Novellus Systems (NVLS) 8-K Entry into a Material Definitive Agreement

Novellus and Lam Research

Novellus and Lam Research

Novellus and Lam Research

Director Meeting

Director Meeting

December

15

th

,

2011

Filed by Novellus Systems, Inc.

Pursuant to Rule 425 under the Securities Act of 1933

and deemed filed pursuant to Rule 14a-12

under the Securities Exchange Act of 1934

Subject Company: Novellus Systems, Inc.

Commission File No.:  000-17157

Exhibit 99.6

P. 2

P. 2

A Transformative Transaction

A Transformative Transaction

Novellus and Lam Research have signed an agreement to

Novellus and Lam Research have signed an agreement to

combine the two companies

combine the two companies

•

•

The new company will be called Lam Research

The new company will be called Lam Research

•

•

NASDAQ symbol is: LRCX

NASDAQ symbol is: LRCX

The  ~$3.3 billion, all-stock deal is expected to close in

The  ~$3.3 billion, all-stock deal is expected to close in

Q2 of CY2012

Q2 of CY2012

This is a GAME-CHANGING move for both companies.

This is a GAME-CHANGING move for both companies.

Together, we can bring value to our customers, employees,

Together, we can bring value to our customers, employees,

and shareholders that we couldn’t have done

and shareholders that we couldn’t have done

independently.

independently.

Both management teams are excited about what this will

Both management teams are excited about what this will

mean for the future of our combined companies

mean for the future of our combined companies

Novellus Systems Confidential

P. 3

P. 3

Compelling Strategic Rationale

Compelling Strategic Rationale

Complementary products and technology

Complementary products and technology

Accelerates the pace of innovation

Accelerates the pace of innovation

Superior ability to meet customer requirements

Superior ability to meet customer requirements

Enhances revenue growth

Enhances revenue growth

Significant operational synergies

Significant operational synergies

Novellus Systems Confidential

P. 4

P. 4

Novellus + Lam Research = A Powerful Combination

Novellus + Lam Research = A Powerful Combination

Lam is a $3.1B leader in etch and single wafer clean technology

Lam is a $3.1B leader in etch and single wafer clean technology

Novellus’

Novellus’

businesses are complementary to Lam’s

businesses are complementary to Lam’s

Together we believe we can grow revenue faster

Together we believe we can grow revenue faster

•

•

More opportunity for growth with complementary adjacent technologies

More opportunity for growth with complementary adjacent technologies

•

•

Optimizing collective development for next-generation tools

Optimizing collective development for next-generation tools

•

•

Leveraging complementary customer relationships

Leveraging complementary customer relationships

Increased scale enables more comprehensive support tailored to

Increased scale enables more comprehensive support tailored to

customers’

customers’

needs

needs

Combined management strength can grow the company to new

Combined management strength can grow the company to new

levels

levels

Combined company = $4.6 billion in revenue

Combined company = $4.6 billion in revenue

Novellus Systems Confidential

P. 5

P. 5

Complementary Product Leadership

Complementary Product Leadership

Expect

Expect

to

to

serve

serve

~32%

~32%

of

of

total

total

wafer

wafer

fab

fab

equipment

equipment

market

market

Novellus Systems Confidential

Note:  CVD: chemical vapor deposition; Cu ECD:  copper electrochemical deposition ; WCVD: tungsten chemical vapor deposition.

Source:  Leadership positions based on Gartner Dataquest and company data specific to 2010 shares; WFE percentages based on Gartner Dataquest

and company data.

P. 6

P. 6

Enhanced Financial Profile

Enhanced Financial Profile

1

Pro forma as of September 30, 2011.

Novellus Systems Proprietary Information

Novellus Systems Proprietary Information

Multiple value creation levers

Multiple value creation levers

P. 7

P. 7

The Right Time –

The Right Time –

the Right Combination

the Right Combination

IC device complexity is growing

•

Semiconductor

roadmap

facing

steep

technology

and

cost

challenges

•

Increases

the

importance

for

customers

to

partner

with

strong

suppliers

Opportunities for equipment suppliers are growing

•

Long-term

demand

being

driven

by

mobility

and

cloud

computing

trends

•

Chipmakers

require

strategic

vendors

who

can

address

technical

challenges

Right combination for future growth opportunities

•

Combined

company

will

be

able

to

deliver

solutions

neither

could

offer

independently

•

Increased

scale

enables

comprehensive

support

capabilities

tailored

to

customers’

needs

•

Technical

adjacencies

support

rapid

development

of

leading-edge

process

solutions

•

Efficiently

&

effectively

develop

solutions

for

next-gen

technology,

including

450

mm

•

Management

depth

and

breadth

capable

of

accomplishing

combined

goals

Novellus Systems Confidential

P. 8

P. 8

The Right Fit –

The Right Fit –

Our Cultures

Our Cultures

Both companies have roots in Silicon Valley

•

Headquartered

in

San

Jose

and

Fremont

with

operations

in

many

of

the

same

locations

Our customer support structures are essentially the same

•

Our respective customer strengths will be beneficial across all products

Our employees share similar values and a spirit of innovation

Our executive teams share similar and complementary management

styles

•

Martin Anstice will be the President and CEO

•

Tim Archer will be the COO

•

Ernie Maddock will be the CFO

Novellus Systems Confidential

P. 9

P. 9

Initial Observations About Combining the Companies

Initial Observations About Combining the Companies

Cultures are very compatible

Cultures are very compatible

Approach to managing the business is very similar

Approach to managing the business is very similar

Fundamental organizational structures are essentially

Fundamental organizational structures are essentially

the same

the same

The challenge facing us is to create a highly effective

The challenge facing us is to create a highly effective

new organization while realizing committed synergies

new organization while realizing committed synergies

We will be methodical, thoughtful, and fair about

We will be methodical, thoughtful, and fair about

decisions relating to organizational change

decisions relating to organizational change

Novellus Systems Confidential

P. 10

P. 10

Next Steps

Next Steps

Preparing for an efficient

Preparing for an efficient

and successful integration

and successful integration

Novellus Systems Proprietary Information

Novellus Systems Proprietary Information

P. 11

P. 11

What Does This Mean for Me Now?

“Business as usual”

until the transaction closes

•

Estimated to be Q2 2012

•

Stay focused on your current goals and objectives

Communication with your Lam counterparts will occur

through an executive staff member

We will share further information about integration as it

becomes available

We are planning a true business combination

•

In the short run, Novellus employees will continue on their current

Compensation & Benefits programs

Novellus Systems Confidential

P. 12

P. 12

Where Can I Find More Information?

Where Can I Find More Information?

A link to resources for employees can be found on

the Fifth Arrow under the link: Novellus and Lam

Research Merger

•

Employee memo

•

Employee FAQs

•

Video of San Jose meeting

Schedule meetings with your direct reports as

soon as possible (today or tomorrow) to review the

details of the announcement

Novellus Systems Confidential

P. 13

P. 13

In Closing

In Closing

Novellus has never been positioned better with

industry leading products and technology to meet

the demand of next generation semiconductor

devices

None of this would be possible without your

support. 

We’re confident that together we’ll build an even

greater legacy in the semiconductor equipment

industry

Novellus Systems Confidential

P. 14

P. 14

How to Find Further Information

How to Find Further Information

This

communication

does

not

constitute

an

offer

to

sell

or

the

solicitation

of

an

offer

to

buy

any

securities,

or

a

solicitation

of

any

vote

or

approval,

nor

shall

there

be

any

sale

of

securities

in

any

jurisdiction

in

which

such

offer,

solicitation

or

sale

would

be

unlawful

prior

to

registration

or

qualification

under

the

securities

laws

of

any

such

jurisdiction.

In

connection

with

the

proposed

merger,

Lam

Research

intends

to

file

with

the

SEC

a

registration

statement

on

Form

S-4

that

will

include

a

joint

proxy

statement

of

Lam

Research

and

Novellus

Systems

that

also

constitutes

a

prospectus

of

Lam

Research.

Lam

Research

and

Novellus

Systems

will

furnish

the

joint

proxy

statement/prospectus

and

other

relevant

documents

to

their

respective

security

holders

in

connection

with

the

proposed

merger

of

Lam

Research

and

Novellus

Systems.

BEFORE

MAKING

ANY

VOTING

OR

INVESTMENT

DECISION,

WE

URGE

SECURITY

HOLDERS

AND

INVESTORS

TO

READ

THE

JOINT

PROXY

STATEMENT/PROSPECTUS

(INCLUDING

ALL

AMENDMENTS

AND

SUPPLEMENTS

THERETO)

AND

OTHER

DOCUMENTS

FILED

WITH

THE

SEC

CAREFULLY

AND

IN

THEIR

ENTIRETY

WHEN

THEY

BECOME

AVAILABLE,

BECAUSE

THEY

WILL

CONTAIN

IMPORTANT

INFORMATION

ABOUT

LAM

RESEARCH

AND

NOVELLUS

SYSTEMS

AND

THE

PROPOSED

MERGER.

The

proposals

for

the

merger

will

be

made

solely

through

the

joint

proxy

statement/prospectus.

In

addition,

a

copy

of

the

joint

proxy

statement/prospectus

(when

it

becomes

available)

may

be

obtained

free

of

charge

from

Lam

Research

Corporation,

Investor

Relations,

4650

Cushing

Parkway,

Fremont,

CA

94538-6401,

or

from

Novellus

Systems,

Investor

Relations,

4000

North

First

Street,

San

Jose,

CA

95134.

Security

holders

will

be

able

to

obtain,

free

of

charge,

copies

of

the

joint

proxy

statement/prospectus

and

S-4

Registration

Statement

and

any

other

documents

filed

by

Lam

Research

or

Novellus

Systems

with

the

SEC

in

connection

with

the

proposed

Merger

at

the

SEC’s

website

at

http://www.sec.gov,

and

at

the

companies’

websites

at

www.Lam

Research.com

and

www.Novellus.com,

respectively.

Novellus Systems Confidential

P. 15

P. 15

Forward Looking Statements

Forward Looking Statements

This

announcement

contains,

or

may

contain,

“forward-looking

statements”

concerning Lam Research and Novellus Systems (together such companies and their

subsidiaries

being

the

“Merged

Company”),

which

are

subject

to

the

safe

harbor

provisions

created

by

the

Private

Securities

Litigation

Reform

Act

of

1995.

Generally,

the

words

“believe,”

“anticipate,”

“expect,”

“may,”

“should,”

“could,”

and

other

future-oriented

terms

identify

forward-looking

statements.

Forward-looking

statements

include,

but

are

not

limited

to,

statements

relating

to

the

following:

(i)

the

expected

benefits

of

the

Merger

and

the

repurchase

program,

the

expected

accretive

effect

of

the

Merger

and

the

repurchase

program

on

the

Merged

Company’s

financial

results,

expected

cost,

revenue,

technology

and

other

synergies,

the

expected

impact

for

customers,

employees

and

end-users,

future

capital

expenditures,

expenses,

revenues,

earnings,

economic

performance,

financial

condition,

losses

and

future

prospects;

(ii)

business

and

management

strategies

and

the

expansion

and

growth

of

Lam

Research’s

or

Novellus

Systems’

operations;

(iii)

the

effects

of

government

regulation

on

Lam

Research’s,

Novellus

Systems’

or

the

Merged

Company’s

business;

(iv)

future

industry

developments

and

trends;

(v)

the

anticipated

timing

of

shareholder

meetings

and

completion

of

the

proposed

merger

and

the

repurchase

program;

and

(vi)

assumptions

underlying

any

of

the

foregoing

statements.

Novellus Systems Confidential

P. 16

P. 16

Forward Looking Statements (cont.)

Forward Looking Statements (cont.)

These

forward-looking

statements

are

based

upon

the

current

beliefs

and

expectations

of

the

management

of

Lam

Research

and

Novellus

Systems

and

involve

risks

and

uncertainties

that

could

cause

actual

results

to

differ

materially

from

those

expressed

in

the

forward-

looking

statements.

Many

of

these

risks

and

uncertainties

relate

to

factors

that

are

beyond

Lam

Research’s

and

Novellus

Systems’

ability

to

control

or

estimate

precisely

and

include,

without

limitation:

the

ability

to

obtain

governmental

or

stockholder

approvals

of

the

Merger

or

to

satisfy

other

conditions

to

the

Merger

on

the

proposed

terms

and

timeframe;

the

possibility

that

the

Merger

does

not

close

when

expected

or

at

all,

or

that

the

companies

may

be

required

to

modify

aspects

of

the

Merger

to

achieve

regulatory

approval;

the

ability

to

realize

the

expected

synergies

or

other

benefits

from

the

transaction

in

the

amounts

or

in

the

timeframe

anticipated;

the

potential

harm

to

customer,

supplier,

employee

and

other

relationships

caused

by

the

announcement

or

closing

of

the

Merger;

the

ability

to

integrate

Novellus

Systems’

and

Lam

Research’s

businesses

in

a

timely

and

cost-efficient

manner;

uncertainties

in

the

global

economy

and

credit

markets;

unanticipated

trends

with

respect

to

the

cyclicality

of

the

semiconductor

industry;

and

rates

of

change

in,

future

shipments,

margins,

market

share,

capital

expenditures,

revenue

and

operating

expenses

generally;

volatility

in

quarterly

results

and

in

the

stock

price

of

the

Merged

Company;

customer

requirements

and

the

ability

to

satisfy

those

requirements;

customer

capital

spending

and

their

demand

for

the

Merged

Company’s

products;

the

ability

to

defend

the

Merged

Company’s

market

share

and

to

gain

new

market

share;

anticipated

growth

in

the

industry

and

the

total

market

for

wafer-fabrication

and

support

equipment

and

the

Merged

Company’s

growth

relative

to

such

growth;

levels

of

research

and

development

expenditures;

the

estimates

made,

and

the

accruals

recorded,

in

order

to

implement

critical

accounting

policies

(including

but

not

limited

to

the

adequacy

of

prior

tax

payments,

future

tax

liabilities

and

the

adequacy

of

the

Merged

Company’s

accruals

relating

to

them);

access

to

capital

markets;

the

ability

to

manage

and

grow

the

Merged

Company’s

cash

position;

the

sufficiency

of

the

Merged

Company’s

financial

resources

to

support

future

business

activities

(including

but

not

limited

to

the

repurchase

program,

operations,

investments,

debt

service

requirements

and

capital

expenditures);

inventory

levels

and

inventory

valuation

adjustments;

the

impact

of

legal

proceedings;

unexpected

shipment

delays

which

adversely

impact

shipment

volumes;

inaccuracies

related

to

the

timing

and

satisfaction

of

remaining

obligations

related

to

vacated

leases;

the

inability

to

recover

the

amortized

cost

of

investments

in

auction-rate

securities,

market

changes

negatively

affecting

auction-rate

securities

and

the

government’s

inability

to

guarantee

the

underlying

securities;

the

inability

to

enforce

the

Merged

Company’s

patents

and

protect

its

trade

secrets;

and

other

risks

and

uncertainties,

including

those

detailed

from

time

to

time

in

Lam

Research’s

and

Novellus

Systems’

periodic

reports

(whether

under

the

caption

Risk

Factors

or

Forward

Looking

Statements

or

elsewhere).

Neither

Lam

Research

nor

Novellus

Systems

can

give

any

assurance

that

such

forward-looking

statements

will

prove

to

have

been

correct.

The

reader

is

cautioned

not

to

place

undue

reliance

on

these

forward-looking

statements,

which

speak

only

as

of

the

date

of

this

announcement.

Neither

Lam

Research

nor

Novellus

Systems

nor

any

other

person

undertakes

any

obligation

to

update

or

revise

publicly

any

of

the

forward-looking

statements

set

out

herein,

whether

as

a

result

of

new

information,

future

events

or

otherwise,

except

to

the

extent

legally

required.

Nothing

contained

herein

shall

be

deemed

to

be

a

forecast,

projection

or

estimate

of

the

future

financial

performance

of

Lam

Research,

Novellus

Systems,

or

the

Merged

Company,

following

the

implementation

of

the

Merger

or

otherwise.

No

statement

in

this

announcement

should

be

interpreted

to

mean

that

the

earnings

per

share,

profits,

margins

or

cash

flows

of

Lam

Research

or

the

Merged

Company

for

the

current

or

future

financial

years

would

necessarily

match

or

exceed

the

historical

published

figures.

Novellus Systems Confidential

P. 17

P. 17

Participants in the Solicitation

Participants in the Solicitation

The

directors

and

executive

officers

of

Lam

Research

and

Novellus

Systems

may

be

deemed

to

be

participants

in

the

solicitation

of

proxies

in

connection

with

the

approval

of

the

proposed

transaction.

Lam

Research

plans

to

file

the

registration

statement

that

includes

the

joint

proxy

statement/prospectus

with

the

SEC

in

connection

with

the

solicitation

of

proxies

to

approve

the

proposed

transaction. 

Information

regarding

Lam

Research’s

directors

and

executive

officers

and

their

respective

interests

in

Lam

Research

by

security

holdings

or

otherwise

is

available

in

its

Annual

Report

on

Form

10-K

filed

with

the

SEC

on

August

19,

2011

and

its

Proxy

Statement

on

Schedule

14A

filed

with

the

SEC

on

September

19,

2011.

Information

regarding

Novellus

Systems’

directors

and

executive

officers

and

their

respective

interests

in

Novellus

Systems

by

security

holdings

or

otherwise

is

available

in

its

Annual

Report

on

Form

10-K

filed

with

the

SEC

on

February

25,

2011

and

its

Proxy

Statement

on

Schedule

14A

filed

with

the

SEC

on

April

8,

2011.

Additional

information

regarding

the

interests

of

such

potential

participants

is

or

will

be

included

in

the

joint

proxy

statement/prospectus

and

registration

statement,

and

other

relevant

materials

to

be

filed

with

the

SEC,

when

they

become

available,

including

in

connection

with

the

solicitation

of

proxies

to

approve

the

proposed

transaction

and

to

elect

directors.

Novellus Systems Confidential