Dec. 20, 2001 – Fremont, CA – Lam Research Corp. is reducing its global work force by approximately 12% or about 400 employees. The company will record a restructuring charge against financial results for the quarter ending December 2001.
“We made this difficult decision to address the current market environment and size our operations accordingly,” stated James Bagley, Lam’s chairman and CEO. “While our near-term expectations about the business environment have not changed, the decline in the last two quarters was greater than we anticipated and required today’s actions. We remain committed to investing in research and development activities and believe that our strong product position will enable the company to demonstrate solid market share growth when the industry recovers.”
In a separate announcement Lam has agreed to settle all outstanding patent litigation with Varian Semiconductor Equipment Associates Inc. Lam has agreed to pay VSEA $20 million and to issue a warrant for the purchase of two million shares of Lam common stock, exercisable through December 2005 at a price of $21.30 per share. $5 million is payable upon signing for licensed use of the patents during 2001 with the warrant covering licensed use of the patents in 2000 and earlier. Quarterly payments totaling the balance of $15 million will be paid over the next three years for future licensed use over the remaining life of the patents.
In connection with the above settlement, Lam will record a special charge of approximately $42 million: $20 million for the cash payment and a non-cash charge of $22 million, which represents the imputed value of the warrants at $21.30 per share. The charge will be reflected in the quarter ending December 2001. The company will file a registration statement with the Securities and Exchange Commission for resale of the warrant shares by VSEA.