Exhibit 10.74
KLA INSTRUMENTS CORPORATION
SECOND AMENDED AND RESTATED
1981 EMPLOYEE STOCK PURCHASE PLAN
1. Purpose. On October 6, 1981, the KLA Instruments Corporation
1981 Employee Stock Purchase Plan (the "Initial Plan") was adopted. On July 1,
1984, the Initial Plan was amended and restated in its entirety and retitled
the KLA Instruments Corporation 1981 Employee Stock Purchase Plan as Amended
and Restated (the "Second Plan"). On July 19, 1989, the Second Plan was
amended and restated in its entirety and retitled the KLA Instruments
Corporation Amended and Restated 1981 Employee Stock Purchase Plan (the "Third
Plan"). On August 3, 1993, the Third Plan was amended and restated in its
entirety as set forth herein and retitled the KLA Instruments Corporation
Second Amended and Restated 1981 Employee Stock Purchase Plan (the "Plan").
Notwithstanding any other provision of the Plan to the
contrary, the terms and conditions of the Initial Plan, the Second Plan, and
the Third Plan shall remain in full force and effect as to options granted and
as to shares of common stock of KLA Instruments Corporation ("KLA") purchased
pursuant to the Initial Plan, the Second Plan, and the Third Plan,
respectively.
Notwithstanding any other provision of the Plan to the
contrary, if an employee participating in the Plan is subject to section 16 of
the Securities Exchange Act of 1934, as amended, (the "Exchange Act") any
provisions of the Plan resulting from the amendment and restatement of the
Second Plan and the Third Plan the application of which to such employee which
would result in a "material increase" in the benefits accruing to such employee
under the Plan such as to require stockholder approval of such provision for
purposes of complying with Rule 16b-3 shall not apply to such employee and,
instead, the applicable provision of the Initial Plan, the Second Plan, or the
Third Plan, as the case may be, if any, shall apply to such employee. The Plan
is established to provide eligible employees of KLA and any current or future
parent and/or subsidiary corporations of KLA (collectively referred to as the
"Company") with an opportunity through payroll deductions to acquire a
proprietary interest in the Company by the purchase of common stock of KLA.
(KLA and any such parent and/or subsidiary corporation of KLA shall be
individually referred to herein as a "Participating Company." For purposes of
the Plan, a parent
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corporation and a subsidiary corporation shall be as defined in sections 425(e)
and 425(f) of the Internal Revenue Code of 1986, as amended (the "Code").)
It is intended that the Plan shall qualify as an "employee
stock purchase plan" under section 423 of the Code (including any future
amendments or replacements of such section), and the Plan shall be so
construed. Any term not expressly defined in the Plan but defined for purposes
of section 423 of the Code shall have the same definition herein.
An employee participating in the Plan (a "Participant") may
withdraw such Participant's accumulated payroll deductions (if any) therein at
any time during an Offering Period (as defined below). Accordingly, each
Participant is, in effect, granted an option pursuant to the Plan (a "Purchase
Right") which may or may not be exercised at the end of an Offering Period and
which is intended to qualify as an option described in section 423 of the Code.
2. Administration. The Plan shall be administered by the Board
of Directors of KLA (the "Board") and/or by a duly appointed committee of the
Board having such powers as shall be specified by the Board. Any subsequent
references to the Board shall also mean the committee if a committee has been
appointed. All questions of interpretation of the Plan or of any Purchase
Right shall be determined by the Board and shall be final and binding upon all
persons having an interest in the Plan and/or any Purchase Right. Subject to
the provisions of the Plan, the Board shall determine all of the relevant terms
and conditions of Purchase Rights granted pursuant to the Plan; provided,
however, that all Participants granted Purchase Rights pursuant to the Plan
shall have the same rights and privileges within the meaning of section
423(b)(5) of the Code. All expenses incurred in connection with the
administration of the Plan shall be paid by the Company.
3. Share Reserve. The maximum number of shares which may be
issued under the Plan shall be two million (2,000,000) shares of KLA's
authorized but unissued common stock or treasury stock (the "Shares"). In the
event that any Purchase Right for any reason expires or is cancelled or
terminated, the Shares allocable to the unexercised portion of such Purchase
Right may again be subjected to a Purchase Right.
4. Eligibility. Any employee of a Participating Company
(including officers and directors who are also employees) is eligible to
participate in the Plan except employees who own or hold options to purchase
or who, as a result of participation in this Plan, would own or hold options to
purchase, stock of the Company possessing five percent (5%) or more of the
total combined voting power or value of all classes of stock of the Company
within the meaning of section 423(b)(3) of the Code.
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An employee who is also a director may participate in the Plan
but may not purchase shares under the Plan until the Company's stockholders
approve the Plan. In the event that stockholder approval of the Plan is not
obtained prior to the last Purchase Date of an Offering Period in which a
director who is also an employee is participating, then any cash balance in
such Participant's account shall be refunded to the Participant as soon as
practical after the last day of the Offering Period.
5. Offering Dates.
(a) Offering Periods. Except as otherwise set forth
below, the Plan shall be implemented by offerings (individually an "Offering")
of two (2) years duration (an "Offering Period"). An Offering Period shall
commence on the first day of January and July of each year. The first Offering
Period shall commence on July 1, 1989. Notwithstanding the foregoing, the
Board may establish a different term for one (1) or more Offerings and/or
different commencing and/or ending dates for such Offerings and/or additional
Offerings, including, without limitation, an Offering commencing October 1,
1989. An employee who becomes eligible to participate in the Plan after an
Offering Period has commenced shall not be eligible to participate in such
Offering but may participate in any subsequent Offering provided such employee
is still eligible to participate in the Plan as of the commencement of any such
subsequent Offering. The Company shall have the authority to designate the
maximum number of Offerings in which an eligible employee may participate at
any one time. The first day of an Offering Period shall be the "Offering Date"
for such Offering Period. In the event the first and/or last day of an
Offering Period is not a business day, the Company shall specify the business
day that will be deemed the first or last day, as the case may be, of the
Offering Period.
(b) Purchase Periods. Each Offering Period shall consist
of four (4) consecutive purchase periods of six (6) months duration (a
"Purchase Period"). The last day of each Purchase Period shall be the
"Purchase Date" for such Purchase Period. Notwithstanding the foregoing, the
Board may establish a different term for one (1) or more Purchase Periods
and/or different commencing dates and/or Purchase Dates for such Purchase
Periods. In the event the first and/or last day of a Purchase Period is not a
business day, the Company shall specify the business day that will be deemed
the first or last day, as the case may be, of the Purchase Period.
(c) Governmental Approval; Stockholder Approval.
Notwithstanding any other provision of the Plan to the contrary, any Purchase
Right granted pursuant to the Plan shall be subject to (i) obtaining all
necessary governmental approvals and/or qualifications of the sale and/or
issuance of the
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Purchase Rights and/or the Shares, and (ii) in the case of Purchase Rights with
an Offering Date after an amendment of the Plan, obtaining any necessary
approval of the stockholders of the Company required by paragraph 22.
6. Participation in the Plan.
(a) Initial Participation. An eligible employee shall
become a Participant on the first Offering Date after satisfying the
eligibility requirements set forth in paragraph 4 and delivering to the Company
not later than the close of business on the date seven (7) days prior to such
Offering Date or on a date as may be established by the Company from time to
time (the "Subscription Date") a subscription agreement indicating the
employee's election to participate in the Plan and authorizing payroll
deductions. An eligible employee who does not deliver a subscription agreement
to the Company on or before the Subscription Date shall not participate in the
Plan for that Offering Period or for any subsequent Offering Period unless such
eligible employee subsequently enrolls in the Plan by complying with the
provisions of paragraph 4 and by filing a subscription agreement with the
Company on or before the Subscription Date for such subsequent Offering Period.
The Company may, from time to time, change the Subscription Date as deemed
advisable by the Company in its sole discretion for proper administration of
the Plan.
(b) Continued Participation. Participation in the Plan
shall continue until (i) the Participant ceases to be eligible as provided in
paragraph 4, (ii) the Participant withdraws from the Plan pursuant to paragraph
11, or (iii) the Participant terminates employment as provided in paragraph 12.
If a Participant is automatically withdrawn from an Offering at the end of a
Purchase Period of such Offering pursuant to paragraph 11(c), then the
Participant shall automatically participate in the Offering Period commencing
on the next business day. At the end of an Offering Period, each Participant
in such terminating Offering Period shall automatically participate in the
first subsequent Offering Period according to the same elections contained in
the Participant's subscription agreement effective for the Offering Period
which has just ended, provided such Participant is still eligible to
participate in the Plan as provided in paragraph 4. However, a Participant may
file a subscription agreement with respect to such subsequent Offering Period
if the Participant desires to change any of the Participant's elections
contained in the Participant's then effective subscription agreement.
7. Right to Purchase Shares. During an Offering Period each
Participant in such Offering Period shall have a Purchase Right consisting of
the right to purchase that number of whole Shares arrived at by dividing Twenty
Thousand Dollars ($20,000) by eighty-five percent (85%) of the fair market
value of the Shares on the Offering Date of such Offering Period; provided,
however,
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that in no event shall a Participant have a Purchase Right for more than two
thousand (2,000) Shares.
8. Purchase Price. The purchase price at which Shares may be
acquired at the end of an Offering pursuant to the exercise of all or any
portion of a Purchase Right granted under the Plan (the "Offering Exercise
Price") shall be set by the Board; provided, however, that the purchase price
shall not be less than eighty-five percent (85%) of the lesser of (a) the fair
market value of the Shares on the Offering Date of such Offering Period, or (b)
the fair market value of the Shares at the time of exercise of all or any
portion of the Purchase Right. Unless otherwise provided by the Board prior to
the commencement of an Offering Period, the Offering Exercise Price shall be
eighty-five percent (85%) of the lesser of (a) the fair market value of the
Shares on the Offering Date of such Offering Period or (b) the fair market
value of the Shares at the time of exercise of all or any portion of the
Purchase Right. For purposes of the Plan, the fair market value of the Shares
at any point in time shall be determined by the Board based on such factors as
the Board deems relevant; including, without limitation, the mean of the bid
and asked price of the Shares on the date in question (or the immediately
preceding business day in the event the date in question falls on a weekend or
legal holiday) as reported on the National Association of Securities Dealers
Automated Quotations system, if available.
9. Payment of Purchase Price. Shares which are acquired pursuant
to the exercise of all or any portion of a Purchase Right for a given Offering
Period may be paid for only by means of payroll deductions from the
Participant's Compensation accumulated during the Offering Period. For
purposes of the Plan, a Participant's "Compensation" with respect to an
Offering shall include all amounts paid in cash and includable as "wages"
subject to tax under section 3101(a) of the Code without applying the dollar
limitation of section 3121(a) of the Code. Accordingly, Compensation shall
include, without limitation, salaries, commissions, bonuses, overtime and
amounts contributed to the Participant's Salary Reduction Account, as that term
is defined in the Company's Employee Savings and Investment Plan (the "Savings
and Investment Plan"). Compensation shall not include reimbursements of
expenses, allowances, or any amount deemed received without the actual transfer
of cash or any amounts directly or indirectly paid pursuant to the Plan or any
other stock purchase or stock option plan or credits or benefits under the
Savings and Investment Plan (other than as set forth above) or any other
Company contributions or payments to any trust, fund, or plan to provide
retirement, pension, profit sharing, health, welfare, death, insurance or
similar benefits to or on behalf of such Participant or any other payments not
specifically referenced above, except to the extent that the inclusion of any
such item with respect to all Participants on a nondiscriminatory basis is
specifically approved by the Board. Except as set forth below. the amount of
Compensation to be
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withheld from a Participant's Compensation during each month shall be
determined by the Participant's subscription agreement.
(a) Election to Decrease Withholding. During an Offering
Period, a Participant may elect to decrease the amount withheld from his or her
Compensation by filing an amended subscription agreement with the Company on or
before the Change Notice Date. The "Change Notice Date" shall initially be the
date fifteen (15) days prior to the end of the first pay period for which such
election is to be effective; provided, however, the Company may change such
Change Notice Date from time to time. A Participant may not elect to increase
the amount withheld from the Participant's Compensation during an Offering
Period.
(b) Limitations on Payroll Withholding. The amount of
payroll withholding with respect to the Plan for any Participant shall be at
least Ten Dollars ($10.00) per month but shall not exceed ten percent (10%) of
the Participant's Compensation for any relevant pay period. Amounts shall be
withheld in whole percentages only and shall be reduced by any amounts
contributed by the Participant and applied to the purchase of Company stock
pursuant to any other employee stock purchase plan qualifying under section 423
of the Code.
(c) Payroll Withholding. Payroll deductions shall
commence on the first payday following the Offering Date and shall continue to
the end of the Offering Period unless sooner altered or terminated as provided
in the Plan.
(d) Participant Accounts. Individual accounts shall be
maintained for each Participant. All payroll deductions from a Participant's
Compensation shall be credited to such account and shall be deposited with the
general funds of the Company. All payroll deductions received or held by the
Company may be used by the Company for any corporate purpose.
(e) No Interest Paid. Interest shall not be paid on sums
withheld from a Participant's Compensation
(f) Exercise of Purchase Right. On each Purchase Date of
an Offering Period, each Participant who has not withdrawn from the Offering or
whose participation in the Offering has not terminated on or before such last
day shall automatically acquire pursuant to the exercise of the Participant's
Purchase Right the number of whole Shares arrived at by dividing the total
amount of the Participant's accumulated payroll deductions for the Purchase
Period by the Offering Exercise Price; provided, however, that in no event
shall the number of Shares purchased by the Participant exceed the number of
Shares subject to the Participant's Purchase Right. No Shares shall be
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purchased on behalf of a Participant whose participation in the Offering or the
Plan has terminated on or before the date of such exercise.
(g) Return of Cash Balance. Any cash balance remaining
in the Participant's account shall be refunded to the Participant as soon as
practical after the last day of the Offering Period. In the event the cash to
be returned to a Participant pursuant to the preceding sentence is an amount
less than the amount necessary to purchase a whole Share, the Company may
establish procedures whereby such cash is maintained in the Participant's
account and applied toward the purchase of Shares in the subsequent Purchase
Period or Offering Period.
(h) Withholding. At the time the Purchase Right is
exercised, in whole or in part, or at the time some or all of the Shares are
disposed of, the Participant shall make adequate provision for foreign, federal
and state tax withholding obligations of the Company, if any, which arise upon
exercise of the Purchase Right and/or upon disposition of Shares. The Company
may, but shall not be obligated to, withhold from the Participant's
Compensation the amount necessary to meet such withholding obligations.
(i) Company Established Procedures. The Company may,
from time to time, establish or change (i) a minimum required withholding
amount for participation in any Offering, (ii) limitations on the frequency
and/or number of changes in the amount withheld during an Offering, (iii) an
exchange ratio applicable to amounts withheld in a currency other than United
States dollars, (iv) payroll withholding in excess of or less than the amount
designated by a Participant in order to adjust for delays or mistakes in the
Company's processing of subscription agreements, (v) the date(s) and manner by
which the fair market value of the Shares is determined for purposes of the
administration of the Plan, and/or (vi) such other limitations or procedures as
deemed advisable by the Company in the Company's sole discretion which are
consistent with the Plan.
(j) Expiration of Purchase Right. Any portion of a
Participant's Purchase Right remaining unexercised after the end of the
Offering Period to which such Purchase Right relates shall expire immediately
upon the end of such Offering Period.
10. Limitations on Purchase of Shares; Rights as a Stockholder.
(a) Fair Market Value Limitation. Notwithstanding any
other provision of the Plan, no Participant shall be entitled to purchase
Shares under the Plan at a rate which exceeds Twenty-Five Thousand Dollars
($25,000) in fair market value, determined as of the Offering Date for each
Offering Period (or
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such other limit as may be imposed by the Code), for each calendar year in
which the Participant participates in the Plan.
(b) Allocation of Shares. In the event the number of
Shares which might be purchased by all Participants in the Plan exceeds the
number of Shares available in the Plan pursuant to all Offerings which have
commenced, the Company shall make a pro rata allocation of the remaining Shares
(and within each Offering, to each Participant in such Offering) in as uniform
a manner as shall be practicable and as the Company shall determine to be
equitable.
(c) Rights as a Stockholder and Employee. A Participant
shall have no rights as a stockholder by virtue of the Participant's
participation in the Plan until the date of the issuance of a stock
certificate(s) for the Shares being purchased pursuant to the exercise of the
Participant's Purchase Right. No adjustment shall be made for cash dividends
or distributions or other rights for which the record date is prior to the date
such stock certificate(s) are issued. Nothing herein shall confer upon a
Participant any right to continue in the employ of the Company or interfere in
any way with any right of the Company to terminate the Participant's employment
at any time.
11. Withdrawal.
(a) Withdrawal From an Offering. A Participant may
withdraw from an Offering by signing a written notice of withdrawal on a form
provided by the Company for such purpose and delivering such notice to the
Company at any time prior to the end of an Offering Period; provided, however,
that if a Participant withdraws after the Purchase Date for a Purchase Period
of an Offering, the withdrawal shall not affect Shares acquired by the
Participant in such Purchase Period. Unless otherwise indicated by the
Participant, withdrawal from an Offering shall not result in a withdrawal from
the Plan or any succeeding Offering therein. By withdrawing from an Offering
on a Purchase Date, a Participant may have Shares purchased on such Purchase
Date and immediately commence participating in the Offering commencing
immediately after such Purchase Date. A Participant is prohibited from again
participating in an Offering upon withdrawal from such Offering. The Company
may impose, from time to time, a requirement that the notice of withdrawal be
on file with the Company for a reasonable period prior to the effectiveness of
the Participant's withdrawal from an Offering.
(b) Withdrawal from the Plan. A Participant may withdraw
from the Plan by signing a written notice of withdrawal on a form provided by
the Company for such purpose and delivering such notice to the Company.
Withdrawals made after a Purchase Date of an Offering Period shall not affect
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shares acquired by the Participant on such Purchase Date. In the event a
Participant voluntarily elects to withdraw from the Plan, the Participant may
not resume participation in the Plan during the same Offering Period, but may
participate in any subsequent Offering under the Plan by again satisfying the
requirements of paragraph 6. The Company may impose, from time to time, a
requirement that the notice of withdrawal be on file with the Company for a
reasonable period prior to the effectiveness of the Participant's withdrawal
from the Plan.
(c) Automatic Withdrawal From an Offering. If the fair
market value of the Shares on a Purchase Date of an Offering is less than the
fair market value of the Shares on the Offering Date for such Offering, then
every Participant shall automatically (i) be withdrawn from the Offering at the
close of the Purchase Date and after the acquisition of Shares for such
Purchase Period, and (ii) be enrolled in the Offering commencing on the first
business day subsequent to such Purchase Period. A Participant may elect not
to be automatically withdrawn from an Offering pursuant to this paragraph 11(c)
by delivering to the Company not later than the close of business on the last
business day before the date seven (7) days prior to the Purchase Date a
written notice indicating such election; provided, however, that the Company
may change the date such notice is required to be delivered to the Company from
time to time.
12. Termination of Employment. Termination of a Participant's
employment with the Company for any reason, including retirement or death or
the failure of a Participant to remain an employee eligible to participate in
the Plan, shall terminate the Participant's participation in the Plan
immediately. A Participant whose participation has been so terminated may
again become eligible to participate in the Plan by again satisfying the
requirements of paragraphs 4 and 6.
13. Repayment of Payroll Deductions. In the event a Participant's
interest in the Plan or any Offering therein is terminated for any reason, the
balance held in the Participant's account shall be returned as soon as
practical after such termination to the Participant (or, in the case of the
Participant's death, to the Participant's legal representative) and all of the
Participant's rights under the Plan shall terminate. Such account balance may
not be applied to any other Offering under the Plan. No interest shall be paid
on sums returned to a Participant pursuant to this paragraph 13.
14. Transfer of Control. A "Transfer of Control" shall be deemed
to have occurred in the event any of the following occurs with respect to the
Control Company. For purposes of applying this paragraph 14, the "Control
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Company" shall mean the Participating Company whose stock is subject to the
Purchase Right.
(a) the direct or indirect sale or exchange by the
stockholders of the Control Company of all or substantially all of the stock of
the Control Company where the stockholders of the Control Company before such
sale or exchange do not retain, directly or indirectly, at least a majority of
the beneficial interest in the voting stock of the Control Company;
(b) a merger in which the stockholders of the Control
Company before such merger do not retain, directly or indirectly, at least a
majority of the beneficial interest in the voting stock of the Control Company;
or
(c) the sale, exchange, or transfer of all or
substantially all of the Control Company's assets (other than a sale, exchange,
or transfer to one (1) or more corporations where the stockholders of the
Control Company before such sale, exchange, or transfer retain, directly or
indirectly, at least a majority of the beneficial interest in the voting stock
of the corporation(s) to which the assets were transferred).
In the event of a Transfer of Control, the Board, in its sole
discretion, shall either (i) provide that Purchase Rights granted under the
Plan shall be fully exercisable to the extent of each Participant's account
balance for the Offering Period as of a date prior to the Transfer of Control,
as the Board so determines or (ii) arrange with the surviving, continuing,
successor, or purchasing corporation, as the case may be, that such corporation
assume the Company's rights and obligations under the Plan. All Purchase
Rights shall terminate effective as of the date of the Transfer of Control to
the extent that the Purchase Right is neither exercised as of the date of the
Transfer of Control nor assumed by the surviving, continuing, successor, or
purchasing corporation, as the case may be.
15. Capital Changes. In the event of changes in the common stock
of the Company due to a stock split, reverse stock split, stock dividend,
combination, reclassification, or like change in the Company's capitalization,
or in the event of any merger, sale or other reorganization, appropriate
adjustments shall be made by the Company in the Plan's share reserve, the
number and class of shares of stock subject to a Purchase Right and in the
purchase price per share of any outstanding Purchase Right, including, without
limitation, the number of Shares subject to a Purchase Right as set forth in
paragraph 7.
16. Non-Transferability. A Purchase Right may not be transferred
in any manner otherwise than by will or the laws of descent and distribution
and
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shall be exercisable during the lifetime of the Participant only by the
Participant.
17. Reports. Each Participant who exercised all or part of the
Participant's Purchase Right for a Purchase Period shall receive as soon as
practical after the last day of such Purchase Period a report of such
Participant's account setting forth the total payroll deductions accumulated,
the number of Shares purchased and the remaining cash balance to be refunded or
retained in the Participant's account pursuant to paragraph 9(g), if any.
18. Plan Term. This Plan shall continue until terminated by the
Board or until all of the Shares reserved for issuance under the Plan have been
issued or until December 31, 2000, whichever shall first occur.
19. Restriction on Issuance of Shares. The issuance of shares
pursuant to the Purchase Right shall be subject to compliance with all
applicable requirements of federal or state law with respect to such
securities. The Purchase Right may not be exercised if the issuance of shares
upon such exercise would constitute a violation of any applicable federal or
state securities laws or other law or regulations. In addition, no Purchase
Right may be exercised unless (i) a registration statement under the Securities
Act of 1933, as amended, shall at the time of exercise of the Purchase Right be
in effect with respect to the shares issuable upon exercise of the Purchase
Right, or (ii) in the opinion of legal counsel to the Company, the shares
issuable upon exercise of the Purchase Right may be issued in accordance with
the terms of an applicable exemption from the registration requirements of said
Act. As a condition to the exercise of the Purchase Right, the Company may
require the Participant to satisfy any qualifications that may be necessary or
appropriate, to evidence compliance with any applicable law or regulation and
to make any representation or warranty with respect thereto as may be requested
by the Company.
20. Legends. The Company may at any time place legends or other
identifying symbols referencing any applicable federal and/or state securities
restrictions and any provision convenient in the administration of the Plan on
some or all of the certificates representing shares of stock issued under the
Plan. The Participant shall, at the request of the Company, promptly present
to the Company any and all certificates representing shares acquired pursuant
to a Purchase Right in the possession of the Participant in order to effectuate
the provisions of this paragraph.
21. Transfer Restrictions. The Company, in its absolute
discretion, may impose such restrictions on the transferability of the shares
purchasable upon the exercise of a Purchase Right as it deems appropriate and
any such
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restriction shall be set forth in the respective subscription agreement and may
be referred to on the certificates evidencing such shares. The Company may
require the employee to give the Company prompt notice of any disposition of
shares of stock acquired by exercise of a Purchase Right within two years from
the date of granting such Purchase Right or one year from the date of exercise
of such Purchase Right. The Company may direct that the certificates
evidencing shares acquired by exercise of a Purchase Right refer to such
requirement to give prompt notice of disposition.
22. Amendment or Termination of the Plan. The Board may at any
time amend or terminate the Plan, except that (i) such termination shall not
affect Purchase Rights previously granted under the Plan except as permitted by
the Plan, and (ii) no amendment may adversely affect a Purchase Right
previously granted under the Plan (except to the extent permitted by the Plan
or as may be necessary to qualify the Plan as an "employee stock purchase plan"
pursuant to section 423 of the Code). In addition, an amendment to the Plan
must be approved by the stockholders of the Company, within the meaning of
section 423 of the Code, within twelve (12) months of the adoption of such
amendment if such amendment would authorize the sale of more shares than are
authorized for issuance under the Plan or would change the designation of
corporations whose employees may be offered Purchase Rights under the Plan.
Notwithstanding any other provision of the Plan to the contrary, in the event
of an amendment to the Plan which affects the rights or privileges of Purchase
Rights to be offered under the Plan, each Participant with an outstanding
Purchase Right shall have the right to exercise such outstanding Purchase Right
on the effective date of the amendment.
IN WITNESS WHEREOF, the undersigned Secretary of KLA Instruments
Corporation certifies that the foregoing Second Amended and Restated 1981
Employee Stock Purchase Plan, as amended, was duly adopted by the Board of
Directors of KLA Instruments Corporation on October 7, 1994.
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Plan History
October 6, 1981 Initial Plan adopted by Board of Directors.
December 7, 1981 Initial Plan approved by stockholders.
December 17, 1982 2-for-1 stock split.
December 8, 1983 2-for-1 stock split.
June 1, 1984 Second Plan adopted by Board of Directors.
October 25, 1984 Second Plan approved by stockholders.
January 1, 1985 Paragraph 9(a) of the Second Plan amended
by the Board of Directors to change the
definition of "base pay." (No stockholder
approval required.)
July 19, 1989 Third Plan adopted by Board of Directors.
(No stockholder approval required.)
July 20, 1990 Share reserve increase of 300,000 shares
(from 900,000 shares to 1,200,000 shares)
and extension of the Plan term until December
31, 2000 approved by the Board of Directors.
October 26, 1990 Share reserve increase and extension of Plan
term approved by stockholders.
October 26, 1990 Paragraph 7 of the Plan amended to limit the
number of shares that a participant may purchase
during an offering period. (No stockholder
approval required.)
September 14, 1992 Share reserve increase of 500,000 shares (from
1,200,000 shares to 1,700,000 shares) and amendment
to allow use of treasury stock approved by Board of
Directors. (Stockholder approval required.)
November 18, 1992 Stockholders approve the 500,000 share increase and
the amendment to allow use of treasury stock.
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August 3, 1993 Paragraph 4 amended to include employees who are also
directors and to allow part-time employees to
participate. Plan restated and renamed the Second
Amended and Restated 1981 Employee Stock Purchase Plan.
(Stockholder approval required.)
November 17, 1993 Stockholders approve the amendments to include employees
who are also director, to allow part-time employees
to participate, and to restate and rename the Plan the
"Second Amended and Restated 1981 Employee Stock
Purchase Plan."
October 7, 1994 The Plan was amended to increase the number of Shares
reserved for issuance under the Plan from 1,700,000 to
2,000,000 shares. (Stockholder approval required.)
November 16, 1994 Stockholders approve the share increase to 2,000,000 shares.
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KLA INSTRUMENTS CORPORATION
SECOND AMENDED AND RESTATED
1981 EMPLOYEE STOCK PURCHASE PLAN
SUBSCRIPTION AGREEMENT
[ ] Original Application
[ ] Change in Percentage of Payroll Deductions
I hereby elect to participate in the Second Amended and Restated 1981
Employee Stock Purchase Plan (the "Stock Purchase Plan") of KLA Instruments
Corporation (the "Company") and subscribe to purchase shares of the Company's
common stock (the "Shares") as determined in accordance with the terms of the
Stock Purchase Plan.
I hereby authorize payroll deductions in the amount of $______________
or______________ percent of my compensation from each paycheck throughout the
"Offering Period" (as defined in the Stock Purchase Plan) in accordance with
the terms of the Stock Purchase Plan. (The amount deducted each [pay period]
[month] must be at least [$ ] and may be no greater than 10% of compensation
for any pay period (if stated in percentages, must be in whole percentages).)
I understand that these payroll deductions will be accumulated for the purchase
of Shares at the applicable purchase price determined in accordance with the
Stock Purchase Plan. I further understand that, except as otherwise set forth
in the Stock Purchase Plan, Shares will be purchased for me automatically on
the last day of the Purchase Period unless I withdraw from the Stock Purchase
Plan or from the Offering Period by giving written notice to the Company or
unless I terminate employment.
I understand that I will automatically participate in each subsequent
Offering Period under the Stock Purchase Plan until such time as I file with
the Company a notice of withdrawal from the Stock Purchase Plan or any such
subsequent Offering Period on such form as may be established from time to time
by the Company or I terminate employment.
I understand that I will be automatically withdrawn from an Offering
Period and be automatically enrolled in the subsequent Offering Period if the
fair market value of the Shares on the purchase date of an Offering Period is
less than the fair market value of the Shares on the first day of such Offering
Period; provided, however, that I may elect not to be automatically withdrawn
if I notify the Company in writing of such election no later than the close of
business on the last business day before the date 7 days prior to the purchase
date of such Offering Period.
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Shares purchased for me under the Stock Purchase Plan should be issued
in the name set forth below. I understand that Shares may be issued either in
my name alone or together with my spouse as community property or in joint
tenancy.)
NAME: ____________________________________________________
ADDRESS: _________________________________________________
MY SOCIAL SECURITY NUMBER: _______________________________
I am familiar with the terms and provisions of the Stock Purchase Plan
and hereby agree to participate in the Stock Purchase Plan subject to all of
the terms and provisions thereof. I understand that the Board reserves the
right to amend the Stock Purchase Plan and my right to purchase stock under the
Stock Purchase Plan as may be necessary to qualify the Plan as an employee
stock purchase plan as defined in section 423 of the Internal Revenue Code of
1986, as amended. I understand that the effectiveness of this subscription
agreement is dependent upon my eligibility to participate in the Stock Purchase
Plan.
Date: ____________________________ Signature: ___________________________
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KLA INSTRUMENTS CORPORATION
SECOND AMENDED AND RESTATED
1981 EMPLOYEE STOCK PURCHASE PLAN
NOTICE OF WITHDRAWAL
I hereby elect to withdraw from the current offering (the "Offering")
of the common stock of KLA Instruments Corporation (the "Company") under the
Second Amended and Restated 1981 Employee Stock Purchase Plan (the "Stock
Purchase Plan"), and hereby request that all payroll deductions credited to my
account under the Stock Purchase Plan with respect to the Offering (if any),
and not previously used to purchase shares of common stock of the Company under
the Stock Purchase Plan, be paid to me as soon as is practical. I understand
that this Notice of Withdrawal automatically terminates my interest in the
Offering.
As to participation in future offerings of stock under the Stock
Purchase Plan, I elect as follows:
[ ] I elect to participate in future offerings under the Stock Purchase
Plan.
I understand that by making the election set forth above I
will automatically participate in each subsequent Offering
under the Stock Purchase Plan until such time as I file with
the Company a notice of withdrawal from the Stock Purchase
Plan or any such subsequent offering on such form as may be
established from time to time by the Company or I terminate
employment.
[ ] I elect not to participate in future offerings under the Stock
Purchase Plan.
I understand that by making the election set forth above I
terminate my interest in the Stock Purchase Plan and that no
further payroll deductions will be made unless I elect in
accordance with the Stock Purchase Plan to become a
participant in another offering under the Stock Purchase Plan.
I understand that if no election is made as to participation in future
offerings under the Stock Purchase Plan, I will be deemed to have elected to
participate in such future offerings.
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Date: ______________________________ Signature: ___________________________
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