DEF 14A of Kla Corp, Sep 24, 2024

DEF 14A of Kla Corp

Filed Sep 24, 2024 · FY20240001193125-24-224794

Open on EDGAR

  1. iii

    | 62 | Outstanding Equity Awards at Fiscal Year End | | 64 | Option Exercises and Stock Vested | | 64 | Nonqualified Deferred Compensation | | 66 | Potential Payments Upon Termination or Change in Control | | 71 | Pay Ratio Disclosure | | 74 | Certain Relationships and Related Transactions | | 75 | Equity Compensation Plan Information | | 76 | Report of the Audit Committee | | 77 | Questions and Answers | | 83 | Information for KLA Annual Meeting of Stockholders on November 6, 2024, 12:00 p.m. PST |

  2. OUR DIRECTORS

    OUR DIRECTORS

  3. OUR DIRECTORS

    | Directors and Principal Occupation | | | Director Since | Current Other Public Company Boards | Committees* | | | | | Independent | Age | | | AC | CTC | NGC | | Robert Calderoni Former Chairman and Interim President and Chief Executive Officer of Citrix Systems, Inc. | Yes | 64 | 2007 | Ansys, Inc. | | 🌑 | Chair | | Jeneanne Hanley Former Senior Vice President and President of E-Systems Division of Lear Corporation | Yes | 51 | 2019 | QuantumScape Corporation | | 🌑 | | | Emiko Higashi Founder of Tohmon Capital Partners, LLC | Yes | 65 | 2010 | Takeda Pharmaceutical Company Rambus, Inc. | 🌑 | | | | Kevin Kennedy Former Chairman of Quanergy Systems, Inc. | Yes | 68 | 2007 | Digital Realty Trust, Inc. UL Solutions Inc. | 🌑 | | 🌑 | | Michael McMullen Senior Advisor of Agilent Technologies, Inc. | Yes | 63 | 2023 | Bristol-Myers Squibb Company | | 🌑 | | | Gary Moore Former Executive Chairman and Chief Executive Officer of ServiceSource International, Inc. | Yes | 75 | 2014 | None | | Chair | 🌑 | | Marie Myers** Executive Vice President and Chief Financial Officer of Hewlett Packard Enterprise Company | Yes | 56 | 2020 | None | Chair | | 🌑 | | Victor Peng Former President, Adaptive, Embedded, and AI Group of Advanced Micro Devices, Inc. | Yes | 64 | 2019 | None | | 🌑 | | | Robert Rango Former President and Chief Executive Officer of Enevate Corporation | Yes | 66 | 2014 | Keysight Technologies, Inc. Microchip Technology, Inc. | 🌑 | | | | Richard Wallace President and Chief Executive Officer of KLA Corporation | No | 64 | 2006 | Marvell Technology, Inc. | | | |

  4. OUR DIRECTORS

    * As of September 12, 2024 ** Ms. Myers is not standing for reelection to the Board at the Annual Meeting.

  5. GOVERNANCE HIGHLIGHTS

    GOVERNANCE HIGHLIGHTS

  6. GOVERNANCE HIGHLIGHTS

    | Board and Governance Information** | | | | | Size of the Board | 9 | Independent Chair | Yes | | Number of Independent Directors | 8 | Proxy Access | Yes | | Average Age of Directors | 64.4 | Stockholder Action by Written Consent | No | | Average Tenure of Directors | 10.8 years | Stockholder Ability to Call Special Meeting | No | | Annual Election of Directors | Yes | Poison Pill | No | | Women | 22% | Stock Ownership Guidelines for Directors and Executive Officers | Yes | | Ethnic/Racial Diversity | 22% | Anti-Hedging and Pledging Policies | Yes | | Majority Voting in Director Elections | Yes | Clawback Policy | Yes |

  7. GOVERNANCE HIGHLIGHTS

    * Ms. Myers is not standing for reelection to the Board at the Annual Meeting, which will reduce the Board’s gender diversity from 30% to 22%. Our Board and Nominating and Governance Committee value gender diversity on the Board and are committed to increasing the number of female Board members. We are actively seeking highly qualified director candidates with the appropriate skills and experience to serve on the Board, and we expect to complete our search and appoint a new director by the next annual meeting. ** The information in this table reflects only the directors nominated Fiscal Year 2024 Performance Highlights

  8. The Board’s Role in Oversight of Risk

    The Board’s Role in Oversight of Risk Our Board, as a whole and through its committees, has responsibility for the oversight of risk management. In its oversight role, our Board has the responsibility to satisfy itself that the risk management processes designed and implemented by management are adequate and functioning as designed. The involvement of the Board in working with management to establish our business strategy at least annually is a key part of its oversight of risk management, its assessment of management’s appetite for risk and its determination of what constitutes an appropriate level of risk for KLA. In addition, the Board periodically conducts a comprehensive review of our overall risk environment and risk management efforts. The Board and its committees also regularly receive updates from management (including representatives of our legal and internal audit teams) regarding certain risks that we face, including industry, business, macroeconomic, litigation, cybersecurity and other operating risks. While our Board is ultimately responsible for risk oversight, our Board has delegated to the Audit Committee the primary responsibility for the active oversight of our enterprise risk management activities. Our Audit Committee is not only responsible for overseeing risk management of financial matters, the adequacy of our risk-related internal controls, financial reporting and internal investigations, and cybersecurity, but its charter also provides that the Audit Committee will discuss at least annually KLA’s risk assessment, enterprise risk management processes and major financial risk exposures, as well as the steps our management has taken to monitor and control those exposures. Our Audit Committee reports its findings and activities to the Board at each quarterly Board meeting. In addition, our other Board committees each oversee certain aspects of risk management. Our Compensation and Talent Committee oversees risks related to our compensation and human capital policies and practices, and our Nominating and Governance Committee oversees governance-related risks, such as Board independence, environmental, social and governance (“ESG”) matters, conflicts of interest and management and director succession planning. The committees report their findings and activities to the Board. While the Board is responsible for risk oversight, management is responsible for risk management. KLA maintains an effective internal controls environment and has processes to identify and manage risk, including an executive risk committee comprised of representatives from our legal, human resources, finance, global operations, internal audit, procurement, and risk and compliance teams. This committee reports to our Chief Executive Officer and has oversight of the various risk assessment, monitoring and controls processes across the Company. The current composition of the committees of the Board is as follows:

  9. The Board’s Role in Oversight of Risk

    | Director | Audit | Compensation and Talent | Nominating and Governance | | Robert Calderoni | | ✓ | Chair | | Jeneanne Hanley | | ✓ | | | Emiko Higashi | ✓ | | | | Kevin Kennedy | ✓ | | ✓ | | Michael McMullen | | ✓ | | | Gary Moore | | Chair | ✓ | | Marie Myers* | Chair | | ✓ | | Victor Peng | | ✓ | | | Robert Rango | ✓ | | | | Richard Wallace | | | |

  10. The Board’s Role in Oversight of Risk

    * Ms. Myers is not standing for reelection to the Board at the Annual Meeting.

  11. Director Nominee Skills Matrix

    Director Nominee Skills Matrix

  12. Director Nominee Skills Matrix

    | Director Nominee Skills Matrix (as of September 12, 2024) | | | | | | | | | | | Public Company. Experience with reporting obligations, investor interaction, corporate securities rules, and public company governance. | ● | ● | ● | ● | ● | ● | ● | ● | ● | | Global Business. Broad exposure to companies or organizations having a significant global presence, including developing and managing business in markets around the world, communicating in different cultures, and understanding different geopolitical situations. | ● | ● | ● | ● | ● | ● | ● | ● | ● | | Corporate Governance. Adhering to bylaws and charters; experience in setting and adhering to corporate governance agenda for a board of directors; knowledge and understanding of governance planning, implementation and review processes; experience in encouraging management accountability and protecting stockholder interests. | ● | ● | ● | ● | ● | ● | ¡ | ● | ● | | Corporate Financing/Capital Allocation. Experience in making capital allocation decisions; experience in financing or capital markets transactions. | ● | ● | ● | ● | ● | ● | ● | ● | ● | | Financial Expertise/Literacy. Experience in accounting or financial reporting, including understanding of internal controls; experience in overseeing such reporting and controls. | ● | ● | ● | ● | ● | ¡ | ¡ | ● | ● | | Information Services and Technology. Experience, knowledge and understanding of information services industry; significant experience with technology, science and innovation; basic knowledge of various IT solutions, experience in overseeing the implementation of such solutions and using such solutions to improve business performance; particular experience with social media and developing online platforms. | ● | ¡ | | ● | ● | ● | ● | ● | ● | | Legal/Public/Regulatory. Expertise in compliance with applicable governmental regulations; experience in legal and regulatory matters, corporate compliance and ethics policies; experience in managing the effects of government policies and regulations. | ● | ¡ | ¡ | ● | ● | ¡ | ¡ | ¡ | ● | | Risk Management. Experience in the management of critical business and/or legal risk; understanding of risk management functions, including risk profiles and appetite statements, scenario planning, crisis management, risk identification/classification and similar functions; history of leadership roles in risk management across a number of organizations; ability to think strategically about risk across several organizations; ability to provide oversight and advice relating to risk. | ● | ● | ¡ | ● | ● | ● | ● | ● | ● | | Business Operations. Experience managing supply chain risk and functionality; operating within and through economic cycles; ramping up and ramping down significant employee base; appropriate staffing decisions across numerous functions and operational channels. | ● | ● | | ● | ● | ● | ● | ● | ● | | Business Development and Strategic Planning. Superior knowledge and understanding of business development, strategic planning, implementation, and review processes; experience in leading strategy discussion at the board level; experience in strategy development with more than one organization; strategic agenda-setting experience; experience with developing and implementing strategies for growth and/or downsizing, including mergers and acquisitions, joint ventures, and divestitures. | ● | ● | ● | ● | ● | ● | ● | ● | ● | | Human Resource, Executive Compensation and Talent Management. Broad experience in executive development, performance, and compensation; experience with HR processes and strategies and efforts to attract, motivate, and retain candidates for key positions; experience in talent development, including developing diversity, equity, and inclusion in workforce. | ● | ● | ¡ | ● | ● | ● | ● | ● | ● | | Cybersecurity/Data Privacy. Experience in overseeing and managing cybersecurity and data privacy risks; history of leadership roles in cybersecurity risk management; degrees, certifications, or other background in cybersecurity. | ¡ | | | ● | ¡ | ● | ¡ | ● | ● | | Industry. Experience in the semiconductor industry; perspective and knowledge of semiconductor-related information, including insight into the industry’s challenges and opportunities. | ● | ¡ | ● | ● | ¡ | ● | ● | ● | ● |

  13. Director Nominee Skills Matrix

    | ● | Denotes extensive experience, knowledge, and/or expertise and indicates a primary qualification supporting the Director’s nomination. | ¡ | Denotes an area in which the Director nominee has demonstrated proficiency and indicates an ancillary qualification supporting the Director’s nomination. |

  14. Board Diversity Matrix

    Board Diversity Matrix The Board Diversity Matrix below depicts the gender and ethnic composition of our Board nominees:

  15. Board Diversity Matrix

    | Board Nominee Diversity Matrix (As of September 12, 2024) | | | | | | Total Number of Directors: | 9 | | | | | | Female | Male | Non-Binary | Did Not Disclose Gender | | Part I: Gender Identity | | | | | | Directors | 2 | 7 | | | | Part II: Demographic Background | | | | | | African American or Black (not of Hispanic or Latinx origin) | | | | | | Alaska Native or Native American | | | | | | Asian | 1 | 1 | | | | Hispanic or Latinx | | | | | | Native Hawaiian or Pacific Islander | | | | | | White (not of Hispanic or Latinx origin) | 1 | 6 | | | | LGBTQ+ | | | | | | Did Not Disclose Demographic Background | | | | |

  16. Board Diversity Matrix

    Our Board and its Nominating and Governance Committee believe that all of the directors and nominees listed below are highly qualified and have the skills and experience required for service on our Board. Below is certain information with respect to our directors and nominees as of the date of this Proxy Statement, including, for each director and nominee, a biography and a summary of his or her significant experiences, qualifications and skills that are most pertinent to that individual’s service as a member of our Board.

  17. NOMINEES FOR ELECTION AT THE 2024 ANNUAL MEETING

    NOMINEES FOR ELECTION AT THE 2024 ANNUAL MEETING

  18. NOMINEES FOR ELECTION AT THE 2024 ANNUAL MEETING

    | Robert Calderoni |

  19. NOMINEES FOR ELECTION AT THE 2024 ANNUAL MEETING

    | Director Since: 2007 Age: 64 Board Committees: Compensation and Talent Nominating and Governance (Chair) | Background Mr. Calderoni has more than 30 years of executive experience in the technology industry. He is the former Chairman and Interim President and Chief Executive Officer of Citrix Systems, Inc., retiring in December 2022. Mr. Calderoni was appointed Interim President and CEO at Citrix in October 2021. Mr. Calderoni was the Executive Chairman at Citrix from July 2015 to December 2018. From October 2015 to January 2016, Mr. Calderoni served as the interim Chief Executive Officer and President of Citrix. Prior to that, he was President of SAP AG’s cloud business following SAP’s October 2012 acquisition of Ariba, Inc., a leading provider of cloud software solutions where he served as Chairman and Chief Executive Officer. Prior to the acquisition, Mr. Calderoni served as Chief Executive Officer and a member of the Board of Directors of Ariba from October 2001 until the company was acquired, and he also served as Ariba’s Chairman of the Board of Directors from July 2003 until the acquisition date. Before becoming Chief Executive Officer of Ariba, Mr. Calderoni served as Ariba’s Chief Financial Officer from January 2001 to October 2001. Prior to joining Ariba, Mr. Calderoni was Chief Financial Officer at Avery Dennison Corporation, a global manufacturing company. He also held numerous senior financial executive positions at major technology companies, including Senior Vice President Finance at Apple Inc., and Vice President Finance at IBM. As a former senior executive officer of Citrix, SAP and Ariba, Mr. Calderoni provides our Board with extensive and relevant leadership and international operations experience in the technology industry. In addition, Mr. Calderoni is well-qualified to serve as Chairman of the Board as a result of his over 20 years of experience as a finance executive, including his past service as the Chief Financial Officer of two publicly traded technology companies. As a Board member of one other public company, Mr. Calderoni also has familiarity with a range of corporate governance issues. Other U.S. Public Company Boards: | | | | Ansys, Inc. (since 2020) Citrix Systems, Inc. (2014 to 2022) | Juniper Networks, Inc. (2003 to 2019) Logmein, Inc. (2017 to 2020) |

  20. NOMINEES FOR ELECTION AT THE 2024 ANNUAL MEETING

    | Jeneanne Hanley |

  21. NOMINEES FOR ELECTION AT THE 2024 ANNUAL MEETING

    | Director Since: 2019 Age: 51 Board Committees: Compensation and Talent | Background Ms. Hanley has held various positions at Lear Corporation, a designer and manufacturer of automotive seating systems and electrical distribution systems and related components, from 1994 until January 2019, most recently serving as Senior Vice President and President of the E-Systems Division. Other positions at Lear Corporation she has held include Corporate Vice President, Global Surface Materials, Corporate Vice President, Americas Seating Business Unit and Vice President, Global Strategy and Business Development. Ms. Hanley earned her bachelor’s degree in mechanical engineering in 1994 and her master’s degree in business administration in 2000 from the University of Michigan. Ms. Hanley possesses significant operating and leadership skills, including extensive experience in electrical distribution systems and electronic modules used in the automotive industry. She offers significant experience pairing business strategy with organizational strategy in a complex global industry. Other U.S. Public Company Boards: QuantumScape Corporation (since 2021) |

  22. NOMINEES FOR ELECTION AT THE 2024 ANNUAL MEETING

    | Emiko Higashi |

  23. NOMINEES FOR ELECTION AT THE 2024 ANNUAL MEETING

    | Director Since: 2010 Age: 65 Board Committees: Audit | Background Ms. Higashi is a founder of Tohmon Capital Partners, LLC (formerly Tomon Partners, LLC), a strategy and M&A advisory firm based in San Francisco and primarily serving companies in technology- and healthcare-related fields since 2003. Ms. Higashi serves on the boards of Takeda Pharmaceutical Company Ltd. and Rambus, Inc. Prior to Tohmon Partners, she was a co-founder and Chief Executive Officer of Gilo Ventures, a technology-focused venture capital firm, from 2000 to 2002. Before that, Ms. Higashi spent 15 years in investment banking. After beginning her investment banking career at Lehman Brothers from 1985 to 1988, Ms. Higashi was a founding member of Wasserstein Parella and the head of that firm’s technology M&A business from 1988 to 1994, and subsequently served as a managing director in charge of Merrill Lynch’s global technology M&A practice from 1994 until 2000. Prior to her investment banking career, Ms. Higashi spent two years as a consultant at McKinsey & Co. in Tokyo, Japan. Ms. Higashi holds a Carnegie Mellon University Software Engineering Institute CERT Certificate for Cybersecurity Oversight. As a result of her extensive career in technology-focused investment banking and finance, Ms. Higashi brings to the Board significant strategic, business development, mergers and acquisitions and financial experience related to the business and financial issues facing large global technology corporations, a comprehensive understanding of international business matters, particularly in Asia, and knowledge of the semiconductor industry. In addition, as a founder and partner of several consulting firms and a founding member of an investment banking firm, Ms. Higashi also possesses significant leadership and entrepreneurial experience. Other U.S. Public Company Boards: | | | | Takeda Pharmaceutical Company Ltd. (since 2016) Rambus, Inc. (since 2017) | One Equity Partners Open Water I Corp. (2021 to 2023) |

  24. NOMINEES FOR ELECTION AT THE 2024 ANNUAL MEETING

    | Kevin Kennedy |

  25. NOMINEES FOR ELECTION AT THE 2024 ANNUAL MEETING

    | Director Since: 2007 Age: 68 Board Committees: Audit Nominating and Governance | Background Mr. Kennedy most recently served as Chairman of the Board of Directors of Quanergy Systems, Inc., a leading provider of LiDAR sensors, from March 2020 to December 2023. He previously served as the Chief Executive Officer of Quanergy from January 2020 to December 2022. In December 2022 Quanergy filed a voluntary petition for relief under Chapter 11 of the Bankruptcy Code in the U.S. Bankruptcy Court for the District of Delaware. From July 2018 through March 2020, Mr. Kennedy was a senior managing director at Blue Ridge Partners, a consulting firm that advises companies on accelerating profitable revenue growth. Prior to that, Mr. Kennedy previously served as President, Chief Executive Officer and member of the Board of Directors of Avaya Inc., a leading global provider of business communications applications, systems and services, positions he held from January 2009 to October 2017. In January 2017, Avaya Inc. filed a voluntary petition for relief under Chapter 11 of the Bankruptcy Code with the U.S. Bankruptcy Court for the Southern District of New York. Prior to joining Avaya, Mr. Kennedy was Chief Executive Officer of JDS Uniphase Corporation, a provider of optical products and test and measurement solutions for the communications industry, from September 2003 to December 2008, also serving as JDS Uniphase’s President from March 2004 to December 2008. From 2001 to 2003, he served as Chief Operating Officer of Openwave Systems, Inc., a provider of software solutions for the communication and media industries. Previously, Mr. Kennedy spent nearly eight years at Cisco Systems, Inc. and 17 years at Bell Laboratories. In 1987, Mr. Kennedy was a Congressional Fellow to the U.S. House of Representatives on Science, Space and Technology. In January 2012, Mr. Kennedy was appointed to the President’s National Security Telecommunications Advisory Committee by former President Barack Obama. Mr. Kennedy holds a Carnegie Mellon University Software Engineering Institute CERT Certificate for Cybersecurity Oversight. As a member of the Board of Directors of UL Solutions Inc. (Underwriters Laboratories, Inc.) and a former senior executive at Avaya, JDS Uniphase, Quanergy and Openwave, Mr. Kennedy possesses a vast amount of leadership and operational experience with companies in high technology industries. Also, as the holder of a Ph.D. degree in engineering from Rutgers University, a member of President Obama’s National Security Telecommunications Advisory Committee, a former Congressional Fellow to the U.S. House of Representatives Committee on Science, Space and Technology, and the author of more than 30 papers on computational methods, data networking and technology management, Mr. Kennedy offers relevant expertise in a broad range of technology matters. Specifically, Mr. Kennedy has been associated with over 150 M&A transactions as part of building large and growing organizations. In addition, as a result of his experience on the Boards of Directors of several public companies, Mr. Kennedy offers our Board a deep understanding of corporate governance matters. Other U.S. Public Company Boards: | | | | Digital Realty Trust, Inc. (since 2013) Quanergy Systems, Inc. (2020 to 2023) | Maxeon Solar Technologies, Ltd. (2020 to 2022) UL Solutions Inc. (since 2020) |

  26. NOMINEES FOR ELECTION AT THE 2024 ANNUAL MEETING

    | Michael McMullen |

  27. NOMINEES FOR ELECTION AT THE 2024 ANNUAL MEETING

    | Director Since: 2023 Age: 63 Board Committees: Compensation and Talent | Background Mr. McMullen is the former Chief Executive Officer and President of Agilent Technologies (“Agilent”), a global leader in life sciences, diagnostics and applied chemical markets, providing application focused solutions that include instruments, software, services and consumables for the entire laboratory workflow, roles he held since 2015 and 2014, respectively, until his retirement in May 2024. Mr. McMullen currently serves as a senior advisor to Agilent. In his over twenty-year career at Agilent and its predecessor, Hewlett-Packard Company, Mr. McMullen held numerous leadership positions, including Chief Operating Officer from 2014 to 2015, and Senior Vice President, Agilent and President, Chemical Analysis Group from 2009 to 2014. Prior to that, he served in various capacities for Agilent, including Vice President and General Manager of the Chemical Analysis Solutions Unit of the Life Sciences and Chemical Analysis Group and Country Manager for Agilent’s China, Japan and Korea Life Sciences and Chemical Analysis Group. Prior to that, Mr. McMullen served as Controller for the Hewlett-Packard Company and Yokogawa Electric Joint Venture from 1996 to 1999. Mr. McMullen served as a member of the Boards of Directors of Agilent from 2015 to 2024 and Coherent, Inc. from 2018 to 2022. As the former President and Chief Executive Officer of Agilent, Mr. McMullen brings to the Board extensive leadership experience, driving growth at a global scale in complex multinational equipment businesses. His experiences will provide valuable insight into challenges faced by a technology company with an international presence. Other U.S. Public Company Boards: | | | Bristol-Myers Squibb Company (since 2024) Agilent Technologies, Inc. (2015 to 2024) Coherent, Inc. (2018 to 2022) |

  28. NOMINEES FOR ELECTION AT THE 2024 ANNUAL MEETING

    | Gary Moore |

  29. NOMINEES FOR ELECTION AT THE 2024 ANNUAL MEETING

    | Director Since: 2014 Age: 75 Board Committees: Compensation and Talent (Chair) Nominating and Governance | Background Mr. Moore retired in July 2022 from his position as the Chief Executive Officer of ServiceSource International, Inc., a global leader in outsourced, performance-based customer success and revenue growth solutions, a position he had held since December 2018. He also held the position of the Executive Chairman of ServiceSource International, Inc. since November 2018. Mr. Moore previously retired in July 2015 from his positions as President and Chief Operating Officer of Cisco Systems, Inc., a leading global provider of networking and other products and services related to the communications and information technology industry, positions he had held from October 2012 to July 2015. Mr. Moore first joined Cisco in October 2001 as Senior Vice President, Advanced Services, and, in August 2007, he also assumed responsibility as co-lead of Cisco Services. From May 2010 to February 2011, he served as Executive Vice President, Cisco Services, and he was Cisco’s Executive Vice President and Chief Operating Officer from February 2011 until October 2012 when he was named President and Chief Operation Officer. Immediately before joining Cisco, Mr. Moore served for approximately two years as Chief Executive Officer of Netigy Corporation, a network consulting company. Prior to that, he was employed for 26 years by Electronic Data Systems (“EDS”), where he held a number of senior executive positions, including as the President and Chief Executive Officer of joint venture Hitachi Data Systems from 1989 to 1992. As the former Executive Chairman and Chief Executive Officer of ServiceSource and a former senior executive with Cisco and other global companies (including roles as Cisco’s President and Chief Operating Officer, the head of Cisco Services, the creator and manager of EDS’s e-solutions global business unit and the President and Chief Executive Officer of the EDS joint venture Hitachi Data Systems), Mr. Moore brings to the Board extensive leadership experience, as well as expertise in matters relating to international operations in the technology industry. Mr. Moore’s experience managing large-scale operations and growing businesses enables him to provide the Board and the Company with valuable advice and guidance regarding operational and strategic issues faced by global technology companies. Other U.S. Public Company Boards: Finjan Holdings, Inc. (2015 to 2020) ServiceSource International, Inc. (2016 to 2022) |

  30. NOMINEES FOR ELECTION AT THE 2024 ANNUAL MEETING

    | Victor Peng |

  31. NOMINEES FOR ELECTION AT THE 2024 ANNUAL MEETING

    | Director Since: 2019 Age: 64 Board Committees: Compensation and Talent | Background Mr. Peng retired in August 2024 from his position as President, Adaptive, Embedded, and AI Group, of Advanced Micro Devices, Inc. (“AMD”), a developer of leadership high-performance and adaptive processor technologies, combining CPUs, GPUs, FPGAs, Adaptive SoCs and deep software expertise to enable leadership computing platforms for cloud, edge and end devices, a position he held since February 2022 when AMD acquired Xilinx, Inc. From January 2018 to February 2022, Mr. Peng served as President and Chief Executive Officer of Xilinx. He served on the Xilinx board of directors from October 2017 to February 2022. From April 2017 to January 2018, Mr. Peng served as Xilinx’s Chief Operating Officer. From July 2014 to April 2017, he served as Executive Vice President and General Manager of Products. Prior to joining Xilinx, Mr. Peng served as Corporate Vice President, Graphics Products Group at AMD from November 2005 to April 2008. Prior to joining AMD, Mr. Peng served in a variety of executive engineering positions at companies in the semiconductor and processor industries. As the former President, Adaptive, Embedded, and AI Group, of AMD, the former Chief Executive Officer of Xilinx and former member of its board of directors, and with his over 30 years of experience in the semiconductor industry, Mr. Peng provides our Board with extensive and relevant leadership and international operations experience. Other U.S. Public Company Boards: Xilinx, Inc. (2017 to 2022) |

  32. NOMINEES FOR ELECTION AT THE 2024 ANNUAL MEETING

    | Robert Rango |

  33. NOMINEES FOR ELECTION AT THE 2024 ANNUAL MEETING

    | Director Since: 2014 Age: 66 Board Committees: Audit | Background Mr. Rango retired in December 2022 from his position as President and Chief Executive Officer of Enevate Corporation, a company working on the development of next generation Lithium Ion (Li-ion) battery technology, after serving in those roles since May 2016. Prior to that, Mr. Rango served for over 12 years, from March 2002 to July 2014, as an executive at Broadcom Corporation, a leading fabless semiconductor company. He most recently served as Executive Vice President and General Manager of Broadcom’s Mobile and Wireless Group, a role he had held from February 2011 to July 2014. During his tenure with Broadcom, Mr. Rango held a number of senior management positions in the company’s Network Infrastructure Business Unit, Mobile and Wireless Group and Wireless Connectivity Group, including as Senior Vice President and General Manager, Wireless Connectivity Group from January 2006 to February 2010 and as Executive Vice President and General Manager, Wireless Connectivity Group from February 2010 to February 2011. From 1995 to 2002, Mr. Rango held several Vice President and General Manager positions at Lucent Microelectronics, a networking communications company, and Agere Systems, a leader in semiconductors and software solutions for storage, mobility and networking markets, in its Optical Access, New Business Initiatives and Modem/Multimedia Divisions. Mr. Rango holds a Carnegie Mellon University Software Engineering Institute CERT Certificate for Cybersecurity Oversight. Mr. Rango possesses significant operating and leadership skills, including extensive experience in global semiconductor product marketing, development and sales. As a result of his past service as an operational executive and general manager of several large global organizations, Mr. Rango offers a broad understanding of mobile, wireless, semiconductor, optical, software and technology management, which enables him to make significant contributions as a member of our Board. Other U.S. Public Company Boards: Keysight Technologies, Inc. (since 2015) Microchip Technology, Inc. (since 2023) Integrated Device Technology, Inc. (2015 to 2019) |

  34. NOMINEES FOR ELECTION AT THE 2024 ANNUAL MEETING

    | Richard Wallace |

  35. NOMINEES FOR ELECTION AT THE 2024 ANNUAL MEETING

    | Director Since: 2006 Age: 64 Board Committees: None | Background Mr. Wallace currently serves as our President and Chief Executive Officer. He has been our Chief Executive Officer since January 2006 and has also served as our President since November 2008. He began at KLA Instruments in 1988 as an applications engineer and has held various general management positions throughout his 36 years with us, including positions as President and Chief Operating Officer from July 2005 to December 2005, Executive Vice President of the Customer Group from May 2004 to July 2005, and Executive Vice President of the Wafer Inspection Group from July 2000 to May 2004. Earlier in his career, he held positions with Ultratech Stepper and Cypress Semiconductor. Mr. Wallace previously served as a member of the Board of Directors of SEMI (Semiconductor Equipment and Materials International), a prominent industry association, including as SEMI’s Chairman of the Board. He earned his bachelor’s degree in electrical engineering from the University of Michigan and his master’s degree in engineering management from Santa Clara University, where he also taught strategic marketing and global competitiveness courses after his graduation. As our President and Chief Executive Officer and a KLA employee for 36 years, Mr. Wallace brings to the Board extensive leadership and semiconductor industry experience, including a deep knowledge and understanding of our business, operations and employees, the opportunities and risks faced by KLA, and management’s strategy and plans for accomplishing our goals. In addition, Mr. Wallace’s current service as a member of the Boards of Directors of KLA and Marvell Technology, Inc., and his prior service as a member of the Boards of Directors of Splunk, NetApp and Proofpoint give him a strong understanding of his role as a Director and a broad perspective on key industry issues and corporate governance matters. Other U.S. Public Company Boards: Marvell Technology, Inc. (since 2024) Splunk, Inc. (2022 to 2024) NetApp, Inc. (2011 to 2019) Proofpoint, Inc. (2017 to 2021) |

  36. DIRECTOR COMPENSATION

    DIRECTOR COMPENSATION

  37. Our Fiscal Year 2024 Director Compensation Program

    Our Fiscal Year 2024 Director Compensation Program Non-employee members of the Board (“Outside Directors”) receive a combination of equity and cash compensation as approved by the Compensation and Talent Committee (or, in the case of the compensation of the Chairman of the Board, as recommended by the Compensation and Talent Committee and approved by the Board). Equity compensation to Outside Directors is provided under our 2023 Incentive Award Plan (“2023 Plan”), which has been approved by our stockholders. Retainers and committee fees are paid in quarterly cash installments (unless the applicable director elects to defer such cash payments, as described below). The following table presents the key features of our fiscal year 2024 Outside Director compensation program:

  38. Our Fiscal Year 2024 Director Compensation Program

    | COMPENSATION ELEMENT | FISCAL YEAR 2024 PROGRAM | | Cash Compensation | | | Standard annual cash retainer | $100,000 | | Committee member additional annual cash retainers (including Committee Chair) | $15,000 for Audit Committee $12,500 for Compensation and Talent Committee $7,500 for Nominating and Governance Committee | | Committee Chair additional annual cash retainers | $30,000 for Audit Committee $20,000 for Compensation and Talent Committee $10,000 for Nominating and Governance Committee | | Annual cash retainer for non-executive Chairman (in lieu of standard retainer) | $155,000 | | Reimbursement for reasonable meeting attendance expenses | Included |

  39. Our Fiscal Year 2024 Director Compensation Program

    | Equity Compensation | | | Market value of standard restricted stock unit (“RSU”) award granted at annual meeting | $235,000 (to be granted at the Annual Meeting); dividend equivalents payable upon vesting | | Market value of non-executive Chairman RSU award granted at annual meeting in lieu of standard RSU award | $290,000 (to be granted at the Annual Meeting); dividend equivalents payable upon vesting | | Vesting period of Outside Director RSUs | Awards vest in full annually; shares immediately issued upon vesting |

  40. Our Fiscal Year 2024 Director Compensation Program

    Effective for fiscal year 2024, the Board increased (i) the standard annual cash retainer from $90,000 to $100,000; (ii) the annual cash retainer for our non-executive Chairman from $130,000 to $155,000; and (iii) the grant-date value of the annual RSU award from $220,000 to $235,000. Other than as described above, members of the Board do not receive any additional compensation for their services as directors. The Board will separately determine the compensation payable to Outside Directors for service on special purpose committees of the Board, if such committees are created. If a new Outside Director joins the Board after the date of an annual meeting of stockholders, his or her first RSU award will be granted at the time or promptly after he or she joins the Board and will be prorated to take into account the period of time from the last annual meeting of stockholders to the date the new Outside Director joined the Board. Under the Outside Director compensation program, the RSU awards granted to our Outside Directors are issued with “dividend equivalent” rights pursuant to our 2023 Plan. Dividend equivalent rights entitle the recipient to receive credits, payable in cash, equal to the cash dividends that would have been received on the shares of our Common Stock had the shares subject to the RSUs been issued and outstanding on the dividend record date. The dividend equivalents are only payable to the recipient upon vesting and settlement of the underlying award. We have had in effect since 2008 a policy of providing prorated vesting acceleration of RSUs held by Outside Directors who are in good standing, whose service on the Board terminates before their RSUs are vested and who, at the time of termination, have served on the Board for six years.

  41. Director Compensation Table

    Director Compensation Table The following table sets forth certain information regarding the compensation earned by or awarded to each Outside Director during fiscal year 2024:

  42. Director Compensation Table

    | Name | Fees Earned or Paid in Cash ($)(1) | Stock Awards ($)(2) | Change in Pension Value and Nonqualified Deferred Compensation Earnings ($)(3) | All Other Compensation ($)(4) | Total ($) | | Robert Calderoni | 185,000 | 289,730 | - | 4,826 | 479,556 | | Jeneanne Hanley | 112,500 | 234,929 | - | 3,661 | 351,090 | | Emiko Higashi | 115,000 | 234,929 | - | 3,661 | 353,590 | | Kevin Kennedy | 122,500 | 234,929 | - | 3,661 | 361,090 | | Michael McMullen | 112,500 | 234,929 | - | 172 | 347,601 | | Gary Moore | 140,000 | 234,929 | - | 3,661 | 378,590 | | Marie Myers | 152,500 | 234,929 | - | 3,661 | 391,090 | | Kiran Patel(5) | 30,625 | - | - | 3,661 | 34,286 | | Victor Peng | 112,500 | 234,929 | - | 3,661 | 351,090 | | Robert Rango | 115,000 | 234,929 | - | 3,661 | 353,590 |

  43. Director Compensation Table

    (1) The amounts set forth in this column represent cash fees earned by each Outside Director during fiscal year 2024, regardless of whether the fees were actually paid during the fiscal year. (2) The amounts shown represent the aggregate grant date fair value of RSUs awarded to each Outside Director during fiscal year 2024, computed in accordance with the provisions of Financial Accounting Standards Board (“FASB”) Accounting Standards Codification Topic 718, referred to in this Proxy Statement as ASC 718 (except that the fair values set forth above have not been reduced by the Company’s estimated forfeiture rate). The ASC 718 grant date fair value of each RSU award was calculated based on the fair market value of our Common Stock on the award date. For further discussion regarding the assumptions used in calculating the grant date fair value for RSUs, please refer to Note 1 to the Company’s consolidated financial statements in Item 8 of the Company’s Annual Report on Form 10-K for the fiscal year ended June 30, 2024, filed with the SEC on August 5, 2024. On November 1, 2023, each Outside Director then in office was granted an RSU award for 493 shares of our Common Stock (other than Mr. Calderoni who, as Chairman of the Board, received an RSU award for 608 shares, as described above under the heading “Our Fiscal Year 2024 Director Compensation Program”). The following table shows, for each Outside Director, the aggregate number of unvested shares of our Common Stock underlying all outstanding RSUs held by that Outside Director then in office as of June 30, 2024:

  44. Director Compensation Table

    | Name | Aggregate Number of Unvested Shares of Common Stock Underlying Director RSU Awards as of June 30, 2024 | | Robert Calderoni | 604 | | Jeneanne Hanley | 493 | | Emiko Higashi | 493 | | Kevin Kennedy | 493 | | Michael McMullen | 493 | | Gary Moore | 493 | | Marie Myers | 493 | | Victor Peng | 493 | | Robert Rango | 493 |

  45. Director Compensation Table

    (3) As noted above, of the current Outside Directors, only Ms. Myers participated in our EDSP during fiscal year 2024. We have concluded that, because the EDSP earnings correspond to the actual market earnings on a select group of investment funds available under the EDSP, no portion of our Outside Directors’ earnings under the EDSP is “above market” or “preferential.” Accordingly, we do not report any portion of our Outside Directors’ earnings under the EDSP in the Director Compensation Table. Ms. Myers’ investment earnings (loss) under the EDSP during fiscal year 2024 were $79,336. (4) Represents dividend equivalents paid upon the vesting of RSUs during fiscal year 2024. (5) Mr. Patel served as an Outside Director through November 1, 2023, at which time his service on our Board ended. Our Corporate Governance Practices At KLA, we believe that strong and effective corporate governance procedures and practices are an extremely important part of our corporate culture. In that spirit, we have summarized several of our corporate governance practices below.

  46. Named Executive Officers

    | COMPENSATION PHILOSOPHY AND DESIGN PRINCIPLES | | | | | Executive compensation should be designed to: | | | | | | Attract, retain and reward executives who contribute to our overall success by offering compensation packages that are competitive with those offered by other employers with which we compete for talent. | | Achieve a balance and alignment between (i) performance-based compensation that rewards corporate and individual achievement and stockholder value creation, and (ii) compensation that supports our long-term retention efforts. | | This philosophy is reflected in the following design principles: | | | | | | In addition to a competitive base salary, a substantial portion of the executives’ potential cash compensation is tied to a short-term incentive bonus plan that rewards corporate and individual achievement of challenging performance goals. | | The program also provides two types of long-term compensation: (i) performance-based restricted stock unit awards covering shares of our Common Stock (“PRSUs”), which provide additional compensation as a reward for achievement of corporate performance goals and which, if earned, include service-vesting requirements, and (ii) service-based restricted stock unit awards covering shares of our Common Stock (“RSUs”) with vesting conditioned only upon continued service. |

  47. Compensation and Talent Committee Decision Making – Approval Procedures Overview and Market Data

    Compensation and Talent Committee Decision Making – Approval Procedures Overview and Market Data The Compensation and Talent Committee takes a broad-based approach in evaluating and making decisions with respect to executive compensation. The charter of the Compensation and Talent Committee gives the Compensation and Talent Committee full authority to determine the compensation of our executive officers (including our NEOs), other than the Chief Executive Officer, for whom the Compensation and Talent Committee makes recommendations to the Outside Directors for approval. Advisor to the Compensation and Talent Committee The Compensation and Talent Committee retains Semler Brossy Consulting Group, LLC (“Semler Brossy”), an independent compensation consultant, to provide the Compensation and Talent Committee with independent, objective analysis and advice on executive officer and director compensation matters. Semler Brossy reports directly to the Chair of the Compensation and Talent Committee and, aside from its support of the Compensation and Talent Committee, performed no other work for the Company during fiscal year 2024. Semler Brossy generally attends all meetings of the Compensation and Talent Committee in which evaluations of the effectiveness of overall executive compensation programs are conducted or in which compensation for executive officers is analyzed or approved. During fiscal year 2024, Semler Brossy’s duties included providing the Compensation and Talent Committee with relevant market and industry data and analysis, as well as preparing and reviewing materials for the Compensation and Talent Committee’s meetings. In fulfilling these duties, Semler Brossy met, as needed and at the direction of the Compensation and Talent Committee, with our Chief Executive Officer, Chief Human Resources Officer and other executive officers and members of our Human Resources department. The Compensation and Talent Committee, in conducting its annual assessment in fiscal year 2024, determined that Semler Brossy was independent and did not have any conflicts of interest. Approval Procedures During multiple meetings (both with and without management present) and with the assistance of Semler Brossy, the Compensation and Talent Committee engaged in extensive deliberation in developing the fiscal year 2024 executive compensation program, seeking to establish compensation packages and target performance levels aimed at rewarding strong future financial performance and our long-term success. The Compensation and Talent Committee’s deliberations for all executive officers looked at a broad range of market data (described below), individual performance reviews and total compensation reports for each officer, the historically cyclical nature of our business, internally appropriate levels and targets relative to the officer’s role, and initial package recommendations from management informed by market data provided by Semler Brossy. With regard to our 2023 Executive Incentive Plan (“2023 Bonus Plan”) and the fiscal year 2024 PRSUs granted to our NEOs, the proposed financial metrics and payout percentage recommendations were developed by management and approved by the Compensation and Talent Committee, with review and guidance from Semler Brossy. With respect to the compensation of our Chief Executive Officer (Mr. Wallace), the Compensation and Talent Committee considered recommendations prepared by Semler Brossy. Following extensive deliberation, the Compensation and Talent Committee recommended Mr. Wallace’s proposed fiscal year 2024 target compensation opportunities and RSU and PRSU grants for approval by the Outside Directors. The Outside Directors then discussed and, in August 2023, approved Mr. Wallace’s fiscal year 2024 target compensation opportunities and PRSU and RSU grants as recommended. Mr. Wallace was not present and did not participate in the discussions regarding his own compensation. For the other NEOs, the Compensation and Talent Committee, after considering the performance reviews and recommendations of Mr. Wallace, as well as extensive comparative compensation data provided by Semler Brossy, approved the fiscal year 2024 target compensation opportunities and PRSU and RSU grants for the other NEOs in August 2023. In each case, when establishing each element of compensation and the overall target compensation opportunities for the NEOs, the Compensation and Talent Committee and the Outside Directors exercised their judgment based upon the data provided, and no specific formula was applied to determine the weight of each data point. Market Data Our ability to continue to attract and retain outstanding contributors, including our core executive team, is essential to our continuing success. Therefore, the Compensation and Talent Committee reviews several different data sources (including Radford survey data for our industry peer group, as well as the broader technology market) to assess whether we are offering compensation opportunities that are competitive with those offered by other employers seeking to attract the same talented individuals. The industry peer group is comprised of U.S. publicly traded companies primarily in the semiconductor and semiconductor equipment industries that had at least 0.33x the Company’s trailing four-quarter revenues and at least 0.2x the Company’s 200-day average market capitalization value. Additionally, the peer group is reviewed to remove companies that we feel are too large to provide meaningful comparison. Below is the list of industry peer group companies used in developing our fiscal year 2024 program:

  48. Compensation and Talent Committee Decision Making – Approval Procedures Overview and Market Data

    | Advanced Micro Devices, Inc. | GLOBALFOUNDRIES Inc. | Micron Technology, Inc. | Skyworks Solutions, Inc. | | Analog Devices, Inc. | Keysight Technologies, Inc. | MKS Instruments, Inc. | Teradyne, Inc. | | Applied Materials, Inc. | Lam Research Corporation | NVIDIA Corporation | Texas Instruments Incorporated | | Broadcom, Inc. | Marvell Technology Inc. | ON Semiconductor Corp. | | | Corning Incorporated | Microchip Technology, Inc. | Qorvo, Inc. | |

  49. Compensation and Talent Committee Decision Making – Approval Procedures Overview and Market Data

    The Compensation and Talent Committee, in consultation with Semler Brossy, periodically reviews and, as appropriate, may approve changes to the list. The peer group reflected the following changes from our fiscal year 2023 peer group: (i) the removal of Xilinx, Inc. due to its acquisition by Advanced Micro Devices, Inc. on February 14, 2022; and (ii) the addition of GLOBALFOUNDRIES Inc. When assessing our fiscal year 2024 executive compensation program, the Compensation and Talent Committee reviewed information developed by Semler Brossy regarding the compensation levels, programs and practices of our industry peer group to obtain comparative data and identify compensation trends and practices. Though the Compensation and Talent Committee referred to percentile data in its analysis, as well as allocations between annual and long-term compensation, the Compensation and Talent Committee did not employ specific equations for determining compensation amounts based on such data. Rather, the Compensation and Talent Committee’s emphasis was on establishing compensation packages for the executive officers that would be competitive with those offered by other employers in our industry, appropriately reflect each executive officer’s skill set and experience, drive performance and encourage retention of top performers.

  50. KEY PAY PRACTICES IN OUR EXECUTIVE COMPENSATION PROGRAM AND LAST YEAR’S “SAY ON PAY” VOTE

    | What We Do | | What We Don’t Do | | | | Pay for performance: We have a pay for performance focus with a majority of our NEOs’ cumulative annual target compensation in the form of performance-based annual cash bonuses and PRSUs, tied to challenging metrics that reflect and are key to the growth and profitability of our business and promote alignment between executive and stockholder economic interests. | | No automatic salary increases: We do not guarantee automatic salary increases for our executive officers. | | | Different metrics in short- and long-term incentive plans: The metrics used for our annual cash bonus program (i.e., Operating Margin Dollar achievement and corporate balanced scorecard assessment) are different from those used for our PRSUs (i.e., Relative Free Cash Flow Margin (as defined below) and non-GAAP EPS). | | No hedging and pledging: We prohibit officers, directors and employees from hedging against our stock or pledging our stock. | | | Long-term incentive alignment: Equity awards vest typically over a four-year period, other than new hire RSU awards, which vest over a three-year period, and our PRSUs, other than our EPS Awards (as defined and described below), which are tied to a three-year performance period with 50% of earned PRSUs vesting in year three and 50% vesting in year four. | | No single-trigger change in control: We only offer “double trigger” change in control benefits. | | | Stock ownership guidelines: We impose stock ownership guidelines on all executive officers and Outside Directors. | | No gross-ups: We do not provide tax gross-up provisions on any change in control, severance or other payments related to executive terminations. | | | Clawbacks: We maintain an SEC- and NASDAQ-compliant clawback policy for recovery of any erroneously awarded incentive compensation in the event of a financial restatement. | | No excessive perquisites: It is our policy to strictly limit the use and value of perquisites. | | | Compensation consultant: The Compensation and Talent Committee retains and regularly consults with an independent compensation consultant to advise on our executive compensation program and practices. | | No dividends prior to vesting: We do not pay dividends on RSUs or PRSUs until the awards vest and then only on the portion that vests. | | | Independence: Executive compensation decisions for Mr. Wallace, our CEO, are made by the Outside Directors on our Board, and for all other executive officers by the Compensation and Talent Committee, which is comprised exclusively of Outside Directors. | | | | | Compensation Risk Assessment: We conduct a compensation risk assessment annually, which is reviewed annually by the Compensation and Talent Committee. | | |

  51. Short-Term Executive Incentive Bonus Plan

    Short-Term Executive Incentive Bonus Plan Our annual Executive Incentive Plan (our “Bonus Plan”) is intended to motivate our senior executives, including our NEOs, to achieve short-term corporate objectives by providing a competitive cash bonus, which is earned based upon the achievement of pre-determined Company performance goals, relating to Operating Margin Dollar (as defined below), the Company’s “balanced scorecard” objectives (as described below) and individual performance. Under our Bonus Plan, which operates on a calendar-year basis consistent with our operating plan, participating executives are eligible to earn up to 200% of the applicable executive’s target bonus opportunity based on the level of attainment of performance goals during the relevant calendar year. During our fiscal year 2024, our NEOs participated in our 2023 Bonus Plan from July 1, 2023 through December 31, 2023, and in our 2024 Bonus Plan from January 1, 2024 through June 30, 2024. The 2024 Bonus Plan is substantially identical to the 2023 Bonus Plan, other than with respect to Operating Margin Dollar target levels of performance and the related payout percentages. Plan Design and Performance Metrics We used Operating Margin Dollar achievement as a key performance metric in our calendar year 2023 Bonus Plan because we believe that it reflects several important competitive and business elements, such as product acceptance, market share and cost discipline, and is therefore a very good barometer of our overall performance. For our calendar year 2023 Bonus Plan, “Operating Margin Dollar” represents our total revenues less total costs of revenues, research and development expenses and selling, general and administrative expenses, other than expenses related to acquisitions, goodwill impairment, severance and merger-related items. In addition to Operating Margin Dollar achievement, payouts under the 2023 Bonus Plan are also determined in part by a “balanced scorecard” rating awarded by the Compensation and Talent Committee, which is designed to measure our progress based on financial and non-financial metrics related to operational excellence, customer focus, growth and talent management. The use of the balanced scorecard is designed to ensure that the quality of our operating results is high and that those results support the sustainability of our business model. We believe that the balanced scorecard’s use of broad measures of financial and strategic success closely aligns with the interests of our executive officers with those of our stockholders. The balanced scorecard is tracked throughout the year by the Board, and then formally reviewed by the Compensation and Talent Committee and the Board following the conclusion of the applicable calendar year for assessment of the Company’s success in achieving its annual strategic goals. For calendar year 2023, the corporate goals and objectives were set at levels that the Compensation and Talent Committee believed would be challenging to achieve based on our historical and anticipated performance and the then-prevailing macroeconomic conditions. For 2023, we, together with industry analysts covering the semiconductor and semiconductor capital equipment industries, anticipated a significant downturn in WFE from record 2022 highs due in large part to weaker consumer demand in electronics end markets, overcapacity in the memory chip markets and, in response to these market developments, lower capital expenditure plans from our largest customers. While the Operating Margin Dollar and many of the “balanced scorecard” metrics are quantitative in nature, some are qualitative and, therefore, introduce a degree of judgment into the bonus determination process. This structure of using both Operating Margin Dollar achievement and the balanced scorecard is intended to ensure that bonus payouts not only reflect the Company’s achievement of specific levels of Operating Margin Dollars, but also the level of management performance necessary to continue to achieve those results over the long term. The 2023 Bonus Plan also contains an element of an individual assessment. The Compensation and Talent Committee may increase or decrease each executive officer’s bonus amount (to the extent earned) based on a subjective assessment of the executive’s individual performance by applying a “bonus achievement percentage” multiplier. Bonus achievement multipliers for individual performance can range from 80% to 120%. Following the completion of calendar year 2023, the Compensation and Talent Committee conducted a performance assessment of each executive officer (including each NEO), with input from Mr. Wallace (except with respect to his own performance), and the Outside Directors conducted a similar assessment for Mr. Wallace, in each case based on the executive officer’s leadership skills, experience and performance, including (for the NEOs) how each NEO led his or her organization as demonstrated against the key balanced scorecard objectives and goals for the NEO’s respective organization. The payout formula under the Bonus Plan was structured as follows: Payout Percentages Our 2023 Bonus Plan was structured to pay out 100% of each participating executive’s target bonus amount if we successfully achieved our target level of Operating Margin Dollar performance (subject to the applicable executive’s bonus achievement percentage multiplier). Under the 2023 Bonus Plan, we were required to achieve a threshold level of Operating Margin Dollar achievement in order for the Bonus Plan to be funded; to the extent Operating Margin Dollar was achieved below the threshold value, the applicable payout percentage would be equal to 0%. Upon achievement of that threshold level, a participant’s actual bonus amount was then determined based upon a bonus payout grid, with Operating Margin Dollar goals as the variable along one axis and, on the other axis, the “balanced scorecard” rating (which is a score awarded to the Company by the Board based on its assessment of our performance against the “balanced scorecard” metrics), as adjusted by the participant’s bonus achievement percentage multiplier. The Compensation and Talent Committee sets performance targets for the Bonus Plan in consideration of internal budgets, broader market forecasts, and prior year achievement. We, together with industry analysts, predicted a significant downturn in WFE for 2023 due to weaker consumer demand in electronics end markets, overcapacity in memory chip markets and, in response to some of these factors, reduced capital expenditures from our largest customers. In consideration of these factors and the anticipated downturn in WFE, with respect to our 2023 Bonus Plan, the Compensation and Talent Committee set the target Operating Margin Dollar achievement at $3.14 billion for the calendar year ended December 31, 2023, which was approximately 25% lower than the comparable target for calendar year 2022 ($4.20 billion) and approximately 30% lower than the actual achievement level for calendar year 2022. The reduced targets set by the Compensation and Talent Committee come off a record setting year for 2022 in which it set an Operating Margin Dollar achievement target that was approximately 59% higher than the target set in 2021 and approximately 23% higher than the actual Operating Margin Dollar achievement level for 2021. The maximum Operating Margin Dollar achievement was set at $4.396 billion for the calendar year ended December 31, 2023, which (if attained) would have been 1% less than the Operating Margin Dollar achievement in 2022. The 2023 Bonus Plan was structured so that, for each level of Operating Margin Dollar performance, the maximum payout would be reasonable relative to our financial results. The following examples highlight the possible funding levels for our 2023 Bonus Plan at different levels of our performance, before applying individual multipliers.

  52. Short-Term Executive Incentive Bonus Plan

    | Level of Operating Margin Dollars | Funding Level Details | | Less than $942 million | No payouts would be made under the 2023 Bonus Plan if we achieved Operating Margin Dollars of less than $942 million | | $942 million (threshold) | Set at 30% of target Highest bonus funding level equal to 35% of the NEO’s target bonuses, if the Board awarded the Company a balanced scorecard rating of 5 (“exceptional”) | | $3.14 billion (target) | Target level of Operating Margin Dollars of $3.14 billion was approximately 30% lower than our Operating Margin Dollar performance for the prior calendar year ($4.462 billion) | | | Highest bonus funding level equal to 140% of the executive officers’ target bonuses, if the Board awarded the Company a balanced scorecard rating of 5 (“exceptional”) | | | Target bonus funding level equal to 100% of the executive officers’ target bonuses, if the Board awarded the Company a balanced scorecard rating of 3+ (“primarily meets expectations”) | | $4.396 billion (maximum) | Set at 40% higher than target Operating Margin Dollars of $4.396 billion would have surpassed any calendar year in our history other than 2022 | | | Highest bonus funding level equal to 200% of the executive officers’ target bonuses, if the Board awarded the Company a balanced scorecard rating of 3+ (“primarily meets expectations”) | | | Minimum bonus funding level equal to 100% of the executive officers’ target bonuses, if the Board awarded the Company a balanced scorecard rating of 1 (“opportunity for improvement”) |

  53. Short-Term Executive Incentive Bonus Plan

    With respect to the balanced scorecard assessment, the Compensation and Talent Committee and the Board considered macro-economic and market dynamic factors when making the balanced scorecard assessment, including projected GDP headwinds, decreased WFE outlook, worldwide supply chain constraints, inflation, rising interest rates, and lower consumer confidence. The Compensation and Talent Committee and the Board also reviewed the following categories to determine the balanced scorecard rating for our 2023 Bonus Plan:

  54. Short-Term Executive Incentive Bonus Plan

    | Balanced Scorecard Objectives | Assessment | Score Given | | KLA Revenue | Calendar year 2023 total revenues finished at $9.671 billion which exceeded our plan. | 4 | | Market Leadership | The Board considered market share as a leading indicator of market leadership and noted an expected slight decline in market share. | 3 | | Product Differentiation | The Board assessed non-GAAP gross margin as a leading indicator of product differentiation versus competitors, noting that overall non-GAAP gross margin finished slightly higher than plan in calendar year 2023. | 3+ | | Productivity | The Board considered non-GAAP operating margin as a leading indicator of productivity, noting that non-GAAP operating margin finished slightly higher than plan in calendar year 2023. | 3+ | | Human Capital | The Board considered employee engagement and employee retention as leading indicators of human capital performance, noting low turnover rates for both the employee base as a whole and for top talent, and an improvement in engagement survey results. The Compensation and Talent Committee reviews on a quarterly basis hiring, turnover, engagement scores, and representation dates for KLA as a whole and by significant geographic locations. | 4 |

  55. Short-Term Executive Incentive Bonus Plan

    The Board evaluated the Company’s performance with respect to the objectives described above on a scale of 1 to 5, with:

  56. Short-Term Executive Incentive Bonus Plan

    | | “1” corresponding to “opportunity for improvement,” | | | “3” corresponding to “primarily meets expectations,” and | | | “5” corresponding to “exceptional.” |

  57. Short-Term Executive Incentive Bonus Plan

    The Board awarded the Company a balanced scorecard rating of “3+” based on its assessment of our overall performance against our strategic objectives during calendar year 2023. That, combined with Operating Margin Dollar achievement of $3.488 billion in calendar year 2023 (approximately 11% above target), resulted in a funding, before applying bonus achievement percentage multipliers, of 118% of target bonuses under the 2023 Bonus Plan. The matrix for the 2023 Bonus Plan is set forth below.

  58. Short-Term Executive Incentive Bonus Plan

    | Calendar Year 2023 Bonus Funding Table | | | | | | | | | | | | | | | Balanced Scorecard Performance | | Operating Margin Dollar ($M) Performance | | | | | | | | | | | | | | | < $942 | $942 | $2,512 | $2,826 | $2,983 | $3,140 | $3,297 | $3,454 | $3,488 | $3,768 | $4,082 | $4,396 | | Exceptional | 5 | 0% | 35% | 99% | 112% | 133% | 140% | 147% | 161% | 165% | 196% | | | | | 4+ | 0% | 30% | 85% | 96% | 114% | 120% | 126% | 138% | 141% | 168% | 198% | | | | 4 | 0% | 28% | 78% | 88% | 105% | 110% | 116% | 127% | 129% | 154% | 182% | | | | 3+ | 0% | 25% | 71% | 80% | 95% | 100% | 105% | 115% | 118% | 140% | 165% | 200% | | Primarily meets expectations | 3 | 0% | 23% | 64% | 72% | 86% | 90% | 95% | 104% | 106% | 126% | 149% | 180% | | | 2+ | 0% | 20% | 57% | 64% | 76% | 80% | 84% | 92% | 94% | 112% | 132% | 160% | | | 2 | 0% | 18% | 50% | 56% | 67% | 70% | 74% | 81% | 82% | 98% | 116% | 140% | | | 1+ | 0% | 15% | 43% | 48% | 57% | 60% | 63% | 69% | 71% | 84% | 99% | 120% | | Opportunity for improvement | 1 | 0% | 13% | 36% | 40% | 48% | 50% | 53% | 58% | 59% | 70% | 83% | 100% | | % of Plan | | <30% | 30% | 80% | 90% | 95% | 100% | 105% | 106% | 110% | 120% | 130% | 140% |

  59. Short-Term Executive Incentive Bonus Plan

    In addition, based on the Compensation and Talent Committee’s (or, with respect to Mr. Wallace, the Outside Directors’) assessment of each NEO’s individual performance for calendar year 2023, NEOs were awarded bonus achievement percentages ranging from 80% to 110%. Payouts The following table presents each NEO’s target bonus (as a percentage of base salary and in dollars, based on actual salary paid during the calendar year 2023 (rather than fiscal year 2024)), as well as the bonus payout percentage generated by the 2023 Bonus Plan’s payout grid, based on our performance, the bonus achievement percentage multiplier assigned to the NEO and the actual bonus amount paid to the NEO.

  60. Short-Term Executive Incentive Bonus Plan

    | Name | NEO’s 2023 Target Bonus Award Under Bonus Plan (as a Percentage of Base Salary)(1) | NEO’s Target Bonus Award Under Bonus Plan ($) | Payout Multiple Based on Company Performance (Operating Margin Dollars and Balanced Scorecard) | Bonus Achievement Percentage Assigned by Compensation and Talent Committee or the Outside Directors | Actual Bonus Payout Under 2023 Bonus Plan ($)(2) | Actual Bonus Payout Under 2023 Bonus Plan as a Percentage of Target Bonus | | Richard Wallace | 175% | 1,676,923 | 118% | 100% | 1,978,769 | 118% | | Bren Higgins | 100% | 686,923 | 118% | 100% | 810,569 | 118% | | Ahmad Khan | 100% | 686,923 | 118% | 100% | 810,569 | 118% | | Oreste Donzella | 90% | 432,000 | 118% | 80% | 407,808 | 94% | | Brian Lorig | 90% | 450,000 | 118% | 110% | 584,100 | 130% |

  61. Short-Term Executive Incentive Bonus Plan

    (1) The amounts in this column represent the applicable NEO’s target bonus (stated as a percentage of the executive officer’s base salary). Under the 2023 Bonus Plan, the actual salary paid during the calendar year multiplied by (a) the payout percentage determined by the 2023 Bonus Plan’s bonus payout grid based on the Company’s performance, and (b) the NEO’s bonus achievement percentage multiplier assigned by the Compensation and Talent Committee or, in the case of Mr. Wallace, the Outside Directors, generated the executive officer’s actual bonus payment amount. (2) Actual bonus payouts are based on the actual salary paid to the NEO during calendar year 2023 rather than fiscal year 2024. Our NEO’s target bonus opportunities are determined by our Compensation and Talent Committee (or, in the case of Mr. Wallace, by our Outside Directors) by considering each NEO’s performance, role and responsibilities at our Company. The target bonus as a percentage of base salary for Messrs. Wallace, Donzella and Lorig increased from 150%, 80% and 80%, respectively, for calendar year 2022 to 175%, 90% and 90%, respectively, for calendar year 2023. Target bonuses as a percentage of base salary for Messrs. Higgins and Khan remained unchanged from calendar year 2022. The target bonus as a percentage of base salary for each of our NEOs for calendar year 2024 was not changed from calendar year 2023.

  62. Long-Term Incentives

    Long-Term Incentives Our annual long-term incentives for our NEOs are awarded in the form of RSUs and PRSUs, typically once per year in late July or early August, coinciding with the beginning of our fiscal year. Annual PRSU Awards During fiscal year 2024, we granted each of our NEOs an annual award of PRSUs, which vests based on the attainment of specified Company performance goals and service-vesting requirements. The NEOs’ fiscal year 2024 PRSUs are earned based on the Company’s Relative Free Cash Flow Margin (as defined below). “Relative Free Cash Flow Margin” means our cumulative free cash flow (cash flow provided by operations, less capital expenditures), divided by cumulative revenues, relative to the cumulative free cash flow margin for our industry peer group companies for the three years ending June 30, 2026. A determination will be made after June 30, 2026, based on the Company’s percentile performance relative to its industry peer group, regarding the percentage of the fiscal year 2024 PRSUs that have been earned. We believe that the Relative Free Cash Flow Margin metric is a key measure of our long-term performance and stockholder value creation. Our ability to generate cash from operations is essential to fund the expansive research and development efforts that are instrumental to our long-term success, as well as our efforts to return cash to stockholders. The relative nature of the metric ensures that our performance must compare favorably to our industry peer group companies for PRSUs to be earned. Any fiscal year 2024 PRSUs earned by an NEO will vest 50% after three years and 50% after four years from the date of grant, in each case, subject to continued service on each vesting date. Fiscal year 2024 PRSUs are granted with dividend equivalent rights which entitle the recipient to receive credits, payable in cash or additional shares of our Common Stock, equal to the cash dividends that would have been received on the shares of our Common Stock had the shares been issued and outstanding on the dividend record date. Dividend equivalents are only paid to the recipient upon vesting or settlement of the underlying award. The following table highlights the possible payouts under the participating NEO’s fiscal year 2024 PRSUs at different levels of Company performance:

  63. Long-Term Incentives

    | Level of Relative Free Cash Flow Margin Performance | PRSU Payout Details | | Less than 30th percentile | No shares underlying the 2024 PRSU awards will become eligible to vest if our Relative Free Cash Flow Margin is below the 30th percentile | | 30th percentile (Threshold) | 25% of the target number of shares underlying the 2024 PRSU awards will become eligible to vest if our Relative Free Cash Flow Margin is equal to the 30th percentile | | 55th percentile (Target) | Target performance level will require strong performance relative to our industry peer group and is therefore considered challenging 100% of the target number of shares underlying the 2024 PRSU awards will become eligible to vest if our Relative Free Cash Flow Margin is equal to the 55th percentile | | 75th percentile or above (Maximum) | Maximum performance level will require significant performance relative to the Company’s industry peer group and is therefore considered very challenging 150% of the target number of shares underlying the 2024 PRSU awards will become eligible to vest if our Relative Free Cash Flow Margin is equal to or greater than the 75th percentile |

  64. Long-Term Incentives

    Payout will be linearly interpolated if actual results fall between the threshold and target, or the target and maximum measurement points above. The following table sets forth the threshold, target and maximum shares achievable by our NEOs with respect to their annual PRSU awards for fiscal year 2024 (rounded down to the nearest whole share):

  65. Long-Term Incentives

    | Name | Type of Grant | Target Value ($)(1) | Threshold Shares (#) | Target Shares (#) | Maximum Shares (#) | | Richard Wallace | Annual PRSU | 11,100,000 | 5,881 | 23,525 | 35,288 | | Bren Higgins | Annual PRSU | 2,750,000 | 1,457 | 5,828 | 8,742 | | Ahmad Khan | Annual PRSU | 2,750,000 | 1,457 | 5,828 | 8,742 | | Oreste Donzella | Annual PRSU | 850,000 | 451 | 1,802 | 2,703 | | Brian Lorig | Annual PRSU | 1,250,000 | 662 | 2,649 | 3,974 |

  66. Long-Term Incentives

    (1) The number of shares underlying our fiscal year 2024 PRSUs was determined by dividing a dollar target by the 30-day average of our closing stock price ending on the Friday prior to approval of the awards. In fiscal year 2024, the 30-day average price was 6% lower than the price on the date of grant, which is the price used to determine the value of the award in the “Summary Compensation Table.” Fiscal Year 2021 Annual PRSUs – Performance Criteria Satisfaction Determination The fiscal year 2021 PRSUs were earned based on our Relative Free Cash Flow Margin attained over the three-year period ended June 30, 2023. In August 2023, the Compensation and Talent Committee and, in the case of Mr. Wallace, the Outside Directors, determined the extent to which the fiscal year 2021 annual PRSUs had been earned: a 150% payout at the 85th percentile of our industry peer group. The terms of the fiscal year 2021 annual PRSUs, including the target performance and payout level, actual results and vesting schedule, are summarized in the following table:

  67. Long-Term Incentives

    | Terms of Fiscal Year 2021 Annual PRSUs | Threshold | Target Level | Maximum Level | Actual Results | | Relative Free Cash Flow Margin performance | 30th percentile | 55th percentile | 75th percentile | 85th percentile | | Payout level as a percentage of target shares | | | | | | Vesting schedule | With respect to the earned fiscal year 2021 annual PRSUs, 50% vested in August 2023 and the remaining 50% vested in August 2024 | | | |

  68. Long-Term Incentives

    The following table sets forth the threshold, target and maximum shares achievable by the NEOs, as well as the actual number of shares earned by them, with respect to the fiscal year 2021 PRSUs (rounded down to the nearest whole share):

  69. Long-Term Incentives

    | Name | Type of Grant | Threshold Shares (#) | Target Shares (#) | Maximum Shares (#) | Actual Shares Earned (#) | | Richard Wallace | Annual PRSU | 6,880 | 27,523 | 41,284 | 41,284 | | Bren Higgins | Annual PRSU | 2,023 | 8,095 | 12,142 | 12,142 | | Ahmad Khan | Annual PRSU | 2,361 | 9,444 | 14,166 | 14,166 | | Oreste Donzella | Annual PRSU | 944 | 3,778 | 5,667 | 5,667 | | Brian Lorig | Annual PRSU | 1,011 | 4,047 | 6,070 | 6,070 |

  70. Long-Term Incentives

    Annual RSU Awards The Compensation and Talent Committee (or in the case of Mr. Wallace, the Outside Directors) also approved annual 2024 RSU grants to our NEOs. Each RSU award vests over four years, with 25% of the RSUs underlying the award vesting on each of the first four anniversaries of the applicable vesting commencement date, subject to continued service through the applicable vesting date. The size of the RSU and annual PRSU awards to NEOs are typically weighted equally, except in the case of Mr. Wallace, whose grants are weighted 60% annual PRSUs (at target levels) and 40% RSUs. Fiscal year RSUs are granted with dividend equivalent rights which entitle the recipient to receive credits, payable in cash or additional shares of our Common Stock, equal to the cash dividends that would have been received on the shares of our Common Stock had the shares been issued and outstanding on the dividend record date. Dividend equivalents are only paid to the recipient upon vesting or settlement of the underlying award. The following table sets forth the RSU grants for each NEO in fiscal year 2024:

  71. Long-Term Incentives

    | Name | Target Value ($)(1) | Shares (#) | | Richard Wallace | 7,400,000 | 15,684 | | Bren Higgins | 2,750,000 | 5,828 | | Ahmad Khan | 2,750,000 | 5,828 | | Oreste Donzella | 850,000 | 1,801 | | Brian Lorig | 1,250,000 | 2,649 |

  72. Long-Term Incentives

    (1) The number of shares underlying our fiscal year 2024 RSUs was determined by dividing a dollar target by the 30-day average of our closing stock price ending on the Friday prior to approval of the awards. In fiscal year 2024, the 30-day average price was 6% lower than the price on the date of grant, which is the price used to determine the value of the award in the “Summary Compensation Table.”

  73. Employee Benefits and Perquisites

    Employee Benefits and Perquisites Perquisites and Other Compensation We make only nominal use of perquisites in compensating our domestic executive officers, including our NEOs, except in the case of Mr. Donzella, who received expatriate benefits upon agreeing to relocate from the United States to the United Kingdom to run our Electronics, Packaging and Components business. All of our executive officers, including our NEOs, are entitled to receive Company-provided professional financial services. These services include tax planning, preparation and filing, as well as financial and estate planning services, up to a maximum cost of $20,000 per calendar year, and are provided in order to allow our executive officers to devote their fullest attention to our business and to help ensure that their tax returns comply with IRS requirements. In addition, our executive officers, including our NEOs, are eligible to participate in our 401(k) plan (including a Company matching contribution on employee 401(k) plan contributions), employee stock purchase plan and the other employee benefit plans (including the Executive Retiree Medical Benefits (as defined and described below)) sponsored by us on the same terms and conditions that are generally available to other eligible employees. Other than the benefits described above, we did not provide any other perquisites to our NEOs in fiscal year 2024. Severance Benefits and Change of Control Agreements We currently maintain two executive severance plans that provide certain compensation and benefits to our employees, including certain of our NEOs, if a participant’s employment with the Company terminates under certain specified circumstances: (i) our Amended and Restated Executive Severance Plan, adopted in 2006 (the “Original Severance Plan”), and (ii) our Amended and Restated 2010 Executive Severance Plan (the “2010 Severance Plan” and, together with the Original Severance Plan, the “Severance Plans”). During fiscal year 2024, Mr. Wallace was a participant under the Original Severance Plan, and Messrs. Higgins, Khan, Lorig and Donzella were participants under the 2010 Severance Plan. These severance benefits and arrangements are described below in more detail under the title “Potential Payments upon Termination or Change in Control.” We believe the Original Severance Plan and the 2010 Severance Plan are important for the long-term retention of our senior executives and enhance their commitment to the attainment of our strategic objectives. These severance benefits allow the participating executives to continue to focus their attention on our business operations and strategic plans without undue concern over their own financial situation during periods when substantial disruptions and distractions might otherwise prevail. We believe that these severance benefits are fair and reasonable in light of the level of dedication and commitment the participating executive officers have rendered the Company, the contribution they have made to our growth and financial success, and the value we expect to receive from retaining their services, including during challenging transition periods in connection with a change of control. Deferred Compensation We maintain an Executive Deferred Savings Plan, a nonqualified deferred compensation plan, which enables eligible employees, including our NEOs, and directors to defer all or a portion of certain components of their compensation, with no Company match. For further information, please see the section of this Proxy Statement entitled “Nonqualified Deferred Compensation.” We do not provide any pension benefits or any other retirement benefits to our NEOs, other than the 401(k) plan generally available to employees and the Executive Retiree Medical Benefits, described below. Executive Retiree Medical Program We have established a retiree medical program to offer access to continued health benefits to certain current domestic senior executive officers (including certain of our NEOs). To be eligible, an executive must be at least 55 years old with 10 years of service with the Company and must be in good standing with us at the time of retirement. Eligible executives are entitled to participate until age 65 and must pay the full cost of the premium. Participation in this program is limited to the Company’s executive officers who were subject to Section 16(a) reporting as of February 2011. The benefits described above shall be referred to herein as the “Executive Retiree Medical Benefits.” As of June 30, 2024, the only NEO eligible to participate in this program was Mr. Wallace. Stock Ownership Guidelines; Policy Regarding Hedging There are stock ownership guidelines applicable to our executive officers (including our NEOs) and Outside Directors. Under those guidelines, our executives are expected to own KLA Common Stock having a minimum value, denominated as a multiple of their annual base salaries, as follows:

  74. Employee Benefits and Perquisites

    Unearned PRSUs do not count for purposes of measuring compliance with the ownership guidelines. The value of outstanding RSUs and PRSUs for which the performance-based vesting criteria (if any) have been achieved but for which the service-based vesting criteria have not yet been satisfied is included in measuring compliance. Each executive officer, once he or she has served in a position listed above for at least four years, is expected to comply with these guidelines. With respect to our NEOs, the Compensation and Talent Committee conducts an annual review to assess compliance with the guidelines. The table below sets forth as of June 30, 2024 our NEOs’ compliance with our stock ownership guidelines. Value is based on the per share closing price of our Common Stock on June 28, 2024 ($824.51) (i.e., the last trading day of our last completed fiscal year) and the ratio is based on the annual salary rate approved during fiscal year 2024.

  75. SUMMARY COMPENSATION TABLE

    SUMMARY COMPENSATION TABLE The following table sets forth certain summary information concerning the compensation earned for services rendered in all capacities to the Company and its subsidiaries by our NEOs for the following fiscal years.

  76. SUMMARY COMPENSATION TABLE

    | Name and Principal Position | Year | Salary ($)(1) | Bonus ($) | Stock Awards ($)(2) | Non-Equity Incentive Plan Compensation ($)(1)(3) | All Other Compensation ($)(4) | Total ($) | | (a) | (b) | (c) | (d) | (e) | (f) | (g) | (h) | | Richard Wallace President & Chief Executive Officer | 2024 | 1,129,905 | — | 19,695,857(5) | 1,978,769 | 28,434 | 22,832,965 | | | 2023 | 1,000,000 | — | 23,492,301 | 2,124,000 | 28,058 | 26,644,359 | | | 2022 | 997,115 | — | 15,296,189 | 2,953,846 | 1,321,475 | 20,568,625 | | Bren Higgins Executive Vice President & Chief Financial Officer | 2024 | 758,174 | — | 5,855,158(5) | 810,569 | 28,649 | 7,452,550 | | | 2023 | 643,462 | — | 9,737,890 | 875,741 | 27,660 | 11,284,753 | | | 2022 | 594,231 | — | 4,305,358 | 1,138,462 | 432,587 | 6,470,638 | | Ahmad Khan President, Semiconductor Process Control (Semi PC), Electronics, Packaging and Components (EPC), and KLA Instruments | 2024 | 758,174 | — | 5,855,158(5) | 810,569 | 27,509 | 7,451,410 | | | 2023 | 650,000 | — | 9,975,137 | 920,400 | 26,853 | 11,572,390 | | | 2022 | 641,346 | — | 4,758,814 | 1,207,692 | 458,034 | 7,065,886 | | Oreste Donzella Executive Vice President and Chief Strategy Officer | 2024 | 501,251 | — | 1,809,895(5) | 407,809 | 4,955,816 | 7,674,771 | | | 2023 | 477,385 | — | 4,013,343 | 441,795 | 965,126 | 5,897,649 | | | 2022 | 457,692 | 4,942 | 1,699,577 | 716,308 | 782,595 | 3,661,114 | | Brian Lorig Executive Vice President, Global Support and Services | 2024 | 521,251 | — | 2,661,344(5) | 584,100 | 10,802 | 3,777,497 | | | 2023 | 496,731 | — | 4,368,618 | 506,012 | 10,578 | 5,381,939 | | | 2022 | 472,115 | — | 1,812,764 | 735,385 | 185,684 | 3,205,948 |

  77. SUMMARY COMPENSATION TABLE

    (1) The amounts shown in column (c) for fiscal year 2024 include amounts deferred by each of our NEOs, including under our 401(k) plan, a tax-qualified deferred compensation plan under Section 401(k) of the Internal Revenue Code, and under our EDSP, a nonqualified deferred compensation program available to the executive officers and certain other employees. (2) The amounts shown in column (d) for fiscal year 2024 represent the aggregate grant date fair value of all RSUs and PRSUs awarded to the particular NEO. For further discussion regarding the assumptions used in calculating the grant date fair value for equity awards, please refer to Note 1 to the Company’s consolidated financial statements in Item 8 of the Company’s Annual Report on Form 10-K for the fiscal year ended June 30, 2024, filed with the SEC on August 5, 2024. With respect to RSUs (i.e., awards issued with only service-based vesting criteria and no performance-based vesting criteria), the grant date fair value of each such RSU has been computed in accordance with the provisions of FASB Accounting Standards Codification Topic 718, referred to in this Proxy Statement as ASC 718. The ASC 718 grant date fair value of each RSU award was calculated based on the closing fair market value of our Common Stock on the applicable grant date. With respect to PRSUs (i.e., awards issued with both service-based and performance-based vesting criteria including EPS Awards), the grant date fair value of each such award has been computed in accordance with ASC 718 based on the probable outcome (determined as of the grant date) of the performance-based conditions applicable to the awards, which is target level performance, and the closing fair market value of our Common Stock on the grant date. (3) The amounts shown in column (f) for fiscal year 2024 reflect the payments earned by each NEO under our 2023 Bonus Plan, which amounts were paid in 2024. The 2023 Bonus Plan covered, and the payments set forth in this column were earned during, calendar year 2023. The NEOs currently participate in our 2024 Bonus Plan, under which they are eligible to earn cash incentive compensation with respect to calendar year 2024. Amounts payable under our 2024 Bonus Plan will not be determinable until the conclusion of calendar year 2024 and, accordingly, will be disclosed in our Proxy Statement for fiscal year 2025. (4) The amounts presented in column (g) consist of the following for fiscal year ended June 30, 2024:

  78. SUMMARY COMPENSATION TABLE

    | Name | Company Matching Contribution to 401(k) Plan ($) | Company-Paid Financial Plan- ning and Tax Preparation Costs ($) | Term Life Insurance Premium ($) | Expatriate Payments ($) | Total ($) | | Richard Wallace | 10,036 | 16,910 | 1,488 | — | 28,434 | | Bren Higgins | 10,635 | 16,910 | 1,104 | — | 28,649 | | Ahmad Khan | 9,495 | 16,910 | 1,104 | — | 27,509 | | Oreste Donzella | 10,000 | 16,910 | — | 4,928,906 | 4,955,816 | | Brian Lorig | 10,058 | — | 744 | — | 10,802 |

  79. SUMMARY COMPENSATION TABLE

    (5) A portion of this amount reflects the estimated fair value of annual PRSUs granted to our NEOs based on the probable outcome (determined as of the grant date) of the performance-based conditions applicable to the awards, which is target level performance and the closing fair market value of our Common Stock on the grant date. The number of shares issuable under the fiscal year 2024 annual PRSUs will be determined by the Company’s Relative Free Cash Flow Margin over the three-year period ending June 30, 2026, relative to our industry peer group. The fiscal year 2024 annual PRSUs are structured so that 100% of the target number of shares underlying the award will be earned upon achievement by KLA of a target Relative Free Cash Flow Margin performance among this peer group (the 55th percentile), and up to 150% of that target number of shares could be earned for performance at or above the 75th percentile. Because the Company’s relative performance over the three-year performance period was undeterminable as of the grant date of the annual PRSUs, the probable outcome of the performance-based conditions applicable to the awards as of the grant date, for purposes of the calculations set forth in this table, has been determined to be equal to 100% of the target number of shares underlying the applicable award. Accordingly, the amounts included in the table above attributable to annual PRSUs granted during fiscal year 2024 are as follows: (a) for Mr. Wallace, $11,817,313; (b) for Mr. Higgins, $2,927,579; (c) for Mr. Khan, $2,927,579; (d) for Mr. Donzella, $905,199; and (e) for Mr. Lorig, $1,330,672. The grant date fair value of the fiscal year 2024 annual PRSUs, if earned at their maximum, would be as follows: (a) for Mr. Wallace, $17,725,970; (b) for Mr. Higgins, $4,391,369; (c) for Mr. Khan, $4,391,369; (d) for Mr. Donzella, $1,357,798; and (e) for Mr. Lorig, $1,996,008. The Company’s achievement of the performance-based conditions applicable to the fiscal year 2024 annual PRSUs (and therefore the number of shares issuable under the fiscal year 2024 annual PRSUs) will be determined by the Compensation and Talent Committee (and, with respect to Mr. Wallace, the Outside Directors) following the completion of fiscal year 2026.

  80. GRANTS OF PLAN-BASED AWARDS

    GRANTS OF PLAN-BASED AWARDS The following table provides certain summary information concerning each grant of plan-based awards made to a NEO during the fiscal year ended June 30, 2024. No stock options or stock appreciation rights were granted to any of the NEOs during the fiscal year ended June 30, 2024.

  81. GRANTS OF PLAN-BASED AWARDS

    | | | Potential Payouts Under Non-Equity Plan Awards(1) | | | Potential Future Payouts Under Equity Incentive Plan Awards | | | | | | Name | Grant Date | Threshold ($) | Target ($) | Maximum ($) | Threshold (#)(2) | Target (#)(3) | Maximum (#)(4) | All Other Stock Awards: Number of Shares of Stock (#) | Grant Date Fair Value of Equity Awards ($)(5) | | (a) | (b) | (c) | (d) | (e) | (f) | (g) | (h) | (i) | (j) | | Richard Wallace | | 520,312 | 1,734,375 | 3,468,750 | | | | | | | | 8/3/2023(6) | | | | | | | 15,684 | 7,878,544 | | | 8/3/2023(7) | | | | 5,881 | 23,525 | 35,287 | — | 11,817,313 | | Bren Higgins | | 210,000 | 700,000 | 1,400,000 | | | | | | | | 8/3/2023(6) | | | | | | | 5,828 | 2,927,579 | | | 8/3/2023(7) | | | | 1,457 | 5,828 | 8,742 | — | 2,927,579 | | Ahmad Khan | | 210,000 | 700,000 | 1,400,000 | | | | | | | | 8/3/2023(6) | | | | | | | 5,828 | 2,927,579 | | | 8/3/2023(7) | | | | 1,457 | 5,828 | 8,742 | — | 2,927,579 | | Oreste Donzella | | 122,400 | 408,000 | 816,000 | | | | | | | | 8/3/2023(6) | | | | | | | 1,801 | 904,696 | | | 8/3/2023(7) | | | | 450 | 1,802 | 2,703 | — | 905,199 | | Brian Lorig | | 127,500 | 425,000 | 850,000 | | | | | | | | 8/3/2023(6) | | | | | | | 2,649 | 1,330,672 | | | 8/3/2023(7) | | | | 662 | 2,649 | 3,973 | — | 1,330,672 |

  82. GRANTS OF PLAN-BASED AWARDS

    (1) The amounts set forth in the table as “Potential Payouts Under Non-Equity Incentive Plan Awards” reflect the potential cash payouts (threshold, target and maximum) that could be earned under our calendar year 2023 and 2024 Bonus Plans. Because the NEOs participated in the calendar year 2023 Bonus Plan during the first half of fiscal year 2024 and the 2024 Bonus Plan during the second half of fiscal year 2024, the amounts under “Potential Payouts under Non-Equity Plan Awards” is apportioned 50% to the potential payouts under the calendar year 2023 Bonus Plan and 50% to the potential payouts under the calendar year 2024 Bonus Plan based on the salary rates and target bonus percentages approved for the NEO during fiscal year 2023 for the 2023 Bonus Plan and fiscal year 2024 for the 2024 Bonus Plan. (2) The number of shares reported in column (f) reflects the threshold number of shares that can potentially be earned under the fiscal year 2024 annual PRSUs (i.e., 25% of the target shares subject to those awards). (3) The number of shares reported in column (g) reflects the target number of shares that can potentially be earned under the fiscal year 2024 annual PRSUs. (4) The number of shares reported in column (h) reflects the maximum number of shares that can potentially be earned under the fiscal year 2024 annual PRSUs (i.e., 150% of the target number of shares subject to those awards). (5) The dollar value reported in column (j) represents the grant date fair value of the applicable RSU or PRSU. With respect to RSUs, the grant date fair value of each such RSU has been computed in accordance with ASC 718. The ASC 718 grant date fair value of each RSU award was calculated based on the closing sale price of our Common Stock on the grant date. With respect to PRSUs, the grant date fair value of the award has been computed in accordance with ASC 718 based on the probable outcome (determined as of the grant date) of the performance-based conditions applicable to the award and the closing sale price of our Common Stock on the grant date. Because the annual PRSUs granted during fiscal year 2024 were structured so that they would be fully earned upon achievement by KLA of its target level of three-year Relative Free Cash Flow Margin performance over the three-year period ending June 30, 2026 (a target that was considered difficult to achieve at the time of grant), the probable outcome of the performance-based conditions applicable to the awards as of the grant date, for purposes of the calculations set forth in this table, has been determined to be equal to the target number of shares potentially issuable under the applicable award. (6) Reflects an award of RSUs that only has a service-vesting component tied to continued service beyond fiscal year 2024. Twenty-five percent (25%) of the shares subject to the award will vest on the one-year anniversary of the grant date, and an additional twenty-five percent (25%) of the shares subject to the award will vest on each of the second, third and fourth anniversaries of the grant date, provided the NEO continues in our service through the applicable vesting date. The underlying shares may also vest on an accelerated basis in the event the NEO’s employment terminates under certain circumstances, as described in the section of this Proxy Statement entitled “Potential Payments Upon Termination or Change of Control.” (7) Reflects an award of annual PRSUs that have both a performance-vesting component tied to the Company’s three-year Relative Free Cash Flow Margin over the three-year period ending June 30, 2026, and a service-vesting component tied to continued service. The achievement of the performance-vesting component of the annual PRSUs (i.e., the number of shares that will be issuable to the NEO under his or her PRSU if he or she satisfies the applicable service-vesting requirements) will be determined following June 30, 2026. Fifty percent (50%) of the earned shares will vest on the three-year anniversary of the grant date (or on the date that such shares are determined to have been earned, if that date is later than the three-year anniversary of the grant date) and the remaining fifty percent (50%) will vest on the fourth anniversary of the date of grant, provided the NEO continues in our service through the applicable vesting date. The underlying shares may also vest on an accelerated basis in the event the NEO’s employment terminates under certain circumstances, as described in the section of this Proxy Statement entitled “Potential Payments Upon Termination or Change of Control.”

  83. OUTSTANDING EQUITY AWARDS AT FISCAL YEAR END

    OUTSTANDING EQUITY AWARDS AT FISCAL YEAR END The following table provides certain summary information concerning outstanding equity awards held by the NEOs as of June 30, 2024. Equity awards reflected in the table below that were granted prior to 2023 were granted under our 2004 Equity Incentive Plan (“2004 Plan”) and awards granted in 2023 were granted under our 2023 Plan.

  84. OUTSTANDING EQUITY AWARDS AT FISCAL YEAR END

    | | | Stock Awards | | | | | Name | Grant Date | Number of Shares or Units of Stock That Have Not Vested (#) | Market Value of Shares or Units of Stock That Have Not Vested (#)(1) | Equity Incentive Plan Awards: Number of unearned shares, units or other rights that have not vested (#) | Equity Incentive Plan Awards: Market or payout value of unearned shares, units or other rights that have not vested ($)(1) | | Richard Wallace | 8/6/2020 | 25,228(2) | 20,800,738 | | | | | 8/5/2021 | 8,648(2) | 7,130,362 | | | | | 8/5/2021 | | | 38,920(3) | 32,089,929 | | | 8/4/2022 | 12,072(2) | 9,953,485 | | | | | 8/4/2022 | | | 36,219(4) | 29,862,928 | | | 8/4/2022 | | | 47,180(5) | 38,900,382 | | | 8/3/2023 | 15,684(2) | 12,931,615 | | | | | 8/3/2023 | | | 35,287(6) | 29,094,484 | | Bren Higgins | 8/6/2020 | 8,093(2) | 6,672,759 | | | | | 8/5/2021 | 3,042(2) | 2,508,159 | | | | | 8/5/2021 | | | 9,129(3) | 7,526,952 | | | 8/4/2022 | 4,470(2) | 3,685,560 | | | | | 8/4/2022 | | | 8,943(4) | 7,373,593 | | | 8/4/2022 | | | 31,453(5) | 25,932,901 | | | 8/3/2023 | 5,828(2) | 4,805,244 | | | | | 8/3/2023 | | | 8,742(6) | 7,207,866 | | Ahmad Khan | 8/6/2020 | 9,444(2) | 7,786,672 | | | | | 8/5/2021 | 3,363(2) | 2,772,827 | | | | | 8/5/2021 | | | 10,090(3) | 8,319,306 | | | 8/4/2022 | 4,695(2) | 3,871,074 | | | | | 8/4/2022 | | | 9,390(4) | 8,319,306 | | | 8/4/2022 | | | 31,453(5) | 25,932,901 | | | 8/3/2023 | 5,828(2) | 4,805,244 | | | | | 8/3/2023 | | | 8,742(6) | 7,207,866 | | Oreste Donzella | 8/6/2020 | 3,778(2) | 3,114,999 | | | | | 8/5/2021 | 1,200(2) | 989,412 | | | | | 8/5/2021 | | | 3,604(3) | 2,971,534 | | | 8/4/2022 | 1,899(2) | 1,565,744 | | | | | 8/4/2022 | | | 3,801(4) | 3,133,963 | | | 8/4/2022 | | | 12,580(5) | 10,372,336 | | | 8/3/2023 | 1,801(2) | 1,484,943 | | | | | 8/3/2023 | | | 2,703(6) | 2,228,651 |

  85. OUTSTANDING EQUITY AWARDS AT FISCAL YEAR END

    | | | Stock Awards | | | | | Name | Grant Date | Number of Shares or Units of Stock That Have Not Vested (#) | Market Value of Shares or Units of Stock That Have Not Vested (#)(1) | Equity Incentive Plan Awards: Number of unearned shares, units or other rights that have not vested (#) | Equity Incentive Plan Awards: Market or payout value of unearned shares, units or other rights that have not vested ($)(1) | | Brian Lorig | 8/6/2020 | 4,045(2) | 3,335,143 | | | | | 8/5/2021 | 1,280(2) | 1,055,373 | | | | | 8/5/2021 | | | 3,844(3) | 3,169,416 | | | 8/4/2022 | 2,235(2) | 1,842,780 | | | | | 8/4/2022 | | | 4,471(4) | 3,686,384 | | | 8/4/2022 | | | 12,580(5) | 10,372,336 | | | 8/3/2023 | 2,649(2) | 2,184,127 | | | | | 8/3/2023 | | | 3,973(6) | 3,275,778 |

  86. OUTSTANDING EQUITY AWARDS AT FISCAL YEAR END

    (1) Calculated based on the $824.51 closing price per share of our Common Stock on June 28, 2024 (i.e., the last trading day of our last completed fiscal year). (2) Reflects RSU awards that vest as to 25% of the underlying shares annually on each anniversary of the date of grant, provided the NEO continues in our employ through the applicable vesting date. The underlying shares may vest on an accelerated basis in the event the NEO’s employment terminates under certain circumstances as described in the section of the Proxy Statement entitled “Potential Payments Upon Termination of Change of Control.” (3) Represents the maximum number of shares of our Common Stock that could be earned under PRSUs that were granted to the applicable NEO in August 2021. The achievement of the performance-vesting component of these PRSUs was determined following the completion of fiscal year 2024 based on the Company’s three-year Relative Free Cash Flow Margin over fiscal years 2022, 2023 and 2024 relative to our industry peer group. Fifty percent (50%) of the earned shares vested on the three-year anniversary of the grant date, and the remaining fifty percent (50%) will vest on the four-year anniversary of the grant date, provided the NEO continues in our employ through the applicable vesting date. The underlying shares may also vest on an accelerated basis in the event the NEO’s employment terminates under certain circumstances, as described in the section of this Proxy Statement entitled “Potential Payments Upon Termination or Change of Control.” (4) Represents the maximum number of shares of our Common Stock that could be earned under PRSUs that were granted to the applicable NEO in August 2022. The achievement of the performance-vesting component of these PRSUs will be determined following the completion of fiscal year 2025 based on the Company’s three-year Relative Free Cash Flow Margin over fiscal years 2023, 2024 and 2025 relative to our industry peer group. Fifty percent (50%) of the earned shares will vest on the three-year anniversary of the grant date, and the remaining fifty percent (50%) will vest on the four-year anniversary of the grant date, provided the NEO continues in our employ through the applicable vesting date. The underlying shares may also vest on an accelerated basis in the event the NEO’s employment terminates under certain circumstances, as described in the section of this Proxy Statement entitled “Potential Payments Upon Termination or Change of Control.” (5) Represents the maximum number of shares of our Common Stock that could be earned under EPS Awards that were granted to the applicable NEO in August 2022. The achievement of the performance-vesting component of these EPS Awards will be determined following the completion of fiscal years 2024, 2025 and 2026 based on the Company’s non-GAAP EPS achieved during the applicable performance period. The underlying shares may vest on an accelerated basis in the event the NEO’s employment terminates under certain circumstances as described in the section of the Proxy Statement entitled “Potential Payments Upon Termination of Change of Control.” (6) Represents the maximum number of shares of our Common Stock that could be earned under annual PRSUs that were granted to the applicable NEO in August 2023. The achievement of the performance-vesting component of these PRSUs will be determined following the completion of fiscal year 2026 based on the Company’s three-year Relative Free Cash Flow Margin over fiscal years 2024, 2025 and 2026 relative to our industry peer group. Fifty percent (50%) of the earned shares will vest on the three-year anniversary of the grant date, and the remaining fifty percent (50%) will vest on the four-year anniversary of the grant date, provided the NEO continues in our employ through the applicable vesting date. The underlying shares may also vest on an accelerated basis in the event the NEO’s employment terminates under certain circumstances, as described in the section of this Proxy Statement entitled “Potential Payments Upon Termination or Change of Control.”

  87. OPTION EXERCISES AND STOCK VESTED

    OPTION EXERCISES AND STOCK VESTED The following table sets forth information with respect to shares of our Common Stock subject to RSUs or PRSUs held by the NEOs that vested during the fiscal year ended June 30, 2024. No stock appreciation rights or stock options were exercised by the NEOs during the fiscal year ended June 30, 2024.

  88. OPTION EXERCISES AND STOCK VESTED

    | | Stock Awards | | | Name | Number of Shares Acquired on Vesting (#)(1) | Value Realized on Vesting ($)(2) | | Richard Wallace | 103,030 | 58,737,590 | | Bren Higgins | 37,782 | 21,742,101 | | Ahmad Khan | 42,891 | 24,592,432 | | Oreste Donzella | 17,278 | 10,051,079 | | Brian Lorig | 17,638 | 10,178,563 |

  89. OPTION EXERCISES AND STOCK VESTED

    (1) Our 2023 Plan and 2004 Plan allow us to withhold shares issuable upon a vesting event to pay for the applicable withholding tax with respect to such vesting event. The gross number of shares acquired on vesting, which is set forth in the table above, was reduced by the withheld shares, and the net remaining shares were issued to each NEO. The following reflects the net number of shares that were issued to each NEO, after giving effect to such withholding, during the fiscal year ended June 30, 2024: Mr. Wallace, 51,945 shares; Mr. Higgins, 19,091 shares; Mr. Khan, 21,735 shares; Mr. Donzella, 8,178 shares; and Mr. Lorig, 8,983 shares. (2) Based on the closing market price of the vested shares on the vesting date (or, if the vesting date occurred on a day on which the NASDAQ Stock Market was closed for trading, the closing market price of our Common Stock on the last trading day immediately prior to the vesting date). Does not include dividend equivalent rights on the vested shares.

  90. NONQUALIFIED DEFERRED COMPENSATION

    NONQUALIFIED DEFERRED COMPENSATION We have established the EDSP in order to provide our executive officers and other key employees with the opportunity to defer all or a portion of their cash compensation each year. Pursuant to the EDSP, each participant can elect to defer between 5% to 100% of his or her salary, commissions and bonuses for the fiscal year. The deferred amount is credited to an account maintained in his or her name on our books. The portion of the account attributable to the participant’s deferral is fully vested at all times but is not matched with any Company funds. The account is periodically adjusted to reflect earnings (or losses) based on the participant’s investment elections among a select group of investment funds utilized to track the notional investment return on the account balance. As of June 30, 2024, there were a total of 30 investment funds available for selection under the EDSP, and the participant may periodically change his or her investment elections. The participant may elect to receive his or her vested account balance upon termination of employment or at an earlier designated date. The distribution may, at the participant’s election, be made in a lump sum or in quarterly installments over a period ranging from five years to 15 years, depending on the circumstances triggering the distribution event. A participant can receive an early distribution of a portion of his or her vested account balance in the event of a financial hardship or in the event he or she agrees to forfeit a designated percentage of his or her remaining account balance. We maintain life insurance policies on EDSP participants as a funding vehicle for a portion of our obligations under the EDSP upon an early distribution of a portion of his or her vested account balance in the event of a financial hardship or in the event he or she agrees to forfeit a designated percentage of his or her remaining account balance. The following table shows the deferred compensation activity for each participating NEO during the fiscal year ended June 30, 2024:

  91. NONQUALIFIED DEFERRED COMPENSATION

    | Name | Executive Contributions in Fiscal Year 2024 ($) | Company Contributions in Fiscal Year 2024 ($) | Aggregate Earnings in Fiscal Year 2024 ($)(1)(2) | Aggregate Withdrawals/ Distributions ($) | Aggregate Balance as of June 30, 2024 ($) | | (a) | (b) | (c) | (d) | (e) | (f) | | Richard Wallace | — | — | 470,758 | — | 3,361,197 | | Bren Higgins | 449,392 | — | 144,998 | — | 1,350,835 | | Ahmad Khan | 324,278 | — | 84,252 | — | 998,343 | | Oreste Donzella | 380,096 | — | 417,902 | — | 3,273,665 | | Brian Lorig | — | — | 229,909 | — | 2,214,605 |

  92. NONQUALIFIED DEFERRED COMPENSATION

    (1) The reported amount corresponds to a composite of the actual market earnings on a group of investment funds selected by the applicable executive officer for purposes of tracking the notional investment return on the officer’s account balance for fiscal year 2024. No portion of the reported amount was “above market” or “preferential.” Accordingly, amounts reported in this column (d) for each NEO are not reported in the Summary Compensation Table. (2) The 30 investment funds named below were available for selection under the EDSP for some or all of fiscal year 2024. The rate of return for each such fund for fiscal year 2024 was as follows:

  93. NONQUALIFIED DEFERRED COMPENSATION

    | Name of Fund | % Rate of Return for Fiscal Year 2024 | | Allspring Gov Money Market Institutional | 5.32% | | American Funds IS Growth 2 | 28.73% | | DFA VA US Targeted Value | 13.47% | | DWS Small Cap Index VIP A | 9.80% | | MFS VIT Global Equity Initial | 6.03% | | MFS VIT III Mid Cap Value Initial | 12.74% | | PIMCO VIT Total Return Institutional | 4.36% | | T. Rowe Price Mid Cap Growth | 9.96% | | Vanguard VIF Balanced | 14.93% | | Vanguard VIF Equity Income | 14.20% | | Vanguard VIF Equity Index | 24.37% | | Vanguard VIF High Yield Bond | 9.25% | | Vanguard VIF International | 8.85% | | Vanguard VIF REIT Index | 4.62% | | Vanguard VIF Small Company Growth | 7.12% | | Vanguard VIF Total Bond Market Index | 2.59% | | Vanguard VIF Total Stock Market Index | 11.00% |

  94. NONQUALIFIED DEFERRED COMPENSATION

    | Funds Added - February 1, 2024 | % Rate of Return for February 1, 2024 to June 30, 2024 | | VIP Freedom® Income Initial | 1.45% | | VIP Freedom® 2010 Initial | 2.28% | | VIP Freedom® 2015 Initial | 0.35% | | VIP Freedom® 2020 Initial | 1.59% | | VIP Freedom® 2025 Initial | 4.97% | | VIP Freedom® 2030 Initial | 5.8% | | VIP Freedom® 2035 Initial | 6.01% | | VIP Freedom® 2040 Initial | 7.41% | | VIP Freedom® 2045 Initial | 7.86% | | VIP Freedom® 2050 Initial | 7.75% | | VIP Freedom® 2055 Initial | 8.05% | | VIP Freedom® 2060 Initial | 7.75% | | VIP Freedom® 2065 Initial | 8.51% |

  95. POTENTIAL PAYMENTS UPON TERMINATION OR CHANGE OF CONTROL

    POTENTIAL PAYMENTS UPON TERMINATION OR CHANGE OF CONTROL In January 2006, our Board adopted the Original Severance Plan, which was amended and restated on October 20, 2016. In November 2010, our Compensation and Talent Committee adopted the 2010 Severance Plan. The 2010 Severance Plan exists in parallel with the Original Severance Plan, which remains in full force and effect for existing participants under that plan until terminated or modified in accordance with its terms. No participant under the 2010 Severance Plan is eligible to simultaneously participate under the Original Severance Plan, and no participant under the Original Severance Plan is eligible to simultaneously participate under the 2010 Severance Plan. The Original Severance Plan and the 2010 Severance Plan each provide certain compensation and benefits if a participant’s employment with us terminates under certain defined circumstances. In exchange for receiving benefits under either plan, the participant must agree to a release of claims in favor of the Company and certain non-solicitation restrictions for the period of time co-terminous with the period for which he or she will receive continued compensation and benefits under the applicable Severance Plan. All of our NEOs participated in either the Original Severance Plan or the 2010 Severance Plan during fiscal year 2024, as described in more detail below.

  96. Table Reflecting Potential Termination and Change of Control Payments

    | Name | Event | Salary/Bonus Continuation and Severance Payments ($) | Pro-rated Bonus ($) | Accelerated Vesting of Stock Awards ($)(1) | Payment of Dividend Equivalents ($)(2) | Total ($) | | Richard Wallace | Termination without Cause or Resignation for Good Reason (3) | 2,250,000 | 1,978,769 | 81,234,848(4) | 1,331,180 | 86,794,796 | | | Termination without Cause or Resignation for Good Reason following a Change of Control (3) (5) | 10,431,615 | 1,978,769 | 162,247,490(6) | 2,266,581 | 176,924,455 |

  97. Table Reflecting Potential Termination and Change of Control Payments

    | Name | Event | Salary / Bonus Continuation ($) | Pro-rated Bonus ($) | Accelerated Vesting of Stock Awards ($)(1) | Payment of Dividend Equivalents ($)(2) | Total ($) | | Bren Higgins | Termination without Cause or Resignation for Good Reason following a Change of Control (3) (5) | 1,125,000 | 810,569 | 53,368,883(6) | 740,778 | 56,045,231 | | Ahmad Khan | Termination without Cause or Resignation for Good Reason following a Change of Control (3) (5) | 1,125,000 | 810,569 | 59,013,479(6) | 858,600 | 61,807,647 | | Oreste Donzella | Termination without Cause or Resignation for Good Reason following a Change of Control (3) (5) | 720,000 | 407,808 | 22,091,921(6) | 327,992 | 23,547,721 | | Brian Lorig | Termination without Cause or Resignation for Good Reason following a Change of Control (3) (5) | 750,000 | 584,100 | 25,848,801(6) | 370,620 | 27,553,521 |

  98. Pay Ratio Disclosure

    Pay Ratio Disclosure As required by Section 953(b) of the Dodd-Frank Wall Street Reform and Consumer Protection Act and Item 402(u) of Regulation S-K, we are providing the following information about the relationship of the annual total compensation of our employees and the annual total compensation of Mr. Wallace, our President and Chief Executive Officer. The pay ratio included in this information is a reasonable estimate calculated in a manner consistent with Item 402(u) of Regulation S-K. As disclosed in the Summary Compensation Table, the fiscal year 2024 annual total compensation as determined under Item 402 of Regulation S-K for Mr. Wallace was $22,832,965. The fiscal year 2024 annual total compensation as determined under Item 402 of Regulation S-K for the median employee was $87,477. Based on the foregoing, our estimate of the ratio of Mr. Wallace’s annual total compensation to the median employee’s annual total compensation for fiscal year 2024 is 261 to 1. Given the different methodologies that various public companies will use to determine an estimate of their pay ratios, the estimated ratio reported above should not be used as a basis for comparison between companies . As permitted by SEC rules, we used the same median employee in our fiscal year 2024 pay ratio calculation as we used in fiscal year 2022 and in fiscal year 2023, as we believe there have not been any changes to our employee population or employee compensation that would have significantly impacted our pay ratio disclosure. On June 30, 2024, we and our subsidiaries employed a total of approximately 15,000 employees. We originally identified the median employee used for our fiscal year 2024 pay ratio calculations for our fiscal year 2022 pay ratio calculations based on total target compensation of each employee within our global workforce as set forth in our human resources databases for fiscal year 2022, which included target salary, cash bonus, equity compensation and other long-term incentive compensation for fiscal year 2022. During the original identification of our median employee, for employees outside the United States, we converted their compensation to U.S. dollars using prevailing exchange rates as of June 30, 2022. With respect to the annual total compensation of Mr. Wallace, we used the amount reported in the “Total” column for fiscal year 2024 in our Summary Compensation Table included in this Proxy Statement. We calculated our median employee’s total annual compensation for fiscal year 2024 in the sam e manner as Mr. Wallace’s total annual compensation was calculated for purposes of the Summary Compensation Table.

  99. PAY VERSUS PERFORMANCE TABLE

    PAY VERSUS PERFORMANCE TABLE The following table sets forth information concerning the compensation of our NEOs for each of the fiscal years ended June 30, 2021, 2022, 2023 and 2024 and our financial performance for such fiscal year.

  100. PAY VERSUS PERFORMANCE TABLE

    | Year | Summary Compensation Table Total for PEO (1) | Compensation Actually Paid to PEO (1)(3) | Average Summary Compensation Table for Non- PEO Named Executive Officers (2) | Average Compensation Actually Paid to Non-PEO Named Executive Officers (2)(3) | Value of Initial Fixed $100 Investment Based On: | | Net Income ($ in thousands) | Free Cash Flow Margin (6) | | | | | | | Total Shareholder Return (4) | Peer Group Total Shareholder Return (5) | | | | 2024 | $22,832,965 | $90,772,465 | $6,589,057 | $13,543,731 | $433.55 | $274.10 | $2,761,896 | 30.9% | | 2023 | $26,644,359 | $66,578,359 | $8,534,115 | $22,630,489 | $256.08 | $183.98 | $3,387,351 | 31.7% | | 2022 | $20,568,625 | $30,398,207 | $5,380,793 | $7,397,584 | $168.08 | $128.04 | $3,322,060 | 32.6% | | 2021 | $13,710,388 | $60,709,229 | $4,396,808 | $15,328,288 | $174.17 | $167.56 | $2,077,353 | 28.2% |

  101. PAY VERSUS PERFORMANCE TABLE

    (1) Amounts reported are for Richard Wallace, who served as our Chief Executive Officer during each of the applicable fiscal years. (2) Our non-PEO named executive officers (our “Non-PEO Named Executive Officers”) were (a) Bren Higgins, Ahmad Khan, Oreste Donzella and Brian Lorig, for fiscal year 2024, (b) Bren Higgins, Ahmad Khan, Oreste Donzella and Brian Lorig, for fiscal year 2023, (c) Bren Higgins, Ahmad Khan, Oreste Donzella and Mary Beth Wilkinson, for fiscal year 2022, and (d) Bren Higgins, Ahmad Khan, Brian Lorig and Mary Beth Wilkinson, for fiscal year 2021. | Executive Compensation Tables (3) Amounts in these columns show the “Compensation Actually Paid,” as calculated in accordance with the specific methodology prescribed by the SEC. The table below provides the adjustments to the Summary Compensation Table total compensation to arrive at the Compensation Actually Paid to our CEO and the average Compensation Actually Paid to our Non-PEO Named Executive Officers for each of the required fiscal years.

  102. PAY VERSUS PERFORMANCE TABLE

    | | 2024 | | 2023 | | 2022 | | 2021 | | | Adjustments to Reported Summary Compensation Table Total for CEO and Non-PEO Named Executive Officers | PEO | Non-PEO Named Executive Officers (Average) | PEO | Non-PEO Named Executive Officers (Average) | PEO | Non-PEO Named Executive Officers (Average) | PEO | Non-PEO Named Executive Officers (Average) | | Summary Compensation Table total amount for applicable fiscal year | $22,832,965 | $6,589,057 | $26,644,359 | $8,534,115 | $20,568,625 | $5,380,793 | $13,710,388 | $4,396,808 | | Subtract the amounts reported under the Stock Awards column in the Summary Compensation Table for the applicable fiscal year | $19,695,857 | $4,045,389 | $23,492,301 | $7,023,747 | $15,296,189 | $3,427,362 | $9,338,877 | $2,947,277 | | Add year-end fair value of equity awards granted during the applicable fiscal year that remain unvested as of applicable fiscal year end determined as of applicable fiscal year end | $41,638,580 | ($1,414,084) | $34,527,604 | $9,647,715 | $17,938,199 | $3,545,418 | $17,727,271 | $5,409,000 | | Add (subtract) year over year change in fair value of equity awards granted in prior years that remain outstanding and unvested as of applicable fiscal year end | $33,678,469 | $7,930,621 | $24,635,303 | $8,777,513 | ($18,828,402) | ($4,115,578) | $41,160,831 | $7,885,372 | | Add (subtract) year over year change in fair value of equity awards granted in prior years that vested in the applicable fiscal year | $12,318,309 | $4,483,525 | $4,263,394 | $2,694,893 | $26,015,974 | $6,014,313 | ($2,550,384) | $584,385 | | Total Adjustments | 67,939,500 | $6,954,674 | $39,934,000 | $14,096,374 | $9,829,582 | $2,016,791 | $46,998,841 | $10,931,480 | | Compensation Actually Paid | $90,772,465 | $13,543,731 | $66,578,359 | $22,630,489 | $30,398,207 | $7,397,584 | $60,709,229 | $15,328,288 |

  103. PAY VERSUS PERFORMANCE TABLE

    For purposes of the foregoing adjustments, the fair value or change in fair value (as applicable) of equity awards was determined as follows: (i) for RSUs, the closing price of our Common Stock on the applicable fiscal year-end date, or, in the case of vesting dates, the closing price of our Common Stock on the applicable vesting date, in each case multiplied by the number of shares of our Common Stock underlying the award; and (ii) for unvested PRSUs (including EPS Awards), the same valuation methodology as the RSUs above, except that the year-end values are multiplied by the probability of achievement of the applicable performance objectives as of the applicable date. (4) In accordance with Item 201(e) of Regulation S-K, our total shareholder return is calculated, for each fiscal year shown in the table above, as the cumulative total shareholder return on our Common Stock from June 30, 2020 (i.e., the last trading day of our 2020 fiscal year), through and including the last day of the applicable fiscal year, assuming a fixed investment of $100. (5) Our peer group is comprised of the component companies of the Philadelphia Semiconductor Index (the “Peer Index”). Amounts reported in this column represent the cumulative total shareholder return of the Peer Index. (6) Free cash flow margin equals our free cash flow divided by total revenues. Free cash flow equals net cash provided by operating activities less capital expenditures. Free cash flow margin over the applicable three-year period relative to our industry peer group for that same three-year period is used in determining the level at which the performance criteria under our annual PRSUs are satisfied, between 0%-150% of the target shares granted.

  104. PAY VERSUS PERFORMANCE TABLE

    | Free Cash Flow Measures | | | | | | (Dollars in millions) | For the twelve months ended | | | | | | June 30, 2021 | June 30, 2022 | June 30, 2023 | June 30, 2024 | | Net cash provided by operating activities | $2,185.0 | $3,312.7 | $3,669.8 | $3,308.6 | | Less Capital expenditures | $(231.6) | $(307.3) | $(341.6) | $(277.4) | | Free cash flow | $1,953.4 | $3,005.4 | $3,328.2 | $3,031.2 | | Free cash flow | $1,953.4 | $3,005.4 | $3,328.2 | $3,031.2 | | Revenue | $6,918.7 | $9,211.9 | $10,496.1 | $9,812.2 | | Free cash flow margin | 28.2% | 32.6% | 31.7% | 30.9% |

  105. Narrative Disclosure to Pay Versus Performance Table

    Narrative Disclosure to Pay Versus Performance Table

  106. Relationship Between Compensation Actually Paid and Total Shareholder Return, Net Income and Free Cash Flow Margin

    Relationship Between Compensation Actually Paid and Total Shareholder Return, Net Income and Free Cash Flow Margin The following charts graphically depict the relationship between compensation actually paid to our PEO and the average of the compensation actually paid to our non-PEO NEOs and each of our cumulative total shareholder return, Peer Index total shareholder return, our net income and free cash flow margin.