KLAC Form 4: Performance RSUs paid at 150% and 147%, tax withholding applied
Rhea-AI Filing Summary
Bren D. Higgins, EVP & Chief Financial Officer of KLA Corporation (KLAC), had multiple restricted stock unit awards vest on 08/07/2025 following committee determinations that performance conditions were met. A performance grant from August 4, 2022 with a target of 5,962 shares paid at the maximum (150%) and 50% of that award vested on 08/07/2025 with the remaining 50% scheduled to vest on 08/04/2026, subject to continued service.
Separately, a second performance tranche with a target of 4,194 shares was certified at 147% of target and will vest on 06/30/2026 if service conditions are met. On 08/07/2025 the reporting person also received a new RSU grant that vests 25% annually. To satisfy required tax withholding, 2,216.97 shares were withheld using an $888.28 per-share value.
Positive
- Performance goals achieved: One PRSU tranche paid at 150% of target and a second tranche at 147% of target, reflecting strong metric outcomes
- Transparent disclosure: Filing details vesting schedules, service conditions, and tax-withholding mechanics, including the $888.28 per-share value used
Negative
- None.
Insights
TL;DR: Compensation-related equity vesting reflects strong performance metrics but is likely immaterial to KLA's near-term cash flow or operations.
The Form 4 documents certification of multi-year performance conditions tied to free cash flow and non-GAAP EPS metrics. One PRSU tranche hit its maximum payout (150% of a 5,962-share target) and a second tranche paid at 147% of a 4,194-share target, indicating robust historical performance against peer and EPS targets. The immediate economic impact is dilution from issued shares and a one-time tax-withholding disposition of 2,216.97 shares at $888.28 per share. For investors, this is primarily an executive-compensation event confirming achieved targets rather than new operating information.
TL;DR: Board and compensation committee actions show structured performance pay working as intended; disclosures are routine and transparent.
The filing clearly documents that performance-based RSUs granted in 2022 satisfied their performance conditions as determined by the Board and Compensation and Talent Committee. Vesting schedules remain subject to continued service for remaining tranches, and the filing discloses tax-withholding mechanics and valuation basis. This transparency aligns with best practices for executive equity disclosures; there is no indication of departure from plan terms or special acceleration beyond standard certification and scheduled vesting.
Insider Trade Summary
| Type | Security | Shares | Price | Value |
|---|---|---|---|---|
| Grant/Award | Common Stock | 8,943 | $0.00 | -- |
| Tax Withholding | Common Stock | 2,216.97 | $888.28 | $1.97M |
| Grant/Award | Common Stock | 6,165.18 | $0.00 | -- |
| Grant/Award | Common Stock | 3,653.376 | $0.00 | -- |
Footnotes (1)
- On August 4, 2022, in addition to the RSUs granted that were subject to only service-based vesting conditions, the Reporting Person was also granted RSUs with both performance-based and service-based vesting conditions ("PRSUs") for a target number of shares equal to 5,962.000 shares of KLA common stock. The maximum number of shares issuable under these PRSUs is 150% of the target shares if KLA's free cash flow relative to its peers was at the 75th percentile or greater for the three years in the period ended June 30, 2025. On August 7, 2025, KLA's Board of Directors and Compensation and Talent Committee determined that the performance conditions applicable to these PRSUs were satisfied at the maximum level. Fifty percent (50%) of the PRSUs will vest today, August 7, 2025, and the remaining fifty percent (50%) of the PRSUs will vest on August 4, 2026, subject to continued service of the Reporting Person. The number of shares of KLA common stock includes 16,071.412 shares issuable upon vesting of restricted stock units ("RSUs"). On August 7, 2025, fifty percent (50%) of the performance-based restricted stock units granted on August 4, 2022 vested. Pursuant to the terms of the grant, shares of KLA common stock were automatically withheld at vesting to cover required tax withholding. The fair market value of KLA common stock used for purposes of calculating the number of shares to be withheld was the closing price of KLA common stock as reported on August 6, 2025. The number of shares of KLA common stock includes 11,599.912 shares issuable upon vesting of RSUs. On August 4, 2022, in addition to the RSUs granted that were subject to only service-based vesting conditions, the Reporting Person was also granted RSUs with both performance-based and service-based vesting conditions ("PRSUs") divided into three tranches. The second tranche was for a target number of shares equal to 4,194.000 shares of KLA common stock. The maximum number of shares issuable under the second tranche of these PRSUs is 250% of the target shares if the sum of KLA's non-GAAP earnings per diluted share for fiscal years 2023, 2024 and 2025 equaled or exceeded $93.00. On August 7, 2025, KLA's Board of Directors and Compensation and Talent Committee determined that the performance conditions applicable to the second tranche of these PRSUs were satisfied at 147% of target shares. The second tranche of these PRSUs will vest on June 30, 2026, subject to continue service of the Reporting Person. The number of shares of KLA common stock includes 17,765.092 shares issuable upon vesting of RSUs. On August 7, 2025, the Reporting Person received a grant of restricted stock units ("RSUs"). The RSUs vest 25% annually from the date of grant. The number of shares of KLA common stock includes 21,418.468 shares issuable upon vesting of RSUs.
