KLA CORP — Director's Dealing 2011

Feb 18, 2011

SEC Form 4 — Statement of Changes in Beneficial Ownership

Issuer: KLA TENCOR CORP (KLAC)
CIK: 0000319201
Period of Report: 2011-02-17

Reporting Person: WALLACE RICHARD P (Director, President and CEO)

Non-Derivative Transactions

Date	Security	Code	Shares	Price	A/D	Holdings After	Ownership
2011-02-17	Common Stock	M	16500	$45.25	Acquired	72234	Direct
2011-02-17	Common Stock	S	30643	$49.75	Disposed	41591	Direct
2011-02-17	Common Stock	A	37500	—	Acquired	79091	Direct
2011-02-17	Common Stock	F	16330	$49.53	Disposed	62761	Direct

Derivative Transactions

Date	Security	Exercise Price	Code	Shares	A/D	Expiration	Underlying	Ownership
2011-02-17	Non-Qualified Stock Option (Right to Buy)	$45.25	M	16500	Disposed	2011-10-02	Common Stock (16500)	Direct

Holdings (Non-Derivative)

Security	Shares	Ownership
Common Stock - Restricted Stock Units	280445	Direct

Footnotes

F1: These sales were effected pursuant to a Rule 10b5-1 trading plan adopted by the Reporting Person on December 15, 2009, as modified on December 14, 2010.

F2: On February 17, 2006, Mr. Wallace received a grant of restricted stock units ("RSUs") covering 75,000 shares of KLA-Tencor common stock. On February 17, 2011, Mr. Wallace vested in fifty percent (50%) of such RSUs.

F3: Pursuant to the terms of the February 17, 2006 RSU grant, 16,330 shares of KLA-Tencor common stock were automatically withheld at vesting to cover required tax withholding. The fair market value of KLA-Tencor common stock used for purposes of calculating the number of shares to be withheld was the closing price of KLA-Tencor common stock as reported on the NASDAQ Stock Market on such vesting date.

F4: Each RSU represents a contingent right to receive one share of KLA-Tencor common stock.

F5: Does not include performance-based RSUs, if any, held by the Reporting Person for which an assessment has not yet been made regarding the achievement of the applicable performance goals. Any such holdings will be reported on Form 4 within two business days of the date such assessment is made.

F6: Represents a stock option granted on October 2, 2001, granting the Reporting Person the right to purchase up to 16,500 shares of KLA-Tencor common stock. One forty-eighth (1/48) of the 16,500 shares subject to this stock option vested on the 13-month anniversary of the grant date and each monthly anniversary thereafter until October 2, 2006.