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                                                                   EXHIBIT 10.26

                                                                 [SYMANTEC LOGO]

                      FY05 EXECUTIVE ANNUAL INCENTIVE PLAN

                           CHAIRMAN AND CHIEF SALESMAN

This Annual Incentive Plan ("The Plan") issued by Symantec Corporation
("Symantec") is effective April 1, 2004, until otherwise stated. The Board of
Directors reserves the right to alter or cancel any or all such Plans for any
reason at any time.

Symantec Corporation         Proprietary and Confidential                   1

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                FY05 EXECUTIVE ANNUAL INCENTIVE COMPENSATION PLAN

JOB CATEGORY:              CHAIRMAN AND CHIEF SALESMAN

Purpose:                   Provide critical focus on specific, measurable goals
                           and to provide incentive compensation upon their
                           attainment.

Bonus Target:              The target incentive for this executive position is
                           100% of the annual base salary. Annual base salary
                           will be reviewed and established at the beginning of
                           each fiscal year. Bonuses will be paid based on
                           actual annual base salary earnings from time of
                           eligibility in the Executive Incentive Plan through
                           March 31, 2005.

Bonus Payments:            The incentive will be paid once annually. Payment
                           will be made within six weeks of the financial close
                           of the fiscal year. Any payments made under this plan
                           are at the sole discretion of the Board of Directors.

Components:                Two metrics will be used to determine the annual
                           bonus payment:

<TABLE>
<CAPTION>
METRIC                               WEIGHTING
------                               ---------
<S>                                  <C>
Corporate Revenue                       50%
Corporate Earnings per Share            50%
</TABLE>

Achievement Schedule:      Each metric has a minimum performance threshold that
                           must be exceeded before that portion of the metric
                           will be paid. Payment for corporate results is
                           uncapped.

Pro-ration:                The Annual Incentive Plan calculation will be based
                           on all eligible base salary earnings for the year,
                           and will be pro-rated based on the number of weeks of
                           participation.

Eligibility:               The Plan participant must be a regular, full-time
                           employee at the end of the fiscal year in order to
                           participate. If the company grants an interim payment
                           for any reason, the participant must be a regular,
                           full-time employee at the end of that performance
                           period in order to receive such payment. A plan
                           participant who leaves before the end of the fiscal
                           year will not receive the end of the fiscal year
                           payment under the Plan or any pro-ration thereof.

Exchange Rates:            The Corporate Performance metrics will not be
                           adjusted for any fluctuating currency exchange rates.
                           Actual growth numbers will be used.

Acquisition:               In the event of an acquisition or purchase of
                           products or technology, the Revenue Growth and
                           Earnings per Share numbers will be adjusted to
                           reflect the change and are to be approved by the
                           Compensation Committee of the Board of Directors.

Plan Provisions:           This plan supersedes any previous incentive or bonus
                           plan that may have been in existence. Those plans are
                           null and void with the issuance of this plan for
                           FY05.

                           Participating in the plan for FY05 does not guarantee
                           participation in future incentive plans. Plan
                           structures and participation will be determined on a
                           year to year basis and are guidelines only.

                           The Board of Directors reserves the right to alter or
                           cancel any or all such Plans for any reason at any
                           time.

                           The Board of Directors, acting on behalf of the
                           shareholders in their best interests, reserves the
                           right to exercise their own judgment with regard to
                           company performance in light of uncontrollable events
                           including, but not limited to, currency fluctuations,
                           business goal modification, and management changes.

Symantec Corporation         Proprietary and Confidential                     2<PAGE>

                                                                    EXHIBIT 10.9

                               AMENDMENT NO. 2 TO
                              EMPLOYMENT AGREEMENT

      THIS AMENDMENT NO. 2 TO EMPLOYMENT AGREEMENT (this "Amendment") is made
and entered into as of March 25, 2004, between Therma-Wave, Inc., a Delaware
corporation (the "Company"), and Boris Lipkin ("Executive") and amends that
Employment Agreement, entered into as of February 5, 2003, between the Company
and Executive (the "Original Agreement") and Amendment No. 1 to the Original
Agreement, entered into as of August 21, 2003 between the Company and Executive
(together with the Original Agreement, the "Amended Agreement"). All terms used
herein but not defined herein shall have the meanings given them in the Amended
Agreement.

      WHEREAS, the Company's Board of Directors wishes to amend the Amended
Agreement to reward Executive for work well done as the Company's President and
Chief Executive Officer.

      THEREFORE, in consideration of the mutual covenants contained herein and
other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the parties hereto agree as follows:

1.    Amendment. Clause (iv) of Section 5(h) of the Amended Agreement shall be
      amended and restated as follows:

      "(iv) after a Change of Control Executive (A) is not subsequently offered
      a comparable position to that of President and Chief Executive Officer
      with comparable Base Salary, Bonus and Benefits (a 'Comparable Position')
      or (B) is offered and accepts a Comparable Position but, within 24 months
      of the Change of Control, terminates his employment in such Comparable
      Position for any of the reasons listed in clauses (i)-(iii) or (v) of this
      Section 5(h)."

2.    Effect of Amendment. Except as herein expressly amended, all terms,
      covenants and provisions of the Amended Agreement are and shall remain in
      full force and effect, and all references therein to the "Agreement" shall
      henceforth refer to the Amended Agreement as amended by this Amendment.
      This Amendment shall be deemed incorporated into, and a part of, the
      Amended Agreement.

3.    Complete Agreement. This Amendment, the Amended Agreement and those
      documents expressly referred to herein and therein embody the complete
      agreement and understanding between the parties and supersede and preempt
      any prior understandings, agreements or representations by or among the
      parties, written or oral, which may have related to the subject matter
      hereof in any way.

4.    Successors and Assigns. This Amendment is intended to bind and inure to
      the benefit of and be enforceable by Executive and the Company and their
      respective heirs, successors and assigns, except that Executive may not
      assign his rights or delegate his obligations hereunder without the prior
      written consent of the Company.
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5.    Choice of Law. All issues and questions concerning the construction,
      validity, enforcement and interpretation of this Amendment and the
      exhibits and schedules hereto shall be governed by, and construed in
      accordance with, the laws of the State of California, without giving
      effect to any choice of law or conflict of law rules or provisions
      (whether of the State of California or any other jurisdiction) that would
      cause the application of the laws of any jurisdiction other than the State
      of California.

6.    Amendment and Waiver. The provisions of this Amendment or the Amended
      Agreement may be amended or waived only with the prior written consent of
      the Company and Executive, and no course of conduct or failure or delay in
      enforcing the provisions of this Amendment shall affect the validity,
      binding effect or enforceability of this Amendment or the Amended
      Agreement.

                                       2
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      The undersigned have executed this Amendment No. 2 to Employment Agreement
as of March 25, 2004.

                                          THERMA-WAVE, INC.

                                          By: /s/ L. Ray Christie
                                              ---------------------------------
                                          Name:  L. Ray Christie
                                          Title: Senior VP and CFO

                                          /s/ Boris Lipkin
                                          -------------------------------------
                                          Boris Lipkin

                                      S-1

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