<PAGE> 1
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))
[ ] Definitive Proxy Statement
[X] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Section 240.14a-11(c) or Section
240.14a-12
LSI LOGIC 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
[ ] $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), 14a-6(i)(2) or
Item 22(a)(2) of Schedule 14A.
[ ] $500 per each party to the controversy pursuant to Exchange Act Rule
14a-6(i)(3).
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) 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.
[ ] 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:
2) Form, Schedule or Registration Statement No.:
3) Filing Party:
4) Date Filed:
<PAGE> 2
(Date)
(Name)
(Address)
Dear __________:
You should have recently received LSI Logic's Proxy Statement for the 1997
Annual Meeting of Stockholders to be held on May 6 at our facility in Gresham,
Oregon. For your convenience, an additional copy of the Proxy Statement is
enclosed here.
Among the proposals this year there are four that deal with reserving additional
shares of common stock for our Employee Stock Purchase Plan (Purchase Plan) and
our 1991 Equity Incentive Plan (Incentive Plan). The purpose of this letter is
to encourage your vote in the affirmative on all proposals and to address
certain frequently heard concerns of stockholders as they may relate to the
Purchase Plan or the Incentive Plan.
The Purchase Plan allows employees to elect to withhold wages to periodically
purchase shares of LSI Logic Common Stock at a discounted price. The employee
Incentive Plan provides for the issuance of non-qualified stock options,
incentive stock options and other stock-based or related benefits. Details of
both plans are included in the Proxy Statement.
The proposals to reserve additional shares for issuance under the Purchase Plan
and the Incentive Plan have been structured to reflect the Board of Directors'
awareness of stockholder interests in how, and to what extent, the benefits
under such stock-based plans are provided.
Proposals relating to each plan request approval for an "evergreen" feature. In
determining the amount of new shares to be added each year, an aggregate amount
of less than five (5) percent of outstanding and issued shares at the beginning
of each year was selected. The annual increases of shares to be added to both
plans is believed to be consistent with internal guidelines for many
stockholders. Expressed as a percentage of outstanding shares, the numbers of
shares that would be added are consistent with LSI Logic's historical practices.
An additional component of the Incentive Plan evergreen proposal is to limit its
applicability to only seven years before shareholder approval would again need
to be obtained. We believe this feature would add stability and predictability
to the plans within appropriate limits.
<PAGE> 3
We are also aware that some stockholders prefer that stock option plans limit or
even prohibit any authority to reprice previously granted stock options without
first obtaining stockholder approval. While LSI Logic's Incentive Plan does not
contain a restriction to this effect, it is believed that the Company's past
practices reflect an approach to this topic that is both conservative and
realistic in the electronics industry.
As you know, LSI Logic is an employer that must recruit for and attempt to
retain a substantial portion of the Company's key engineering talent in Silicon
Valley. In this context, LSI Logic's practice is to grant stock options at fair
market value at the time of grant. Further, consideration of the question of
stock option repricing has and would be considered in the future only in
circumstances that the Company regarded as extraordinary. We believe, for
example, that the repricing offered in 1996 reflects this attitude, since it did
not include the CEO or the individuals who then were the four highest
compensated executive officers. Also, a vesting restart requirement was imposed
as a condition of obtaining the new price. We trust you will agree that our
practice reflects an appropriate balance of business requirements and adequate
stockholder protections.
LSI Logic firmly believes that, in the context of the competitive environment in
which we seek to recruit and retain talented people, stock-based employee
incentive compensation plans are a crucial component of our compensation
strategy.
Should you have any questions about the foregoing or any of the other proposals
this year, please do not hesitate to contact me at 408.433.4365.
We look forward to receiving your affirmative vote.
Sincerely,
Diana Matley
Director, Investor Relations
Enc.
