program, if
applicable);
(d)
An extension of the period
in which such Participant or, in the event of such
Participant’s death, such Participant’s beneficiary or
beneficiaries may exercise such Participant’s options
following such Participant’s termination of service with the
Company to a date that is the earlier of: (i) ninety (90) days
from end of the term of the Consulting Agreement, or (ii) the
expiration of the maximum term of the option;
(e)
Continued availability of
the AYCO Company for financial services at Consultant’s own
expense; and
(f)
Continue vesting during
the term of the Consulting Agreement of eligible bonus under the
Executive 3-Year Cash Bonus Program, Long-Term Incentive Bonus Plan
and any successor plan to such plans; and
(g)
The Company will pay the
premiums for coverage under the Company’s Group Health
Plan(s) for the Participant, Participant’s spouse, and
Participant’s eligible dependent children during the Health
Benefit Period. As a condition to the benefits provided
herein, the Participant must waive (and not revoke such waiver) any
and all rights under Title X of the Consolidated Omnibus Budget
Reconciliation Act (COBRA) of 1985 and Section 4980B of the
Internal Revenue Code of 1986. The Participant,
Participant’s spouse, and Participant’s dependent
children, acknowledge and agree that by accepting the Group Health
Plan premium payments provided by the Company during the Health
Benefit Period they are waiving such COBRA rights. Following
the Health Benefit Period, the Participant, Participant’s
spouse, and Participant’s eligible dependent children, may
participate in the Company’s Group Health Plan by paying for
such coverage at the Company’s Group Health Plan retirement
group rate in effect at the time such payment is due, until the
earlier of: (1) the date the Participant or the
Participant’s spouse reaches age sixty-five (65) or becomes
entitled to Medicare coverage (Part A or Part B),
(2) the Participant, Participant’s spouse, or
Participant’s dependent children cease to pay their
applicable premiums for coverage under the applicable Group
Health
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