UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 14A
Proxy Statement Pursuant to Section 14(a) of the
Securities Exchange Act of 1934 (Amendment No. )
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement
[ ] Confidential, for Use of the
Commission Only (as permitted
by Rule 14a-6(e)(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to
SS.240.14a-12
Berkeley Technology Limited
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(Name of Registrant as Specified In Its Charter)
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(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
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1) Title of each class of securities to which transaction applies:
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2) Aggregate number of securities to which transaction applies:
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3) Per unit price or other underlying value of transaction computed pursuant
to Exchange Act Rule 0-11 (set forth the amount on which the filing fee is
calculated and state how it was determined):
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[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee
was paid previously. Identify the previous filing by registration
statement number, or the Form or Schedule and the date of its filing.
1) Amount Previously Paid:
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2) Form, Schedule or Registration Statement No.:
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3) Filing Party:
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4) Date Filed:
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BERKELEY TECHNOLOGY LIMITED
One Castle Street
St. Helier, Jersey JE2 3RT
Channel Islands
April 29, 2009
Dear ADR holder:
You are cordially invited to attend the Annual General Meeting of
Shareholders of Berkeley Technology Limited to be held at the Jersey Museum,
Ouless Room, The Weighbridge, St. Helier, Jersey, Channel Islands on Friday,
July 31, 2009, at 9:00 a.m. local time.
Details of the business to be conducted at the meeting are given in the
attached Notice of Annual General Meeting of Shareholders and Proxy Statement.
As an ADR holder you are not entitled to vote directly at the meeting,
however, the ADR Depositary, The Bank of New York Mellon, is obligated to vote
the shares it holds on your behalf in accordance with your instructions. Whether
or not you plan to attend the meeting, it is important that your interests be
represented and voted at the meeting. Accordingly, please sign, date and return
the enclosed proxy card to The Bank of New York Mellon (in the accompanying
envelope). In order for your proxy instructions to be valid, they must be
received by The Bank of New York Mellon on or before July 23, 2009. You may
revoke or amend your proxy for any reason provided that such change is received
by The Bank of New York Mellon on or before July 23, 2009.
Thank you for your interest in Berkeley Technology Limited.
Sincerely,
/s/ Robert A. Cornman
Robert A. Cornman
Secretary
BERKELEY TECHNOLOGY LIMITED
One Castle Street
St. Helier, Jersey JE2 3RT
Channel Islands
NOTICE OF ANNUAL GENERAL MEETING OF SHAREHOLDERS
To the ADR holders of Berkeley Technology Limited:
NOTICE IS HEREBY GIVEN that the Annual General Meeting of Shareholders of
Berkeley Technology Limited (the "Company") will be held at the Jersey Museum,
Ouless Room, The Weighbridge, St. Helier, Jersey, Channel Islands on Friday,
July 31, 2009, at 9:00 a.m. local time, for the following purposes:
Ordinary Business
1. To receive the report of the directors and the financial statements
included in the Company's Annual Report to Shareholders for the year ended
December 31, 2008, together with the report of BDO Stoy Hayward LLP, the
Company's independent auditors.
2. To re-elect a director, Harold E. Hughes, Jr., who is retiring by rotation.
3. To re-appoint BDO Stoy Hayward LLP as the Company's independent auditors
for purposes of the Company's primary listing on the London Stock Exchange
and BDO Seidman, LLP as the Company's independent registered public
accounting firm for purposes of the Company's listing in the U.S., and to
authorize the directors to fix their remuneration.
Other Business
4. To act on any other matters that may properly come before the meeting.
The Board of Directors knows of no other matters which may be presented for
shareholder action at the meeting. To date, no shareholder proposals have
been received by the Company. However, if other matters do properly come
before the meeting, it is intended that the persons named in the proxies
will vote upon such matters in accordance with their best judgment.
Holders of our Ordinary Shares are entitled to twenty-one (21) clear days
notice of, and to vote at, the Annual General Meeting and any adjournment
thereof. Only ADR holders of record at the close of business on April 22, 2009
are entitled to notice of, to attend and to have their vote counted at the
Annual General Meeting and any adjournment thereof. ADR holders are not entitled
to vote directly at the meeting; however, the ADR Depositary, The Bank of New
York Mellon, is obligated to vote the shares it holds on behalf of the ADR
holders in accordance with their instructions. Accordingly, please sign, date
and return the enclosed proxy card to The Bank of New York Mellon (in the
accompanying envelope). IN ORDER FOR YOUR PROXY INSTRUCTIONS TO BE VALID, THEY
MUST BE RECEIVED BY THE BANK OF NEW YORK MELLON ON OR BEFORE JULY 23, 2009. A
copy of our Annual Report to Shareholders for the year ended December 31, 2008,
which contains audited consolidated financial statements and other information,
accompanies this Notice and the enclosed Proxy Statement. All ADR holders are
cordially invited to attend the meeting.
By Order of the Board of Directors
/s/ Robert A. Cornman
Robert A. Cornman
Secretary
April 29, 2009
BERKELEY TECHNOLOGY LIMITED
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PROXY STATEMENT
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ABOUT THE ANNUAL GENERAL MEETING
General
This Proxy Statement and the accompanying proxy card are being mailed to
ADR holders of Berkeley Technology Limited (the "Company" and, together with its
subsidiaries, the "Group") on or about April 29, 2009, in connection with the
solicitation of proxies by our Board of Directors for use at the Annual General
Meeting of Shareholders to be held on July 31, 2009 (the "Meeting"), or at any
adjournments thereof. The Meeting will be held at 9:00 a.m. local time, at the
Jersey Museum, Ouless Room, The Weighbridge, St. Helier, Jersey, Channel
Islands.
Proxies
The proxy card accompanying this Proxy Statement, which instructs The Bank
of New York Mellon as ADR Depositary (the "ADR Depositary"), is solicited by our
Board of Directors. ADRs represented by properly executed proxies received by
the ADR Depositary in time for the Meeting will be voted in accordance with the
choices specified in the proxies. Any ADR holder giving a proxy has the power to
revoke it prior to its exercise by giving notice of revocation to the ADR
Depositary in writing, or by executing and delivering to the ADR Depositary a
later dated proxy. However, such action must be taken in sufficient time to
permit the necessary examination and tabulation of the subsequent proxy or
revocation before the vote is taken. Proxy instructions, amendments or
revocations must therefore be received by the ADR Depositary on or before July
23, 2008.
Solicitation
The cost of preparing, assembling, printing and mailing this Proxy
Statement, the accompanying proxy card and any other related materials used in
the solicitation of proxies will be borne by us. In addition to soliciting by
mail, our directors, officers and employees, without receiving any additional
compensation, may solicit proxies personally, by telephone or facsimile. Except
as described above, we do not presently intend to solicit proxies other than by
mail.
Also enclosed herewith is a copy of our Annual Report to Shareholders for
the year ended December 31, 2008.
Voting and Quorum at the Annual General Meeting
Holders of ADRs should complete and return the enclosed proxy card in
accordance with the terms provided thereon not later than the close of business
on July 23, 2009. The close of business on April 22, 2009 has been fixed as the
record date for the determination of the holders entitled to give instructions
of voting rights at the Meeting and any adjournment thereof. Under the
depositary agreement between us and the ADR Depositary, the ADR Depositary shall
not vote or attempt to exercise the right to vote that attaches to the Ordinary
Shares other than in accordance with such instructions.
Two shareholders present in person or by proxy and entitled to vote,
holding in aggregate, or represented by proxy, not less than one-third of the
total Ordinary Shares outstanding, shall be a quorum for all purposes. If a
quorum is present, directors are elected and all other matters are decided upon
by a show of hands, unless before or upon the declaration of the results, a poll
is demanded by the Chairman of the Meeting or by at least three shareholders or
by one or more shareholders representing not less than one-tenth of the total
voting rights of shareholders. If a poll is taken, every shareholder who is
present in person by representative or proxy shall have one vote for every share
of which he or she is the holder. Cumulative voting in the election of directors
is not permitted.
1
The Company does not have a policy with regard to members of the Board of
Directors attending Annual General Meetings. One Board member attended the prior
year's Annual General Meeting.
Proposals 1 to 3 which are described below are ordinary resolutions. Any
other resolutions presented at the meeting would be special resolutions. The
approval of an ordinary resolution requires the affirmative vote of a majority
of the votes cast at the Meeting. The approval of a special resolution requires
an affirmative vote of at least two-thirds of the votes cast at the Meeting.
Accordingly, abstentions and broker non-votes will have no effect on any
resolution voted on at the Meeting.
As of March 31, 2009, there were 64,439,073 Ordinary Shares outstanding and
1,187,193 ADRs outstanding, representing 11,871,930 of those Ordinary Shares or
18.4% of the Company's total outstanding shares. Each Ordinary Share carries one
vote in a poll. Each ADR carries ten votes indirectly through each Ordinary
Share held by the ADR Depositary on the ADR holder's behalf.
For the purposes of this Proxy Statement, the term "vote" shall refer to
either a vote by a holder of Ordinary Shares or instructions to the ADR
Depositary by a holder of ADRs.
PROPOSAL 1 - REPORT OF THE DIRECTORS AND FINANCIAL STATEMENTS
To receive the report of the directors and the financial statements
included in the Company's Annual Report to Shareholders for the year ended
December 31, 2008, together with the report of BDO Stoy Hayward LLP, the
Company's independent auditors.
Our Articles of Association provide that each year the above shall be
presented before a General Meeting of Shareholders. The Board of Directors
recommends a vote for the acceptance of the report of the directors and
financial statements for the year ended December 31, 2008, together with the
report of the independent auditors thereon. Shareholder approval is not
required, but is being sought as a matter of good corporate practice.
PROPOSAL 2 - ELECTION OF DIRECTOR
To re-elect a director, Harold E. Hughes, Jr., who is retiring by rotation.
Our Articles of Association provide that at each Annual General Meeting,
one-third (or the number nearest to but not exceeding one-third) of the
directors other than Arthur I. Trueger, who, as he is also our managing
director, does not retire by rotation nor is counted in calculating the number
of directors to retire by rotation, shall retire from office by rotation. Under
our Articles of Association, there shall be no less than three directors. The
directors (other than Mr. Trueger) are elected to hold office until they are
subject to retirement by rotation. Harold E. Hughes, Jr., the nominated director
for 2009, has informed us that he is willing to serve as a director. No person
other than a director retiring at the meeting shall, unless recommended by our
Board of Directors, be eligible for election to the office of director at any
Annual General Meeting unless not less than seven, nor more than twenty-eight
(28) days, before the date appointed for the meeting, a notice in writing signed
by a shareholder, and a notice in writing signed by that person of his
willingness to be elected, has been left at our registered office in Jersey.
Our Board of Directors may appoint any person to be a director, either to
fill a casual vacancy or as an additional director. Any director so appointed
shall hold office only until the next Annual General Meeting and shall then be
eligible for re-appointment, but shall not be taken into account in determining
the directors who are to retire by rotation at such meeting.
The following director, already being a member of our Board of Directors
and eligible for re-election, retires by rotation and is nominated for
re-election at this Annual General Meeting.
Harold E. Hughes, Jr. Mr. Hughes, age 63, has been a non-executive
director since January 1987. He has been Chief
Executive Officer of Rambus, Inc., a
chip-semiconductor
2
interface supplier, since January 2005, and a
director of Rambus since June 2003. Previously, he
was Chairman of Pandesic LLC, an eCommerce
software supplier owned jointly by Intel
Corporation and SAP, from 1997 to 2000. Prior to
Pandesic, Mr. Hughes was employed by Intel
Corporation for 23 years, during which time he
held a number of positions in financial and
operational management. He previously served on
the boards of Xilinx, Inc. and REMEC, Inc., having
resigned those board seats in 2006 and 2005,
respectively. Mr. Hughes is a member of the Audit,
Business Development and Compensation Committees.
Subject to re-election, Mr. Hughes will be required to retire by rotation
again at the Annual General Meeting in 2012, provided that no additional
directors are appointed, or existing directors resign, before that time.
The Board of Directors recommends a vote FOR the re-election of Harold E.
Hughes, Jr. as a director.
PROPOSAL 3 - APPOINTMENT OF INDEPENDENT AUDITORS
To re-appoint BDO Stoy Hayward LLP as the Company's independent auditors
for purposes of the Company's primary listing on the London Stock Exchange and
BDO Seidman, LLP as the Company's independent registered public accounting firm
for purposes of the Company's listing in the U.S., and to authorize the
directors to fix their remuneration.
We do not expect that representatives of BDO Stoy Hayward LLP or BDO
Seidman, LLP will be present at the Annual General Meeting. BDO Stoy Hayward LLP
and BDO Seidman, LLP have been our auditors since July 2002.
The Board of Directors recommends a vote FOR the proposal to re-appoint BDO
Stoy Hayward LLP as our independent auditors for purposes of our listing on the
London Stock Exchange and BDO Seidman, LLP as our independent registered public
accounting firm for purposes of our listing in the U.S., and to authorize the
directors to fix their remuneration. Shareholder approval of our auditors is a
legal requirement, and if shareholders were to reject this proposal, the
directors would have to appoint another independent auditor.
BOARD OF DIRECTORS AND COMMITTEES
Biographical information about each director continuing in office is
provided below:
Arthur I. Trueger Mr. Trueger, age 60, is the founder and a
Executive Chairman principal shareholder of Berkeley Technology
Limited. He has worked for us for more than 31
years and holds A.B., M.A. and J.D. degrees from
the University of California.
Director continuing in office for a term expiring in 2010:
The Viscount Trenchard Lord Trenchard, age 58, has been a non-executive
director since August 1999. He was appointed a
Managing Director of Mizuho International plc in
2007, and became a director of Bache Global Series
also in 2007. Previously, Lord Trenchard was a
Senior Adviser to Prudential Financial, Inc., a
provider of international private client wealth
management services, from 2002 to 2008. He was a
director of Robert Fleming and Co. Limited, or one
of its principal subsidiaries, from 1996 to 2000,
where he was also head of Japanese Investment
Banking. He was a director of Kleinwort
3
Benson Limited from 1986 to 1996, whose Tokyo
office he managed for many years. Lord Trenchard
is a member of the Audit and Business Development
Committees.
Director continuing in office for a term expiring in 2011:
Victor A. Hebert Mr. Hebert, age 72, has been a non-executive
Deputy Chairman director since the Company's incorporation in
January 1985 and Deputy Chairman since February
1996. In October 2008, Mr. Hebert joined Burrill &
Company as Managing Director, Chief Administrative
Officer and Chief Legal Officer. Burrill &
Company, based in San Francisco, is a global
leader in life sciences with principal activities
in venture capital, private equity, merchant
banking and media. Previously, Mr. Hebert
practiced law with Heller Ehrman LLP since 1962.
Mr. Hebert is a member of the Compensation
Committee.
The above retirement dates assume that no additional directors are
appointed, or existing directors resign, during the period. Retiring directors
are eligible for re-election.
Meetings of the Board
Our Board of Directors held four meetings during 2008. The Board has three
committees: Audit, Compensation and Business Development. The Audit Committee
held four meetings during 2008, and there were no meetings held by the
Compensation Committee and the Business Development Committee. Director
attendance at all Board and committee meetings was 96% during 2008.
Committees of the Board
Audit Committee
Members: Harold E. Hughes, Jr. (Chairman), The Viscount Trenchard
Our Board of Directors has adopted a written charter for the Audit
Committee, which is attached to this Proxy Statement as Appendix A (as amended
and restated on May 8, 2008). The primary functions of the Audit Committee are
to assist the Board of Directors in fulfilling its oversight responsibilities by
reviewing the adequacy of (i) the financial reporting process (including
reviewing the selection, application and disclosure of critical accounting
policies), (ii) financial information that will be provided to shareholders and
others, (iii) the systems of internal financial controls that management and the
Board have established, and (iv) our audit process and to consider issues raised
by our independent auditors in the U.K. and by our independent registered public
accounting firm in the U.S. In addition, the Audit Committee is responsible for
considering and recommending the appointment of, and reviewing fee arrangements
with, our independent auditors in the U.K. and our independent registered public
accounting firm in the U.S. During 2008, the Audit Committee met four times. The
functions of our Audit Committee and its activities during 2008 are further
described in the "Report of the Audit Committee of the Board of Directors"
below.
Compensation Committee
Members: Victor A. Hebert (Chairman), Harold E. Hughes, Jr.
The Compensation Committee approves all elements of compensation for the
Executive Chairman, including bonuses, other than grants of share options. The
Compensation Committee recommends all grants of share options for the Executive
Chairman, executive officers and employees to the Trustees of The London Pacific
Group 1990 Employee Share Option Trust. During 2008, the Compensation Committee
did not hold any meetings.
4
Business Development Committee
Members: Harold E. Hughes, Jr., The Viscount Trenchard
The Business Development Committee was established on March 31, 2001 for
the purpose of dealing generally with all aspects of new business areas,
including expanding existing business internationally. Formal committee meetings
are not generally held, as individual committee members undertake specific
responsibilities for areas of new business development. During 2008, the
Business Development Committee did not hold any meetings.
Nomination Committee
Due to the small size of the Board, it is considered unnecessary for there
to be a specific Nomination Committee and the whole Board acts in this capacity
as and when required. The Board of Directors is comprised of four members (three
of whom are non-executive directors).
The Board of Directors meets quarterly and any nominations arising would
normally be considered at those quarterly meetings. There is no written charter
for the Board in relation to nominations and one is not considered necessary due
to the infrequency of new Board appointments. If and when Board vacancies arise,
the Board would consider applicants from a wide range of sources including
recommendations from any existing director or officer. The Company may also use
a third-party search firm depending upon the circumstances at the time of the
vacancy. While there are no minimum qualifications as such for nominees, the
Board would look for candidates with appropriate experience and background
relative to the requirements of the Company at the time of the nomination. The
Board does not accept unsolicited shareholder recommendations due to the small
size of the Board, which is considered appropriate for the Company, and the
infrequency of new Board appointments.
No nominations for director were received for consideration during 2008 or
2009 to date.
DIRECTORS' COMPENSATION
Annual Compensation
Each director receives a base annual fee of $3,750, except for the
Executive Chairman who, effective June 30, 2001, no longer receives this fee.
The Deputy Chairman receives an additional annual fee of $5,000. Each director
on the Audit Committee and Compensation Committee receives an additional annual
fee of $3,750, and each director on the Business Development Committee receives
an additional annual fee of $5,000. Lord Trenchard receives an additional annual
fee of $10,000 for administrative duties performed for the Company in Jersey.
Share Option Plan
Under The London Pacific Group 1990 Employee Share Option Trust, a
non-executive director may be granted options to purchase our Ordinary Shares,
generally exercisable in four equal annual installments beginning one year from
the date of grant. Options expire seven or ten years from the date of grant. On
March 27, 2007, each non-executive director was granted 50,000 options with an
exercise price equal to the market value of the Ordinary Shares on the grant
date ($0.10) and vesting over four years. On August 19, 2008, the exercise price
of these options was modified from $0.10 to $0.31, the net book value of the
shares as of December 31, 2006. Until further notice, new option grants will
have an exercise price equal to the net book value of the shares as of the end
of the previous quarter. On August 20, 2008, each non-executive director was
granted 50,000 options with an exercise price of $0.30, the net book value of
the shares as of June 30, 2008, and vesting over four years.
The Executive Chairman makes recommendations to the Trustees of The London
Pacific Group 1990 Employee Share Option Trust in relation to such grants to the
non-executive directors.
5
Director Summary Compensation Table for 2008
Non-Equity Nonqualified
Fees Incentive Deferred
Earned or Plan Compen- All Other
Paid in Stock Option Compen- sation Compen-
Name Cash Awards Awards(1) sation Earnings sation(2) Total
$ $ $ # $ $ $
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Harold E. Hughes, Jr. 16,250 0 2,185 0 0 0 18,435
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Victor A. Hebert 12,500 0 2,185 0 0 0 14,685
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Viscount Trenchard 12,500 0 2,185 0 0 10,000 24,685
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<FN>
(1) On August 20, 2008, each non-executive director was granted 50,000 share
options with an exercise price equal to the net book value of our Ordinary
Shares on June 30, 2008 ($0.30) and vesting over four years. The grant date
fair value of each 50,000 option award was $2,185.
(2) Amount reflects an additional annual fee of $10,000 for administrative
duties performed for the Company in Jersey.
</FN>
LEGAL PROCEEDINGS INVOLVING OFFICERS AND DIRECTORS
No material legal proceedings have been made against any of our executive
officers or directors with respect to their duties to the Company.
6
INFORMATION REGARDING BENEFICIAL OWNERSHIP OF PRINCIPAL
SHAREHOLDERS, DIRECTORS AND EXECUTIVE OFFICERS
The following table sets forth certain information with respect to
beneficial ownership of Ordinary Shares as of March 31, 2009 for each person who
is known by us to own beneficially more than 5% of the Ordinary Shares
(including Ordinary Shares underlying ADRs), for directors and executive
officers named in the Summary Compensation Table on page 9 of this Proxy
Statement, and for all directors and executive officers as a group:
Amount and Nature of Ownership (1)
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Options
Number of Exercisable Total Shares Percent of
Ordinary Within 60 Days of Beneficially Outstanding
Name Shares Owned March 31, 2009 (2) Owned Ordinary Shares
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Arthur I. Trueger 19,260,693 2,000,000 21,260,693 33.0%
650 California Street, Suite 2600
San Francisco, California 94108
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The London Pacific Group 13,084,681 - 13,084,681 20.3%
1990 Employee Share
Option Trust (2) (3)
Whiteley Chambers, Don Street
St. Helier, Jersey JE4 9WG
Channel Islands
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Victor A. Hebert (4) 45,000 45,000 90,000 *
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Harold E. Hughes, Jr. - 65,000 65,000 *
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The Viscount Trenchard - 45,000 45,000 *
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Ian K. Whitehead 400 2,700,000 2,700,400 4.2%
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All directors and executive 19,306,093 4,855,000 24,161,093 37.5%
officers as a group (2)
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Peter Gyllenhammar (5) 5,175,000 - 5,175,000 8.0%
Grev Turegatan 27
11438 Stockholm, Sweden
- ------------------------------------------------------------------------------------------------------------------
SC Fundamental Value 5,634,240 - 5,634,240 8.7%
Fund, L.P. (6)
747 Third Avenue, 27th Floor
New York, New York 10017
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SC Fundamental Value 4,079,970 - 4,079,970 6.3%
BVI, Ltd. (7)
C/o Citco Fund Services (Cayman
Islands) Limited
Corporate Centre
West Bay Road
P.O. Box 31106 SMB
Grand Cayman, Cayman Islands
British West Indies
- ------------------------------------------------------------------------------------------------------------------
<FN>
* Amount represents less than one percent.
(1) Except as described in footnote (4) below, each director and executive
officer has sole voting and investment power with respect to his shares.
(2) The shares underlying the 4,855,000 options exercisable are also included
in the 13,084,681 shares held by The London Pacific Group 1990 Employee
Share Option Trust.
7
(3) The Trustees of The London Pacific Group 1990 Employee Share Option Trust
are entitled to notice of, and to vote at the Meeting, with each share
entitling them to one vote. The Trust has waived its entitlement to
dividends on any shares held. Victor A. Hebert, Deputy Chairman and a
non-executive director, is one of the two trustees of the Trust.
(4) The number of Ordinary Shares owned by Mr. Hebert includes 40,000 shares
held in a pension and profit sharing trust for the benefit of Mr. Hebert
over which he has shared voting and investment power. The total number of
shares beneficially owned by Mr. Hebert does not include any shares owned
by The London Pacific Group 1990 Employee Share Option Trust, of which Mr.
Hebert is one of the two trustees, and as to which shares Mr. Hebert
disclaims any beneficial interest, except for his options covering 120,000
shares.
(5) We were notified on January 7, 2008 that Bronsstadet AB and Union Discount
Company of London plc, companies wholly-owned by Mr. Peter Gyllenhammar,
had increased their combined holdings to 4,545,000 Ordinary Shares on
January 4, 2008. We were notified further on January 29, 2008 that the same
two companies wholly-owned by Mr. Peter Gyllenhammar, had increased their
combined holdings to 5,175,000 on January 25, 2008.
(6) Based on a notification received on April 3, 2006 which also indicated that
3,067,740 of the Ordinary Shares owned are held in ADR form.
(7) Based on a notification received on April 3, 2006 which also indicated that
2,221,470 of the Ordinary Shares owned are held in ADR form.
</FN>
EXECUTIVE COMPENSATION
Executive Compensation Components
Base Salary and Annual Incentive Compensation
For 2008, our executive officers received an annual salary, but no bonuses
related to the prior year were paid, and no bonuses will be paid relating to
2008, due to the Company's net operating losses for 2008 and 2007. In addition,
the Company is continuing to conserve cash in light of its efforts to develop
its venture capital consulting business.
Mr. Trueger and Mr. Whitehead currently receive annual salaries of $300,000
and (pound)500,000 (approximately $720,000 at an exchange rate of (pound)1 =
$1.44), respectively. On August 12, 2008, the Company gave notice to Mr.
Whitehead that his employment agreement would end on June 30, 2009. Reference is
made to Exhibit 10.3.1 to the Company's Form 10-K for the year ended December
31, 2000 for a copy of Mr. Whitehead's employment agreement and to Mr.
Whitehead's salary waiver described below in "Potential Payments upon
Termination or Change in Control." In connection with the notice to end his
employment agreement referenced above, Mr. Whitehead gave notice to the Company
that he had rescinded his salary waiver. Therefore, Mr. Whitehead's annual
salary increased from (pound)150,000 to (pound)500,000 for the period from July
1, 2008 through June 30, 2009.
Long-term Incentive Plan
Share options may be granted to the Executive Chairman under The London
Pacific Group 1990 Employee Share Option Trust. The Compensation Committee of
the Board of Directors considers the responsibilities and performance of the
Executive Chairman and the performance of the Group when determining the number
of options to be recommended to the Trustees of The London Pacific Group 1990
Employee Share Option Trust. The Trust may grant share options to other officers
and employees, following recommendations from the Executive Chairman to the
Compensation Committee, which, if concurring, makes recommendations to the
trustees of the Trust. The objectives of this plan include retaining the best
personnel and providing for additional performance incentives.
Generally, option grants are exercisable in four equal installments
beginning one year from the date of the grant, subject to employment
continuation, and expire seven or ten years from the date of the grant.
8
On March 27, 2007, the Chief Financial Officer was granted 1,000,000 share
options with an exercise price equal to the market value of our Ordinary Shares
on the grant date ($0.10) and vesting over four years. On August 19, 2008, the
exercise price of these options was modified from $0.10 to $0.31, the net book
value of the shares as of December 31, 2006. Until further notice, new option
grants will have an exercise price equal to the net book value of the shares as
of the end of the previous quarter. The Chief Financial Officer did not receive
any new option grants during 2008.
There were no option exercises during 2008 under The London Pacific Group
1990 Employee Share Option Trust by the named executive officers. The value of
the share options held by them as of December 31, 2008 was nil as all vested and
unvested share options were not in-the-money at that date.
Pension Plan
The Group has a defined contribution plan for the Chief Financial Officer.
This plan was established in 2000, with $58,000 contributed during the year
ended December 31, 2008.
Deferred Compensation Plan
The Company currently does not offer a deferred compensation plan for
executive officers or employees.
Perquisites and Other Executive Benefits
The Company currently does not offer any perquisites or other executive
benefits to its executive officers.
Employment Contracts
Mr. Whitehead joined us in September 1990 as Chief Financial Officer. The
Company extended an employment letter to Mr. Whitehead. His employment is
terminable either by the Company on twelve (12) months written notice or by Mr.
Whitehead on six (6) months written notice. As discussed above, on August 12,
2008, the Company gave notice to Mr. Whitehead that his employment agreement
would end on June 30, 2009.
The Executive Chairman does not have a contract of service with the
Company.
SUMMARY COMPENSATION TABLE
The following table sets forth the cash and non-cash compensation paid to
our Executive Chairman and Chief Financial Officer for the last two fiscal
years:
Non-
Equity Nonqualified
Incentive Deferred
Plan Compen- All Other
Name and Stock Option Compen- sation Compen-
Principal Position Year Salary Bonus Awards Awards(1) sation Earnings sation(2) Total
$ $ $ $ # $ $ $
- ------------------------------------------------------------------------------------------------------------------
Arthur I. 2008 300,000 0 0 0 0 0 0 300,000
Trueger, 2007 300,000 0 0 0 0 0 0 300,000
Executive Chairman
- ------------------------------------------------------------------------------------------------------------------
Ian K. 2008 581,083 0 0 31,600 0 0 64,781 677,464
Whitehead, 2007 301,250 0 0 27,722 0 0 54,225 383,197
CFO
- ------------------------------------------------------------------------------------------------------------------
9
<FN>
(1) Amount reflects the compensation expense recognized by Berkeley Technology
Limited for financial statement reporting purposes with respect to share
options during the 2008 and 2007 fiscal years in accordance with SFAS 123R.
For a discussion of the assumptions used in the valuations, refer to Note 1
and Note 10 to our consolidated financial statements included in our Form
10-K for the year ended December 31, 2008.
On March 27, 2007, Mr. Whitehead was granted 1,000,000 share options with
an exercise price equal to the market value of our Ordinary Shares on the
grant date ($0.10) and vesting over four years. The grant date fair value
of these options was $64,900. On August 19, 2008, the exercise price of
these options was modified from $0.10 to $0.31, the net book value of the
shares as of December 31, 2006. The original fair value of $64,900
continues to be amortized over the vesting schedule of these options in
accordance with SFAS 123R, as there is no incremental value of the modified
options.
(2) Amounts represent pension plan contributions for 2007 and 2008, as well as
$6,798 for life insurance and additional long-term disability insurance
benefits in 2008 for Mr. Whitehead.
</FN>
OUTSTANDING EQUITY AWARDS AT FISCAL YEAR-END
Option Awards Stock Awards
------------------------------------------------------------ ----------------------------------------------
Equity
Incentive
Equity Plan
Incentive Awards:
Equity Plan Market or
Incentive Awards: Payout
Number Number of Plan Number of Value of
of Securities Awards: Market Unearned Unearned
Securities Underlying Number of Number of Value of Shares, Shares,
Underlying Unexer- Securities Shares or Shares or Units or Units or
Unexer- cised Underlying Units of Units of Other Other
cised Options: Unexercised Option Option Stock Stock That Rights Rights
Options: Unexer- Unearned Exercise Expiration That Have Have Not That Have That Have
Name Exercisable cisable Options Price Date Not Vested Vested Not Vested Not Vested
# # # $ # $ # $
- -------------------------------------------------------------------------------------------------------------------------
Arthur I.
Trueger 2,000,000 0 0 $5.40 May 17, 2011 0 0 0 0
- -------------------------------------------------------------------------------------------------------------------------
Ian K. 200,000 0 0 $2.46 Mar 20, 2011 0 0 0 0
Whitehead 1,000,000 0 0 $0.43 Jun 10, 2012 0 0 0 0
750,000 250,000 0 $0.15 May 13, 2015 0 0 0 0
250,000 750,000 0 $0.31 Mar 27, 2017 0 0 0 0
- -------------------------------------------------------------------------------------------------------------------------
POTENTIAL PAYMENTS UPON TERMINATION OR CHANGE IN CONTROL
The Company entered into an employment letter agreement with Mr. Whitehead
in 1990. The agreement does not provide for a fixed term. If Mr. Whitehead's
employment is terminated by the Company other than for cause, he is entitled to
receive one year's written notice and to be paid at his full annual salary
(pre-salary waiver) of (pound)500,000 (approximately $720,000 at an exchange
rate of (pound)1 = $1.44). In addition, the Company will be obligated to make
monthly contributions to the defined contribution pension plan set up for Mr.
Whitehead for the one year notice period in the annual amount of (pound)36,000
(approximately $52,000 at an exchange rate of (pound)1.00 = $1.44), instead of
at an annual amount of (pound)27,000 (approximately $39,000 at an exchange rate
of (pound)1.00 = $1.44). As discussed above, on August 12, 2008, the Company
gave notice to Mr. Whitehead that his employment agreement would end on June 30,
2009. In connection with the notice to end his employment agreement referenced
above, Mr. Whitehead gave notice to the Company that he had rescinded his salary
waiver. Therefore, Mr. Whitehead's annual salary increased from (pound)150,000
to (pound)500,000, and his annual pension contributions increased from
(pound)27,000 to (pound)36,000, for the period from July 1, 2008 through June
30, 2009.
10
Mr. Trueger does not have a contract of service with the Company.
Under a December 31, 2008 termination scenario, all vested and unvested
share options held by Mr. Trueger and Mr. Whitehead were out-of-the-money on
that date, and thus no share options would have been exercised and no value
would have been received by them.
REPORT OF THE AUDIT COMMITTEE OF THE BOARD OF DIRECTORS
Management is responsible for the financial reporting process, the
preparation of consolidated financial statements in accordance with U.S.
generally accepted accounting principles, the system of internal controls, and
procedures designed to insure compliance with accounting standards and
applicable laws and regulations. The Company's independent auditors, BDO Stoy
Hayward LLP in the U.K., are responsible for auditing the financial statements
in accordance with International Standards on Auditing (UK and Ireland), and the
Company's independent registered public accounting firm, BDO Seidman, LLP in the
U.S., are responsible for auditing the financial statements in accordance with
the standards established by the PCAOB (United States). The Audit Committee's
responsibility is to monitor and review these processes and procedures. The
members of the Audit Committee are neither professionally engaged in the
practice of accounting or auditing. The Audit Committee relies, without
independent verification, on the information provided to them and on the
representations made by management that the financial statements have been
prepared with integrity and objectivity, and on the representations of
management and the opinions of BDO Stoy Hayward LLP and BDO Seidman, LLP that
such financial statements have been prepared in conformity with U.S. generally
accepted accounting principles.
The Audit Committee reviewed and discussed the Company's audited financial
statements for the year ended December 31, 2008 with the Company's management
and with the Company's independent registered public accounting firm, BDO
Seidman, LLP. The Audit Committee discussed with BDO Seidman, LLP the matters
required to be discussed under generally accepted auditing standards (including
Statements on Auditing Standards ("SAS") No. 61). In addition, the Audit
Committee has discussed with the independent auditors, BDO Stoy Hayward LLP and
BDO Seidman, LLP, the auditors' independence from management and the Company
(including the matters in the written disclosure required by PCAOB Rule 3526),
and considered the compatibility of non-audit services with the auditors'
independence. The Audit Committee considered and believes that the performance
of services related to "Audit-Related Fees" and "Tax Fees" is compatible with
maintaining the independence of BDO Stoy Hayward LLP and BDO Seidman, LLP.
For the years ended December 31, 2008 and 2007, BDO Stoy Hayward LLP and
BDO Seidman, LLP billed or will bill the Company for the following fees:
2008 2007
Audit Fees $151,967 $146,441
Audit-Related Fees (1) $12,078 $13,970
Tax Fees (2) $2,070 $3,025
All Other Fees $0 $0
(1) Related to the audits of our insurance regulatory reports.
(2) Related to tax compliance services.
Based on the Audit Committee's review and discussions above, the Audit
Committee recommended to the Board of Directors that the Company's audited
financial statements be included in its Annual Report on Form 10-K for the year
ended December 31, 2008, for filing with the Securities and Exchange Commission,
and in its 2008 Annual Report to Shareholders.
The Audit Committee pre-approved all fees for audit and permissible
non-audit services performed by BDO Stoy Hayward LLP and BDO Seidman, LLP.
11
The Audit Committee has considered and concluded that the provision of the
non-audit services in the table above is compatible with maintaining the
independence of BDO Stoy Hayward LLP and BDO Seidman, LLP, and has pre-approved
all such fees.
AUDIT COMMITTEE
Harold E. Hughes, Jr. (Chairman)
The Viscount Trenchard
OTHER INFORMATION ABOUT DIRECTORS AND EXECUTIVE OFFICERS
Related Person Transactions
We paid legal fees of approximately $45,000 during 2008 to a law firm of
which one of our directors, Victor A. Hebert, was a member until October 2008.
The Board of Directors reviews all related person transactions, or
potential related person transactions, for ratification, revision or
termination.
Section 16(a) Beneficial Ownership Reporting Compliance
Section 16(a) of the Securities Exchange Act of 1934 and related
regulations require our directors, executive officers, and anyone holding more
than 10% of the Company's Ordinary Shares to report their initial ownership of
the Company's Ordinary Shares and any changes in that ownership to the
Securities and Exchange Commission ("SEC"). We are required to disclose in this
Proxy Statement the failure of any reporting person to file these reports when
due. To our knowledge, based solely on our review of copies of such reports
received by us, we believe that during 2008, all reporting persons of the
Company satisfied these filing requirements.
CODE OF ETHICS
On November 12, 2003, the Board of Directors adopted a Code of Ethics (the
"Code") applicable to the Company's Chief Executive Officer, Chief Financial
Officer, Controller, all other officers of the Company, or any other person
serving in an equivalent position. This Code embodies our commitment to conduct
business in accordance with the highest ethical standards and applicable laws,
rules and regulations. Our Code was amended and restated in December 2007 and
this amended and restated Code was filed as Exhibit 14.1 to our Form 10-K for
the year ended December 31, 2007, filed with the SEC on March 31, 2008.
OTHER MATTERS
We know of no other matters to be presented at the Annual General Meeting
other than those described in this Proxy Statement. In the event that other
business properly comes before the Meeting, the persons named as proxies will
have discretionary authority to vote the shares underlying the ADRs represented
by the accompanying proxy in accordance with their own judgment.
ADDITIONAL INFORMATION
Communications with the Board
Security holders may send communications to the Board, or any member of it,
care of the Secretary at the Group's mailing address in Jersey, Channel Islands
(see address on page 13). Any appropriate delivery instructions clearly marked
on the face of the communication or its envelope will be adhered to.
12
Communications to the Board or any member of the Board, without such specific
delivery instructions, will be dealt with at the discretion of the Company's
Secretary, and if necessary, in conjunction with the Company's Executive
Chairman.
Shareholder Proposals for 2010 Annual General Meeting
ADR holders are entitled to present proposals for action at a forthcoming
meeting of shareholders if they comply with the requirements of the SEC's proxy
rules. Any proposals intended to be presented at the 2010 Annual General Meeting
of Shareholders of Berkeley Technology Limited must be received at our mailing
address in Jersey, Channel Islands (see address below) on or before December 30,
2009 in order to be considered for inclusion in our proxy materials relating to
such meeting.
Availability of Annual Report on Form 10-K
A copy of our Annual Report on Form 10-K for the year ended December 31,
2008, as filed with the SEC, will be furnished without charge to ADR holders
upon receipt by us of a request addressed to:
Robert A. Cornman
Secretary
Berkeley Technology Limited
P.O. Box 715
Jersey JE4 0PX
Channel Islands
The enclosed form of proxy has been prepared at the direction of the
Company, of which you are an ADR holder, and is sent to you at the request of
our Board of Directors.
BERKELEY TECHNOLOGY LIMITED
By Order of the Board of Directors
/s/ Robert A. Cornman
Robert A. Cornman
Secretary
St. Helier
Jersey, Channel Islands
April 29, 2009
13
APPENDIX A
AUDIT COMMITTEE CHARTER
Adopted by the Board of Directors of
Berkeley Technology Limited
Amended and Restated on May 8, 2008
Composition:
The Audit Committee shall be composed of two or more directors, as
determined by the Board of Directors, each of whom shall meet the independence
and financial literacy requirements of the Securities Exchange Commission (SEC),
and at least one of whom shall have past employment experience in finance or
accounting, requisite professional certification in accounting or any other
comparable experience or background which results in the individual's financial
sophistication, including being or having been a chief executive officer, chief
financial officer or other senior officer with financial oversight
responsibilities and such other attributes necessary to satisfy the "audit
committee financial expert" requirements established by the SEC's final rules
("Final Rules") implementing Section 407 of the Sarbanes-Oxley Act of 2002, as
amended (the "Act").
In determining if each member of the Audit Committee satisfies the minimum
standards for being considered "independent" under the Final Rules, no such
member (or the member's family, law firm, accounting firm, consulting firm,
investment banking firm or financial advisory firm) shall (x) accept or receive,
directly or indirectly, any consulting, advisory or other compensatory fee from
the Company or any of its subsidiaries, other than fees for board or board
committee service, or (y) be an affiliated person of the Company or any of its
subsidiaries, other than in the capacity of a Director of the Company.
Unless a chairperson is designated by the Board of Directors, the members
of the Audit Committee may appoint their own chairperson by majority vote.
Responsibilities:
1. Select, nominate, appoint, retain (or terminate) and compensate the
Company's independent auditors in the U.K. (for purposes of the Company's
primary listing on the London Stock Exchange) and the Company's
independent registered public accounting firm in the U.S. (for purposes
of the Company's listing in the U.S.) (together, the Company's
"independent auditors"); directly evaluate and oversee the performance of
the independent auditors and, if so determined by the Audit Committee,
replace the independent auditors, it being acknowledged that the
independent auditors are ultimately accountable to the shareholders of
the Company. In addition, the Audit Committee shall review the range and
cost of audit and non-audit services performed by the independent
auditors; approve in advance the engagement of the independent accounting
firm for all audit services and non-audit services, based on
independence, qualifications and, if applicable, performance, and approve
the fees and other terms of any such engagement. The Audit Committee
shall meet as often as is necessary, holding such regular or special
meetings as may be called by the Chairman of the Audit Committee, or at
the request of the independent auditors. The Audit Committee shall ensure
that the independent auditors report directly to the Audit Committee, not
management.
2. Ensure the receipt of, and evaluate, the written disclosures and the
letter that the independent auditors submit to the Audit Committee
regarding the auditors' independence in accordance with the Act, the
Final Rules, and Independence Standards Board Standard No. 1, discuss
such reports with the auditors and, if so determined by the Audit
Committee in response to such reports, take appropriate action to address
issues raised by such evaluation, and ensure the rotation of the lead
audit partner having primary responsibility for the audit, as required by
law.
14
3. Discuss with the independent auditors the matters required to be
discussed by Statement of Auditing Standards No. 114 as it may be
amended, modified or supplemented, and in particular, describing all
relationships between the independent auditors and the Company, and
discuss with the independent auditors any relationships or services that
may impact their objectivity or independence; and confer with the
independent auditors and management concerning the scope of the
independent auditors' audit of the consolidated financial statements of
the Company and its subsidiaries; direct the attention of the independent
auditors to specific matters or areas deemed by the Audit Committee to be
of special significance; and authorize the independent auditors to
perform supplemental reviews or audits as the Audit Committee may deem
necessary, appropriate or desirable.
4. Instruct management and the independent auditors that the Audit Committee
expects to be informed if there are any subjects that require special
attention or if they perceive any significant deficiencies or material
weaknesses in the Company's internal controls over financial reporting,
as well as significant risks, exposures, complex or unusual transactions,
audit activities and audit findings; review with the independent auditors
any significant difficulties encountered during the course of the audit,
any restrictions on the scope of work or access to requested or required
information and any significant disagreement among management and the
independent auditors in connection with the preparation of financial
statements.
5. Meet with management and the independent auditors to discuss the annual
financial statements and the report and opinion of the independent
auditors thereon, and to discuss significant issues encountered in the
course of the audit work, including significant changes in accounting
principles or the application therein, restrictions on the scope of
activities, access to required information and adequacy of internal
financial controls; discuss with management all Section 302 and Section
906 certifications required by the Act, and review management's report on
internal controls as required by Section 404 of the Act.
6. Review the management letter delivered by the independent auditors in
connection with the audit, earnings press releases, including pro forma
or adjusted non-GAAP information, and other financial information or
earnings guidance given to analysts and rating agencies.
7. Meet quarterly with management and the independent auditors to review
interim financial statements, and to discuss the quarterly financial
statements prior to the filing of the Form 10-Q; provided that this
responsibility may be delegated to the Chairman of the Audit Committee.
8. Meet at least once each year in separate executive sessions with
management and the independent auditors to discuss matters that any of
them or the Audit Committee believes could significantly affect the
financial statements and should be discussed privately; discuss
alternative treatments of financial information within generally accepted
accounting principles that the independent auditors have discussed with
management, the ramifications of the use of such alternative disclosures
and treatments and the treatment preferred by the independent auditors,
as well as regulatory and accounting initiatives, on the financial
statements of the Company. In addition, the Audit Committee shall perform
an annual self-evaluation.
9. Have such meetings with management and the independent auditors as the
Audit Committee deems necessary, appropriate or desirable to discuss
significant financial risk exposures facing the Company and management's
plans for monitoring and controlling such exposures; and to obtain from
the independent auditors their recommendations regarding internal
controls and other matters relating to the accounting procedures and the
books and records of the Company and its subsidiaries; review and discuss
with management the adequacy of the Company's internal controls and
procedures for financial reporting.
10. Review significant changes to the Company's accounting principles and
practices proposed by the independent auditors or management.
15
11. Conduct or authorize such inquiries into matters within the Audit
Committee's scope of responsibility as the Audit Committee deems
appropriate and as otherwise required by the Act and the Final Rules. The
Audit Committee shall review all related party transactions on an ongoing
basis and approve any related party transaction. The Audit Committee
shall be empowered to retain independent counsel and other professional
advisors, including counsel, as it deems necessary to carry out its
duties and to assist in the conduct of any such inquiries. The Audit
Committee shall also establish procedures for the receipt, retention and
treatment of complaints regarding accounting, internal accounting
controls or auditing matters, including procedures for the confidential,
anonymous submission by employees of concerns regarding questionable
accounting or auditing matters.
12. Provide minutes of Audit Committee meetings to the Board of Directors,
and report to the Board of Directors on any significant matters arising
from the Audit Committee's work.
13. At least annually, review and reassess this charter, the Audit
Committee's budget, staffing and independence, and, if appropriate,
recommend proposed changes to the Board of Directors.
14. Prepare the report required by the rules of the SEC to be included in the
Company's annual proxy statement.
15. In the performance of its responsibilities, the Audit Committee is the
representative of the shareholders. However, it is not the responsibility
of the Audit Committee to plan or conduct audits, or to determine whether
the Company's financial statements are complete and accurate or in
accordance with U.S. generally accepted accounting principles.
16