SEPARATION AGREEMENT AND GENERAL
RELEASE
This Separation
Agreement and General Release (“Agreement”) confirms
the terms of your retirement from KLA-Tencor Corporation
(“KLA”). You retired as a Chairman of the Board,
director, officer and employee of KLA (and all applicable
subsidiaries and affiliates of KLA) as of October 16, 2006,
and you were named Chairman Emeritus by the Board. You acknowledge
that, as of the date of your retirement, you have been paid all
compensation owed to you as of that date.
If you sign
this Agreement, and provided you do not exercise your right of
revocation, the consideration provided herein will be made
available to you. Please read the following carefully as it sets
forth the terms of our separation agreement and contains a release
of claims. If you agree to its terms after considering them as
provided in this Agreement, you are asked to sign it not later than
November 6, 2006, and it will be binding upon you.
I. BENEFITS
UPON SIGNING OF THE AGREEMENT
On or about
seven (7) calendar days after your execution of this
Agreement, provided you do not exercise your right of revocation
and provided all applicable conditions of this Agreement are met,
you will be paid a lump sum amount equal to $37,500, which is 25%
of your current base salary ($150,000 per year), less required
deductions. This payment will be made to you in accordance with
KLA’s normal payroll practices for salaried employees. With
the exception of the payment of your remaining salary due through
the date of your retirement and the reimbursements described in the
next paragraph, you will not be eligible for any additional payment
under any other agreement or any severance or other plan, policy or
program.
On or about
seven (7) calendar days after your execution of this
Agreement, provided you do not exercise your right of revocation
and provided all applicable conditions of this Agreement are met,
you will be entitled to receive the following until you reach age
70: (a) reimbursement for the costs of an executive office
(not on Company premises) and related amenities, provided that such
reimbursement will not exceed $50,000 per year; and (b) the
full-time services of your current administrative assistant (or her
replacement), who will be an employee of the Company, provided that
the fully-loaded cost for such assistant does not exceed $100,000
per year.
II.
TERMINATION OF EMPLOYMENT AND CONTRACT
As set forth
above, you retired as a director, officer and employee of KLA on
October 16, 2006. As of that date, by mutual agreement your
employment with KLA immediately ceased, and any
Mr. Kenneth Levy
October 16, 2006
Page 2
and all
employment or service contracts between you and KLA (or any of its
predecessors or affiliates) immediately terminated, with each party
having no further monetary or other obligations
thereunder.
In
consideration of the benefits of this Agreement as provided for
above, you release KLA, any affiliated companies, and the current
and former officers, directors, agents, attorneys, and employees
and assigns of KLA and any affiliated companies, from any and all
claims up through the date of the execution of this Agreement. The
claims subject to this release include, but are not limited to,
those related to your roles as director, officer and employee of
KLA and the termination thereof and those related to any employment
or service contract between you and KLA (or any of its predecessors
or affiliates) and the termination thereof. All such claims
(whether known or unknown) are barred without regard to whether
those claims are based on any alleged breach of a duty arising in
statute, contract, or tort. This expressly includes waiver and
release of any rights and claims arising under any and all laws,
rules, regulations, or ordinances, including, but not limited to,
the Workers Adjustment and Retraining Notification Act; Title VII
of the Civil Rights Act of 1964; the Americans with Disabilities
Act; the Family and Medial Leave Act; the Equal Pay Act of 1963;
the Age Discrimination in Employment Act; and any similar law of
any other state or governmental entity. The foregoing release shall
not apply to (1) claims for indemnification arising under or
with respect to Labor Code Section 2802, other provisions of
law, KLA’s bylaws, or your indemnification agreement with
KLA, (2) your right to continue your health insurance benefits
under COBRA, (3) your rights under this Agreement,
(4) your rights to vested benefits under the terms of any KLA
benefit plan, and (5) any claims relating to the historical
stock option practices of KLA during your affiliation with KLA
(provided that this exclusion does not cover compensation and
valuation claims by you relating to stock options and other equity
awards granted to you or exercised by you, which are the subject of
Section V hereof).
The parties
agree to apply California law in interpreting this Agreement.
Accordingly, you further waive any rights
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