SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a)
of the Securities Exchange Act of 1934
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 under ss. 240.14a-12
LINEAR TECHNOLOGY CORPORATION
- --------------------------------------------------------------------------------
(Name of Registrant as Specified in its Charter)
- --------------------------------------------------------------------------------
(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.
(1) Title of each class of securities to which transaction applies:
___________
(2) Aggregate number of securities to which transaction applies:
___________
(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): __________
(4) Proposed maximum aggregate value of transaction: ______________
(5) Total fee paid: _____________
[ ] Fee paid previously with preliminary materials.
[ ] Checkbox 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: __________________
(2) Form Schedule or Registration Statement No.: ___________________
(3) Filing Party: ________________
(4) Date Filed: ________________
LINEAR TECHNOLOGY CORPORATION
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Notice of Annual Meeting of Stockholders
To Be Held on November 6, 2002
TO THE STOCKHOLDERS:
NOTICE IS HEREBY GIVEN that the Annual Meeting of Stockholders of Linear
Technology Corporation, a Delaware corporation (the "Company"), will be held on
November 6, 2002 at 3:00 p.m., local time, at the Company's principal executive
offices, located at 720 Sycamore Drive, Milpitas, California 95035, for the
following purposes:
1. To elect five (5) directors to serve until the next Annual Meeting of
Stockholders and until their successors are elected.
2. To ratify the appointment of Ernst & Young LLP as independent auditors
of the Company for the fiscal year ending June 29, 2003.
3. To transact such other business as may properly come before the Annual
Meeting or any adjournment thereof.
The foregoing items of business are more fully described in the Proxy
Statement accompanying this Notice.
Only stockholders of record of the Company's Common Stock at the close of
business on September 9, 2002, the record date, are entitled to notice of and to
vote at the Annual Meeting and any adjournment thereof.
All stockholders are cordially invited to attend the Annual Meeting in
person. However, to ensure your representation at the meeting, you are urged to
mark, sign, date and return the enclosed proxy card as promptly as possible in
the postage-prepaid envelope enclosed for that purpose. Any stockholder
attending the Annual Meeting may vote in person even if such stockholder has
returned a proxy card.
FOR THE BOARD OF DIRECTORS
/s/ Arthur F. Schneiderman
Arthur F. Schneiderman
Secretary
Milpitas, California
September 25, 2002
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YOUR VOTE IS IMPORTANT.
WHETHER OR NOT YOU PLAN TO ATTEND THE MEETING, PLEASE SIGN, DATE AND RETURN
THE ENCLOSED PROXY CARD AS PROMPTLY AS POSSIBLE IN THE ENCLOSED ENVELOPE.
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LINEAR TECHNOLOGY CORPORATION
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PROXY STATEMENT
FOR
2002 ANNUAL MEETING OF STOCKHOLDERS
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INFORMATION CONCERNING SOLICITATION
AND VOTING
General
The enclosed Proxy is solicited on behalf of the Board of Directors of
Linear Technology Corporation, a Delaware corporation (the "Company"), for use
at the Annual Meeting of Stockholders to be held November 6, 2002, at 3:00 p.m.,
local time, or at any adjournment thereof, for the purposes set forth herein and
in the accompanying Notice of Annual Meeting of Stockholders. The Annual Meeting
will be held at the Company's principal executive offices, located at 720
Sycamore Drive, Milpitas, California 95035. The telephone number at that
location is (408) 432-1900.
These proxy solicitation materials and the Company's Annual Report to
Stockholders for the year ended June 30, 2002, including financial statements,
were mailed on or about September 25, 2002 to all stockholders entitled to vote
at the Annual Meeting.
Record Date and Voting Securities
Stockholders of record at the close of business on September 9, 2002 (the
"Record Date") are entitled to notice of and to vote at the meeting. As of the
Record Date, 314,384,864 shares of the Company's Common Stock, par value $0.001,
were issued and outstanding. No shares of the Company's Preferred Stock are
outstanding.
Revocability of Proxies
Any proxy given pursuant to this solicitation may be revoked by the person
giving it at any time before its use by delivering to the Company (Attention:
Paul Coghlan, Vice President of Finance and Chief Financial Officer) a written
notice of revocation or a duly executed proxy card bearing a later date or by
attending the Annual Meeting and voting in person.
Voting Rights and Solicitation of Proxies
On all matters other than the election of directors, each share has one
vote. Each stockholder voting for the election of directors may cumulate such
stockholder's votes and give one candidate a number of votes equal to the number
of directors to be elected (which number is currently set at five) multiplied by
the number of shares held by such stockholder, or may distribute such
stockholder's votes on the same principle among as many candidates as the
stockholder may select. However, no stockholder will be entitled to cumulate
votes unless a stockholder has, prior to the voting, given notice at the meeting
of the stockholder's intention to cumulate votes. If any stockholder gives such
notice, all stockholders may cumulate their votes for the election of directors.
In the event that cumulative voting is invoked, the proxy holders will have the
discretionary authority to vote all proxies received by them in such a manner as
to ensure the election of as many of the Board of Directors' nominees as
possible.
The Company will bear the cost of soliciting proxies. In addition, the
Company may reimburse brokerage firms and other persons representing beneficial
owners of shares for their expenses in forwarding solicitation material to
beneficial owners. Solicitation of proxies by mail may be supplemented by one or
more of telephone, telegram, facsimile, e-mail or personal solicitation by
directors, officers or regular employees of the Company. No additional
compensation will be paid to these persons for these services.
Quorum; Abstentions; Broker Non-Votes
Votes cast by proxy or in person at the Annual Meeting will be tabulated by
the Inspector of Elections. The Inspector will also determine whether or not a
quorum is present. Except in certain specific circumstances, the affirmative
vote of a majority of shares present in person or represented by proxy at a duly
held meeting at which a quorum is present is required under Delaware law and the
Company's Bylaws for approval of proposals presented to stockholders. In
general, Delaware law also provides that a quorum consists of a majority of
shares entitled to vote and present or represented by proxy at the meeting.
When proxies are properly dated, executed and returned, the shares
represented by those proxies will be voted at the Annual Meeting in accordance
with the instructions of the stockholder. If no instructions are indicated on a
properly executed proxy, the shares represented by that proxy will be voted as
recommended by the Board of Directors. If any other matters are properly
presented for consideration at the Annual Meeting, the persons named in the
enclosed proxy card and acting thereunder will have discretion to vote on those
matters in accordance with their best judgment. The Company does not currently
anticipate that any other matters will be raised at the Annual Meeting.
Pursuant to Delaware law, the Inspector will include shares that are voted
"WITHHELD" or "ABSTAIN" on a particular matter among the shares present and
entitled to vote for purposes of determining the presence or absence of a quorum
for the transaction of business at the Annual Meeting generally, and also among
the shares entitled to vote on that matter (the "Votes Cast"). Broker non-votes
on a particular matter will be counted for purposes of determining the presence
of a quorum, but will not be counted for purposes of determining the number of
"Votes Cast" with respect to the matter on which the broker has expressly not
voted. Accordingly, broker non-votes will not affect the determination as to
whether the requisite approval has been obtained with respect to a particular
matter.
Deadline for Receipt of Stockholder Proposals
Stockholders are entitled to present proposals for action at a forthcoming
meeting if they comply with the requirements of the Company's Bylaws and the
proxy rules established by the Securities and Exchange Commission. Proposals of
stockholders of the Company that are submitted for inclusion in the proxy
statement and form of proxy card for next year's annual meeting must be received
by the Company no later than one hundred twenty (120) days prior to the one year
anniversary date of the mailing of this Proxy Statement. Assuming a mailing date
of September 25, 2002, the deadline for stockholder proposals for next year's
annual meeting will be May 28, 2003.
In addition, under the Company's Bylaws, a stockholder wishing to make a
proposal at next year's annual meeting must submit that proposal to the Company
not less than 90 days prior to the meeting (or, if the Company gives less than
100 days notice of the meeting, then within ten days after that notice). The
Company may refuse to acknowledge any proposal not made in compliance with the
foregoing procedure.
2
The attached proxy card grants the proxy holders discretionary authority to
vote on any matter raised at this year's Annual Meeting. In addition, assuming a
mailing date of September 25, 2002 for this proxy statement, the proxy holders
at next year's annual meeting will have similar discretionary authority to vote
on any matter that is not submitted to the Company before August 11, 2003.
How to Obtain a Copy of Linear's Annual Report on Form 10-K
We will provide without charge to each stockholder solicited by these proxy
solicitation materials a copy of Linear's Annual Report on Form 10-K, together
with the financial statements, financial statement schedules and all other
exhibits required to be filed with the Annual Report on Form 10-K, upon request
of the stockholder made in writing to Linear Technology Corporation, 720
Sycamore Drive, Milpitas, California 95035, Attn: Paul Coghlan, Vice President
of Finance and Chief Financial Officer.
3
PROPOSAL ONE
ELECTION OF DIRECTORS
Nominees
The Company's Bylaws currently provide for a board of five directors.
Unless otherwise instructed, the proxy holders will vote the proxies received by
them for the Company's five nominees named below, all of whom are currently
directors of the Company. In the event that any nominee of the Company is unable
or declines to serve as a director at the time of the Annual Meeting, the
proxies will be voted for any substitute nominee who is designated by the
current Board of Directors to fill the vacancy. It is not expected that any
nominee listed below will be unable or will decline to serve as a director. In
the event that additional persons are nominated for election as directors, the
proxy holders intend to vote all proxies received by them in such a manner as
will ensure the election of as many of the nominees listed below as possible,
and, in such event, the specific nominees to be voted for will be determined by
the proxy holders. In any event, the proxy holders cannot vote for more than
five persons. The term of office of each person elected as a director will
continue until the next Annual Meeting of Stockholders or until his successor
has been elected and qualified.
The names of the nominees, and certain information about them as of
September 9, 2002, are set forth below.
Name Of Nominee Age Principal Occupation Director Since
- ------------------------------- ----------- -------------------------------------------------------- ----------------
Robert H. Swanson, Jr......... 64 Chairman and Chief Executive Officer of the Company 1981
David S. Lee.................. 65 Chairman, Cortelco Systems Holding Corp. 1988
Leo T. McCarthy............... 72 President, The Daniel Group 1994
Richard M. Moley.............. 63 Former President and Chief Executive Officer,
StrataCom, Inc. 1994
Thomas S. Volpe .............. 51 Chief Executive Officer, Volpe Investments LLC 1984
There are no family relationships among the Company's directors and
executive officers.
Mr. Swanson, a founder of the Company, has served as Chairman and Chief
Executive Officer since April 1999. From the Company's incorporation in
September 1981 until April 1999, Mr. Swanson served as President and Chief
Executive Officer. Mr. Swanson has also served as a director of the Company
since its incorporation. From August 1968 to July 1981, he was employed in
various positions at National Semiconductor Corporation, a manufacturer of
integrated circuits, including Vice President and General Manager of the Linear
Integrated Circuit Operation and Managing Director in Europe.
Mr. Lee is Chairman of the Boards of eOn Communication Corp., Cortelco and
Cidco Communications, and a Regent of the University of California. Mr. Lee
co-founded Qume Corporation in 1973 and served as Executive Vice-President of
Qume until it was acquired by ITT Corporation in 1978. After the acquisition,
Mr. Lee held the positions of Executive Vice President of ITT Qume until 1981,
and President of ITT Qume through 1983. From 1983 to 1985, he served as Vice
President of ITT and as Group Executive and Chairman of its Business Information
Systems Group. In 1985, he became President and Chairman of Data Technology
Corp. ("DTC"), and in 1988 DTC acquired and merged with Qume. Currently, Mr. Lee
is a member of the Board of Directors of ESS Technology Inc., iBasis Inc.,
Accela.com, Daily Wellness Co. and Pacific International Center for High
Technology Research. Mr. Lee also serves as a member of the California Chamber
of Commerce and Honorary President of Asian Cultural Teachings. Mr. Lee served
as an adviser to Presidents George Bush and Bill Clinton on the Advisory
Committee on Trade Policy and Negotiation (Office of the U.S. Trade
Representative/Executive Office of the President) and to
4
Governor Pete Wilson on the California Economic Development Corporation (CalEDC)
and the Council on California Competitiveness. Mr. Lee is a past Commissioner of
the California Postsecondary Education Commission, as well as having founded and
served as Chairman of the Chinese Institute of Engineers, the Asian American
Manufacturers' Association and the Monte Jade Science and Technology
Association.
Mr. McCarthy has served since January 1995 as President of The Daniel
Group, a partnership engaged in international trade and other investment
opportunities. Mr. McCarthy retired from elective office in 1994 after twelve
years as Lieutenant Governor of the State of California. His primary
responsibility as Lieutenant Governor was to help businesses start and grow
through his role as chair of the California Commission for Economic Development.
One major area of focus for Mr. McCarthy was and still remains international
trade and investment, particularly involving Pacific Rim markets. Mr. McCarthy
serves as a director on the board of Forward Funds, which is a mutual fund. He
also serves as Vice Chair of the Board of Accela.com, a privately held software
company.
Mr. Moley served as Chairman, President and Chief Executive Officer of
StrataCom, Inc., a network systems company, from June 1986 until its acquisition
by Cisco Systems, Inc., a provider of computer internetworking solutions, in
July 1996. Mr. Moley served as Senior Vice President and Board Member of Cisco
Systems until November 1997, when he became a consultant and private investor.
Mr. Moley served in various executive positions at ROLM Corporation, a
telecommunications company, from 1973 to 1986. Prior to joining ROLM, he held
management positions in software development and marketing at Hewlett-Packard
Company. Mr. Moley serves as a director of Netro, Echelon Corporation and
Spirent, plc, a British company.
Mr. Volpe has served as Chief Executive Officer of Volpe Investments LLC
since July 2001. From December 1999 to June 2001, Mr. Volpe served as Chairman
of Prudential Volpe Technology Group. Mr. Volpe served as Chief Executive
Officer of Volpe Brown Whelan & Company, LLC (formerly Volpe, Welty & Company),
a private investment banking and risk capital firm, from its founding in April
1986 until its acquisition by Prudential Securities in December 1999. Until
April 1986, he was President and Chief Executive Officer of Hambrecht & Quist
Incorporated, an investment banking firm with which he had been affiliated since
1981. Currently, Mr. Volpe is a member of the Board of Directors of Rigel
Pharmaceuticals, Inc.
Vote Required and Recommendation of Board of Directors
The five nominees receiving the highest number of affirmative votes of the
shares entitled to be voted will be elected as directors. Votes "withheld" will
be counted for purposes of determining the presence or absence of a quorum for
the transaction of business at the meeting, but have no other legal effect upon
election of directors under Delaware law.
THE COMPANY'S BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS VOTING "FOR" THE
NOMINEES SET FORTH ABOVE.
5
PROPOSAL TWO
RATIFICATION OF APPOINTMENT OF
INDEPENDENT AUDITORS
The Board of Directors has selected Ernst & Young LLP, independent
auditors, to audit the financial statements of the Company for the year ending
June 29, 2003, and recommends that the stockholders vote for ratification of
such appointment. Although action by stockholders is not required by law, the
Board of Directors believes that it is desirable to request approval of this
selection by the stockholders. In the event of a negative vote on such
ratification, the Board of Directors will reconsider its selection. Ernst &
Young LLP has audited the Company's financial statements since the fiscal year
ended June 30, 1982. Representatives of Ernst & Young LLP are expected to be
present at the Annual Meeting, will have the opportunity to make a statement and
are expected to be available to respond to appropriate questions from
stockholders.
Fees Billed To The Company By Ernst & Young LLP During The Fiscal Year Ended
June 30, 2002
Audit Fees
Audit fees billed to the Company by Ernst & Young LLP during the fiscal
year ended June 30, 2002, for the audit of the Company's annual financial
statements included in the Company's 2002 Annual Report on Form 10-K and the
review of the Company's interim financial statements included in the Company's
quarterly reports on Form 10-Q during fiscal 2002, totaled $172,000.
Financial Information Systems Design and Implementation Fees
The Company did not engage Ernst & Young LLP to provide advice or services
to the Company regarding financial information systems design and implementation
during the fiscal year ended June 30, 2002.
All Other Fees
Fees billed to the Company by Ernst & Young LLP during the Company's fiscal
year ended June 30, 2002 for all other non-audit services rendered to the
Company totaled $222,000. All other services includes fees of $22,000 for
audit-related services such as accounting advice and statutory audits, and fees
of $200,000 for other services, including tax services. The audit committee of
the Board has determined that the non-audit services provided by Ernst & Young
LLP are compatible with maintaining Ernst & Young LLP's independence.
THE COMPANY'S BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS VOTING "FOR" THE
RATIFICATION OF THE APPOINTMENT OF ERNST & YOUNG LLP AS THE COMPANY'S
INDEPENDENT AUDITORS FOR THE FISCAL YEAR ENDING JUNE 29, 2003.
6
BENEFICIAL SECURITY
OWNERSHIP OF DIRECTORS, EXECUTIVE
OFFICERS AND CERTAIN OTHER
BENEFICIAL OWNERS
Security Ownership
The following table sets forth certain information known to the Company
regarding the beneficial ownership of the Company's Common Stock as of the
Record Date, by (a) each beneficial owner of more than 5% of the Company's
Common Stock, (b) the Company's Chief Executive Officer and the Company's four
other most highly compensated executive officers during fiscal 2002
(collectively, the "Named Executive Officers"), (c) each director of the
Company, and (d) all directors and executive officers of the Company as a group.
Except as otherwise indicated, each person has sole voting and investment power
with respect to all shares shown as beneficially owned, subject to community
property laws where applicable.
Shares Beneficially Percentage
Beneficial Owner Owned Beneficially Owned
- ------------------------------------------------------------------------ ------------------------- ------------------
Janus Capital Management LLC (1)........................................ 33,642,493 10.7%
100 Fillmore Street
Denver, CO 80206-4923
Robert H. Swanson, Jr. (2)............................................ 1,383,000 *
Robert C. Dobkin (3)................................................... 1,916,704 *
Clive B. Davies (4).................................................... 1,036,756 *
Paul Coghlan (5)........................................................ 689,948 *
Lothar Maier (6)........................................................ 152,000 *
Thomas S. Volpe (7).................................................... 248,000 *
David S. Lee (8)....................................................... 96,000 *
Leo T. McCarthy (9).................................................... 208,900 *
Richard M. Moley (10).................................................. 72,000 *
All directors and executive officers as a group (16 persons) (11)....... 7,516,339 2.4
- -----------------------------
* Less than one percent of the outstanding Common Stock.
(1) Based on information reported to the Company by Janus Capital Corporation
on September 11, 2002.
(2) Includes (i) 10,000 shares issued in the name of Robert H. Swanson, Jr. and
Sheila L. Swanson, Trustees of the Robert H. Swanson, Jr. and Sheila L.
Swanson Trust U/T/A dated May 27, 1976, (ii) 125,000 shares issued in the
name of Robert H. Swanson, Jr. Trustee, Robert H. Swanson, Jr. Annuity,
Trust 1, U/A 6/17/02, (iii) 125,000 shares issued in the name of Robert H.
Swanson, Jr. Trustee, Sheila L. Swanson Annuity, Trust 1, U/A 6/17/02 and
(iv) 1,123,000 shares issuable pursuant to options exercisable within 60
days of September 9, 2002.
(3) Includes 705,704 shares issued in the name of Robert C. Dobkin and Kathleen
C. Dobkin, Trustees of the Dobkin Family Trust U/D/T dated September 16,
1991. Also includes 1,211,000 shares issuable pursuant to options
exercisable within 60 days of September 9, 2002.
(4) Includes 636,256 shares issued in the name of Clive B. Davies and Carol B.
Davies, Trustees of the Davies Living Trust dated September 9, 1994. Also
includes 673,500 shares issuable pursuant to options exercisable within 60
days of September 9, 2002.
(5) Includes 616,500 shares issuable pursuant to options exercisable within 60
days of September 9, 2002.
(6) Includes 152,000 shares issuable pursuant to options exercisable within 60
days of September 9, 2002.
(7) Consists of 248,000 shares issuable pursuant to options exercisable within
60 days of September 9, 2002.
(8) Consists of 96,000 shares issuable pursuant to options exercisable within
60 days of September 9, 2002.
(9) Includes 18,000 shares issued in the name of Leo and Jacqueline McCarthy
LLC and 10,000 shares issued in the name of the McCarthy Grandchildren's
Trust. Also includes 180,900 shares issuable pursuant to options
exercisable within 60 days of September 9, 2002.
(10) Consists of 72,000 shares issuable pursuant to options exercisable within
60 days of September 9, 2002.
(11) Includes 5,792,200 shares issuable pursuant to options exercisable within
60 days of September 9, 2002.
7
Securities Authorized for Issuance Under Equity Compensation Plans
The following table provides information as of June 30, 2002 about the
Company's Common Stock that may be issued upon exercise of outstanding options,
warrants and rights under all of our existing equity compensation plans,
including the 1981 Incentive Stock Option Plan, 1986 Employee Stock Purchase
Plan, the 1988 Stock Option Plan, 1996 Incentive Stock Option Plan and the 2001
Nonstatutory Stock Option Plan, and the number of shares of Common Stock that
remain available for future issuance under these existing equity compensation
plans:
- -------------------------------- ----------------------------- ---------------------------- ----------------------------------
Plan category Number of securities to be Weighted-average exercise Number of securities remaining
issued upon exercise of price of outstanding available for future issuance
outstanding options, options, warrants and under equity compensation plans
warrants and rights rights (excluding securities to be
issued upon exercise of
outstanding options, warrants
and rights)
- -------------------------------- ----------------------------- ---------------------------- ----------------------------------
Equity compensation plans 35,132,660 $21.02 8,687,730
approved by security holders
- -------------------------------- ----------------------------- ---------------------------- ----------------------------------
Equity compensation plans not 3,760,300 (1) $38.61 11,235,950
approved by security holders
- -------------------------------- ----------------------------- ---------------------------- ----------------------------------
Total 38,892,960 $22.72 19,923,680
- -------------------------------- ----------------------------- ---------------------------- ----------------------------------
(1) Issued pursuant to our 2001 Nonstatutory Stock Option Plan, which does not
require the approval of and has not been approved by our stockholders. See
description of the 2001 Nonstatutory Stock Option Plan below.
1996 Incentive Stock Option Plan
The Company's 1996 Incentive Stock Option Plan (the "1996 Plan") was
adopted by the Board of Directors in July 1996 and was approved by the Company's
stockholders in November 1996. The 1996 Plan provides for the granting to
employees, including officers and directors, of incentive stock options within
the meaning of Section 422 of the Internal Revenue Code of 1986, as amended (the
"Code"), and for the granting to employees, directors and consultants of
non-statutory stock options. Incentive stock options may be granted only to
employees, including employee directors and officers. Section 162(m) of the Code
places limits on the deductibility for federal income tax purposes of
compensation paid to certain executive officers of the Company. In order to
preserve the Company's ability to deduct the compensation income associated with
options granted to such persons, the 1996 Plan provides that no employee,
director or consultant may be granted, in any fiscal year of the Company,
options to purchase more than 500,000 shares of Common Stock. Notwithstanding
this limit, however, in connection with an individual's initial employment with
the Company, he or she may be granted options to purchase up to an additional
500,000 shares of Common Stock. The exercise price of an option is determined at
the time the option is granted, provided that, generally in the case of an
incentive stock option, the exercise price may not be less than 100% of the fair
market value of the Common Stock on the date the option is granted. Options
granted under the 1996 Plan generally vest at a rate of 1/10th of the shares
subject to the option after each six month period of continued service to the
Company, however, the vesting schedule can change on a grant-by-grant basis. The
1996 Plan provides that vested options may be exercised for 3 months after
termination of employment and for up to 12 months after termination of
employment as a result of death or disability. The Company may select
alternative periods of time for exercise upon termination of service. The 1996
Plan permits options to be exercised with cash, check, promissory note, other
shares of our stock, consideration received by us under a "cashless exercise"
8
program or certain other forms of consideration. In the event that we merge with
or into another corporation, or sell substantially all of our assets, the 1996
Plan provides that each outstanding option will be assumed or substituted for by
the successor corporation. If such substitution or assumption does not occur,
each option will fully vest and become exercisable. Unless terminated sooner,
the 1996 Plan will terminate automatically in July 2006. As of the date of this
proxy statement, there are 32,000,000 shares of common stock reserved for
issuance under the 1996 Plan, of which 7,566,220 shares remain reserved for
future issuance and 21,375,210 are subject to outstanding options.
1981 Incentive Stock Option Plan (the "1981 Plan") and 1988 Stock Option Plan
(the "1988 Plan")
The 1981 Plan and 1988 Plan have terms substantially the same as the terms
of the 1996 Plan. The Company no longer grants options under either of these
plans. As of the date of this proxy statement, there are no shares of common
stock subject to outstanding options under the 1981 Plan. As of the date of this
proxy statement, there are 13,757,450 shares of common stock are subject to
outstanding options under the 1988 Plan.
The 1986 Employee Stock Purchase Plan
The 1986 Employee Stock Purchase Plan (the "Purchase Plan") was adopted by
the Board of Directors in April 1986 and approved by the stockholders in May
1986. A total of 8,400,000 shares of the Company's Common Stock have been
reserved for issuance under the Purchase Plan, of which 1,121,500 remain
available for future issuance as of the date of this proxy statement. The
Purchase Plan, which is intended to qualify under Section 423 of the Code,
permits eligible employees to purchase Common Stock through payroll deductions
at the end of each offering period. The Purchase Plan is implemented by
consecutive offering periods of approximately six months each, ending on the
last trading day of fiscal months April and October of each year. The purchase
price per share of the shares offered under the Purchase Plan in a given
offering period is the lower of 85% of the fair market value of the Common Stock
on the first day of the offering period or 85% of the fair market value of the
Common Stock on the last day of the offering period. The purchase price for the
shares is accumulated by payroll deductions during the offering period. The
deductions must be at least 5%, but may not exceed 10%, of a participant's
eligible compensation for a given offering period.
All persons who are employed by the Company on a given enrollment date and
who are customarily employed by the Company for at least twenty hours per week
and more than five months per calendar year are eligible to participate in the
Purchase Plan. Participation in the Purchase Plan ends automatically on
termination of employment with the Company and a participant may discontinue his
or her participation in the Purchase Plan at any time during the offering
period. The Purchase Plan operates through the granting on the first day of each
offering period of an option to purchase shares. The maximum number of shares
placed under option in an offering period is determined by dividing the amount
of the participant's total payroll deductions that will be accumulated prior to
the end of the offering period by the purchase price, provided that the maximum
number of shares subject to such option may not exceed 300 shares per offering
period. Notwithstanding the foregoing, no employee will be permitted to
subscribe for shares under the Purchase Plan if, immediately after such
subscription, the employee would own 5% or more of the voting power or value of
all classes of stock of the Company or of any of its subsidiaries, nor will any
employee be permitted to participate to the extent such employee could buy under
all employee stock purchase plans of the Company more than $25,000 worth of
stock in any calendar year. Unless terminated sooner, the Purchase Plan will
terminate 20 years from its effective date.
9
2001 Nonstatutory Stock Option Plan
In fiscal 2001, the Board of Directors approved the 2001 Nonstatutory Stock
Option Plan (the "2001 Plan"). The 2001 Plan provides for the granting of
non-qualified stock options to employees and consultants at the fair market
value of our common stock as of the date of grant. The Company can not grant
options under the 2001 Plan to directors or officers of the Company. Options
granted under the 2001 Plan generally vest at a rate of 1/10th of the shares
subject to the option after each six month period of continued service to the
Company, however, the vesting schedule can change on a grant-by-grant basis. The
2001 Plan provides that vested options may be exercised for 3 months after
termination of employment and for up to 12 months after termination of
employment as a result of death or disability. The Company may select
alternative periods of time for exercise upon termination of service. The 2001
Plan permits options to be exercised with cash, check, promissory note, other
shares of our stock, consideration received by us under a "cashless exercise"
program or certain other forms of consideration. In the event that we merge with
or into another corporation, or sell substantially all of our assets, the 2001
Plan provides that each outstanding option will be assumed or substituted for by
the successor corporation. If such substitution or assumption does not occur,
each option will fully vest and become exercisable. As of the date of this proxy
statement, there are 30,000,000 shares of common stock reserved for issuance
under the 2001 Plan, of which 26,235,950 shares remain reserved for future
issuance and 3,760,300 are subject to outstanding options.
Board Meetings And Committees
The Board of Directors of the Company held a total of four meetings during
the fiscal year ended June 30, 2002. No director attended fewer than 75% of the
meetings of the Board of Directors and the Board committees upon which such
director served. The Board of Directors has an Audit Committee and a
Compensation Committee. The Board of Directors has no nominating committee or
any committee performing similar functions.
The Audit Committee of the Board of Directors currently consists of
directors Lee, McCarthy, Moley and Volpe, and held a total of four meetings
during the last fiscal year. The Audit Committee is governed by a written
charter that it has adopted. The Audit Committee recommends engagement of the
Company's independent auditors, and is primarily responsible for approving the
services performed by the Company's independent auditors and for reviewing and
evaluating the Company's accounting principles and its system of internal
accounting controls. Each member of the Company's Audit Committee is
"independent" as defined under Nasdaq's listing standards in effect as of the
date of this proxy statement.
The Compensation Committee of the Board of Directors currently consists of
directors Lee, McCarthy, Moley and Volpe, and held a total of four meetings
during the last fiscal year. The Committee reviews and approves the Company's
executive compensation policy, including the salaries and target bonuses of the
Company's executive officers, and administers the Company's stock plans.
Director Compensation
The Company currently pays each non-employee director an annual retainer of
$20,000 and a fee of $1,500 for each meeting of the Board of Directors attended.
Directors are generally eligible to receive options under the Company's stock
option plans. For the fiscal year ended June 30, 2002, Messrs. Lee, McCarthy,
Moley and Volpe each received an option to purchase 20,000 shares at an exercise
price of $37.79. Each of these options vests as to 100% of the shares subject to
the option one year from the date of grant.
10
Compensation Committee Interlocks and Insider Participation
No executive officer of the Company served on the compensation committee of
another entity or on any other committee of the board of directors of another
entity performing similar functions during the last fiscal year.
Section 16(a) Beneficial Ownership Reporting Compliance
Section 16(a) of the Securities Exchange Act of 1934, as amended, requires
the Company's executive officers and directors, and persons who own more than
ten percent of a registered class of the Company's equity securities, to file
reports of ownership on Form 3 and of changes in ownership on Forms 4 or 5 with
the Securities and Exchange Commission and the National Association of
Securities Dealers, Inc. Executive officers, directors and ten percent
stockholders are also required by Commission rules to furnish the Company with
copies of all Section 16(a) forms they file.
Based solely upon its review of copies of such forms and amendments, if
any, received by the Company, or written representations from certain reporting
persons that no Forms 5 were required for such persons, the Company believes
that its executive officers, directors, and ten percent stockholders complied
with all applicable Section 16(a) filing requirements during the fiscal year
ended June 30, 2002.
11
EXECUTIVE OFFICER COMPENSATION
The following table sets forth all compensation received for services
rendered to the Company in all capacities, for the last three fiscal years ended
June 30, 2002, by the Named Executive Officers:
Summary Compensation Table
Long Term
Annual Compensation Compensation
------------------------------------------ --------------
Securities
Other Annual Underlying All Other
Name and Principal Position Year Salary ($) Bonus ($)(1) Compensation ($) Options (#) Compensation ($)(3)
- ----------------------------------- ------- ------------- ------------ ---------------- ----------- -------------------
Robert H. Swanson, Jr............ 2002 $302,491 $1,125,445 $204,930 (2) -- $15,980
Chairman and Chief Executive 2001 302,975 3,169,878 -- 700,000 25,417
Officer 2000 274,273 2,263,455 -- -- 31,980
Clive B. Davies.................. 2002 263,270 798,735 -- -- 15,635
President 2001 277,119 2,305,594 -- 195,000 21,863
2000 272,696 1,795,484 -- -- 23,156
Robert C. Dobkin................. 2002 275,502 367,351 -- -- 15,290
Vice President, Engineering 2001 274,253 1,128,868 -- 145,000 21,878
and Chief Technical Officer 2000 261,639 1,140,285 -- -- 22,397
Paul Coghlan...................... 2002 248,250 669,508 -- -- 15,290
Vice President, Finance and 2001 268,460 1,915,592 -- 145,000 21,540
Chief Financial Officer 2000 255,152 1,452,206 -- -- 21,693
Lothar Maier...................... 2002 228,423 368,640 -- -- 14,450
Vice President and Chief 2001 244,428 987,203 -- 75,000 18,825
Operating Officer 2000 225,577 448,508 -- -- 19,875
- -----------------------------
(1) Includes cash profit sharing and cash bonuses earned for the fiscal year,
whether accrued or paid.
(2) Represents the imputed value of personal use of the Company's airplane by
Mr. Swanson during the year ended June 30, 2002.
(3) Includes insurance premiums paid by the Company under its life insurance
program. Also includes 401(k) profit sharing distributions earned during
the fiscal year.
Option Grants in Last Fiscal Year
No stock options were granted to the Named Executive Officers during the
year ended June 30, 2002.
12
Option Exercises And Holdings
The following table provides information with respect to option exercises
in fiscal 2002 by the Named Executive Officers and the value of such officers'
unexercised options at June 28, 2002.
Aggregated Option Exercises in Last Fiscal Year-End Option Values
- ---------------------------------------------------------------------------------------------------------------------------
Number of Shares
Underlying Unexercised Value of Unexercised
Options at In-the-Money Options at
Shares Fiscal Year-End (#) (1) Fiscal Year-End ($) (2)
Acquired On Value --------------------------- -----------------------------
Name Exercise (#) Realized(1) Exercisable Unexercisable Exercisable Unexercisable
- ------------------------------- --------------- ------------- -------------- ------------- ----------- ---------------
Robert H. Swanson, Jr......... 0 0 823,000 180,000 $15,425,802 $2,108,016
Clive B. Davies............... 50,000 $1,691,775 564,000 104,000 11,112,693 1,130,215
Robert C. Dobkin.............. 0 0 1,113,000 112,000 25,176,447 1,520,904
Paul Coghlan................... 0 0 541,000 64,000 11,916,371 756,267
Lothar Maier................... 0 0 100,000 100,000 152,370 152,370
- -----------------------------
(1) Market value of underlying securities on the exercise date, minus the
exercise price.
(2) Value is based on the last reported sale price of the Common Stock on the
Nasdaq National Market of $31.43 per share on June 28, 2002 (the last
trading day for fiscal 2002), minus the exercise price.
Employment Agreements
In January 2002, the Company entered into employment agreements with Mr.
Swanson, its Chairman and Chief Executive Officer, and with Messrs. Davies,
Coghlan and Dobkin, each a Named Executive Officer.
Employment Agreement with the Chairman and Chief Executive Officer
Mr. Swanson's employment agreement provides that he will receive an annual
base salary of $345,000, which is subject to annual adjustments by the
Compensation Committee, and bonuses pursuant to his participation in the
Company's 1996 Senior Executive Bonus Plan and Key Employee Incentive Bonus
Plan.
If Mr. Swanson is involuntarily terminated by the Company for any reason
other than cause (as defined in his employment agreement) or if he voluntarily
resigns with good reason (as defined in his employment agreement) or, after his
65th birthday, for any reason, then 100% of his stock options and restricted
stock will immediately vest, and he will receive continued payments of one
year's base salary and bonus. In addition, the Company will pay Mr. Swanson's
group health and dental plan continuation coverage premiums until the earlier of
18 months from his termination and such time as Mr. Swanson and his dependents
are covered by similar plans of a new employer.
If there is a change of control of the Company (as defined in his
employment agreement), Mr. Swanson will receive similar benefits to those above
immediately, including payment of one year's salary and bonus in a lump sum
within five days of the change of control.
If Mr. Swanson voluntarily resigns as Chief Executive Officer other than
for good reason, but agrees, at the request of the Board of Directors, to remain
as Chairman of the Board with duties requiring one to two days per week of Mr.
Swanson's time, Mr. Swanson will receive his existing salary and bonus pro rated
based on the number of full days Mr. Swanson performs services as Chairman
throughout the year, but in no event more than 50% of the last full annual bonus
received by Mr. Swanson. In such case, Mr. Swanson's benefits will
13
continue, and his stock options and restricted stock will vest at twice the rate
as if he had continued as Chief Executive Officer.
If Mr. Swanson should die while employed by the Company, 50% of his then
unvested restricted stock and options will vest immediately.
The Company has a fractional ownership in two different aircraft operated
by NetJets, Inc. So long as Mr. Swanson is either Chief Executive Officer or
Chairman of the Board, he is entitled to use the Company's airplane for personal
use for up to 35% of the available flight time in any year. To the extent use of
the airplane results in imputed taxable income to Mr. Swanson, the Company will
make additional payments to him so that the net effect is the same as if no
income were imputed to him.
If payments to Mr. Swanson under his employment agreement (together with
any other payments or benefits Mr. Swanson receives) would trigger the excise
tax provisions of Sections 280G and 4999 of the Code, Mr. Swanson will be paid
an additional amount so that he receives, net of the excise taxes, the amount he
would otherwise have been entitled to receive in their absence.
Employment Agreements with Three of the Named Executive Officers
The employment agreements with Messrs. Davies, Coghlan and Dobkin, each a
Named Executive Officer, provide for base salaries of $305,000, $285,000 and
$280,000, respectively, subject to certain annual adjustments by the Board of
Directors. Each of these executives is also entitled to bonuses pursuant to the
Company's 1996 Senior Executive Bonus Plan and Key Employee Incentive Bonus
Plan.
If any one of these executives is involuntarily terminated by the Company
for any reason other than cause (as defined in the employment agreements) or if
he voluntary resigns with good reason (as defined in the employment agreements),
then his stock options and restricted stock will immediately vest to the extent
they would have vested had the executive remained employed by the Company for an
additional six months, and he will receive continued payments of six month's
base salary and bonus. In addition, the Company will pay the executive's group
health and dental plan continuation coverage premiums until the earlier of six
months from his termination and such time as the executive and his dependents
are covered by similar plans of a new employer.
If, after a change of control (as defined in the employment agreements), an
executive is involuntarily terminated for any reason other than cause, or if he
voluntarily resigns with good reason, then 50% of his then unvested stock
options and restricted stock will immediately vest, and he will receive
continued payments of one year's base salary and 50% of his bonus. In addition,
the Company will pay the executive's group health and dental plan continuation
coverage premiums until the earlier of twelve months from his termination and
such time as the executive and his dependents are covered by similar plans of a
new employer.
If an executive should die while employed by the Company, 50% of his then
unvested restricted stock and options will vest immediately.
If payments to an executive under his employment agreement (together with
any other payments or benefits the executive receives) would trigger the excise
tax provisions of Sections 280G and 4999 of the Code, and such payments are less
than 3.59 multiplied by the executive's "base amount" (as defined in Section
280G), then the payments will be reduced so that no portion of the payments will
be subject to excise tax under Section 4999. If payments under the employment
agreement (together with any other payments or benefits the executive receives)
would exceed 3.59 multiplied by the executive's "base amount," then the
executive will be paid an additional amount so that he receives, net of the
excise taxes, the amount he would otherwise have been entitled to receive in
their absence.
14
PERFORMANCE GRAPH
The following graph shows a five-year comparison of cumulative total
stockholder return, calculated on a dividend-reinvested basis, for Linear
Technology Corporation, the Nasdaq National Market, the S&P Semiconductor
Equipment and Products Index (the "SEPI") and the S&P 500. The graph assumes
that $100 was invested in the Company's Common Stock, in the Nasdaq National
Market, in the SEPI and in the S&P 500 on the last trading day of the Company's
1996 fiscal year. Note that historic stock price performance is not necessarily
indicative of future stock price performance.
[The following descriptive data is supplied in accordance with Rule 304(d) of
Regulation S-T]
Year LLTC Nasdaq SEPI* S&P 500
- --------------------- ---------------- -------------- -------------- -----------
June 1997 100 100 100 100
June 1998 117 131 98 128
June 1999 262 186 176 155
June 2000 499 275 398 164
June 2001 346 150 176 138
June 2002 247 101 110 112
* Following the Standard & Poor's index reclassification, the S&P
Electronics Index used by the Company in prior years is no longer available.
15
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AUDIT COMMITTEE REPORT
The following is the Audit Committee's report submitted to the Board of
Directors for the fiscal year ended June 30, 2002.
The Audit Committee of the Board of Directors has:
o reviewed and discussed the Company's audited financial statements for
the fiscal year ended June 30, 2002 with the Company's management;
o discussed with Ernst & Young LLP, the Company's independent auditors,
the materials required to be discussed by Statement of Auditing
Standard 61; and
o reviewed the written disclosures and the letter from Ernst & Young LLP
required by Independent Standards Board No. 1 and has discussed with
Ernst & Young LLP its independence.
Based on the Audit Committee's review of the matters noted above and its
discussions with the Company's independent auditors and the Company's
management, the Audit Committee recommended to the Board of Directors that the
financial statements be included in the Company's 2002 Annual Report on Form
10-K.
Respectfully submitted by:
THE AUDIT COMMITTEE
David S. Lee
Leo T. McCarthy
Richard M. Moley
Thomas S. Volpe
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16
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COMPENSATION COMMITTEE REPORT
Introduction
The Compensation Committee of the Board of Directors is composed only of
non-employee directors. It is responsible for reviewing and recommending for
approval by the Board of Directors the Company's compensation practices,
executive salary levels and variable compensation programs, both cash-based and
equity-based. The Committee generally determines base salary levels for
executive officers of the Company at or about the start of each fiscal year and
determines actual bonuses at the end of each six-month fiscal period based upon
Company and individual performance.
Compensation Philosophy
The Committee has adopted an executive pay-for-performance philosophy
covering all executive officers, including the Chief Executive Officer. This
philosophy emphasizes variable compensation in order to align executive
compensation with the Company's business objectives and performance and to
attract, retain and reward executives who contribute both to the short-term and
long-term success of the Company. Pay is sufficiently variable that
above-average performance results in above-average total compensation, and
below-average performance for the Company or the individual results in
below-average total compensation. The focus is on corporate performance and
individual contributions toward that performance.
Compensation Program
The Company has a comprehensive compensation program which consists of cash
compensation, both fixed and variable, and equity-based compensation. The
program has four principal components, which are intended to attract, retain,
motivate and reward executives who are expected to manage both the short-term
and long-term success of the Company. These components are:
Cash-Based Compensation
Base Salary--Base salary is predicated on industry and peer group
comparisons and on performance judgments as to the past and expected future
contribution of the individual executive officer. In general, salary increases
are made based on median increases in salaries for similar executives of
similar-size companies in the high technology industry.
Profit Sharing--Profit sharing payments are distributed semi-annually to
all employees, including executives, from a profit sharing pool. The amount of
the pool is largely determined by the magnitude of sales and operating income
for the six-month period. This pool is distributed to all eligible employees
based on the ratio of their individual salary to total salaries for all
employees. A portion of this profit sharing is paid directly into a 401(k)
retirement plan for all United States employees.
Bonuses--The Company has a discretionary key employee incentive pool
pursuant to which executive officers and a limited number of key employees may
receive semi-annual cash bonuses. Targets for sales growth and operating income
as a percentage of sales influence the size of the pool. Individual payments are
made based on the Company's achievement of these targets and upon the
individual's personal and departmental performance.
In 1996, the Company adopted the 1996 Senior Executive Bonus Plan to
facilitate, under Section 162(m) of the Internal Revenue Code, the federal
income tax deductibility of compensation paid to
- --------------------------------------------------------------------------------
17
- --------------------------------------------------------------------------------
the Company's most highly compensated executive officers. In fiscal 2002, the
participants were Messrs. Swanson, Davies, Dobkin, Coghlan and Maier. In fiscal
2003, the plan will include the Chief Executive Officer and each of the
Company's four other most highly compensated executive officers. In July 2000,
the Board of Directors approved an amendment to the plan to increase the maximum
amount payable to any individual in any one year under the plan from $3 million
to $5 million. This amendment was approved by the Company's stockholders in
November 2000.
Equity-Based Compensation
Stock Options--Stock options are granted periodically to provide additional
incentive to executives and other key employees to work to maximize long-term
total return to stockholders. The options generally vest over a five-year period
to encourage option holders to continue in the employ of the Company. Over 41%
of worldwide employees have received stock options. In granting options, the
Compensation Committee takes into account the number of shares and outstanding
options already held by the individual.
Chief Executive Officer Compensation
The Committee uses the same factors and criteria described above for
compensation decisions regarding the Chief Executive Officer.
Compensation Limitations for Tax Purposes
The Committee has considered the potential impact of Section 162(m) of the
Internal Revenue Code adopted under the federal Revenue Reconciliation Act of
1993. Section 162(m) generally disallows a tax deduction for any publicly-held
corporation for individual compensation exceeding $1 million in any taxable year
for any of the Named Executive Officers, unless compensation is
performance-based. The Company's policy is to qualify, to the extent reasonable,
its executive officers' compensation for deductibility under applicable tax
laws. In 1996, the Company implemented the 1996 Senior Executive Bonus Plan in
order to qualify certain bonus payments to the Named Executive Officers as
performance-based compensation under Section 162(m). The Committee believes that
the implementation of the 1996 Senior Executive Bonus Plan enables the Company
to compensate its executive officers in accordance with its pay-for-performance
philosophy while maximizing the deductibility of such compensation. However, the
Committee recognizes that the loss of a tax deduction may be necessary in some
circumstances.
Summary
The Committee believes that a fair and motivating compensation program has
played a critical role in the success of the Company. The Committee reviews this
program on an ongoing basis to evaluate its continued effectiveness.
Respectfully submitted by:
THE COMPENSATION COMMITTEE
David S. Lee
Leo T. McCarthy
Richard M. Moley
Thomas S. Volpe
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18
OTHER MATTERS
The Company knows of no other matters to be submitted to the meeting. If
any other matters properly come before the meeting or any adjournment or
postponement thereof, it is the intention of the persons named in the enclosed
form of proxy to vote the shares they represent as the Board of Directors may
recommend.
BY ORDER OF THE BOARD OF DIRECTORS
Dated: September 25, 2002
19
Appendix A: Proxy
20
EDGAR APPENDIX A
PROXY
LINEAR TECHNOLOGY CORPORATION
2002 ANNUAL MEETING OF STOCKHOLDERS
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned stockholder of Linear Technology Corporation, a Delaware
corporation, hereby acknowledges receipt of the Notice of Annual Meeting of
Stockholders and Proxy Statement, each dated September 25, 2002 and hereby
appoints Robert H. Swanson, Jr. and Paul Coghlan, or either of them, as
attorneys-in-fact, each with full power, on behalf and in the name of the
undersigned, to represent the undersigned at the 2002 Annual Meeting of
Stockholders of Linear Technology Corporation to be held on November 6, 2002, at
3:00 p.m. local time, at the Company's principal executive offices, located at
720 Sycamore Drive, Milpitas, California 95035, and at any postponement or
adjournment thereof, and to vote all shares of Common Stock which the
undersigned would be entitled to vote if then and there personally present, on
the matters set forth on the reverse side, and, in their discretion, upon such
other matter or matters which may properly come before the meeting and any
adjournment thereof.
This proxy will be voted as directed or, if no contrary direction is indicated,
will be voted FOR the election of the specified nominees as directors, FOR the
ratification of the appointment of Ernst & Young LLP as independent auditors,
and as said proxies deem advisable on such other matters as may properly come
before the meeting.
- -------------------------- --------------------------
SEE REVERSE SIDE CONTINUED AND TO BE SIGNED ON REVERSE SIDE SEE REVERSE SIDE
- -------------------------- --------------------------
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THIS PROXY WILL BE VOTED AS DIRECTED, OR, IF NO CONTRARY DIRECTION IS INDICATED, WILL BE VOTED FOR THE ELECTION OF THE SPECIFIED
NOMINEES AS DIRECTORS, FOR THE RATIFICATION OF THE APPOINTMENT OF ERNST & YOUNG LLP AS INDEPENDENT AUDITORS, AND AS SAID PROXIES
DEEM ADVISABLE ON SUCH OTHER MATTERS AS MAY COME BEFORE THIS MEETING.
1. To elect five (5) directors to serve until the next Annual
Meeting of Stockholders and until their successors are elected. FOR WITHHELD
ALL FROM ALL
Nominees: Robert H. Swanson, Jr.; David S. Lee; Leo T. McCarthy; [ ] [ ]
Richard M. Moley; Thomas S. Volpe
[ ] For all nominees exactly except as noted
------------------------------
2. To ratify the appointment of Ernst & Young LLP as independent
auditors of the Company for the fiscal year ending June 29, 2003. FOR AGAINST ABSTAIN
[ ] [ ] [ ]
In their discretion, upon such other matter or matters which may properly come before the meeting and any postponement or
adjournment thereof.
This proxy should be marked, dated, signed by the stockholder(s) exactly as his or her name appears hereon, and returned promptly in
the enclosed envelope. Persons signing in a fiduciary capacity should so indicate. If shares are held by joint tenants or as
community property, both should sign.
Signature: Date: Signature: Date:
---------------------- ---------- --------------------------- -------------
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WHETHER OR NOT YOU PLAN TO ATTEND THE MEETING IN PERSON YOU ARE URGED TO SIGN AND PROMPTLY
MAIL THIS PROXY IN THE RETURN ENVELOPE SO THAT YOUR STOCK MAY BE REPRESENTED AT THE MEETING.
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