PDF : 2026 Proxy Statement (482972)

Published: 2026-04-29 21:28:15 ET PDFS

Published on 04/29/2026 at 09:28 pm EDT

PDF Solutions, Inc.

Tuesday, June 16, 2026

https://www.pdf.com

Meeting Date and Time

Meeting Location

Record Date

Tuesday, June 16, 2026

10:00 a.m. PDT

PDF Solutions, Inc.

Corporate Headquarters

2858 De La Cruz Boulevard, Santa Clara, California 95050

You are entitled to vote only if you were a stockholder as of the close of business on April 17, 2026

(the "Record Date").

The 2026 Annual Meeting of Stockholders (the "Annual Meeting") of PDF Solutions, Inc. (the "Company," or "PDF Solutions," or "we," or "us") will be held on Tuesday, June 16, 2026, at 10:00 a.m. PDT at the Company's corporate headquarters, located at 2858 De La Cruz Boulevard, Santa Clara, California 95050.

The items of business at the Annual Meeting are:

Proposal

Board Recommendation

Additional Detail (Page #)

The election of two Class I members of the Board of Directors to hold office until the first annual meeting of stockholders that is held after December 31, 2028, or until such director's respective successor is duly elected and qualified.

The ratification of the appointment of BPM LLP as our

the nominees 2

independent registered public accounting firm for the fiscal year ending December 31, 2026.

The approval of our Eleventh Amended and Restated 2011 Stock Incentive Plan.

The approval of our Third Amended and Restated 2021 Employee Stock Purchase Plan.

The approval, by a non-binding advisory vote, of the compensation of our named executive officers disclosed in this Proxy Statement.

Stockholders may also consider such other business as may properly come before the Annual Meeting or any adjournment or postponement thereof.

2026 Notice of Annual Meeting of Stockholders

Other Important Information

You are entitled to attend the Annual Meeting only if you were a stockholder as of the close of business on the Record Date or hold a valid proxy for the Annual Meeting. You should be prepared to present photo identification for admittance. If you are not a stockholder of record but hold shares through a broker, bank, trustee, or nominee (i.e. in street name), you should provide proof of beneficial ownership as of the Record Date, such as your most recent account statement prior to the Record Date, a copy of the voting instruction card provided by your broker, bank, trustee, or nominee, or similar evidence of ownership.

Your Vote is Very Important

Whether or not you expect to attend the Annual Meeting in person, please vote your shares as soon as possible. You may vote over the Internet, in person at the annual meeting, by using the toll-free telephone number on your proxy card or voting instruction materials (if you are in Canada, Puerto Rico, or the United States), or by mailing a proxy card or voting instruction card.

On or about April 30, 2026, we will mail our stockholders as of the Record Date, a Notice of Internet Availability of Proxy Materials.

Please review the instructions on the Notice of Internet Availability of Proxy Materials or on your proxy card or voting instruction materials regarding your voting options.

Our proxy statement and annual report to stockholders for the year ended December 31, 2025, are available at

https://www.pdf.com/proxy-materials.

On behalf of our Board of Directors, thank you for your participation in this important annual process. By Order of the Board of Directors,

ROCHELLE LIVINGSTON

Secretary and General Counsel

Santa Clara, California April 29, 2026

Proxy Statement 1 Proposal No.4:

Proposal No.1:

Election of Class I Directors to the Board

Approval of our Third Amended and Restated

2021 Employee Stock Purchase Plan

Director Classes

Proposal No.5:

Board Skills and Experience

Advisory Approval of our Named Executive

Nominee Selection Process

Officers' Compensation

Nominees for Class I Directors

Security Ownership of Certain Beneficial

Continuing Class II Directors

Owners and Management

Continuing Class III Directors

Certain Relationships and Related

Corporate Governance

Transactions

Governance and our Board of Directors

Equity Compensation Plan Information

Board Leadership Structure 12

The Board of Directors and its Committees 13

Executive Compensation 51

Compensation and Human Capital

Meetings of the Board of Directors and 13

Attendance

Management Committee Report 61

Compensation and Human Capital

Board Composition 16

Overboarding Policy 16

Board and Committee Evaluation 16

Management Committee Interlocks and

Insider Participation 61

Summary Compensation Table 62

Stockholder Recommendations of Board 16

Candidates

Grants of Plan-Based Awards in Fiscal Year 63

Stockholder Communications 16

Stockholder Engagement 17

Director Independence 17

The Board's Role in Risk Oversight 18

Strategy Oversight by the Board 19

Information Security and Risk Oversight 19

Code of Ethics 19

Corporate Governance Policies 20

Environmental, Social & Governance Matters 21

Oversight of Human Capital Management 21

Audit Committee Report 22

Proposal No.2:

Ratification of Appointment of Independent

Registered Public Accounting Firm 23

Proposal No.3:

Approval of our Eleventh Amended and Restated

2011 Stock Incentive Plan 25

2025

Outstanding Equity Awards as of

December 31, 2025 64

Option Exercises and Stock Vested in 2025 65

2025 CEO Pay Ratio Disclosure 69

Pay Versus Performance Disclosure 70

Director Compensation 74

General Information 76

Note About Forward-Looking Statements 82

Appendix A:

PDF Solutions, Inc.'s Eleventh Amended and Restated 2011 Stock Incentive Plan 83

Appendix B:

PDF Solutions, Inc.'s Third Amended and

Restated 2021 Employee Stock Purchase Plan 99

PDF SOLUTIONS, INC.

2858 De La Cruz Boulevard Santa Clara, California 95050

To Be Held on June 16, 2026, at 10:00 a.m. PDT Proposals to be Voted on at the Annual Meeting You are being asked to vote on the following:

To elect two Class I members of the Board of Directors to hold office until the first annual meeting of stockholders that is held after December 31, 2028, or until such director's respective successor is duly elected and qualified.

To ratify the appointment of BPM LLP as our independent registered public accounting firm for the year ending December 31, 2026.

To approve our Eleventh Amended and Restated 2011 Stock Incentive Plan.

To approve our Third Amended and Restated 2021 Employee Stock Purchase Plan.

To approve, by a non-binding advisory vote, the compensation of our named executive officers disclosed in this Proxy Statement.

To take action on any other business as may properly come before the 2026 Annual Meeting or any adjournments or postponements thereof.

The Board recommends a vote FOR each of the director nominees listed in Proposal 1 and FOR Proposals 2, 3, 4, and 5.

On or about April 30, 2026, we will mail our stockholders as of the Record Date, a Notice of Internet Availability of Proxy Materials.

Important Notice of Availability of Proxy Materials

for the Annual Meeting of Stockholders to be held on June 16, 2026:

Our Proxy Statement and 2025 Annual Report

are available on the Internet and may be viewed and printed, free of charge, at https://www.pdf.com/proxy-materials.

‌The Board of Directors, upon recommendation from the Nominating and Corporate Governance ("NCG") Committee of the Board, has nominated two candidates for re-election to the Board this year as Class I directors: Joseph R. Bronson and Ye Jane Li. Detailed information about each nominee, and each of our continuing directors, including their ages as of April 17, 2026, is provided below.

Name

Nominees:

Class

Election Year

Age

Position(s)

Director Since

Joseph R. Bronson

2026

Lead Independent Director

2014

Ye Jane Li

2026

Director

2021

Continuing Directors:

Chi-Foon Chan, Ph.D.

2027

Director

2023

Kimon W. Michaels, Ph.D.

2027

Director, Executive Vice President, Products and Solutions

1995

Shuo Zhang

2027

Director

2019

Nancy Erba

III

2025

Director

2019

Michael B. Gustafson

III

2025

Director

2018

John K. Kibarian, Ph.D.

III

2025

Director,

President and CEO

1992

Recommendation of the Board

THE BOARD RECOMMENDS THAT OUR STOCKHOLDERS VOTE FOR THE ELECTION OF EACH OF THE CLASS I DIRECTOR NOMINEES INDICATED ABOVE.

Our amended and restated bylaws (our "Bylaws") provide that the number of directors shall be established by the Board or the stockholders of the Company. Our amended and restated certificate of incorporation provides that the directors shall be divided into three classes, with each class serving for staggered, three-year terms and one class being elected at each year's annual meeting of stockholders. The Board has set the number of Directors at eight, currently consisting of two Class I directors, three Class II directors and three Class III directors.

The Class I directors elected at the 2026 annual meeting of stockholders (the "Annual Meeting") will hold office until the first annual meeting that is held after the year ending December 31, 2028, or until each such director's successor has been duly elected and qualified or until such director's earlier death, resignation, or removal. The terms of the Class II and Class III directors will expire at the annual meeting of stockholders following the years ending December 31, 2026, and December 31, 2027, respectively. If any director nominee is unable to serve or for good cause will not serve, the Board may reduce the size of the Board, designate a substitute, or leave a vacancy unfilled. If a substitute is designated, proxies voting on the original director candidate will be cast for the substitute candidate.

It is not expected that the nominees listed below will be unable or will decline to serve as a director. The Class I nominees, each of whom presently serves as a director of the Company, have each consented to serve a three-year term.

The certain individual experience, qualifications, attributes, and skills of the below named directors that led the Board to conclude that Mr. Bronson and Ms. Li should be re-nominated as directors are described in each nominee's biography below. The information below was provided by the nominees and the continuing Class II and Class III directors with unexpired terms. There is no family relationship between the continuing directors, executive officers, and the Class I nominees.

Our directors collectively provide significant skills and experiences in areas relevant to overseeing the Company's business and strategy. The skills and experience of our Board include, but are not limited to:

Finance or Accounting Experience: Finance or accounting experience is necessary for the oversight of our financial reporting processes and internal controls. Relevant experience includes experience with financial markets, financing operations, and accounting and financial reporting processes, and/or senior financial leadership experience at large global organizations and financial institutions.

Executive Leadership: Experience with executive leadership is critical to the effective oversight of management. Relevant experience includes experience at the executive-level or in senior leadership positions at a public company or other large organization, with input into operations, growth, and strategy, and/or building and strengthening corporate culture.

Technology & Innovation: Experience with technology and innovation is important to our long-term success and provides needed oversight as our business expands into new markets. Relevant experience includes experience identifying customer needs and market trends and applying new technologies to develop products and services to meet those needs.

Growth & Corporate Strategy: Experience with growth and corporate strategy is important for oversight of the successful planning and execution of our long-term vision. Relevant experience includes experience setting and executing corporate strategy, M&A activity, and integration.

Board Skills Matrix

Sales & Marketing: Experience with sales and marketing provides important perspective and leadership for effective oversight of efforts to expand our market share. Relevant experience includes experience in leadership positions of business-to-business sales, marketing, or brand management.

Industry Experience: Industry-specific experience is useful to understand our R&D efforts, our products and services, and the markets in which we compete. Relevant experience includes experience with and knowledge of our industries (i.e. semiconductor, electronics, and analytics software) and relevant technologies.

Global Business Experience: Global business experience provides valuable business and cultural perspectives important to the strategic opportunities and risks related to our business. Relevant experience includes experience in leadership positions with substantial international operations or scope.

Public Company Board Experience: Public company board experience helps ensure accepted standards for board operation and company oversight. Relevant experience includes experience at the board level with other public companies (past or present).

Joseph R. Bronson

Chi-Foon Chan

Nancy Erba

Michael B. Gustafson

John K. Kibarian

Ye Jane Li

Kimon W. Michaels

Shuo Zhang

Finance or Accounting Experience

☑

Executive Leadership

☑

Technology & Innovation

☑

Growth & Corporate Strategy

☑

Sales & Marketing

☑

Industry Experience

☑

Global Business Experience

☑

Public Company Board Experience

☑

Identify the Candidate

The NCG Committee identifies nominees by first evaluating the current members of the Board willing to continue in service. If any member of the Board does not wish to continue in service, if the Board decides not to re-nominate a member for re-election, or if the Board decides to increase the size of the Board, the NCG Committee identifies the desired skills and experience of a new nominee in light of the philosophy explained below.

Current directors are polled for suggestions as to individuals meeting the philosophy of the NCG Committee and the NCG Committee has the authority to select, engage, compensate, and terminate third-party search firms, legal counsel, and other advisors as it deems necessary and advisable to assist the NCG Committee in carrying out its responsibilities and functions as set forth herein.

Confirm Candidate Qualifications

Once the NCG Committee has identified a prospective nominee or if it has received a recommendation from a stockholder, the NCG Committee makes an initial determination as to whether to conduct a full evaluation of the candidate.

This initial determination is based on the information provided to the NCG Committee concerning the prospective candidate, as well as the NCG Committee's own knowledge of the prospective candidate, which may be supplemented by inquiries to the person making the recommendation or others. The preliminary determination is based primarily on the need for additional Board members to fill vacancies or expand the size of the Board and the likelihood that the prospective nominee can satisfy the evaluation factors described below.

Candidate Evaluation

The NCG Committee then evaluates the prospective nominee, considering the following:

Personal characteristics, including demonstrated sound judgment;

The extent to which a candidate would fill a present or anticipated need on the Board;

The ability of the candidate to devote sufficient time to the affairs of the Company;

The independence of the proposed candidate within the meaning of the listing standards of The Nasdaq Stock Market LLC ("Nasdaq");

Diversity of experience and background of the proposed candidate, including the need for financial or accounting, executive leadership, technology and innovation, growth and corporate strategy, sales and marketing, industry, global business, public sector, or other expertise on our Board of Directors or its committees; and

a range of perspectives with reference to our business model and specific needs.

In connection with this evaluation, the NCG Committee determines whether to interview the prospective nominee and, if warranted, one or more members of the NCG Committee and others, as appropriate, conduct interviews in person or by telephone.

Committee Recommendation

After completing this process, the NCG Committee makes a recommendation to the full Board as to the persons who should be nominated by the Board, and the Board determines the nominees.

Stockholder Vote

Director nominees are then elected by the Company's stockholders at the Annual Meeting. We believe each Director brings a diverse set of skills and perspectives that add significant value to our governance and oversight.

Joseph R. Bronson

Principal and Chief Executive Officer, The Bronson Group, LLC

Lead Independent Director

Ye Jane Li

Strategic Advisor, Diversis Capital

Independent Director

Director Since 2014

Age 77

Committees

NCG (Chair); Audit

Director Since 2021

Age 58

Committees

Compensation and Human Capital Management ("CHCM")

Director Qualifications

Mr. Bronson has extensive experience in finance and operations spanning more than 21 years and he brings over 50 total years of audit committee chair experience. Mr. Bronson is an "audit committee financial expert" based on his knowledge and understanding of generally accepted accounting principles and financial statements. Mr. Bronson's financial experience is beneficial to us and combined with Mr. Bronson's extensive knowledge of the industry and operations, enables him to provide valuable strategic input to us.

Select Business Experience

Mr. Bronson is currently the Principal and Chief Executive Officer of The Bronson Group, LLC, a financial and operating consulting services company (since 2011).

Previously, Mr. Bronson was a Managing Director and Strategic Advisor to Cowen & Co., a financial services firm (from 2017 to 2021).

Mr. Bronson also previously served as Chair of the board of directors of GraphAudio, Inc. (from 2021 to 2023).

Other Public Company Directorships in Past Five Years

Zircon Corporation (since 2024)

Maxim Integrated Products, Inc. (from 2007 to 2021)

Jacobs Solutions Inc. (f/k/a Jacobs Engineering Group Inc.) (from 2004 to 2021)

Director Qualifications

Ms. Li brings executive-level experience in a wide range of technology companies and international experience with global companies headquartered in the United States, Japan, and China, and successful track record in general management, strategy development, M&A, and marketing and sales leadership. We greatly benefit from her meaningful insight. We also benefit from Ms. Li's broad corporate governance experience derived from her experience on multiple U.S. public company boards.

Select Business Experience

Ms. Li currently serves as a Strategic Advisor for Diversis Capital, LLC, a private equity firm (since 2013).

Prior to that, she was Chief Operating Officer of Huawei Enterprise USA Inc., an information technology company (from 2012 to 2015).

Ms. Li has also served on the board of directors of ServicePower, a private company (since 2017).

Other Public Company Directorships in Past Five Years

Knowles Corporation (since 2018)

Semtech Corporation, Chair (since 2016)

CTS Corporation (from 2020 to 2023)

Chi-Foon Chan, Ph.D.

Former President, Co-Chief Executive Officer and Director, Synopsys, Inc.

Independent

Kimon W. Michaels, Ph.D.

Executive Vice President, Products and Solutions, PDF Solutions, Inc.

Non-Independent Director

Director Since 2023

Age 76

Committees NCG

Director Since 1995

Age 60

Committees None

Director Qualifications

Dr. Chan brings to the Board more than 24 years of senior executive-level leadership, strategic, and operational experience within the EDA industry, with a thorough understanding of business, operations and technology strategies. He has broad knowledge of the overall EDA industry landscape, and he provides particular expertise in the Asia-Pacific region. We also benefit from Dr. Chan's extensive research and development and engineering experience in the semiconductor industry gained from his prior leadership positions.

Select Business Experience

Dr. Chan has served on the Board of Advisors for TMFG Group at Intel Corporation, a global technology company (since 2022).

Dr. Chan was President, Co-Chief Executive Officer and a member of the Board of Directors of Synopsys, Inc., an electronic design automation company (from 2012 to 2022).

Other Public Company Directorships in Past Five Years

Synopsys, Inc. (from 2012 to 2022)

Director Qualifications

Dr. Michaels provides the Board with unique insight regarding Company-wide issues gained in his position as an executive officer of the Company, including various leadership capacities and levels of operations, and as one of our co-founders. This experience provides the Board with invaluable insight into Company operations.

Select Business Experience

Dr. Michaels, one of our founders, has served as our Executive Vice President, Products and Solutions (since February 2019).

Shuo Zhang

Chief Executive Officer and General Partner, Renascia Partners LLC

Independent

Director Since 2019

Age 61

Committees CHCM; NCG

Director Qualifications

Ms. Zhang brings a wide range of relevant experience and expertise in the semiconductor and test industries that is invaluable to our evolutions to the leading provider of big data solutions for the semiconductor and electronics markets. We greatly benefit from her impressive executive track record in sales, marketing, and international mergers and acquisitions, and from her insights and business acumen.

Select Business Experience

Ms. Zhang serves as Chief Executive Officer and General Partner of Renascia Partners LLC, a consulting firm (since 2015).

She has also been involved with private venture capital firms in the Silicon Valley for approximately 25 years.

Other Public Company Directorships in Past Five Years

Soitec SA (since 2021)

Telink Semiconductor Shanghai Co Ltd (since 2017)

Grid Dynamics Holdings, Inc. (since 2017)

E.Merge Technology Acquisition Corp. (from 2020 to 2022)

Nancy Erba

Chief Financial Officer, Power Integrations, Inc.

Independent

Michael B. Gustafson

Chairman, Druva, Inc.

Independent

Director Since 2019

Age 59

Committees Audit (Chair)

Director Since 2018

Age 59

Committees

CHCM (Chair); Audit

Director Qualifications

Ms. Erba is an "audit committee financial expert" based on her knowledge and understanding of generally accepted accounting

principles and financial statements, her experience analyzing and evaluating financial statements that present a breadth and level of complexity of accounting issues relevant to those of the Company, and her understanding of internal control over financial reporting. Ms. Erba has an impressive track record of success in building and leading best in class finance, business operations, and corporate development organizations throughout her career, and provides the Board with valuable oversight, direction, and strategic input.

Select Business Experience

Ms. Erba is currently Chief Financial Officer of Power Integrations, Inc., a supplier of high-performance electronic components (since January 2026).

She previously served as Chief Financial officer of Infinera Corporation, a provider of optical transport networking equipment, software and services (from 2019 to 2025), a wholly-owned subsidiary of Nokia Corporation (since February 2025).

Director Qualifications

Mr. Gustafson's more than 30 years as a successful leader of multiple technology companies and teams, including public and private, across infrastructure and software offerings make him a valuable advisor to us.

Select Business Experience

Mr. Gustafson is the Chairman of the board of directors of Druva, Inc., a provider of cloud data protection and information management solutions (since 2016), a privately held company.

He is also the sole member of Carve Your Destiny, LLC, a consulting company (since 2016), and an independent Director of Reltio Inc. (since 2016), Indico Data Systems (since 2022), and Auvik Networks (since 2023), all privately held companies.

Other Public Company Directorships in Past Five Years

Matterport, Inc. (since 2021), acquired by CoStar Group in 2025

Everspin Technologies, Inc. (from 2017 to 2022)

John K. Kibarian, Ph.D.

President, Chief Executive Officer, and Director, PDF Solutions, Inc.

Non-Independent

Director Since 1992

Age 62

Committees None

Director Qualifications

Being a leader of the Company since its founding, Dr. Kibarian brings to the Board an extraordinary understanding of our Company's business, history, and organization. Dr. Kibarian's training and education as an engineer, together with his day-to-day leadership and intimate knowledge of our business and operations, helps the Board in developing and executing our long-term strategy.

Select Business Experience

Dr. Kibarian is one of our co-founders and has served as our President (since 1991) and our Chief Executive Officer (since 2000).

He is also a Governing Council member of Electronic System Design Alliance, a trade association

for electronic design companies (since 2019).

We are committed to the highest standards of corporate ethics and diligent compliance with financial accounting and reporting rules. The Board provides independent leadership in the exercise of its responsibilities. Our executive officers oversee a strong system of internal controls and compliance with corporate policies and applicable laws and regulations. Our employees operate in a climate of responsibility, candor, and integrity.

Key highlights of the Board and corporate governance practices are set forth below:

6 of 8 Directors are Independent

Over 62% Board Refreshment since 2018

Separate Chair (or Lead Independent Director if Chair is vacant) and CEO

Lead Independent Director Charter

Limit on Outside Public Company Directorships

Annual Board and Committee Evaluations

Regular Executive Sessions of Independent Directors at quarterly Board and Committee Meetings

On-going Education for Directors for Issues Pertinent to our Business (e.g., export)

Majority Voting for Uncontested Director Elections

100% of Committee Chairs and Members are Independent

Board Diversity Policy

Proxy Access Rights

38% of Directors are Women

Stockholder Engagement with holders of over 78% of the Company's Outstanding Shares in 2025

Stock Ownership Policy for Directors and Section 16 Officers

Related Party Transactions Policy

The Corporate Governance Board Guidelines provide for a Chairperson of the Board or, if vacant, a Lead Independent Director. The Bylaws and Corporate Governance Board Guidelines require that the Chairperson position be held by a separate individual from the Chief Executive Officer unless otherwise determined by the Board. The Board believes the separation of the Chief Executive Officer and the Chairperson position enhances the Board's oversight of, and independence from, Company management, the ability of the Board to carry out its roles and responsibilities on behalf of our stockholders, and our overall corporate governance as compared to a combined Chairperson/Chief Executive Officer leadership structure.

Under our Corporate Governance Board Guidelines, the Chairperson of the Board, or in the absence of such a position, the Lead Independent Director, is responsible for presiding at all meetings of our stockholders and of the Board as a whole, as well as over executive sessions of the independent directors, and shall perform such other duties, and exercise such powers, as from time to time shall be prescribed in the Bylaws or by the Board. The position of Chairperson of the Board of Directors has been vacant since May 2018.

Initially in January 2019, and most recently in June 2025, the independent directors unanimously elected or re-elected Mr. Joseph Bronson to the role of Lead Independent Director. Mr. Bronson has been a director of the Company since May 2014. He is currently Chair of the NCG Committee and a member of Audit Committee of the Board.

Under the Bylaws, in the absence of a Chairperson, the Lead Independent Director may exercise all the rights and powers granted to the Chairperson of the Board. By definition, no employee of the Company may hold the Lead Independent Director position.

Role and Responsibilities of the Lead Independent Director

The Lead Independent Director's primary responsibilities are set forth in the Corporate Governance Board Guidelines and the Lead Independent Director Charter and include:

Calling and presiding at executive sessions of the independent directors and reporting relevant matters to the Chairperson (if any) and/or Chief Executive Officer;

Presiding at meetings of the Board at which the Chairperson (if any) is not present or is to be appointed;

Providing leadership to ensure that the Board works cohesively and independently of management;

Serving as liaison between the independent directors and/or the Chief Executive Officer and between the independent directors and senior management;

Approving meeting agendas for the Board together with the Chairperson (if any);

Coordinating the assessment of Board committee structure, organization and charters, and evaluating the need for any changes to the same;

Interviewing all Board candidates with the Chairperson of the NCG Committee and making recommendations to the NCG Committee and the Board; and

Leading the evaluation of the Chairperson (if any) and the Chief Executive Officer by the independent directors and the CHCM Committee.

The Lead Independent Director must be elected by a majority of the non-employee, independent directors of the Board for renewable one-year terms or until such earlier time as he or she ceases to be a director, resigns as Lead Independent Director or is replaced as Lead Independent Director by a majority of the nonemployee, independent directors, or the Board elects an independent Chair. The establishment of a Lead Independent Director with robust function, authority and responsibilities reflects the Board's commitment to strong corporate governance.

The Board has standing Audit, Compensation and Human Capital Management ("CHCM"), and Nominating and Corporate Governance ("NCG") Committees. Our board committees operate pursuant to charters that have been approved by the Board, are reviewed at least annually, and are available on our website at https://www.pdf.com/company/governance/.

The following table provides additional information regarding the committees of our Board of Directors:

Independent Directors

Audit Committee

CHCM

Committee

NCG

Committee

Joseph R. Bronson

L Lead Independent Director

Audit Committee Financial Expert

Committee Chairperson

Committee Member

Chi-Foon Chan, Ph.D.

Shuo Zhang

Michael B. Gustafson

John K. Kibarian, Ph.D.

Kimon W. Michaels, Ph.D.

Non-Independent Directors

Nancy Erba

Ye Jane Li

2025 Average

Board and Committee Meeting Attendance

98%

The Board met nine times during 2025. Additionally, our Board committees held a total of seventeen meetings in 2025.

All of our incumbent Board members attended 75% or more of the meetings of the Board and the committees on which they each served, held during the period for which they served as directors or committee members.

Pursuant to our Corporate Governance Board Guidelines we invite and encourage each member of our Board to be present at our annual meetings of stockholders. Seven of our directors attended our 2025 annual meeting of stockholders either in person or by telephone.

In addition to the Board and committee meetings noted above, the Board and certain of the committees also acted by unanimous written consent in the conduct of their business.

Current Members Ms. Erba (Chair) Mr. Bronson

Ms. Zhang

Independence

The Board has determined that each member of the Audit Committee is independent within the meaning of Nasdaq's director independence standards and Rule 10A-3 of the Securities Exchange Act of 1934, as amended (the "Exchange Act").

The Board has determined that Ms. Erba and Mr. Bronson are "audit committee financial experts" under the SEC

rules and have accounting or related financial management expertise.

Meetings

The Audit Committee held four meetings in 2025.

Attendance

The average rate of attendance for members of the Audit Committee in 2025 was 100%.

Principle Functions of the Committee

Among other responsibilities, the Audit Committee is charged by the Board with the authority and responsibility to:

Appoint the independent registered public accounting firm and assist the Board in the oversight of the qualifications and independence of the independent registered public accounting firm.

Monitor our compliance with legal and regulatory requirements including preparing the audit committee report that SEC rules require to be included in this proxy statement (this "Proxy Statement").

Evaluate the performance of our internal and external audit efforts.

Review and discuss the adequacy and effectiveness of our disclosure controls and procedures.

Review the adequacy and effectiveness of our information and cyber security functions on behalf of the Board.

Oversee our principal enterprise risk exposures and mitigation, control, and monitoring efforts in respect of such risks, and our business continuity and disaster preparedness planning.

Oversee and reviews ethics matters on behalf of the Board.

Current Members Mr. Bronson (Chair) Dr. Chan

Mr. Gustafson Ms. Zhang Independence

The Board has determined that each member of the NCG Committee is independent within the meaning of Nasdaq's director independence standards.

Meetings

The NCG Committee held four meetings in 2025.

Attendance

Principle Functions of the Committee

Among other responsibilities, the NCG Committee is charged by the Board with the authority and responsibility to:

Identify, review, evaluate, and recommend candidates to serve as directors on the Board.

Make other recommendations to the Board regarding affairs related to the directors of the Board.

Oversee our corporate governance functions on behalf of the Board.

Oversee the Company's programs, policies, practices, disclosures relating to relevant risks and opportunities, measures, objectives, and performance relating to environmental, social, and governance issues.

The average rate of attendance for members of the NCG Committee in 2025 was 100%.

Current Members Mr. Gustafson (Chair) Ms. Li

Dr. Chan

Independence

The Board has determined that each member of the CHCM Committee is independent within the meaning of Nasdaq's director independence standards and a "non-employee director" as defined in Rule 16b-3 under the Exchange Act.

Meetings

The CHCM Committee held nine meetings in 2025.

Attendance

The average rate of attendance for members of the CHCM Committee in 2025 was 96%.

Principle Functions of the Committee

Among other responsibilities, the CHCM Committee is charged by the Board with the authority and responsibility to:

Establish and administer our policies regarding annual executive compensation, including salaries, cash incentives, and long-term equity incentives.

Assist with the administration of our cash-based and equity-based incentive compensation plans including our stock incentive and purchase plans.

Make recommendations to the Board with respect to non-employee director compensation.

Oversee the Company's programs, policies, practices, disclosures relating to relevant risks and opportunities, measures, objectives, and performance relating to human capital matters.

The NCG Committee has identified a range of skillsets, backgrounds and experiences at the Board level as an essential element in supporting the attainment of our strategic objectives. Our Board has adopted a diversity policy, pursuant to which we actively seek highly-qualified individuals from minority groups to include in the pool from which new candidates are selected. All Board candidates will be identified based on merit and suitability and considered against appropriate criteria.

The NCG Committee considers each director's ability to dedicate sufficient time, energy, and attention to the fulfillment of his or her duties when it nominates directors each year. Our Corporate Governance Board Guidelines contains our overboarding policy, which provides that prior to accepting service on the board of directors of any other public company, a Director shall notify the Chairperson or Lead Independent Director and the chair of the Committee. Ordinarily, Directors should not serve on more than three other boards of public companies in addition to our Board (except for any employee Director, who shall not serve on more than one other board). Members of the Audit Committee are encouraged to not serve on more than two public company audit committees (including the Audit Committee.

The Board also considers directors' other obligations and commitments, including leadership positions the director may hold on other boards, in assessing directors' ability to serve on our Board. In renominating directors for election at our 2026 annual meeting, the NCG Committee and Board have determined that each of our directors is currently in compliance with our Corporate Governance Board Guidelines and has sufficient time, energy, and attention to serve on the Board.

The NCG Committee is responsible for periodically overseeing an evaluation of our corporate governance practices and procedures and reviewing and recommending to the Board for approval any changes to our corporate governance framework. In addition, the NCG Committee is tasked with evaluating our programs, policies, practices, and disclosures relating to environmental and social issues and impact to support the sustainable growth of our businesses.

We consider potential Board candidates recommended by stockholders. Stockholders may send any recommendations for director nominees or other communications to the Board or any individual director at the following address:

Board of Directors (or NCG Committee, or name of individual director) PDF Solutions, Inc.

Attention: Secretary

2858 De La Cruz Boulevard Santa Clara, California 95050

See "Proposals for Next Year's Annual Meeting" on page 77 for information on how to recommend or nominate one or more potential candidates for election to the Board of Directors.

Our Board welcomes all communications from our stockholders. Stockholders may send communications to the Board or any director of the Board in particular, at the following address: PDF Solutions, Inc., Attention: Investor Relations, 2858 De La Cruz Boulevard, Santa Clara, California 95050. Any correspondence addressed to the Board or to any one of our directors of the Board sent in care of our corporate offices is reviewed by our Investor Relations department and pertinent correspondence is presented to the Board at its regular meetings.

The Board values the input of our stockholders, and we are committed to maintaining stockholder engagement that provides a constructive dialogue. Our engagement with its stockholders is intended to provide stockholders with honest, candid information on relevant issues. We also gather stockholder views and feedback.

The chart below includes detail of the features of our approach to stockholder engagement.

Before the Annual Meeting

Annual Stockholder Meeting

Provide annual business update to stockholders (if appropriate or requested).

Receive voting results for Board and stockholder proposals.

Discuss stockholder proposals (if any).

Publish the Annual Report and Proxy Statement.

Engage with stockholders regarding proposals (as necessary).

After the Annual Meeting

Off-Season Engagement

One-on-One meetings between stockholders, Directors (if appropriate or requested), and members of management.

Attend and participate in investor and corporate governance-related events and conferences.

Evaluate potential changes to the Board, corporate governance, and other relevant matters given stockholder feedback.

Discuss voting results from the Annual Meeting.

Review corporate governance trends, recent regulatory developments, and our own corporate governance documents, policies, and procedures.

Consider topics for discussions during off-season stockholder engagements.

We have adopted standards for director independence in accordance with the Nasdaq listing rules and the SEC rules. An "independent director" means a person, other than an officer or employee of the Company or its subsidiaries, or any other individual having a relationship that, in the opinion of the Board, would interfere with the exercise of independent judgment in carrying out the responsibilities of a director. To be considered independent, the Board must affirmatively determine that neither the director nor an immediate family member has had any direct or indirect material relationship with the Company within the last three years.

The Board considered the relationships, transactions, or arrangements with each of the directors discussed in "Certain Relationships and Related Transactions," in this Proxy Statement and concluded that none of the current or former nonemployee directors who served in 2025 on the Board have any relationships with the Company that would impair their independence, other than Drs. Kibarian and Michaels, who are employees of the Company.

The Board determined that Mr. Bronson, Dr. Chan, Ms. Erba, Mr. Gustafson, Ms. Li, and Ms. Zhang are independent directors under applicable Nasdaq listing rules and SEC rules.

The Board has determined that:

all directors who served in 2025 or currently serve on the Audit, CHCM, and NCG Committees are independent under the Nasdaq listing rules and SEC rules; and

all members of the Audit Committee meet the additional independence requirement and they do not directly or indirectly receive compensation from the Company other than their compensation as directors.

The independent directors meet regularly in executive sessions without the presence of the non-independent directors or members of our management, and in any event, not less than twice per year during regularly scheduled Board

meeting days and from time to time as they deem necessary or appropriate.

Our Board of Directors and committees of the board play a significant role in providing oversight of our management of risk. While our senior management has responsibility for the day-to-day management of risks, our Board is responsible for ensuring that the risk management processes designed and implemented by management are functioning as intended.

Board of Directors

Our Board of Directors plays a significant role in providing oversight of our management of risk. Because responsibility for the oversight of elements of our enterprise risk management extends to various committees of the Board, our Board has determined that it, rather than any one of its committees, should retain the primary oversight role for risk management. Each committee reports regularly to the Board with respect to such committee's particular risk oversight responsibilities.

NCG Committee

The NCG Committee has primary responsibility for the oversight of risk related to our corporate governance and social and environmental practices.

CHCM Committee

The CHCM Committee has primary responsibility for the oversight of risk related to our compensation policies and practices and culture, recruiting, retention, career development and progression, diversity, equity and inclusion, human health and safety, and total rewards.

Audit Committee

The Audit Committee has primary responsibility for the oversight of risk related to our financial statements and processes and responsibility for the oversight of risk related to our information and cyber security functions.

Management

Our senior management regularly attends meetings of the Board and its committees and provides the Board and its committees with reports regarding our operations, strategies, and objectives, and the risks inherent within them, and efforts to monitor and address risk exposures. Board and committee meetings also provide a forum for directors to discuss issues with, request additional information from, and provide guidance to, senior management. In addition, our directors have direct access to senior management to discuss any matters of interest, including those related to risk.

Management identifies and evaluates the effectiveness of risk management and mitigation methods and periodically reports to the Audit Committee and at least annually to the Board to allow the Audit Committee and Board to monitor and manage our ongoing enterprise risk management process.

Our Board of Directors actively oversees our long-term business strategy and strategic priorities. The Board attends an all-day meeting once a year, including in 2025, focused on strategy, which includes presentations from, and engagement with, the senior leaders of the Company. In 2025, the Board also worked closely with our CEO in reviewing and monitoring the execution of our performance to strategic goals. In addition, throughout the year, the Board routinely met with senior management on critical business matters that tie to our strategic priorities.

We are heavily reliant on our technology and infrastructure, as well as the public cloud to an increasing degree, to provide our products and services to our customers. As a result, we have developed an information security program aimed at enhancing our network security measures, identifying and mitigating information security risk, and protecting and preserving the confidentiality, integrity, and continued availability of critical information owned by us and that of our customers and suppliers that is in our care.

As described in the Audit Committee Charter, the Audit Committee is tasked with oversight of certain risk issues, including cybersecurity. The Audit Committee is comprised entirely of independent directors, two of whom have significant work experience related to information security issues or oversight. Management reports high severity security incidents to the Audit Committee after they are discovered. Additionally, management provides a summary four times per year of all significant security incidents to the Audit Committee. The full Board of Directors is also provided an annual assessment of our information security program, our internal response preparedness, and assessments led by outside assessors and auditors.

Additional information about the Company's cybersecurity program can be found in Item 1C. "Cybersecurity" of our Annual Report on Form 10-K filed on February 24, 2026.

We have adopted a Code of Ethics, which applies to all employees, officers, and directors, including our principal executive officer and principal financial officer. The Board of Directors is responsible for setting the standards of conduct contained in the Code of Ethics and for updating these standards as appropriate to reflect legal and regulatory developments. The Audit Committee is charged by the Board with the authority and responsibility to review and assess the Code of Ethics and recommend any amendments thereto or waivers thereof for approval by the Board.

To the extent required under applicable U.S. Securities and Exchange Commission or Nasdaq rules, we will disclose material amendments to the Code of Ethics and any waiver of its provisions with respect to any director or executive officer in accordance with applicable law by posting such information on our website at https://www.pdf.com.

Although we are currently not a member of the Responsible Business Alliance (RBA), upon recommendation by the Audit Committee, our Board of Directors elected to adopt the RBA Code of Conduct to supplement our Code of Ethics, including the specific policies of the RBA Code relating to the five critical areas of corporate social responsibility: labor, health and safety, environment, management systems, and ethics.

We provide information on our website about our corporate governance policies, including our Code of Ethics, charters for the three standing committees of the Board (i.e. the Audit, CHCM, and NCG Committees) and the Lead Independent Director Charter. The Board also adopted the following governance policies: Diversity Policy, Corporate Governance Board Guidelines, Board Confidentiality Policy, Related Party Transactions Policy, Director and Officer Stock Ownership Guidelines, and Disclosure Policy. These materials can be found at https://www.pdf.com/company/governance/. Our website address provided is not intended to function as a hyperlink, and the information on our website is not, and should not be considered, part of this Proxy Statement and is not incorporated by reference herein.

Investors may also request free printed copies of the Code of Ethics and committee charters by sending inquiries to us at PDF Solutions, Inc., Attention: Investor Relations, 2858 De La Cruz Boulevard, Santa Clara, California 95050.

Our policies and practices reflect corporate governance initiatives that are compliant with the Nasdaq continued listing requirements and the corporate governance requirements of the Sarbanes-Oxley Act of 2002, including:

a majority of our Board is independent as defined in the Nasdaq Rule 5605(a)(2);

all members of the Audit Committee, the CHCM Committee, and the NCG Committee are independent as the term is defined under the Nasdaq listing rules;

the independent members of the Board meet at least twice per year in executive sessions without the presence of the non-independent directors or management;

we have an ethics hotline available to all employees, and our NCG Committee has procedures for the anonymous submission of employee complaints on accounting, internal controls, auditing, or other related matters; and

we have adopted a Code of Ethics that applies to all of our employees, including our principal executive officer and all members of our finance department, including our principal financial officer and principal accounting officer, as well as to members of our Board.

ESG Oversight

Given the importance of ESG to the long-term success of our business, our Board and its committees play a critical role in overseeing ESG matters.

Board of Directors

Our Board is responsible for (i) oversight of ESG risks and opportunities and (ii) the integration of ESG into strategy, to the extent material to the business.

NCG Committee

The NCG Committee reviews and oversees our programs, policies, practices, disclosures relating to relevant risks and opportunities, measures, objectives, and performance relating to ESG issues, and makes recommendations to the Board regarding the integration of ESG matters into our business strategy and operation.

‌CHCM Committee

The CHCM Committee reviews and oversees our programs, policies, practices, disclosures relating to relevant risks and opportunities, measures, objectives, and performance relating to human capital matters, including but not limited to matters regarding culture, recruiting, retention, career development and progression, diversity, equity and inclusion, human health and safety, and total rewards, and makes recommendations to the Board regarding the integration of human capital matters into our business strategy and operations.

Audit Committee

The Audit Committee oversees our principal enterprise risk exposures facing us and our mitigation, control, and monitoring efforts in respect of such risks, including, but not limited to environmental and sustainability risks, and our business continuity and disaster preparedness planning.

The Audit Committee also reviews cybersecurity risks, incidents, the adequacy and effectiveness of our information and cyber security policies and the internal controls regarding information and cyber security and any other risks and incidents relevant to our computerized information system controls and security.

Management-Level ESG Steering Committee

The purpose of the management-level ESG Steering Committee is to (i) establish programs, policies and practices relating to ESG matters and (ii) assist the NCG Committee of the Board in fulfilling its oversight responsibilities with respect to ESG matters. The ESG Steering Committee is chaired by our General Counsel.

‌The Audit Committee reviewed and discussed the audited consolidated financial statements for the year ended December 31, 2025, with management and BPM LLP, the Company's independent registered public accounting firm.

The Audit Committee discussed with the independent registered public accounting firm the adequacy of our internal control system, financial reporting procedures and the matters required to be discussed by the applicable requirements of the Public Company Accounting Oversight Board (United States) ("PCAOB") and the SEC.

The Audit Committee has received and reviewed the written disclosures and the letter from the independent registered public accounting firm as required by applicable requirements of the PCAOB regarding the independent public accounting firm's communications with the Audit Committee concerning independence. Additionally, the Audit Committee has discussed with BPM LLP the issue of their independence from the Company.

Based on its review of the audited consolidated financial statements and the various discussions noted above, the Audit Committee recommended to the Board that the audited consolidated financial statements be included in our Annual Report on Form 10-K for the year ended December 31, 2025.

SUBMITTED BY THE AUDIT COMMITTEE:

Nancy Erba, Chair Joseph R. Bronson

April 23, 2026 Shuo Zhang

The information contained in the Audit Committee Report shall not be deemed to be "soliciting material," to be "filed" with the SEC, or to be subject to Regulation 14A or Regulation 14C (other than as provided in Item 407 of Regulation S-K) or to the liabilities of Section 18 of the Exchange Act and, notwithstanding anything to the contrary set forth in any of the Company's filings under the Securities Act of 1933, as amended, (the "Securities Act") or the Exchange Act that might incorporate future filings, including this Proxy Statement, in whole or in part, the Audit Committee Report shall not be deemed to be incorporated by reference into any such filings with the SEC except to the extent that the Company specifically incorporates it by reference into a document filed under the Securities Act or the Exchange Act.

The Audit Committee has appointed BPM LLP ("BPM") as our independent registered public accounting firm for the year ending December 31, 2026. As a matter of good corporate governance, our Audit Committee has decided to submit its selection of principal independent registered public accounting firm to stockholders for ratification. In the event that ratification of this selection of an independent registered public accounting firm is not approved by a majority of the votes cast at the Annual Meeting in person or by proxy, the Audit Committee will consider interviewing other independent registered public accounting firms. There can be no assurances, however, that it will appoint another firm if this proposal is not approved.

Even if the selection is ratified, the Audit Committee in its discretion may select a different registered public accounting firm at any time to be the independent registered public accounting firm for the year ending December 31, 2026, if it determines that such a change would be in the best interests of the Company and our stockholders.

BPM was originally retained by us on September 13, 2018. A representative of BPM is expected to be present at the Annual Meeting. This representative will have an opportunity to make a statement and will be available to respond to appropriate questions.

We regularly review the services provided by and fees of the independent registered public accounting firm. These services and fees are also reviewed with our Audit Committee annually. In accordance with standard policy, BPM periodically rotates the individuals who are responsible for PDF Solution's audit.

BPM was our independent registered public accounting firm for the years ended December 31, 2025 and 2024. Our Audit Committee determined that BPM's provision of these services, which are described below, does not impair BPM's independence from the Company. The aggregate fees incurred for BPM's audits of our 2025 and 2024 consolidated financial statements are summarized in the following service categories:

Fees Billed to the Company

2025

2024

Audit fees (1)

$ 865,300

$ 737,600

Audit-related fees

Tax fees

All other fees

Total Fees

$ 865,300

$ 737,600

(1) Includes fees for audit services rendered for the audit of our annual consolidated financial statements included in our Annual Report on Form 10-K, review of our condensed consolidated financial statements included in our quarterly reports on Form 10-Q and services that were provided in connection with statutory and regulatory filings or engagements.

Proposal No. 2:

Ratification of Appointment of Independent Registered Public Accounting Firm

The Audit Committee's policy is to pre-approve all audit and permissible non-audit services provided by BPM. These services may include audit services, audit-related services, tax services and other services. Pre-approval is generally provided for up to one year and any pre-approval is detailed as to the particular service or category of services and is generally subject to an initial estimated budget. BPM and Company management are required to periodically report to the Audit Committee regarding the extent of services provided by BPM in accordance with this pre-approval, and the fees performed to date. The Audit Committee may also pre-approve particular services on a case-by-case basis.

All services provided by BPM during the years ended December 31, 2025 and 2024, were approved by the Audit Committee in accordance with our pre-approval policy and applicable SEC regulations.

Recommendation of the Board

THE BOARD RECOMMENDS THAT OUR STOCKHOLDERS VOTE FOR THE RATIFICATION OF BPM LLP AS OUR INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM FOR THE YEAR ENDING DECEMBER 31, 2026.

‌Proposal No. 3: Approval of our Eleventh Amended and

At the Annual Meeting, we are asking our stockholders to approve our Eleventh Amended and Restated 2011 Stock Incentive Plan (the "Eleventh Amended 2011 Plan"), which is the eleventh amendment and restatement of the 2011 Stock Incentive Plan, (defined on page 28 below), to increase the number of shares reserved for issuance under the Eleventh Amended 2011 Plan by an additional 800,000 shares and extend the deadline to award incentive stock options to April 23, 2036.

Our Board of Directors adopted the Eleventh Amended 2011 Plan on April 23, 2026, subject to the approval of stockholders.

As of April 17, 2026, there were 1,636,726 shares subject to outstanding grants and 3,201,258 shares remaining available for future grants under the Tenth Amended and Restated 2011 Stock Incentive Plan (the "Tenth Amended 2011 Plan").

Under the Eleventh Amended 2011 Plan 4,001,258 shares would be available for future Awards, based on the shares available for future Awards under the Tenth Amended 2011 Plan as of April 17, 2026.

If approved by our stockholders, the Eleventh Amended 2011 Plan will take effect on June 16, 2026, and will continue in effect until terminated by the Board, pursuant to the terms of the Eleventh Amended 2011 Plan. If our stockholders do not approve this proposal, then the Eleventh Amended 2011, including an increase in the number of shares available for issuance and the other amendments described in this proposal, will not become effective and the Tenth Amended 2011 Plan will continue in effect.

Our Board of Directors recommends a vote in favor of the Eleventh Amended 2011 Plan because the Board believes the Eleventh Amended 2011 Plan is in the best interests of the Company and our stockholders for the following reasons:

Ensure adequate available shares. Our Board of Directors believes that the ability to continue to distribute equity awards, including for unforeseen events, is important for our continued growth and success.

Aligns executive, employee, non-employee director, independent contractor, and stockholder interests. We currently provide stock awards to a broad-based group of our employee population as well as our non-employee directors and independent contractors. We believe that our stock-based compensation program, along with our stock

ownership guidelines for our non-employee directors and executives, which include equity award holding requirements for our Chief Executive Officer, help align the interests of our executives, employees, and non-employee directors, and independent contractors with the interests of our stockholders by giving them a sense of ownership and long-term personal involvement in and accountability for the development and financial success of the Company. If the Eleventh Amended 2011 Plan is approved, we will be able to continue to use equity to align the interests of our executives, employees, and non-employee directors, and independent contractors with the interests of our stockholders.

Supports our pay-for-performance philosophy. A significant portion of total compensation for our non-founder executive officers is equity-based incentive compensation, which ultimate value is tied to our stock price. We use incentive compensation to help reinforce desired business results and to motivate executives to make decisions to

produce those results. If the Eleventh Amended 2011 Plan is approved, it will continue to support our pay-for-performance philosophy.

Balances appropriately our need to attract and retain talent with stockholder interests regarding dilution. We recognize the dilutive impact of our equity compensation program on our stockholders, and we continuously strive to balance this concern with the competition for talent, competitive compensation practices, and the need to attract and

retain talent. As described in more detail below under the heading "Dilution, Overhang and Burn Rate," we believe the Eleventh Amended 2011 Plan is not excessively dilutive to our stockholders given our overhang and that our three-year average annual gross burn rate is 2.20% and our three-year average net burn rate is 2.04%. Further, our Board is committed to continue to manage and control the amount of our common stock used for equity compensation.

Protects stockholder interests and embraces sound stock-based compensation practices. As described in more detail below under the heading "The Eleventh Amended 2011 Plan Reflects Governance Best Practices," the Eleventh Amended 2011 Plan includes features that are consistent with the interests of our stockholders (and their

advisors) and sound corporate governance practices.

The Eleventh Amended 2011 Plan is being amended to provide, among other things, for the following:

Increase in Share Reserve. Subject to capitalization adjustments and the share counting provisions described below, as of June 16, 2026, a total of 16,200,000 shares will be authorized for Awards granted under the Eleventh Amended 2021 Plan (which amount includes 800,000 new shares), plus up to 3,500,000 shares previously issued

under the Company's 2001 Stock Option Plan (the "2001 Plan") that are forfeited or repurchased by the Company or shares subject to awards previously issued under the 2001 Plan that expire or that terminate without having been exercised or settled in full on or after November 16, 2011. See below for more information.

Other Amendments. To provide that incentive stock options may be granted through April 23, 2036, unless further approved by stockholders.

The Eleventh Amended 2011 Plan was designed to include a number of best practice provisions that we believe reinforce the alignment between our stockholders' interests and equity compensation arrangements for employees, non-employee directors and contractors. These provisions include, but are not limited to the following:

No Repricing or Buyout of Underwater Options or Stock Appreciation Rights (SARs). Prohibits stock option and stock appreciation right repricing or other exchanges for cash or equity compensation without stockholder consent.

No Discounted Options and SARs. Requires stock options and stock option agreement to be granted with an exercise price equal to at least the fair market value of our common stock on the date the award is granted.

No Evergreen Provision. Avoids the use of "evergreen" share reserve increases and instead requires stockholder approval to increase the share reserve.

No Liberal Share Recycling with respect to Options and SARs. Shares will not be added back to the number of shares available for issuance when such shares are (i) shares that were subject to a stock-settled stock appreciation right and were not issued upon the net settlement or net exercise of such stock appreciation right, (ii) shares used to

pay the exercise or purchase price of stock options or stock appreciation rights, (iii) shares delivered to or withheld by the Company to pay the withholding taxes related to stock options or stock appreciation rights, or (iv) shares repurchased on the open market with the proceeds of a stock option exercise.

Awards are Subject to Clawback. Each participant must comply with applicable law, the Company's Code of Ethics, and the Company's corporate policies, as applicable, including without limitation the Company's Compensation Recovery Policy. In addition, compliance with applicable law, the Company's Code of Ethics, and the Company's

corporate policies, as applicable, will be a pre-condition to earning, or vesting in, any award under the Eleventh Amended 2011 Plan. Any Awards under the Eleventh Amended 2011 Plan will continue to be subject to the Company's Compensation Recovery Policy even if already granted, paid, or settled, until the Company's Compensation Recovery Policy ceases to apply to such Awards.

Individual Share Limits for All Participants. Subject to capitalization adjustments, no participant in the Eleventh Amended 2011 Plan may receive stock options and stock appreciation rights during any fiscal year of the Company covering in excess of 1,000,000 shares per award type, and no participant in the Eleventh Amended 2011 Plan shall

receive stock grants or stock units during any fiscal year of the Company covering in excess of 1,000,000 shares. The aggregate maximum number of shares that may be issued in connection with incentive stock options under the Eleventh Amended 2011 Plan is 1,000,000 shares.

Fungible Share Reserve. The Eleventh Amended 2011 Plan includes a fungible share reserve to manage dilution, such that the aggregate number of shares reserved under the Eleventh Amended 2011 Plan will be decreased at a rate of 1.33 per share issued pursuant to each award other than a stock option or stock appreciation right.

No Dividends and Dividend Equivalents on Unvested Awards. Dividends and dividend equivalents will not be paid or settled with respect to any award granted under the Eleventh Amended 2011 Plan until the underlying shares or units vest, and no dividend equivalents or otherwise may be credited with respect to options and stock appreciation

rights.

No Single Trigger and Specific Disclosure of Equity Award Vesting upon a Change in Control. Awards do not automatically accelerate upon a change in control unless the acquiring company does not assume or replace the

Awards (with performance-based equity Awards, if not assumed or replaced vesting at the target level of achievement), or unless an award continues in effect or is assumed or an equivalent award substituted, and the participant's service is terminated by the Company or one of its subsidiaries without cause upon or within twenty-four

(24) months following the change in control.

Prohibition on Payment of Dividends and Dividend Equivalents on Unvested Awards. Prohibits the payment or settlement of dividends or dividend equivalents with respect to any award until the underlying shares or units vest.

No Automatic Grants. The Eleventh Amended 2011 Plan does not provide for automatic grants to any participant.

No Tax Gross-ups. The Eleventh Amended 2011 Plan does not provide for any tax gross-ups.

No Transferability. Except as provided in the applicable Award agreement and then only to the extent such transfer is otherwise permitted by applicable law and is not a transfer for value (unless such transfer for value is approved in

advance by the Company's stockholders), Awards are not transferable other than by will or by the laws of descent and distribution. In addition, in no event may any Award be transferred for consideration to a third-party financial institution.

No Reload Grants. The Eleventh Amended 2011 Plan does not provide for reload grants, or the granting of stock options conditioned upon delivery of shares to satisfy the exercise price and/or tax withholding obligation under another employee stock option.

While the use of long-term incentives in the form of equity awards is an important part of our compensation program, we recognize that stock awards dilute existing stockholders and are mindful of our responsibility to our stockholders to exercise judgment in the granting of equity awards.

The following table sets forth information regarding outstanding grants as of April 17, 2026, under the Eleventh Amended 2011 Plan. As of April 17, 2026, we had 39,917,373 shares of common stock issued and outstanding. The market value of one share of our common stock on April 17, 2026, as determined based on the closing price per share of our common stock as reported on the Nasdaq was $43.97.

Weighted-

Average Exercise Price

Average

Remaining Contractual

Full Value

Shares Available

for Future

Equity Plan

Stock Options

(# of shares)

Per

Share ($)

Term

(In Years)

Awards

(# of shares)(1)

Grant (# of

shares)

Tenth Amended 2011 Plan

16,302 $

17.01

3.02

1,620,424

3,201,258

Restricted stock awards ("RSAs") and RSU are referred to as "Full Value Awards."

The following table provides detailed information regarding our historical equity award granting practices, including our share usage rate (commonly referred to as "burn rate") and equity overhang activity (based on total potential award shares) under the 2011 Stock Incentive Plan for the last three years. The effects of our stock repurchase program are included in these calculations. During the last three years, no awards were issued under any equity plan other than the 2011 Stock Incentive Plan and our 2021 Employee Stock Purchase Plan, and no awards were made outside of a stockholder-approved equity plan.

Fiscal 2025

Fiscal 2024

Fiscal 2023

Gross Burn Rate (1)

2.57%

1.96%

2.06%

Net Burn Rate (2)

2.34%

1.80%

1.98%

Equity Overhang (3)

8.24%

10.66%

11.25%

Gross Burn Rate is calculated as (a) the number of new stock awards granted under the 2011 Stock Incentive Plan, divided by

(b) the weighted average common shares outstanding of the Company at the end of the year.

Net Burn Rate is calculated as (a) the number of new stock awards granted under the 2011 Stock Incentive Plan, net of stock awards cancelled and forfeited under the 2011 Stock Incentive Plan, divided by (b) the weighted average common shares outstanding of the Company at the end of the year.

Equity Overhang is calculated as (a) the number of shares subject to outstanding option and stock awards plus the number of shares available for grant under the 2011 Stock Incentive Plan, divided by (b) the number of shares subject to outstanding option and stock awards, plus the number of shares available for grant under the 2011 Stock Incentive Plan, plus the weighted average common shares outstanding of the Company at the end of the year. The number of shares available for grant was divided by a rate of 1.33 pursuant to the 2011 Stock Incentive Plan.

The table below shows the number of time-based full value awards granted under the 2011 Stock Incentive Plan in each of the last three years. The Company did not grant any options or performance-based awards in the last three years.

Fiscal Year

Option

Awards Granted

Total Full Value Awards Granted

Time Based

Full Value Awards Granted

2025

- 1,009,444

1,009,444

2024

- 756,282

756,282

2023

- 783,444

783,444

Description of the Eleventh Amended 2011 Plan

The material features of the Eleventh Amended 2011 Plan are outlined below. This summary does not purport to be a complete description of all the provisions of the Eleventh Amended 2011 Plan and is qualified in its entirety by reference to the complete text of the Eleventh Amended 2011 Plan. Stockholders are urged to read the actual text of the Eleventh Amended 2011 Plan in its entirety, a copy of which has been filed with the SEC as Appendix A to this Proxy Statement. Any stockholder who desires to obtain a copy of the Eleventh Amended 2011 Plan may do so by written request to our Secretary at PDF Solutions, Inc., Attention: Secretary, 2858 De La Cruz Boulevard, Santa Clara, CA 95050.

Only employees and independent contractors of the Company or any parent, subsidiary or affiliate of the Company, and non-employee directors of the Board, are eligible to participate in the Eleventh Amended 2011 Plan. Upon the adoption of the Eleventh Amended 2011 Plan approximately 604 employees (including 4 executive officers), 6 non-employee directors, and 46 contractors will be eligible to participate in the Eleventh Amended 2011 Plan.

The terms of the Eleventh Amended 2011 Plan provide for discretionary incentive awards in the form of options (which may be incentive stock options or nonstatutory stock options), stock appreciation rights, stock grants, and stock units (collectively, the "Awards").

The Board (or its duly authorized delegee) shall administer the Eleventh Amended 2011 Plan. The Board shall generally have membership composition that enables Awards to those participants who are subject to the requirements of Section 16 of the Exchange Act. However, the Board may from time-to-time delegate to a committee of one or more members of the Board, and the Board or such committee may from time-to-time delegate to one or more of our officers,

the authority to grant or amend Awards or to take other administrative actions with respect to participants who are subject to the requirements of Section 16 of the Exchange Act. Notwithstanding the foregoing, the Board shall administer the Eleventh Amended 2011 Plan with respect to all Awards granted to non-employee directors.

Subject to the provisions of the Eleventh Amended 2011 Plan, the Eleventh Amended 2011 Plan administrator shall have the full authority, in its sole discretion, to take any actions it deems necessary or advisable for the administration of the Eleventh Amended 2011 Plan, including, but not limited to:

selecting eligible participants that are to receive Awards under the Eleventh Amended 2011 Plan;

determining the type, number, vesting requirements, and other features and conditions of such Awards;

adopting such rules or guidelines as it deems appropriate to implement the Eleventh Amended 2011 Plan;

making all other decisions relating to the operation of the Eleventh Amended 2011 Plan; and

adopting such plans or subplans as may be deemed necessary or appropriate to provide for the participation by employees of the Company, its parent, or its subsidiaries and affiliates that reside outside of the United States.

The Eleventh Amended 2011 Plan administrator's determinations under the Eleventh Amended 2011 Plan shall be final and binding on all persons.

To the maximum extent permitted by applicable law and the Company's certificate of incorporation, bylaws and other governing documents, each member of the Eleventh Amended 2011 Plan administrator shall be indemnified and held harmless by the Company against and from (i) any loss, cost, liability, or expense that may be imposed upon or reasonably incurred by him or her in connection with or resulting from any claim, action, suit, or proceeding to which he or she may be a party or in which he or she may be involved by reason of any action taken or failure to act under the Eleventh Amended 2011 Plan or any Award agreement, and (ii) from any and all amounts paid by him or her in settlement thereof, with the Company's approval, or paid by him or her in satisfaction of any judgment in any such claim, action, suit, or proceeding against him or her, provided he or she shall give the Company an opportunity, at its own expense, to handle and defend the same before he or she undertakes to handle and defend it on his or her own behalf. The foregoing right of indemnification shall not be exclusive of any other rights of indemnification to which such persons may be entitled under the Company's Articles of Incorporation or Bylaws, by contract, as a matter of law, or otherwise, or under any power that the Company may have to indemnify them or hold them harmless.

The stock issuable under the Eleventh Amended 2011 Plan shall be authorized but unissued shares or treasury shares. The aggregate number of shares reserved for Awards under the Eleventh Amended 2011 Plan is 16,200,000 shares.

Stockholders originally approved our 2011 Stock Incentive Plan at our 2011 Annual Meeting, with 3,200,000 shares initially reserved for future awards under it. Stockholders have approved ten prior amendment and restatements to the 2011 Stock Incentive Plan to, among other things, increase the number of shares reserved for Awards under it as follows:

an additional 1,600,000 shares at the 2013 annual meeting of stockholders, for a total of 4,800,000 shares reserved;

an additional 1,750,000 shares at the 2014 annual meeting of stockholders, for a total of 6,550,000 shares reserved;

an additional 1,250,000 shares at the 2016 annual meeting of stockholders, for a total of 7,800,000 shares reserved;

an additional 1,250,000 shares at the 2017 annual meeting of stockholders, for a total of 9,050,000 shares reserved;

an additional 1,250,000 shares at the 2019 annual meeting of stockholders, for a total of 10,300,000 shares reserved;

an additional 1,250,000 shares at the 2020 annual meeting of stockholders, for a total of 11,550,000 shares reserved;

an additional 1,250,000 shares at the 2022 annual meeting of stockholders, for a total of 12,800,000 shares reserved;

an additional 1,000,000 shares at the 2023 annual meeting of stockholders, for a total of 13,800,000 shares reserved;

an additional 800,000 shares at the 2024 annual meeting of stockholders, for a total of 14,600,000 shares reserved; and

an additional 800,000 shares at the 2025 annual meeting of stockholders, for a total of 15,400,000 shares reserved.

In addition, any shares subject to stock options or other awards granted under our 2001 Plan that are forfeited or repurchased by the Company or that expire or otherwise terminate without having been exercised in full on or after November 16, 2011, when our 2011 Stock Incentive Plan was first approved by stockholders, shall be added to the Eleventh Amended 2011 Plan share reserve and shall become available for issuance pursuant to the Eleventh Amended 2011 Plan, with the maximum number of such shares to be added to the Eleventh Amended 2011 Plan pursuant to such terminations, forfeitures and repurchases not to exceed 3,500,000 shares. As of April 17, 2026, there were 509,793 such shares added to the 2011 Stock Incentive Plan. In the case of Awards other than stock options or stock appreciation rights, the aggregate number of shares reserved under the Eleventh Amended 2011 Plan will be decreased at a rate of

1.33 per share issued pursuant to each such Award.

If Awards are forfeited or are terminated for any reason before vesting or being exercised, then the shares underlying such Awards will again become available for Awards under the Eleventh Amended 2011 Plan (for purposes of clarity, if the share reserve is reduced by 1.33 shares per share subject to Awards granted under the Eleventh Amended 2011 Plan other than options or stock appreciation rights, then the share reserve shall be increased by 1.33 times the number of shares subject to such Awards that are so forfeited or terminated). Further, if shares acquired pursuant to any such Award are forfeited to or repurchased by the Company such shares shall return to the Eleventh Amended 2011 Plan and again be available for issuance pursuant to the Eleventh Amended 2011 Plan, provided that in the case of Awards, other than options or stock appreciation rights, 1.33 times the number of shares so forfeited or repurchased will return to the Eleventh Amended 2011 Plan and will again become available for issuance. Shares tendered by a Participant or withheld by the Company to satisfy any tax withholding obligation with respect to Awards, other than options or stock appreciation rights, will again be available for issuance under the Eleventh Amended 2011 Plan (for purposes of clarity, the share reserve shall be increased by 1.33 times the number of shares subject to such awards that are so tendered or withheld). Stock appreciation rights to be settled in shares shall be counted in full against the number of shares available for issuance under the Eleventh Amended 2011 Plan, regardless of the number of shares issued upon settlement of the stock appreciation rights. Notwithstanding the foregoing, shares subject to an Award under the Eleventh Amended 2011 Plan may not again be made available for issuance under the Eleventh Amended 2011 Plan if such shares are: (i) shares that were subject to a stock-settled stock appreciation right and were not issued upon the net settlement or net exercise of such stock appreciation right, (ii) shares used to pay the exercise or purchase price of options or stock appreciation rights,

(iii) shares delivered to or withheld by the Company to pay the withholding taxes related to options or stock appreciation rights, or (iv) shares repurchased on the open market with the proceeds of an option exercise.

Neither any dividend equivalents settled in cash distributed under the Eleventh Amended 2011 Plan nor any cash settled Awards shall reduce the number of shares available for Awards.

In the event of a subdivision of the outstanding shares, a declaration of a dividend payable in shares, a declaration of a dividend payable in a form other than shares in an amount that has a material effect on the price of shares, a combination or consolidation of the outstanding shares (by reclassification or otherwise) into a lesser number of shares, a recapitalization, a spin-off or a similar occurrence, the Eleventh Amended 2011 Plan administrator will make such adjustments as it, in its sole discretion, deems appropriate to the number of shares and kind of shares or securities issuable under the Eleventh Amended 2011 Plan (on both an aggregate and per-participant basis) and under each outstanding Award, to the per-participant Award limits, and to the exercise price of outstanding stock options and stock appreciation rights.

As of April 17, 2026, the fair market value of a share of Company common stock (based on the closing price of the Company's common stock) was $43.97, and there were approximately 16,302 shares of our common stock subject to outstanding stock options granted under the 2011 Stock Incentive Plan with a weighted average exercise price of $17.01 and a weighted average remaining term of 3.02 years. In addition, there were approximately 1,620,424 shares of our common stock subject to outstanding stock unit awards granted under the 2011 Stock Incentive Plan.

Subject to capitalization adjustments, no participant in the Eleventh Amended 2011 Plan shall receive stock options and stock appreciation rights during any fiscal year of the Company covering in excess of 1,000,000 shares per Award type, and no participant in the Eleventh Amended 2011 Plan shall receive stock grants or stock units during any fiscal year of the Company covering in excess of 1,000,000 shares. Subject to capitalization adjustments, the aggregate maximum number of shares that may be issued in connection with incentive stock options under the Eleventh Amended 2011 Plan shall be 1,000,000 shares. Further, no incentive stock options may be granted after April 23, 2036, without further stockholder approval.

Dividends and dividend equivalents will not be paid or settled with respect to any award granted under the Eleventh Amended 2011 Plan until the underlying shares or units vest, and no dividend equivalents or otherwise may be credited with respect to options and stock appreciation rights.

Stock Options

In the case of stock options, each stock option granted under the Eleventh Amended 2011 Plan shall be evidenced and governed by a stock option agreement between the participant and the Company, which will generally be delivered online by the Company or its designated third-party broker and accepted online by the participant. The stock option agreement or the online grant summary to which such agreement refers shall specify whether the option is an incentive stock option or a non-qualified stock option, the number of shares granted, the exercise price, the vesting schedule, exercisability, and the term (not to exceed ten years from the date of grant). The exercise price of a stock option must not be less than 100% of the fair market value of a share (or 110% for an incentive stock option granted to an individual who owns more than 10% of the total combined voting power of all classes of outstanding stock of the Company, its parent or any of its subsidiaries) on the date of grant.

Under the Eleventh Amended 2011 Plan, the stock option exercise price must be paid at the time the shares are purchased and may generally be made in cash (including by check, wire transfer or similar means) or, if provided for in the applicable Award agreement, by cashless exercise, by surrendering previously acquired shares of Company common stock, or by any other form that is consistent with applicable laws, regulations and rules and approved by the Committee. Except as otherwise provided in the applicable Award agreement, a stock option may be exercised during the lifetime of the participant only or by the guardian or legal representative of the participant. No stock option can be exercised after the expiration date of the stock option.

Within the limitations of the Eleventh Amended 2011 Plan, the Eleventh Amended 2011 Plan administrator may modify, extend, or assume outstanding stock options or may accept the cancellation of outstanding stock options (whether granted by the Company or by another issuer) in return for the grant of new stock options for the same or a different number of shares and at the same or a different exercise price. Notwithstanding the foregoing, no modification of a stock option shall, without the consent of the participant, impair his or her rights or obligations under such stock option and, unless there is approval by the Company stockholders, the Eleventh Amended 2011 Plan administrator may not reprice outstanding stock options. A repricing means repricing outstanding options and/or outstanding stock appreciation rights by lowering or reducing the exercise price of such awards or implementing an option or stock appreciation right exchange program whereby the participant agrees to cancel an existing option or stock appreciation right in exchange for cash, an option, a stock appreciation right or other award.

Stock Appreciation Rights

In the case of stock appreciation right, each stock appreciation right granted under the Eleventh Amended 2011 Plan shall be evidenced by an agreement between the participant and the Company, which will generally be delivered online by the Company or its designated third-party broker and accepted online by the participant. A stock appreciation right agreement may provide for a maximum limit on the amount of any payout notwithstanding the fair market value on the date of exercise of the stock appreciation right. Each stock appreciation right agreement or the online grant summary to which such agreement refers shall specify the number of shares to which the stock appreciation right pertains, the exercise price, exercisability, and the term (not to exceed ten years from the date of grant). The exercise price of a stock appreciation right must not be less than 100% of the fair market value of a share on the date of grant.

Stock appreciation rights may be awarded in combination with stock options or stock grants, and such an Award shall provide that the stock appreciation rights will not be exercisable unless the related Award is forfeited. No stock appreciation right can be exercised after the expiration date provided in the applicable Award agreement.

If, on the date when a stock appreciation right expires, the exercise price under such stock appreciation right is less than the fair market value of a share on such date but any vested portion of such stock appreciation right has not been exercised or surrendered, then such stock appreciation right shall automatically be deemed to be exercised as of such date with respect to such vested portion. Upon exercise of a stock appreciation right, the participant (or any person having the right to exercise the stock appreciation right after the participant's death) shall receive from the Company (i) shares,

(ii) cash or (iii) any combination of shares and cash, as the Eleventh Amended 2011 Plan administrator shall determine at the time of grant of the stock appreciation right, in its sole discretion.

The amount of cash and/or the fair market value of shares received upon exercise of stock appreciation rights shall, in the aggregate, be equal to the amount by which the fair market value (on the date of surrender) of the shares subject to the stock appreciation rights exceeds the exercise price of the shares.

Stock Grants

In the case of stock grants, a stock grant may be issued with or without cash consideration. Each stock grant awarded under the Eleventh Amended 2011 Plan shall be evidenced and governed by a stock grant agreement between the participant and the Company, which will generally be delivered online by the Company or its designated third-party broker and accepted online by the participant. The stock grant agreement or the online grant summary to which such agreement refers shall specify the number of shares granted and the vesting conditions and schedule in the event any shares subject to the Award are restricted and subject to vesting.

The holder of a stock grant awarded under the Eleventh Amended 2011 Plan will be credited with all dividends and other distributions that are paid by the Company on an equivalent number of shares that are not subject to such restrictions.

Any such dividends and other distributions shall be distributed only if, when and to the extent the related shares vest. Dividends and other distributions credited with respect to any shares that do not vest shall be forfeited.

Stock Units

In case of stock units, each stock unit granted under the Eleventh Amended 2011 Plan shall be evidenced by a stock unit agreement between the participant and the Company, which will generally be delivered online by the Company or its designated third-party broker and accepted online by the participant. Each stock unit agreement shall specify the number of shares to which the stock unit pertains, and the vesting conditions for the stock units (if any). Settlement of vested stock units may be made in the form of cash, shares, or any combination of both, as determined by the Eleventh Amended 2011 Plan administrator at the time of the grant of the stock units, in its sole discretion. Methods of converting stock units into cash may include (without limitation) a method based on the average fair market value of shares over a series of

trading days. Vested stock units may be settled in a lump sum or in installments. The distribution may occur or commence when the vesting conditions applicable to the stock units have been satisfied or have lapsed, or it may be deferred, in accordance with applicable law, to any later date. The amount of a deferred distribution may be increased by an interest factor or by dividend equivalents.

The Eleventh Amended 2011 Plan administrator may, in its sole discretion, provide that dividend equivalents will be credited in connection with the grant of stock units that may be settled in cash, in shares of equivalent value, or in some combination thereof. Any dividend equivalents credited with respect to stock units shall be equal in value to the dividends and other distributions that are paid by the Company on an equivalent number of shares and shall be settled in cash or shares to the participant (with or without interest or other earnings, as provided at the discretion of the Eleventh Amended 2011 Plan administrator) only if, when and to the extent the related stock units vest. Dividend equivalents credited with respect to any stock unit that does not vest shall be forfeited.

Except as otherwise provided in the applicable Award agreement and then only to the extent such transfer is otherwise permitted by applicable law and is not a transfer for value (unless such transfer for value is approved in advance by the Company's stockholders), no Award shall be transferable by the participant other than by will or by the laws of descent and distribution. No stock option, stock appreciation right or interest therein may be assigned, pledged, or hypothecated by the participant during his or her lifetime, whether by operation of law or otherwise, or be made subject to execution, attachment, or similar process. Except as otherwise provided in the applicable Award agreement, no stock unit, unvested stock grant or interest therein may be anticipated, assigned, attached, garnished, optioned, transferred or made subject to any creditor's process, whether voluntarily, involuntarily or by operation of law.

Unless otherwise provided in the applicable Award agreement, or with respect to a participant who resides in the U.S., the applicable employment agreement provides otherwise, in the event of a participant's termination of service (and, in all cases, subject to the term of the stock option and/or stock appreciation right, all unvested (or, in the case of a termination for cause, all vested, unvested and unvested) portions of any outstanding Awards shall terminate and/or be immediately forfeited without consideration, and the then-vested portion of any outstanding stock options and stock appreciation rights may be exercised by a participant (or his or her personal representative) within 90 days (inclusive) following the date of termination of service for any reason other than cause, death or disability and 6 months (inclusive) following a termination of service for death or disability.

The Board may amend or terminate the Eleventh Amended 2011 Plan at any time and for any reason. Any such termination of the Eleventh Amended 2011 Plan, or any amendment thereof, shall not impair any Award previously granted under the Eleventh Amended 2011 Plan. No Awards shall be granted under the Eleventh Amended 2011 Plan after the plan's termination. No Incentive Stock Options may be granted after April 23, 2036, without further stockholder approval. An amendment of the Eleventh Amended 2011 Plan shall be subject to the approval of the Company's stockholders only to the extent such approval is required by applicable laws, regulations, or rules. Within the limitations of the Eleventh Amended 2011 Plan, the Eleventh Amended 2011 Plan administrator may modify, extend, or assume outstanding Awards or may accept the cancellation of outstanding Awards (whether granted by the Company or by another issuer) in return for the grant of new Awards for the same or a different number of shares and, as applicable, at the same or a different exercise price. Notwithstanding the foregoing, no modification of an Award shall, without the consent of the participant, impair his or her rights or obligations under such Award and, unless there is approval by the Company stockholders, the Eleventh Amended 2011 Plan administrator may not reprice outstanding stock options or stock appreciation rights.

Awards under the Eleventh Amended 2011 Plan may be made subject to performance conditions as well as time-vesting conditions. Such performance conditions may be based on an objective formula or standard utilizing one or more of the following factors, including but not limited to: (i) operating income; (ii) earnings before interest, taxes, depreciation and amortization; (iii) earnings; (iv) cash flow; (v) market share; (vi) sales or revenue; (vii) expenses; (viii) cost of goods sold;

(ix) profit/loss or profit margin; (x) working capital; (xi) return on equity or assets; (xii) earnings per share; (xiii) economic value added; (xiv) price/earnings ratio; (xv) debt or debt-to-equity; (xvi) accounts receivable; (xvii) write-offs; (xviii) cash;

(xix) assets; (xx) liquidity; (xxi) operations; (xxii) intellectual property (e.g., patents); (xxiii) product development;

(xxiv) regulatory activity; (xxv) manufacturing, production or inventory; (xxvi) mergers and acquisitions or divestitures; and/or (xxvii) financings, each with respect to the Company and/or one or more of its parent, subsidiaries, affiliates or operating units.

The Eleventh Amended 2011 Plan provides that in the event of a change in control, except as set forth in an Award agreement, if the successor corporation does not continue, assume, or substitute for outstanding Awards, the participants will fully vest in all their outstanding and unvested Awards and have the right to exercise all of their outstanding options and stock appreciation rights, including shares as to which such Awards would not otherwise be vested or exercisable, and, with respect to Awards with performance-based vesting, all performance goals will be deemed achieved at one hundred percent (100%) of target levels and all other terms and conditions met. In addition, if an option or stock appreciation right is not continued, assumed, or substituted in the event of a change in control, the Company will notify the participant in writing or electronically that such Award shall be fully exercisable for a period of fifteen (15) days from the date of such notice, contingent upon the occurrence of the change in control, and such Award shall terminate upon the expiration of such period. Furthermore, in the event an Award continues in effect or is assumed or an equivalent Award substituted, and a participant's service is terminated by the Company or one of its subsidiaries without cause upon or within twenty-four (24) months following the change in control, then such participant shall be fully vested in such continued, assumed, or substituted Award. To the extent not previously exercised or settled, options, stock appreciation rights and stock units shall terminate immediately prior to the dissolution or liquidation of the Company.

For purposes of the Eleventh Amended 2011 Plan, a "change in control" means the consummation of any of the following transactions: (i) the sale of all or substantially all of our assets; (ii) the merger of the Company with or into another corporation in which securities possessing more than 50% of the total combined voting power of the Company are transferred to a person or persons different from the persons holding those securities immediately prior to such transaction; (iii) the acquisition, directly or indirectly, by any person or related group of persons of beneficial ownership of securities of the Company representing more than 50% of the total combined voting power of our then outstanding securities (provided, however, that the acquisition of additional stock by any person or related group of persons, who is considered to own more than 50% of the total voting power of the stock of the Company will not be considered a change in control); or (iv) a change in the effective control of the Company, which occurs on the date that a majority of members of the Board is replaced during any twelve (12) month period by directors whose appointment or election is not endorsed by a majority of the members of the Board prior to the date of the appointment or election.

Each participant must comply with applicable law, the Company's Code of Ethics, and the Company's corporate policies, as applicable, including without limitation the Company's Compensation Recovery Policy. Notwithstanding anything to the contrary, (i) compliance with applicable law, the Company's Code of Ethics, and the Company's corporate policies, as applicable, will be a pre-condition to earning, or vesting in, any Award under the Eleventh Amended 2011 Plan and (ii) any Awards under the Eleventh Amended 2011 Plan that are subject to the Company's Compensation Recovery Policy may be reduced, cancelled, forfeited, rescinded, or recouped even if already granted, paid, or settled.

The following summary is intended only as a general guide as to federal income tax consequences under current U.S. tax law of participation in the Eleventh Amended 2011 Plan and does not attempt to describe all potential tax consequences. This discussion is intended for the information of our stockholders considering how to vote at the Annual Meeting and not as tax guidance to individuals who participate in the Eleventh Amended 2011 Plan. The following is not intended or written to be used, and cannot be used, for the purposes of avoiding taxpayer penalties. Tax consequences are subject to change and a taxpayer's particular situation may be such that some variation in application of the described rules is applicable. Accordingly, participants have been advised to consult their own tax advisors with respect to the tax consequences of participating in the Eleventh Amended 2011 Plan.

A recipient of an incentive stock option, nonstatutory stock option, or stock appreciation right will not have taxable income upon the grant of the stock option or stock appreciation right. For nonstatutory stock options and stock appreciation rights, the participant will recognize ordinary income upon exercise in an amount equal to the difference between the fair market value of the shares on the date of exercise and the exercise price. Any gain or loss recognized upon any later disposition of the shares generally will be a capital gain or loss.

The acquisition of shares upon exercise of an incentive stock option will not result in any taxable income to the participant, except, possibly, for purposes of the alternative minimum tax. The gain or loss recognized by the participant on a later sale or other disposition of such shares will either be capital gain or loss or ordinary income, depending upon whether the participant holds the shares for the legally required period (two-years from the date of grant and one-year from the date of exercise). If the shares are not held for the legally-required period, the participant will generally recognize ordinary income equal to the lesser of (i) the difference between the fair market value of the shares on the date of exercise and the exercise price, or (ii) the difference between the sales price and the exercise price.

For stock Awards subject to vesting (restricted stock), unless the participant elects to be taxed at the time of receipt of the restricted stock, the participant will not have taxable income upon the receipt of the Award, but upon vesting will recognize ordinary income equal to the fair market value of the shares at the time of vesting less the amount paid for such shares (if any).

For Awards of stock units, a participant does not receive any taxable income at the time the Award of stock units is granted. Instead, when the stock units vest and the shares of stock are transferred, the participant will recognize ordinary income equal to the amount of cash and/or the fair market value of shares received.

At the discretion of the Eleventh Amended 2011 Plan administrator, the Eleventh Amended 2011 Plan allows a participant to satisfy his or her tax withholding requirements under federal and state tax laws in connection with the exercise or receipt of an Award by electing to have shares withheld, and/or by delivering to the Company already-owned shares.

If the participant is an employee or former employee, the amount a participant recognizes as ordinary income in connection with any Award is subject to withholding taxes (generally not applicable to incentive stock options) and the Company is allowed an income tax deduction equal to the amount of ordinary income recognized by the participant. However, Code Section 162(m) contains special rules regarding the federal income tax deductibility of compensation paid to certain executive officers. Under Section 162(m), annual compensation paid to any of these specified executives will be deductible only to the extent that it does not exceed $1,000,000.

The Eleventh Amended 2011 Plan does not provide for set benefits or amounts of Awards, and we have not approved any Awards that are conditioned on stockholder approval of the Eleventh Amended 2011 Plan. However, we plan to grant Awards to certain named executive officers, employees that are not executive officers, and current non-employee directors that remain directors following the Annual Meeting in connection with our annual award cycle following our Annual Meeting, which Awards will be made under the Eleventh Amended 2011 Plan if it is approved by stockholders or under the Tenth Amended 2011 Plan if the Eleventh Amended 2011 Plan is not approved by stockholders. The planned Awards to non-employee directors are discussed in further detail in the section entitled "Director Compensation" below.

John K. Kibarian, Ph.D.

Chief Executive Officer, President and Director

The following table summarizes the RSU grants that each of these individuals or groups will receive following the Annual Meeting. All other future Awards to directors, executive officers, employees, and consultants of the Company under the Eleventh Amended 2011 Plan are discretionary and cannot be determined at this time.

Name of Individual or Group

Dollar

Value

Number

of Units

Adnan Raza

Chief Financial Officer, Executive Vice President, Finance

Kimon W. Michaels, Ph.D.

Executive Vice President, Products and Solutions and Director

Andrzej Strojwas - -

Chief Technology Officer

All current executive officers, as a group

All current directors who are not executive officers, as a group (1)

$ 1,050,000

All employees who are not executive officers, as a group

(1) Represents the dollar value of RSUs that we expect to grant to our non-employee directors pursuant to our non-employee director compensation program. The number of shares subject to these RSUs is not determinable because it will be only known at the time of grant. These Awards will be made under the Eleventh 2011 Amended Plan if it is approved by stockholders or under the Tenth Amended 2011 Plan if the Eleventh 2011 Amended Plan is not approved by stockholders.

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