Why did Stephen P. Kaufman resign from the KLA-Tencor Board?

Stephen P. Kaufman resigned from the Board of Directors and its committees in accordance with KLA-Tencor's Corporate Governance Standards, which stipulate that directors are expected to retire following their 72nd birthday. He had served on the Board for 12 years.

What happens to Mr. Kaufman's unvested stock awards?

Upon his resignation, Mr. Kaufman is entitled to the acceleration of the vesting of his unvested restricted stock units. This applies to an award of 1,856 shares granted in November 2013, providing him with prorated vesting calculated on a quarterly basis through his effective resignation date.

What is the significant change in the company's By-Laws?

The most substantial change to the By-Laws is the switch from a plurality voting standard to a majority voting standard for the election of directors in uncontested elections. This means that each director must now receive more than 50% of the votes cast 'for' them to be elected.

What happens if a director does not receive a majority of votes in an uncontested election under the new rules?

If an incumbent director fails to receive a majority of the votes cast in an uncontested election, they are required to offer their resignation to the Board. The Nominating and Governance Committee will review the resignation, and the Board will make a decision on whether to accept it within 90 days, with the rationale publicly disclosed.

KLAC 8-K: Leadership Changes & Corporate Changes

Summary

KLA Corporation (KLAC) filed an 8-K on August 8, 2014, primarily announcing two key events. Firstly, a long-serving director, Stephen P. Kaufman, resigned from the Board of Directors and its committees in accordance with the company's retirement policy based on age. Mr. Kaufman's resignation triggers accelerated vesting of some of his unvested restricted stock units, amounting to 1,856 shares, reflecting his 12 years of service. Secondly, the company's Board of Directors approved an amendment and restatement of its By-Laws, effective immediately. The most significant change is the adoption of a majority voting standard for director elections in uncontested situations, replacing the previous plurality standard. This means directors must now receive a majority of votes cast to be elected, and failure to do so will result in the director offering their resignation to the Board for consideration.

Key Highlights

1Director Stephen P. Kaufman resigned from the Board of Directors and its committees due to age-related retirement policy.
2Mr. Kaufman's resignation is effective following the filing of the company's Fiscal Year 2014 Form 10-K.
3He will receive prorated vesting acceleration for 1,856 unvested restricted stock units due to his 12 years of service.
4The company's By-Laws were amended and restated, effective immediately.
5A key change to the By-Laws is the adoption of a majority voting standard for director elections in uncontested situations.
6Under the new standard, directors must receive a majority of votes cast to be elected.
7Directors failing to achieve a majority vote in uncontested elections will offer their resignation to the Board.

KLA CORP 8-K Report, Executive Changes (Aug 8, 2014)

Summary

Key Highlights

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