Nanometrics (NANO)

Item 5.02 – Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.

On August 25, 2009, Vincent J. Coates resigned as a director of Nanometrics Incorporated, effective immediately. Mr. Coates’ resignation was for personal reasons and not as a result of any disagreements relating to the Company’s operations, policies or practices.

On August 25, 2009, the Company’s Board of Directors (the “Board”) appointed Norman Coates, the son of Vincent J. Coates, as a director of the Company to fill the vacancy created by the resignation of Vincent J. Coates. A copy of the press release announcing Norman Coates’ appointment to the Board is attached as Exhibit 99.1 to this Current Report on Form 8-K and is incorporated herein by reference.

As a non-employee director, Norman Coates’ compensation for his services as director will be consistent with that of the Company’s other non-employee directors. Norman Coates will receive an annual retainer fee of $20,000 plus $1,500 for each on site board meeting and $500 for each telephonic board meeting lasting more than 30 minutes. Norman Coates also will receive 20,000 options in connection with his appointment to the Board, and 2,500 stock options on the second business day of each quarter thereafter, which options are subject to certain service and vesting requirements. He also will receive an award of 2,000 restricted stock units on the first business day of each year, which units are subject to certain service and vesting requirements. There are no other arrangements or understandings between Norman Coates and any other person pursuant to which Norman Coates was appointed as a director of the Company.

Since the beginning of the Company’s last fiscal year, the Company and its subsidiaries have not engaged in any transactions, and there are no proposed transactions, or series of similar transactions, in which Norman Coates had a direct or indirect material interest in which the amount involved exceeds $120,000.

Item 5.02 – Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.

On May 27, 2009, Nanometrics Incorporated (“Nanometrics”) held its 2009 Annual Meeting of Stockholders (the “Annual Meeting”) at which the stockholders of Nanometrics approved, among other items, (a) the amendment and restatement of the Nanometrics Incorporated 2005 Equity Incentive Plan (the “2005 Incentive Plan”), which amendments allow in 2009 for a one-time stock option exchange program for eligible employees and executive officers (the “Option Exchange Program”) and clarify the 2005 Incentive Plan term and (b) the amendment and restatement of the Nanometrics Incorporated 2003 Employee Stock Purchase Plan (the “2003 Stock Plan” and together with the 2005 Incentive Plan, the “Plans”), which amendment to the 2003 Stock Plan increased the number of shares reserved for issuance under the 2003 Stock Plan by 1,200,000 shares (the “Plan Increase”). In addition to the Plan Increase, the Board of Directors of Nanometrics amended the 2003 Stock Plan to (i) reduce the number of shares of common stock that may be purchased by any one employee during each offering period from 5,000 shares to 4,000 shares and (ii) limit the aggregate number of shares of common stock that may be purchased under the 2003 Stock Plan in a single offering period to 200,000 shares.

The text of the amendments to the Plans and the material terms of the proposed Option Exchange Program are summarized in the Company’s definitive proxy statement filed with the Securities and Exchange Commission on April 21, 2009 in connection with the Annual Meeting (the “Proxy Statement”). The foregoing description of the amendments to the Plans contained in this Current Report on Form 8-K does not purport to be complete and is qualified in its entirety by reference to the full text of the Plans filed with the Proxy Statement.

Item 5.02 – Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.

On February 18, 2009, Nanometrics Incorporated announced the appointment of James P. Moniz as Chief Financial Officer (and principal accounting officer). Also on February 18, 2009, Bruce A. Crawford resigned his position as interim Chief Financial Officer. Mr. Crawford will continue in his position as Chief Operating Officer.

Pursuant to an Employment Agreement between us and Mr. Moniz, Mr. Moniz will be paid an annual base salary of $300,000 and will be eligible to participate in all Company employee benefit plans, policies and arrangements that are provided to the other executive officers and employees of the Company. Additionally, Mr. Moniz will be granted a non-qualified option for 100,000 shares of common stock. The shares subject to the option will vest over a three-year period from the date of grant, with one-third of the total number vesting on the first anniversary of the date of grant, and 1/36^th of the total number vesting ratably on a monthly basis thereafter.

Mr. Moniz will also be eligible for an annual bonus payment of $150,000 if the Company meets certain milestones included in an operating plan to be approved by the Board of Directors, certain benefits including, health benefits and executive reimbursement plan for eligible expenses, and severance benefits if Mr. Moniz is terminated without cause or he resigns for good reason within twelve months of a change of control, including six months continuing salary, full acceleration of all outstanding equity awards and up to twelve months of continued health benefits (including dependents). Also, the Company intends to enter into its standard form of indemnification agreement with Mr. Moniz on substantially the same terms as those entered into with the Company’s other executive officers.

Prior to joining the Company, Mr. Moniz, age 51, served as Chief Financial Officer of Photon Dynamics, Inc., a global supplier of flat panel display test equipment, from April 2008 until October 2008. From October 2000 until February 2008, Mr. Moniz was Chief Financial Officer, Treasurer and Assistant Secretary of Nextest Systems Corporation. Mr. Moniz holds a B.S. in Accounting from San Jose State University.

Item 5.02 – Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.

(b) On December 4, 2008, Quentin B. Wright, gave Nanometrics Incorporated notice that he intends to resign as the Chief Accounting Officer of Nanometrics Incorporated effective on January 9, 2008. Mr. Wright will continue to act as the company’s Chief Accounting Officer until such time.

Signature

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

Item 5.02 – Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.

On September 5, 2008, Nanometrics Incorporated announced that it has appointed Bruce A. Crawford, an officer of the company, to replace Gary C. Schaefer as the company’s Chief Financial Officer on an interim basis, effective as of September 5, 2008. The Company has launched a nationwide search for a permanent replacement for Mr. Schaefer.

Bruce A. Crawford, 56, has served as our Chief Operating Officer since July 2006. From July 2005 to July 2006, Mr. Crawford served as President and Chief Operating Officer of Accent Optical Technologies, Inc., a supplier of process control and metrology systems to the global semiconductor manufacturing industry, which was acquired by Nanometrics in July 2006. From February 2003 to July 2005, Mr. Crawford served as Accent Optical’s Chief Operating Officer and Executive Vice President and from October 2000 to February 2003, he served as Vice President of Worldwide Operations. Mr. Crawford holds an A.S. degree from De Anza College.

In connection with Mr. Schaefer's resignation and the appointment of Mr. Crawford as Nanometrics’ interim Chief Financial Officer, on September 5, 2008, Nanometrics announced that it has appointed Quentin B. Wright, an officer of the company, as the company’s Chief Accounting Officer, effective September 5, 2008.

Mr. Wright, 52, previously served as the company’s Chief Accounting Officer from April 2005 to November 2007 and as Nanometrics’ interim Chief Financial Officer from April 2007 to November 2007 and has since served as Vice-President of Finance. From November 2003 until April 2005, Mr. Wright provided financial consulting services for various technology clients in Silicon Valley. From May 1999 until November 2003, Mr. Wright served as Director of Accounting of Adaptec, Inc., a manufacturer of storage access solutions. Mr. Wright holds a B.S. degree in Business Administration from Oregon State University.

On September 5, 2008, the Company issued a press release announcing Mr. Crawford’s appointment. A copy is filed herewith as Exhibit 99.1 and is incorporated herein by reference.

Item 5.02 – Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.

(b) Effective as of September 5, 2008 Gary C. Schaefer, has resigned as the Chief Financial Officer and Vice President, Administration of Nanometrics Incorporated.

Signature

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

Item 5.02 – Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.

(d)   On April 3, 2008, Nanometrics Incorporated, a Delaware corporation (the “Company”), announced that its Board of Directors (the “Board”) had appointed Howard A. Bain III as a director of the Company, effective as of April 1, 2008. Mr. Bain qualifies as an “audit committee financial expert” as defined in the rules and regulations of the Securities and Exchange Commission and has been appointed to serve as a member and the Chairman of the Audit Committee of the Board. Mr. Dox will stay on the Audit Committee, but is relinquishing the position of Audit Committee Chairman to Mr. Bain.

Mr. Bain will participate in the Company’s standard non-employee director compensation program. As such, Mr. Bain will receive an annual cash retainer of $20,000, $1,500 for each in-person Board and committee meeting attended, $500 for each telephonic Board and committee meeting attended, an initial option grant to purchase 20,000 shares of common stock, quarterly option grants to purchase 2,500 shares of common stock and an annual award of 2,000 restricted stock units. Additionally, in his capacity as a member and Chairman of the Audit Committee, Mr. Bain will receive an annual cash retainer of $12,000.

On April 3, 2008, the Company issued a press release announcing Mr. Bain’s appointment. A copy is filed herewith as Exhibit 99.1 and is incorporated herein by reference.

Item 5.02 – Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.

(e) On March 24, 2008, the Compensation Committee of the Board of Directors of Nanometrics Incorporated, a Delaware corporation (the “Company”), approved a 2008 Executive Bonus Plan (the “Plan”). Under the terms of the Plan, quarterly bonus payments are based on the quarterly achievement by the Company of certain financial goals based on the Company’s annual operating plan and individualized programmatic objectives for certain named executive officers. Subject to the minimum amounts referenced below, no bonus will be paid in a particular quarter under the Plan if the Company is not profitable in such quarter, as determined in accordance with generally accepted accounting principals, or GAAP.

The maximum available annual payout under the Plan to Timothy J. Stultz, Ph.D., our President, Chief Executive Officer and a director, is $420,000, which is based on 150% achievement of target goals in each quarter. At 100% achievement of target goals in each quarter, Dr. Stultz’s annualized aggregate bonus payout will be $200,000. For each of the first and second quarters of 2008, Dr. Stultz’s minimum bonus payout will be $50,000 and for each of the third and fourth quarters of 2008, his minimum bonus payout will be $25,000. The maximum available annual payout under the Plan to Gary C. Schaefer, our Chief Financial Officer and Vice President of Finance and Administration, is $252,000, which is based on 150% achievement of target goals in each quarter. At 100% achievement of target goals in each quarter, Mr. Schaefer’s annualized aggregate bonus payout will be $120,000. For each of the first and second quarters of 2008, Mr. Schaefer’s minimum bonus payout will be $30,000. The maximum available annualized aggregate payout under the Plan to Bruce A. Crawford, our Chief Operating Officer, is $329,000, which is based on 150% achievement of target goals in each quarter. At 100% achievement of target goals in each quarter, Mr. Crawford’s annual payout will be $156,500.

Because the actual bonuses payable under the Plan will vary depending on the extent to which actual performance meets, exceeds, or falls short of the goals approved by the Compensation Committee, the exact amount of the payout (if any) to a named executive officer under the Plan cannot be determined at this time.

Signature

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

Item 5.02 – Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.

(b) On February 26, 2008, Joseph F. Dox notified the Board of Directors (the “Board”) of Nanometrics Incorporated (the “Company”) that he has decided not to stand for re-election at the Company’s 2008 Annual Meeting of Stockholders. Mr. Dox informed the Board he has made this decision due to the Company’s completion of several directives, including the recruitment of senior executives and the integration of the Nanometrics-Accent merger, and looks forward to continuing his retirement.

Mr. Dox, 65, has served as a director of the Company since May 2007. Mr. Dox is a member of the class of directors whose term expires at the Company’s 2008 Annual Meeting of Stockholders and will continue to serve as a member of the Board until such meeting. Mr. Dox has informed the Board that his decision was not the result of any disagreement with the Company on any matter relating to its operations, policies or practices.

Signature

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

Item 5.02 – Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.

On January 16, 2008, the Compensation Committee of the Board of Directors of Nanometrics Incorporated (the “Company”) approved the terms of an employment agreement (the “Employment Agreement”) between the Company and its Chief Financial Officer and Vice President of Finance and Administration, Gary C. Schaefer.

Pursuant to the Employment Agreement, Mr. Schaefer will be paid an annual base salary of $300,000 and will be eligible to participate in all Company employee benefit plans, policies and arrangements that are provided to the other executive officers and employees of the Company. Additionally, as previously disclosed on a Current Report on Form 8-K filed with the Securities and Exchange Commission on November 9, 2007, Mr. Schaefer was granted a non-qualified option for 50,000 shares of common stock and an award of 20,000 restricted stock units. The shares subject to the option will vest over a three-year period from the date of grant, with one-third of the total number vesting on the first anniversary of the date of grant, and 1/36^th of the total number vesting ratably on a monthly basis thereafter. The restricted stock units will vest over a three-year period from the date of grant, with one-third of the total number vesting on each annual anniversary of the date of grant.

Mr. Schaefer will also be eligible for an annual bonus payment of up to $120,000 if the Company meets certain milestones included in an operating plan to be approved by the Board of Directors, a guaranteed quarterly bonus of $20,000 for the fourth fiscal quarter of 2007, guaranteed quarterly bonuses of $30,000 for the first and second fiscal quarters of 2008 and certain severance benefits, including twelve months continuing salary, performance bonus plan participation, health benefits and Exec-U-Care reimbursements for eligible expenses, and acceleration of all equity awards upon a termination without cause. Also, the Company intends to enter into its standard form of indemnification agreement with Mr. Schaefer on substantially the same terms as those entered into with the Company’s other executive officers.

Since November 2007, Mr. Schaefer, 53, has served as the Company’s Chief Financial Officer and Vice President of Finance and Administration. Mr. Schaefer has also served as the Company’s Director of Internal Audit during 2007 and as an internal audit consultant to the Company during 2005 and 2006. Prior to joining the Company, Mr. Schaefer served as a Sarbanes-Oxley consultant with Resources Global Inc., the operating subsidiary of Resources Connection, Inc., a multinational professional services firm, from March 2004 to March 2005. From August 2003 to January 2004, Mr. Schaefer served as Chief Financial Officer for Logic Devices Incorporated, a digital integrated circuits development company. Mr. Schaefer holds a B.S. in Biology/Accounting and an M.B.A. from Santa Clara University.

Signature

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

Item 5.02 – Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.

On November 5, 2007, Nanometrics Incorporated announced the appointment of Gary C. Schaefer as its Chief Financial Officer and Vice President, Administration, effective immediately. Also on November 5, 2007, Quentin B. Wright stepped down as our interim Chief Financial Officer and Chief Accounting Officer. The terms of Mr. Schaefer’s employment have not yet been fully determined, although we have granted Mr. Schaefer a non-qualified option for 50,000 shares of common stock and an award of 20,000 restricted stock units. The shares subject to the option will vest over a three-year period from the date of grant, with one-third of the total number vesting on the first anniversary of the date of grant, and 1/36th of the total number vesting ratably on a monthly basis thereafter. The restricted stock units will vest over a three-year period from the date of grant, with one-third of the total number vesting on each annual anniversary of the date of grant.

Since April 2007, Mr. Schaefer, 53, has served as our Director of Internal Audit, and as an internal audit consultant to us during 2005 and 2006. Prior to joining us, Mr. Schaefer served as a Sarbanes-Oxley consultant with Resources Global Inc., the operating subsidiary of Resources Connection, Inc., a multinational professional services firm, from March 2004 to March 2005. From August 2003 to January 2004, Mr. Schaefer served as Chief Financial Officer for Logic Devices Incorporated, a digital integrated circuits development company. Mr. Schaefer holds a B.S. in Biology/Accounting and an M.B.A. from Santa Clara University.

Item 5.02 – Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.

Appointment of Dr. Stultz

On August 6, 2007, Nanometrics Incorporated announced that Timothy J. Stultz, Ph.D. will join the company as its President and Chief Executive Officer. Dr. Stultz is expected to join us in late-August, and is to succeed Bruce C. Rhine, who will become Chairman of the Board of Directors. Our founder, Vincent J. Coates, will become Vice Chairman of Board. Dr. Stultz will become a director of Nanometrics effective as of his start of employment with us. The terms of Dr. Stultz’s employment are set out in the offer letter to Dr. Stultz which is attached as Exhibit 10.1, and in the executive severance agreement and relocation agreement attached as Exhibits 10.2 and 10.3, respectively.

Dr. Stultz will be paid an annual base salary of $377,000 and will receive a signing bonus of $100,000 after completion of one month’s service to the company. Additionally, we will grant Dr. Stultz an option for 200,000 shares of common stock and an award of 50,000 restricted stock units from within our 2005 Equity Incentive Plan. The shares subject to the option will vest over a three-year period from the date of grant, with one-third of the total number vesting on the first anniversary of the date of grant, and 1/36^th of the total number vesting ratably on a monthly basis thereafter. The restricted stock units will vest over a three-year period from the date of grant, with one-third of the total number vesting on each annual anniversary of the date of grant.

We have also included in Dr. Stultz’s package payment of relocation expenses, eligibility for bonus payments, and certain severance and change of control benefits, including cash and equity award acceleration, all as set forth in more detail in the attached agreements. Also, we intend to enter into our standard form of indemnification agreement with Dr. Stultz on substantially the same terms as those entered into with our other executive officers.

Since June 2003, Dr. Stultz, 59, has served as the President and Chief Executive Officer and a member of the board of directors of Imago Scientific Instruments Corporation, a supplier of proprietary 3-D atom probe microscopes to the research materials and microelectronics industries. Prior to Imago, Dr. Stultz served as President and Chief Executive Officer for ThauMDx, a developer of diagnostic systems and technologies for the analysis of biomolecules, drugs and chemicals. Dr. Stultz received his B.S., M.S. and Ph.D. in Materials Science and Engineering from Stanford University.

Incentive Cash Award Program

Our Board of Directors has indicated that the operative performance metric for the incentive cash award program previously disclosed in a Current Report on Form 8-K filed with the Securities and Exchange Commission on May 31, 2007 is quarterly operating profitability, not quarterly earnings before income taxes, as previously disclosed.

Item 5.02 – Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.

(e) On July 10, 2007, the Compensation/Stock Option Committee (the “Committee”) of the Board of Directors of Nanometrics Incorporated (the “Company”) approved an increase to the annual base salary of the Company’s Chief Operating Officer, Bruce A. Crawford, bringing Mr. Crawford’s annual base salary to $313,500, effective immediately. The Committee also approved a grant of 20,000 Restricted Stock Units to Mr. Crawford under the Company’s 2005 Equity Incentive Plan, a copy of which has previously been filed with the Commission. The RSUs will vest in full on July 10, 2008. In addition, the Committee approved an employment agreement with Mr. Crawford which provides for certain severance benefits following a termination without cause, including continued salary payments for six months and twelve months equity award acceleration. The form of employment agreement will be filed with the Commission in an upcoming filing.

Signature

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

Item 5.02 – Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.

(e) In connection with the termination of John D. Heaton, former President and Chief Executive Officer of Nanometrics Incorporated (the “Company”), the Company entered into a Separation and Release Agreement with Mr. Heaton (the “Agreement”) effective as of July 3, 2007 (the “Effective Date”). Under the terms of the Agreement, the Company confirmed that it would honor its obligations to Mr. Heaton as described in that certain Employment Agreement dated as October 4, 2006 by and between the Company and Mr. Heaton including continued salary payments to Mr. Heaton for twelve months following termination and the accelerated vesting of equity awards exercisable as to 66,667 shares of the Company’s common stock, which represents that number of shares that would have vested had Mr. Heaton remained an employee of the Company through the twelve-month anniversary of his termination. Furthermore, the Company agreed to extend the deadline for Mr. Heaton to exercise his vested stock options to the date that is immediately prior to the Company’s public announcement of its second quarter 2007 earnings.

Signature

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

Item 5.02 – Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.

(e) On June 8, 2007, the Compensation Committee of the Board of Directors of Nanometrics Incorporated, a Delaware corporation (the “Company”), approved the issuance of nonqualified options to purchase up to an aggregate of 160,000 shares of the Company’s common stock under the 2005 Equity Incentive Plan. Under the program, option awards were made to Quentin B. Wright, the Company’s Interim Chief Financial Officer, Bruce A. Crawford, the Company’s Chief Operating Officer, and other senior-level employees. Messrs. Wright and Crawford were each granted options to purchase up to 25,000 shares. The awards have an exercise price of $6.25, which represents the closing price of the Company’s common stock on the date of grant, June 8, 2007.

The options vest in accordance with the following schedule: 25% of the shares subject to the option shall begin vesting in accordance with the two-year time-based vesting described below upon the attainment of one of the four performance milestones. For each performance milestone that is not attained, 25% of the shares subject to the option shall not vest and shall be forfeited immediately upon the determination that the performance milestone has not been attained. For example, if the first and third performance milestones are attained but the second and fourth are not, then a maximum of 50% of the shares subject to the option will be eligible to vest in accordance with the two-year time-based vesting schedule described below and the remainder shall not vest and shall be forfeited.

The first performance milestone shall mean the determination by the Company’s Chief Financial Officer that the Company has attained quarterly operating profitability during the second fiscal quarter of 2007.

The second performance milestone shall mean the determination by the Company’s Chief Financial Officer that the Company has attained quarterly operating profitability during the third fiscal quarter of 2007.

The third performance milestone shall mean the determination by the Company’s Chief Financial Officer that the Company has attained quarterly operating profitability during the fourth fiscal quarter of 2007.

The fourth performance milestone shall mean the determination by the Company’s Chief Financial Officer that the Company has attained quarterly operating profitability in each of the second, third and fourth fiscal quarters of 2007.

Upon attainment of a performance milestone, 25% of the shares subject to the option shall begin to vest ratably monthly over a two-year period beginning on the date of the determination by the Company’s Chief Financial Officer that the performance milestone was attained and subject, in each case, to the optionee’s continued employment with the Company on the relevant vesting date.

For the avoidance of doubt, all shares subject to the option shall be fully vested on the second anniversary of the attainment of the last performance milestones (assuming that all performance milestones have been attained); provided, however, that for each performance milestone that is not attained, 25% of shares subject to the option will not vest and shall be forfeited immediately upon the determination that the performance milestone has not been attained.

The options terminate on June 8, 2014.

Signature

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

Item 5.02 – Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.

(e) On May 24, 2007, the Compensation Committee of the Board of Directors of Nanometrics Incorporated, a Delaware corporation (the “Company”), approved certain compensation arrangements described below for the Company’s executive officers and other senior-level employees.

Salary Increase

The Compensation Committee approved an increase to the base salary of the Company’s acting Chief Financial Officer, Quentin B. Wright, in the amount of $5,000 per month, retroactive as to the date he first took on his role as acting Chief Financial Officer in April 2007. This salary adjustment, granted in recognition of Mr. Wright’s enhanced responsibilities as acting Chief Financial Officer, raises his annual base salary to $275,550.

Incentive Cash Award Program

The Compensation Committee approved an incentive cash award program for the remainder of 2007. Under the terms of the program, a pool of 5% of the Company’s earnings before income taxes as measured on a quarterly basis for the remaining three quarters of 2007 will be available to pay cash bonuses to participating individuals. The Compensation Committee also determined the applicable percentage of the bonus pool available for payment of these quarterly bonuses to participating individuals: Mr. Bruce Rhine, acting Chief Executive Officer – 20%; Mr. Quentin Wright, acting Chief Financial Officer – 20%; Mr. Bruce Crawford, Chief Operating Officer – 20%; and the remaining 40% to be distributed at the discretion of the Chief Executive Officer among certain other senior-level employees of the Company other than the aforementioned executive officers. No bonus will be paid under this program in a quarter in which the Company incurs a loss. Because the amount of a participant’s cash bonus under the program is dependent on the Company’s future earnings before taxes, the exact amount of the payout (if any) to an executive under the program cannot be determined at this time.

Item 5.02 – Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.

(d) On May 21, 2007, Nanometrics Incorporated announced that its Board of Directors had appointed Joseph F. Dox as a director of the company, effective as of May 17, 2007. Mr. Dox is expected to join the Audit Committee pending nomination by the company’s nominating and governance committee and confirmation by the Board of Directors.

Mr. Dox will participate in the company’s standard non-employee director compensation program. As such, Mr. Dox will receive an annual cash retainer of $15,000 plus $1,500 for each board and special committee meeting attended and an initial option grant to purchase 20,000 shares of common stock as well as automatic quarterly option grants to purchase 2,500 shares of common stock.

On May 21, 2007, the company issued a press release announcing Mr. Dox’s election. A copy is filed herewith as Exhibit 99.1 and is incorporated herein by reference.

Item 5.02 – Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.

On April 23, 2007, Nanometrics announced that it has appointed Quentin B. Wright, an officer of the company, to replace Douglas J McCutcheon as the company’s Chief Financial Officer on an interim basis, effective immediately. The Company will conduct a nationwide search for a permanent replacement for Mr. McCutcheon.

Mr. Wright, 50, has served as the company’s Chief Accounting Officer since April 2005. Prior to joining Nanometrics, Mr. Wright provided financial consulting services for various technology clients in Silicon Valley. From May 1999 until November 2003, Mr. Wright served as Director of Accounting of Adaptec, Inc., a manufacturer of storage access solutions. Mr. Wright holds a B.S. degree in Business Administration from Oregon State University.

On April 25, 2007, the company issued a press release relating to these matters. A copy is filed herewith as Exhibit 99.2 and is incorporated herein by reference.

Item 5.02 – Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.

On March 26, 2007, Nanometrics announced that it has appointed Bruce C. Rhine, an officer of the company and a member of the Board of Directors, to replace John D. Heaton as the company’s President and Chief Executive Officer on an interim basis, effective immediately. The Nominating and Governance Committee of the Board of Directors, together with the Chairman of the Board and the interim CEO, will conduct a nationwide search for a permanent Chief Executive Officer.

Mr. Rhine, 49, has served as the company’s Chief Strategy Officer and a director since July 2006. Prior to joining Nanometrics, Mr. Rhine served as Chairman and Chief Executive Office of Accent Optical Technologies, Inc., a supplier of process control and metrology systems to the global semiconductor manufacturing industry, which was acquired by Nanometrics in July 2006. Mr. Rhine holds a B.S. degree in Chemical Engineering and an M.B.A. in Finance from Pennsylvania State University.

On March 26, 2007, the company issued a press release relating to these matters. A copy is filed herewith as Exhibit 99.1 and is incorporated herein by reference.