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NOTICE OF 1995 ANNUAL MEETING OF SHAREHOLDERS
MONDAY, JANUARY 29, 1996
------------------
TO THE SHAREHOLDERS:
NOTICE IS HEREBY GIVEN that the 1995 Annual Meeting of Shareholders of
Micron Technology, Inc., a Delaware corporation (the "Company"), will be held on
January 29, 1996, at 9:00 a.m., Mountain Standard Time, at the BOISE CENTRE ON
THE GROVE, 850 W. FRONT STREET, BOISE, ID 83702, for the following purposes:
1. To elect directors to serve for the ensuing year and until their
successors are elected and qualified.
2. To approve an amendment to the Company's Certificate of
Incorporation increasing the number of authorized shares of Common Stock
from 300,000,000 to 1,000,000,000 shares.
3. To approve an amendment to the Company's 1994 Stock Option Plan
increasing the number of shares of Common Stock reserved for future grant
from 2,000,000 to 7,000,000 shares.
4. To ratify the appointment of Coopers & Lybrand L.L.P. as independent
accountants of the Company for the fiscal year ending August 29, 1996.
5. To transact such other business as may properly come before the
meeting or any adjournment thereof.
The foregoing items of business are more fully described in the Proxy
Statement accompanying this Notice.
Only shareholders of record at the close of business on November 30, 1995,
are entitled to notice of and to vote at the meeting.
All shareholders are cordially invited to attend the meeting in person.
Directions to the meeting's location accompany the Proxy Statement. However, to
ensure your representation at the meeting, you are urged to vote, sign, date,
and return the enclosed Proxy as promptly as possible in the postage-prepaid
envelope enclosed for that purpose. The shareholders attending the meeting may
vote in person even if they have returned a proxy.
By Order of the Board of Directors
WILBUR G. STOVER, JR.
VICE PRESIDENT, FINANCE, CHIEF
FINANCIAL OFFICER AND CORPORATE
SECRETARY
Boise, Idaho
December 18, 1995
YOUR VOTE IS IMPORTANT NO MATTER HOW MANY SHARES YOU OWN
Please indicate your voting instructions on the enclosed proxy card, date
and sign it, and return it in the envelope provided, which is addressed for your
convenience. No postage is required if mailed in the United States.
PLEASE MAIL YOUR PROXY PROMPTLY
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8000 S. FEDERAL WAY
BOISE, IDAHO 83706-9632
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PROXY STATEMENT
1995 ANNUAL MEETING OF SHAREHOLDERS
MONDAY, JANUARY 29, 1996
---------------------
INFORMATION CONCERNING SOLICITATION AND VOTING
GENERAL
The enclosed Proxy is solicited on behalf of the Board of Directors of
Micron Technology, Inc. (the "Company"), for use at the 1995 Annual Meeting of
Shareholders to be held on January 29, 1996, at 9:00 a.m., Mountain Standard
Time, or at any adjournment thereof (the "Annual Meeting"). The purposes of the
Annual Meeting are set forth herein and in the accompanying Notice of 1995
Annual Meeting of Shareholders. The Annual Meeting will be held at the BOISE
CENTRE ON THE GROVE, 850 W. FRONT STREET, BOISE, IDAHO 83702. Directions to the
Annual Meeting accompany this Proxy Statement. The Company's telephone number is
(208) 368-4000.
This Proxy Statement and enclosed Proxy are first being mailed on or about
December 18, 1995, to all shareholders entitled to vote at the meeting.
RECORD DATE
Shareholders of record at the close of business on November 30, 1995 (the
"Record Date"), are entitled to notice of and to vote at the meeting.
DEADLINE FOR RECEIPT OF SHAREHOLDER PROPOSALS FOR 1996 ANNUAL MEETING
Proposals of shareholders of the Company which are intended to be presented
at the Company's 1996 Annual Meeting of Shareholders, must be received by the
Company no later than July 1, 1996, and otherwise be in compliance with
applicable laws and regulations in order to be included in the proxy statement
and form of proxy relating to that meeting.
REVOCABILITY OF PROXY
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 a written
notice of revocation or a duly executed proxy bearing a later date or by
attending the Annual Meeting and voting in person.
SOLICITATION
The cost of solicitation will be borne by the Company. In addition, the
Company may reimburse brokerage firms and other persons representing beneficial
owners of shares for their expenses in forwarding solicitation materials to such
beneficial owners. Proxies may be solicited by the Company's directors, officers
and employees, without additional compensation, personally or by telephone,
facsimile or telegram. The Company intends to use the services of Beacon Hill
Partners, Inc., a proxy solicitation firm, in connection with the solicitation
of proxies. Although the exact cost of those services is not known at this time,
it is anticipated that the cost will be approximately $5,000.
VOTING SECURITIES AND PRINCIPAL HOLDERS
OUTSTANDING SHARES
The Company has only one class of stock outstanding, the Company's common
stock, $.10 par value per share (the "Common Stock"). At the Record Date,
206,970,339 shares of the Company's Common Stock were issued and outstanding.
<PAGE>
VOTING RIGHTS
Under the Delaware General Corporation Law and the Company's Certificate of
Incorporation and Bylaws, each shareholder will be entitled to one vote for each
share of Common Stock held at the Record Date for all matters, including the
election of directors, unless cumulative voting for the election of directors is
required. Cumulative voting for the election of directors shall not be required
unless at least one shareholder has given notice at the meeting, prior to the
voting, of the intention to cumulate votes. In the event cumulative voting is
requested, every shareholder voting for the election of directors may cumulate
such shareholder's votes and give one candidate a number of votes equal to the
number of directors to be elected multiplied by the number of votes to which the
shareholder's shares are entitled, or distribute the shareholder's votes among
as many candidates as the shareholder thinks fit, provided that votes cannot be
cast for more than ten (10) candidates. In the event cumulative voting is
required, the persons authorized to vote shares represented by proxies shall
have the authority and discretion to vote such shares cumulatively for any
candidate or candidates for whom authority to vote has not been withheld. The
ten nominees for director receiving the highest number of votes cast will be
elected, whether or not any one of them receives the vote of a majority of the
shares represented and entitled to vote at the meeting. Abstentions and broker
nonvotes as to the election of the directors will not count as votes cast "FOR"
or "AGAINST" any nominee.
With respect to the proposed amendment to the Company's Certificate of
Incorporation, such business item will require the affirmative vote of a
majority of the outstanding shares of Common Stock entitled to vote on such
matter. Thus, abstentions and broker nonvotes will have the effect of a vote
"AGAINST" such business item.
All other business items will require the affirmative vote of a majority of
the shares of Common Stock represented at the meeting and entitled to vote on
such matters. Abstentions as to such business items will have the effect of a
vote "AGAINST" such proposals. Broker nonvotes with respect to such business
items will not be counted for purposes of determining the number of shares
represented and entitled to vote at the meeting and will not represent a vote
either "FOR" or "AGAINST" such items of business. Thus, broker nonvotes as to
these proposals will not have any effect on their passage or failure to pass.
VOTING OF PROXIES
The shares of Common Stock represented by all properly executed proxies
received in time for the meeting will be voted in accordance with the directions
given by the shareholders. IF NO INSTRUCTIONS ARE GIVEN, THE SHARES WILL BE
VOTED (i) FOR each of the nominees named herein as directors, or their
respective substitutes as may be appointed by the Board of Directors; (ii) FOR
the amendment to the Company's Certificate of Incorporation; (iii) FOR the
amendment to the Company's 1994 Stock Option Plan; and (iv) FOR ratification of
the appointment of Coopers & Lybrand L.L.P. as independent accountants of the
Company for fiscal 1996.
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SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth security ownership information as of November
30, 1995, for (i) persons known by the Company to own beneficially more than
five percent (5%) of the Company's Common Stock, (ii) each director, (iii) each
Named Executive Officer listed in the "SUMMARY COMPENSATION TABLE" set forth
herein, and (iv) all directors and executive officers as a group:
<TABLE>
<CAPTION>
AMOUNT AND NATURE OF PERCENT OF
NAME AND ADDRESS OF BENEFICIAL OWNER BENEFICIAL OWNERSHIP CLASS
- ------------------------------------------------------------------------------- --------------------- -----------
<S> <C> <C>
J.R. Simplot Company........................................................... 23,699,000 (1) 11.45%
999 Main Street, Suite 1300
Boise, Idaho 83707
John R. Simplot................................................................ 18,077,700 (2)(3) 8.73%
999 Main Street, Suite 1300
Boise, Idaho 83707
Simplot Canada Limited......................................................... 2,600,000 (4) 1.26%
Steven R. Appleton............................................................. 145,466 (5)(6) *
Donald D. Baldwin.............................................................. 42,800 (5)(6) *
Edward J. Heitzeberg........................................................... 233,700 (5)(6) *
Jerry M. Hess.................................................................. 22,000 (7) *
Robert A. Lothrop.............................................................. 40,049 (8) *
Tyler A. Lowrey................................................................ 80,998(5)(6)(9) *
Thomas T. Nicholson............................................................ 1,601,670 (10) *
Allen T. Noble................................................................. 2,001,200 *
Joseph L. Parkinson............................................................ 0 (11) n/a
Don J. Simplot................................................................. 148,020 (2)(12) *
Gordon C. Smith................................................................ 750 (13) *
Kenneth G. Smith............................................................... 59,000 (5)(6) *
Wilbur G. Stover, Jr........................................................... 39,398 (5)(6) *
All directors and executive officers as a group (20
persons)(2),(3),(5),(6),(7),(8),(9),(10),(11),(12),(13),(14).................. 49,054,071 23.70%
</TABLE>
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* Less than 1%
(1)Does not include shares held by Simplot Canada Limited, a wholly owned
subsidiary of the J.R. Simplot Company, and by Messrs. John R. Simplot and
Don J. Simplot.
(2)Messrs. John R. Simplot and Don J. Simplot, directors of the Company, are
shareholders of the J.R. Simplot Company. Mr. Don J. Simplot serves as a
director, member of the Office of the Chairman of the Board of Directors and
as Corporate Vice President of the J.R. Simplot Company. In addition to
their respective number of shares indicated in the table, these individuals
may be deemed to be beneficial owners of 23,699,000 shares held by the J.R.
Simplot Company and 2,600,000 shares held by Simplot Canada Limited, a
wholly owned subsidiary of the J.R. Simplot Company.
(3)Includes 11,917,600 shares held in the J.R. Simplot Self Declaration of
Revocable Trust dated December 21, 1989, 15,200 shares held by Mrs. Simplot,
22,400 shares held in joint tenancy with Mrs. Simplot, 6,122,449 shares held
in the JRS Properties L.P., an Idaho Limited Partnership, and 51 shares held
in S-Sixteen L.P., on Idaho Limited Partnership.
(4)Simplot Canada Limited is a wholly owned subsidiary of the J.R. Simplot
Company.
(5)Does not include shares of common stock of Micron Communications, Inc.
("MCC"), a subsidiary of the Company, held by Mr. Appleton, 1,206; Mr.
Baldwin, 1,206; Mr. Heitzeberg, 1,206; Mr. Lowrey, 1,285; Mr. Kenneth G.
Smith, 463; Mr. Stover, 1,206; and all directors and executive
3
<PAGE>
officers as a group (20 persons), 12,892. The total number of shares held by
all directors and executive officers as a group represents 1.76% of the
total outstanding shares of MCC common stock.
(6)Includes options exercisable within 60 days of November 30, 1995, under the
Company's 1985 Incentive Stock Option Plan and the Company's 1994 Stock
Option Plan in the following amounts: Mr. Appleton, 87,646; Mr. Baldwin,
15,800; Mr. Heitzeberg, 78,000; Mr. Lowrey, 58,998; Mr. Kenneth G. Smith,
45,000; Mr. Stover, 27,398; and all directors and executive officers as a
group (20 persons), 849,682.
(7)Includes 20,000 shares held directly in the name of Jerry M. Hess and 2,000
shares held in the name of J.M. Hess Construction Co.
(8)Includes 40 shares held directly in the name of Robert A. Lothrop, 424
shares held in the name of Mrs. Lothrop, and 39,585 shares held in joint
tenancy with Mrs. Lothrop.
(9)Does not include 1,966 shares of common stock of Micron Quantum Devices,
Inc. ("MQD"), a subsidiary of the Company, held by Mr. Lowrey, which
represents less than one percent (1%) of the total outstanding shares of MQD
common stock. No other directors or executive officers of the Company hold
shares of MQD common stock.
(10)Includes 1,550,000 shares held directly in the name of Thomas T. Nicholson,
16,670 shares held in the name of Mrs. Nicholson, 10,000 shares held in the
name of Mountain View Equipment, 8,000 shares held in the name of
Miller-Nicholson, Inc., 7,000 shares held in the name of MNI, and 10,000
shares held in the name of MNII.
(11)Reflects ownership as of May 1, 1995. Changes in beneficial ownership of
Company securities, if any, subsequent to such date have not been reported
by Mr. Parkinson to the Company.
(12)Includes 143,020 shares held in the name of Mr. Don J. Simplot directly and
5,000 shares held by Mr. Don J. Simplot as custodian for his minor child.
(13)All shares are held in joint tenancy with Mrs. Gordon C. Smith.
(14)Includes beneficial ownership, if any, for Mr. Joseph L. Parkinson and Mr.
Kenneth G. Smith. Also, includes 23,699,000 shares held by the J.R. Simplot
Company and 2,600,000 shares held by Simplot Canada Limited (see footnote
(3) above).
BUSINESS TO BE TRANSACTED
1. ELECTION OF DIRECTORS
NOMINEES
The Company's Bylaws currently provide for ten (10) directors, and it is
contemplated that a Board of ten (10) directors will be elected at the meeting.
Unless otherwise instructed, the proxy holders will vote the proxies received by
them for management's ten (10) nominees named below, all of whom are presently
directors of the Company. In the event that any management nominee is unable or
declines to serve as a director at the time of the Annual Meeting, the proxies
will be voted for any nominee who shall be designated by the present Board of
Directors to fill the vacancy. 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. It is not expected that any nominee
will be unable or will decline to serve as a director. The term of office of
each person elected as a director will continue until the next annual meeting of
4
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shareholders and until such person's successor has been elected and qualified.
Officers are appointed by the Board of Directors and serve at the discretion of
the Board. The names of the ten (10) nominees and certain information about them
are set forth below:
<TABLE>
<CAPTION>
SERVED AS A
DIRECTOR
NAME OF NOMINEE AGE PRINCIPAL OCCUPATION SINCE
- -------------------------- --- ---------------------------------------------------------------- -------------
<S> <C> <C> <C>
Steven R. Appleton 35 Chairman of the Board of Directors, Chief Executive Officer and 1994(1)
President of the Company
Jerry M. Hess 57 Chairman and Chief Executive Officer of J.M. Hess Construction 1994
Company, Inc. (General Construction)
Robert A. Lothrop 69 Former Senior Vice President of J.R. Simplot Company (Food 1994(2)
Processing, Fertilizer and Agricultural Chemicals
Manufacturing)
Tyler A. Lowrey 42 Vice Chairman of the Board of Directors and Chief Technical 1994(3)
Officer of the Company
Thomas T. Nicholson 59 Vice President of Honda of Seattle (Automobile Distributorship); 1980
President of Mountain View Equipment (Farm Equipment
Dealership); and Partner of CC&T Land & Livestock (Cattle
Business)
Allen T. Noble 66 President of Farm Development Corporation (Land Development and 1980
Agribusiness Interests); Director, West One Bancorp (Financial
Institution)
Don J. Simplot 60 Member of Office of the Chairman and Corporate Vice President of 1982
the J.R. Simplot Company (Food Processing, Fertilizer and
Agricultural Chemicals Manufacturing); Director, AirSensors,
Inc. (Alternative Fuels Conversion Equipment)
John R. Simplot 86 Former Chairman of the Board of the J.R. Simplot Company (Food 1980
Processing, Fertilizer and Agricultural Chemicals
Manufacturing)
Gordon C. Smith 66 Former President and Chief Executive Officer of the J.R. Simplot 1990
Company (Food Processing, Fertilizer and Agricultural Chemicals
Manufacturing)
Wilbur G. Stover, Jr. 42 Vice President, Finance, Chief Financial Officer and Corporate 1994
Secretary of the Company
</TABLE>
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(1) Mr. Appleton also served as a member of the Board of Directors of the
Company between April 1991 and July 1992.
(2) Mr. Lothrop also served as a member of the Board of Directors of the Company
between August 1986 and July 1992.
(3) Mr. Lowrey also served as a member of the Board of Directors of the Company
between August 1990 and July 1992.
Each of the nominees has been engaged in his principal occupation set forth
above during the past five years, except as follows:
(i) During the past five years, Steven R. Appleton served in various
capacities with the Company, its subsidiaries and affiliates, including
President and Chief Operating Officer and Vice President, Manufacturing of
the Company; Chairman of the Board of Directors of Micron Semiconductor,
Inc. (a wholly owned subsidiary of the Company); and President and Chief
Executive Officer of Micron Semiconductor, Inc.
(ii) Robert A. Lothrop served as Senior Vice President of the J.R.
Simplot Company from January 1986 until his retirement in January 1991.
5
<PAGE>
(iii) During the past five years, Tyler A. Lowrey served in various
capacities with the Company, its subsidiaries and affiliates, including Vice
President, Research and Development of the Company; Vice President, Process
Research and Development and Assistant Technical Officer of the Company; and
Vice President, Chief Technical Officer and director of Micron
Semiconductor, Inc.
(iv) Don J. Simplot served as the President of Simplot Financial
Corporation, a wholly owned subsidiary of the J.R. Simplot Company, from
February 1985 until January 1992. In April 1994, Mr. Don J. Simplot was
appointed as a member of the Office of the Chairman of the J.R. Simplot
Company.
(v) John R. Simplot served as the Chairman of the Board of Directors of
the J.R. Simplot Company prior to his retirement in April 1994. Mr. John R.
Simplot currently serves as Chairman Emeritus of the J.R. Simplot Company.
(vi) Gordon C. Smith served in various management positions from July
1980 until January 1992 for Simplot Financial Corporation, a wholly owned
subsidiary of the J.R. Simplot Company. From May 1988 until his retirement
in March 1994, Mr. Smith served as the President and Chief Executive Officer
of the J.R. Simplot Company. Mr. Smith also currently serves as a director
of the J.R. Simplot Company.
(vii) During the past five years, Wilbur G. Stover, Jr. served in various
capacities with the Company, its subsidiaries and affiliates, including,
Controller and Treasurer of the Company and Vice President, Finance, and
Chief Financial Officer of Micron Semiconductor, Inc.
Mr. Allen T. Noble has served as a director of West One Bancorp, or its
predecessor, since 1975 (except for the period between March 1983 through
September 1984). West One Bancorp is the parent company of West One Bank, Idaho,
the Company's stock transfer agent and registrar. West One Bancorp is a publicly
traded company.
There is no family relationship between any director or executive officer of
the Company, except between John R. Simplot and Don J. Simplot, who are father
and son, respectively.
SECTION 16(A) COMPLIANCE
Section 16(a) of the Securities and Exchange Act of 1934 requires the
Company's directors and executive officers, and persons who own beneficially
more than ten percent (10%) of the Common Stock of the Company, to file reports
of ownership and changes of ownership with the Securities and Exchange
Commission and the New York Stock Exchange. Copies of all filed reports are
required to be furnished to the Company pursuant to Section 16(a). Based solely
on the reports received by the Company and on written representations from
reporting persons, the Company believes that the directors, executive officers,
and greater than ten percent (10%) beneficial owners complied with all
applicable filing requirements during the fiscal year ended August 31, 1995,
except for Mr. John R. Simplot. Mr. John R. Simplot, who is a director of the
Company, failed to timely report on SEC Form 4 (Statement of Changes in
Beneficial Ownership) a purchase by his spouse of 250 shares of Common Stock of
the Company in March 1995. In addition, on February 14, 1990, Mr. John R.
Simplot transferred all of the shares of Common Stock that he held directly on
such date to the J.R. Simplot Self Declaration of Revocable Trust dated December
21, 1989. This transaction, which did not change Mr. Simplot's interest in such
shares, was not timely reported.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
In March of 1995, Lake Hazel Shopping Center, an Idaho general partnership,
of which Mr. Nicholson is a partner, sold approximately 80 acres of real
property located in Ada County, Idaho, to the Company for $708,445. The
acquisition of the real estate was in the Company's ordinary course of obtaining
property for expansion of its operations at its Boise, Idaho site.
6
<PAGE>
BOARD MEETINGS AND COMMITTEES
The Board of Directors of the Company held a total of sixteen (16) meetings
during the fiscal year ended August 31, 1995. The Board of Directors has formed
a standing Audit Committee and a standing Compensation Committee.
The Audit Committee, which consists of Mr. Nicholson, Mr. Noble, and Mr.
Gordon C. Smith, held two (2) meetings during fiscal 1995. The Audit Committee
is primarily responsible for reviewing the services performed by the Company's
independent accountants and evaluating the Company's accounting principles and
system of internal accounting controls.
The Compensation Committee, which consists of Mr. Lothrop, Mr. Nicholson,
Mr. Noble, and Mr. John R. Simplot, held three (3) meetings during fiscal 1995.
The Compensation Committee is primarily responsible for reviewing and approving
the compensation for the Company's officers. (See "Compensation Committee
Interlocks and Insider Participation" set forth herein.)
During fiscal 1995, all incumbent directors attended 75% or more of the
total number of meetings of the Board of Directors and of the total number of
meetings of all committees of the Board on which they served.
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COMPENSATION OF DIRECTORS AND EXECUTIVE OFFICERS
The following table shows all compensation paid to the Company's Chief
Executive Officer and the Company's other four most highly compensated executive
officers who were serving as executive officers at the end of fiscal 1995 for
all services rendered to the Company and its subsidiaries for each of the last
three completed fiscal years. The table also shows all such compensation paid to
Mr. Parkinson, Chief Executive Officer through September 26, 1994 and Mr.
Kenneth G. Smith, an executive officer through May 10, 1995, who would have been
one of the four most highly compensated executive officers of the Company other
than the CEO, except for the fact that he was not serving as an executive
officer at the end of fiscal 1995:
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
LONG-TERM
ANNUAL COMPENSATION COMPENSATION
------------------------------------------------- ----------------
FISCAL OTHER ANNUAL OPTIONS ALL OTHER
NAME AND PRINCIPAL POSITION (1) YEAR SALARY (2) BONUS (3)(4) COMPENSATION (5) GRANTED (#)(6)(7) COMPENSATION (8)
- -------------------------------- --------- ----------- ------------- --------------------- ---------------- ----------------
<S> <C> <C> <C> <C> <C> <C>
Steven R. Appleton 1995 $ 450,000 $ 1,239,540 $ 0 120,000 $ 57,017
Chairman, CEO 1994 436,624 640,246 0 100,000 42,397
and President 1993 232,692 150,227 0 125,008(9) 22,663
Tyler A. Lowrey 1995 450,000 1,245,274 0 120,000 15,262
Vice Chairman, 1994 436,624 613,818 0 100,000 4,717
Chief Technical Officer 1993 232,692 303,907 0 125,008(9) 4,154
Edward J. Heitzeberg 1995 200,000 613,047 0 80,000 25,000
Vice President, Quality 1994 196,836 227,507 0 75,000 20,642
1993 176,635 182,284 0 60,010(9) 4,459
Wilbur G. Stover, Jr. 1995 233,385 576,845 0 72,000 12,249
Vice President, Finance, 1994 156,692 189,385 0 49,998 4,176
CFO and Secretary 1993 120,008 48,290 0 60,010(9) 1,877
Donald D. Baldwin 1995 205,000 516,027 0 64,000 20,447
Vice President, Sales 1994 200,949 201,758 0 75,000 16,112
1993 159,808 53,815 0 60,010(9) 13,933
Joseph L. Parkinson 1995 370,769 201,976 0 0 157,398
Former Chairman 1994 679,722 656,318 0 0 51,433
and CEO 1993 331,731 491,787 0 0 12,584
Kenneth G. Smith 1995 204,500 592,672 0 80,000 30,204
Former Vice President, 1994 200,943 202,158 0 75,000 17,180
Operations 1993 159,808 51,949 0 60,010(9) 12,308
</TABLE>
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(1) Represents the Chief Executive Officer and four most highly compensated
executive officers, other than the Chief Executive Officer, in their
respective positions at the end of fiscal 1995. Mr. Parkinson, and certain
other officers of the Company, resigned from their positions as officers and
directors of the Company effective as of September 26, 1994. Effective upon
their resignations, Steven R. Appleton was appointed to serve as the
Company's Chairman, Chief Executive Officer, and President; Tyler A. Lowrey
was appointed to serve as Vice Chairman and Chief Technical Officer; and
Wilbur G. Stover, Jr. was appointed to serve as Vice President, Finance, and
Chief Financial Officer of the Company. Mr. Kenneth G. Smith, former Vice
President, Operations, resigned as an officer of the Company on May 10,
1995.
(2) Includes compensation deferred by the employee under the Company's Section
401(k) retirement plan.
8
<PAGE>
(3) Includes executive bonuses earned and paid during the fiscal year for
financial performance goals relating to previous fiscal years. See the
subheading "PAYMENT/EXERCISE RESTRICTIONS" under "REPORT OF THE COMPENSATION
COMMITTEE OF THE BOARD OF DIRECTORS REGARDING EXECUTIVE COMPENSATION" set
forth herein.
(4) Includes profit sharing and bonus compensation paid for achievement of
performance milestones, filing and issuance of patents, and publication of
technical articles.
(5) Excludes the payment of certain perquisites and other benefits which in the
aggregate did not exceed the lesser of $50,000 or 10% of the named
executive's salary and bonus for such year.
(6) Includes options to purchase shares of the Company's Common Stock under the
Company's 1985 Incentive Stock Option Plan and the 1994 Stock Option Plan
(the "Stock Plans").
(7) Options granted under the Stock Plans reflect a 2-for-1 stock split effected
in the form of a stock dividend as of May 4, 1995, and a 5-for-2 stock split
effected in the form of a stock dividend, as of April 1, 1994.
(8) Consists of (i) Company contributions made on the named executive's behalf
to the Section 401(k) retirement plan; (ii) cash paid to the named executive
under the Company's time-off plan; and (iii) cash paid upon termination of
the 1993 Micron Semiconductor, Inc., Stock Appreciation Rights Plan (the
"SAR Plan"). Under the SAR Plan, each employee of Micron Semiconductor,
Inc., as of January 22, 1993, was granted the right to participate in the
book value appreciation of ten (10) shares of Micron Semiconductor, Inc.,
common stock. As of September 1, 1994, the total number of shares subject to
appreciation rights under the SAR Plan represented approximately 1.62% of
the total outstanding shares of Micron Semiconductor, Inc., common stock.
Effective November 4, 1994, Micron Semiconductor, Inc., was merged with and
into Micron Technology, Inc., and the SAR Plan was terminated and amounts
equal to the appreciation of rights under the SAR Plan were paid to all
eligible employees. See footnote (9) to this table and accompanying
financial disclosure.
(9) Includes ten (10) stock appreciation rights ("SARs") awarded to Micron
Semiconductor, Inc. employees under the SAR Plan. See footnote (8) to this
table for further details.
OPTION GRANTS IN LAST FISCAL YEAR
The following table provides information on options granted under the
Company's 1994 Stock Option Plan in fiscal 1995 to the Named Executive Officers:
<TABLE>
<CAPTION>
INDIVIDUAL GRANTS
-------------------------------------------------------- POTENTIAL REALIZABLE VALUE
PERCENT OF AT ASSUMED ANNUAL RATES OF
TOTAL OPTIONS EXERCISE OR STOCK PRICE APPRECIATION
GRANTED TO BASE PRICE FOR OPTION TERM
OPTIONS EMPLOYEES IN PER EXPIRATION --------------------------
NAME GRANTED (#)(1)(2) FISCAL YEAR SHARE (2) DATE 5% 10%
- --------------------------- ---------------- ------------- ----------- ---------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
Steven R. Appleton 120,000 2.40% $ 18.18 10-27-00 $ 741,960 $ 1,683,240
Tyler A. Lowrey 120,000 2.40% $ 18.18 10-27-00 741,960 1,683,240
Edward J. Heitzeberg 80,000 1.60% $ 18.18 10-27-00 494,640 1,122,160
Wilbur G. Stover, Jr 72,000 1.44% $ 18.18 10-27-00 445,176 1,009,944
Donald D. Baldwin 64,000 1.28% $ 18.18 10-27-00 395,712 897,728
Joseph L. Parkinson 0 0% n/a n/a n/a n/a
Kenneth G. Smith 80,000 1.60% $ 18.18 10-27-00 494,640 1,122,160
</TABLE>
- ------------------------
(1) Options granted under the Company's 1994 Stock Option Plan typically have a
six (6) year term and vest over a five (5) year period in increments of
twenty percent (20%) per year. Options under such plan may be granted as
incentive stock options ("ISOs") or nonstatutory stock options ("NSOs").
ISOs are granted with an exercise price equal to 100% of the fair market
value (as
9
<PAGE>
defined in the plan) of the Company's Common Stock on the date of grant. All
NSOs granted and set forth in the above table were granted with an exercise
price equal to 100% of the fair market value (as defined in the plan) of the
Common Stock on the date of grant.
(2) Options granted and set forth in the above table, as well as the exercise
price thereof, reflect a 2-for-1 stock split effected in the form of a stock
dividend as of May 4, 1995.
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR
AND FISCAL YEAR-END OPTION/SAR VALUES
The following table provides information regarding option exercises in
fiscal 1995 by the Named Executive Officers and the value of such officers'
unexercised options at August 31, 1995:
<TABLE>
<CAPTION>
NUMBER OF SECURITIES
UNDERLYING VALUE OF UNEXERCISED
UNEXERCISED IN-THE-MONEY OPTIONS/
OPTIONS/SARS AT SARS AT FISCAL YEAR-
FISCAL YEAR-END END
SHARES --------------------- ---------------------
ACQUIRED ON VALUE EXERCISABLE (E) EXERCISABLE (E)
NAME EXERCISE (#)(1) REALIZED UNEXERCISABLE (U) UNEXERCISABLE (U)
- ------------------------------------ -------------- ------------- --------------------- ---------------------
<S> <C> <C> <C> <C>
Steven R. Appleton.................. 104,294 $ 3,437,518 15,706(E) $1,173,697(E)
405,002(U) 27,499,346(U)
Tyler A. Lowrey..................... 59,996 1,179,137 0(E) 0(E)
305,002(U) 20,041,348(U)
Edward J. Heitzeberg................ 0 0 37,000(E) 2,605,277(E)
196,000(U) 12,764,469(U)
Wilbur G. Stover, Jr................ 29,998 1,043,389 0(E) 0(E)
151,000(U) 9,700,888(U)
Donald D. Baldwin................... 57,000 2,363,097 2,000(E) 149,210(E)
183,000(U) 12,077,328(U)
Joseph L. Parkinson................. 15,000 225,799 0(E) 0(E)
0(U) 0(U)
Kenneth G. Smith.................... 51,000 1,462,775 10,000(E) 740,350(E)
200,000(U) 13,083,816(U)
</TABLE>
- ------------------------
(1) Shares acquired on exercise of an option reflect a 2-for-1 stock split
effected in the form of a stock dividend as of May 4, 1995.
COMPENSATION OF DIRECTORS
DIRECTORS' FEES
Directors who are employees of the Company receive no additional or special
remuneration for their service as directors. Directors who are not employees of
the Company are entitled to receive, effective December 19, 1994, a director fee
of $4,000 for each Board of Directors meeting attended. Prior to such date,
Directors received a fee of $3,000 for each Board of Directors meeting attended.
The Company also reimburses directors for travel and lodging expenses, if any,
incurred in connection with attendance at Board meetings. Directors do not
receive any additional or special remuneration for their service on any of the
committees established by the Board of Directors.
Mr. Lothrop and Mr. Gordon C. Smith have entered into individual agreements
with the Company pursuant to which the receipt of their meeting fees is deferred
until the first business day of the calendar year in which they no longer serve
as a director of the Company. Deferred amounts, in the case of termination of
service as a director, are paid in five annual installments. In the event of
death, the balance then owed is paid in a single sum as soon as practicable
following the death of the director or former director. All amounts deferred are
recorded as a liability on the records of the Company. Such amounts accrue
interest monthly at a rate per annum equal to the Company's average investment
portfolio yield for such month.
10
<PAGE>
TERMINATION OF EMPLOYMENT AGREEMENTS AND CHANGE IN CONTROL ARRANGEMENT
TERMINATION AGREEMENTS
The Company has entered into separate agreements with each executive officer
and certain other key employees of the Company relating to notice of termination
and compensation upon termination or death. Each agreement requires that the
Company or officer or employee give six (6) months advance written notice of
termination regardless of the reason or justification for termination. The
officer or employee may discontinue active duties at any time following notice;
however, employment for purposes of salary, bonuses, benefits, stock vestings,
and for determining conflicts of interest continues for at least six (6) months
from the date of notice. The Board also approved the payment of performance
bonuses that otherwise would have been paid within six (6) months after the date
of an officer's death. During fiscal 1995, payments were made pursuant to these
agreements to Mr. Parkinson and Mr. Kenneth G. Smith.
CHANGE IN CONTROL ARRANGEMENT
On October 31, 1988, the Company's Board of Directors adopted an arrangement
whereby, upon any change in control of the Company, all unvested shares and
options shall vest, and all unpaid bonuses subject to installments shall be
immediately due and payable. "Change in Control" is defined under this
arrangement to mean the acquisition by any person or entity, directly,
indirectly or beneficially, acting alone or in concert, of more than thirty-five
percent (35%) of the Common Stock of the Company then outstanding.
NOTWITHSTANDING ANYTHING TO THE CONTRARY SET FORTH IN ANY OF THE COMPANY'S
PREVIOUS FILINGS UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR THE EXCHANGE
ACT OF 1934, AS AMENDED, THAT MIGHT INCORPORATE FUTURE FILINGS, INCLUDING THIS
PROXY STATEMENT, IN WHOLE OR IN PART, THE FOLLOWING REPORT AND THE PERFORMANCE
GRAPH SET FORTH HEREIN SHALL NOT BE INCORPORATED BY REFERENCE INTO ANY SUCH
FILINGS.
REPORT OF THE COMPENSATION COMMITTEE OF THE BOARD OF DIRECTORS
REGARDING EXECUTIVE COMPENSATION
COMPENSATION COMMITTEE
This report has been prepared by the Compensation Committee of the Board of
Directors of the Company (the "Committee"). Robert A. Lothrop, Thomas T.
Nicholson, Allen T. Noble, and John R. Simplot serve as members of the
Committee. The Committee meets at least annually or more frequently as the
Company's Board of Directors may request. The Committee's primary
responsibilities include the review of compensation, consisting of salary,
bonuses, benefits, stock option grants and other compensation, of the Company's
executive officers. Compensation for the Company's officers for fiscal 1995,
including base salary, performance bonuses, stock option grants, and other
compensation, were determined by the Compensation Committee and reviewed and
approved by the Company's Board of Directors.
Compensation for Micron Semiconductor, Inc. officers was reviewed and
approved by the Micron Semiconductor, Inc., Board of Directors. Grants to Micron
Semiconductor, Inc. officers of options to purchase the Company's Common Stock,
were reviewed and approved by the Boards of Directors of Micron Semiconductor
Inc., and of the Company. Effective November 4, 1994, Micron Semiconductor, Inc.
was merged with and into Micron Technology, Inc. On October 17, 1994, Mr.
Lothrop and Mr. Nicholson were appointed to replace Mr. Parkinson and Mr. Reid
N. Langrill as members of the Compensation Committee.
EXECUTIVE OFFICER COMPENSATION
The executive officer compensation programs utilized by the Company are
described below for the purpose of providing a general understanding of the
various components of executive officer compensation. These executive officer
compensation programs are designed to attract, retain and reward highly
qualified executive officers who are important to the Company's success and to
provide incentives relating directly to the financial performance and long-term
growth of the Company and its
11
<PAGE>
subsidiaries. The various components of the executive officer compensation
programs used by the Company are, in most cases, the same as those made
available generally to employees of the Company and its subsidiaries. The
following is a summary of the executive officer compensation programs:
CASH COMPENSATION
BASE SALARY. Base salaries are established primarily upon an evaluation of
the officer's positions and contributions to the Company including (i)
individual performance, (ii) level of responsibility, (iii) technical expertise,
(iv) length of service, (v) Company performance, and (vi) industry compensation
levels.
COMPANY PERFORMANCE BONUSES. Cash bonuses to executive officers are
intended to reward officers for the Company's financial performance during the
fiscal year. Accordingly, bonuses are determined based on performance criteria
established at the beginning of each fiscal year formulated primarily as a
percentage of the after-tax net profit of the Company at the end of the fiscal
year. Performance bonus percentages are established according to a subjective
analysis of each officer according to the same criteria utilized to determine
base salary.
PROFIT SHARING. The Company distributes ten percent (10%) of the Company's
quarterly after-tax net profits to all eligible employees of the Company. The
plan provides for equal allocation among all eligible employees of the first
$500,000 of amounts eligible for distribution. Amounts exceeding $500,000 are
distributed pro rata to eligible employees on the basis of base salary of
eligible employees.
INCENTIVE BONUSES. From time to time, incentive cash bonuses are approved
for payment to employees, including executive officers, for the achievement of
milestones, the completion of projects identified as contributing substantially
to the Company's success, and the attainment of technological advances.
EQUITY COMPENSATION
In order to provide long-term incentive to the executive officers and
employees of the Company and its subsidiaries related to long-term growth in the
value of the Company's Common Stock, the Company issues incentive stock options
and nonstatutory stock options to such persons under the Company's 1985
Incentive Stock Option Plan and the Company's 1994 Stock Option Plan (the "Stock
Plans"). The determination of who receives stock options under the Stock Plans
and the number of stock options granted to each such recipient is based upon the
same criteria utilized to determine base salary.
OTHER COMPENSATION
In addition to cash and equity compensation programs, the executive officers
participate in various other employee benefit plans, including, but not limited
to, a time-off plan. Under the time-off plan, all employees of the Company,
including executive officers, are allowed to accumulate a predetermined
nondiscriminatory number of hours for vacation, holiday, sick time, emergencies
and personal needs. Hours accumulated in excess of 400 that are not used are
paid out in cash. Executive officer participation in various clubs,
organizations, and associations may also be funded by the Company.
PAYMENT/EXERCISE RESTRICTIONS
In an effort to encourage employees and executive officers to remain
employed by the Company and to promote Company performance, many compensation
programs for employees and executive officers contain provisions which subject
the benefits of such programs to certain conditions. In this regard, Company
performance bonuses awarded to each executive officer are earned and paid in
equal
12
<PAGE>
annual installments over a five (5) year period, subject to the following
conditions: (i) the Company is profitable in the year of payment; (ii) the
individual remains employed by the Company or a subsidiary of the Company; and
(iii) the Board of Directors approves the payment of the annual installment.
Likewise, stock options granted to executive officers typically have a term of
six (6) years and vest twenty percent (20%) each year for a period of five (5)
years from the date of grant.
CEO COMPENSATION
During fiscal 1995, Mr. Joseph L. Parkinson served as the Chairman of the
Board of Directors and the Chief Executive Officer of the Company. He resigned
from his officer and director positions with the Company, effective as of
September 26, 1994. Mr. Parkinson was a founder of the Company and served as
President and Chief Operating Officer of the Company from 1980 to 1986 when he
was appointed to serve as Chairman of the Board of Directors and Chief Executive
Officer. Mr. Parkinson's compensation for fiscal 1995 consisted of amounts
received under the executive officer compensation programs described above. The
amounts paid to Mr. Parkinson during the fiscal year were based upon the amounts
owed him pursuant to the contractual terms of his termination agreement. See the
description of TERMINATION AGREEMENTS set forth in the Proxy Statement in which
this Report is included.
Effective September 26, 1994, Mr. Steven R. Appleton was elected Chairman of
the Board of Directors, President and Chief Executive Officer. His base salary
then in effect continued after his assumption of his new positions. His cash
bonuses for the year were attributable primarily to the receipt of annual
installments of Company Performance Bonuses for fiscal years 1993, 1994 and
1995. See the description of COMPANY PERFORMANCE BONUSES in this Report. See
also the description under the subheading "PAYMENT/EXERCISESRESTRICTIONS" in
this Report.
Effective October 27, 1994, the Board of Directors approved a grant to Mr.
Appleton of 120,000 stock options (adjusted to reflect the 2-for-1 stock split
effected in the form of a stock dividend as of May 4, 1995). Grants to other
executive officers of the Company were made at the same time. The Compensation
Committee had no predetermined number of options that it believed Mr. Appleton
should hold. The actual number of options granted to Mr. Appleton was based upon
subjective and objective factors, such as, his individual performance, his
position in the Company relative to the other executive officers who received
option grants on the same date, the Company's overall performance, his length of
service with the Company, his past contributions to the success of the Company
and his contributions to the Company's success that were expected to be made in
the future.
Compensation Committee of the Board of
Directors
Robert A. Lothrop
Thomas T. Nicholson
Allen T. Noble
John R. Simplot
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
During fiscal 1995, the Compensation Committee members initially consisted
of Joseph L. Parkinson, Reid N. Langrill, John R. Simplot and Allen T. Noble.
Joseph L. Parkinson and Reid N. Langrill served as the Company's Chairman of the
Board and Chief Executive Officer, and Vice President, Finance; Treasurer and
Chief Financial Officer, respectively, until September 26, 1994, when they
resigned as officers and directors of the Company. Due to the resignation of
Messrs. Parkinson and Langrill, Mr. Lothrop and Mr. Nicholson were appointed
members of the Compensation Committee, effective October 17, 1994. During the
fiscal year, there were no other members of the Compensation Committee who were
officers or employees of the Company or any of its subsidiaries. With respect to
Mr. Nicholson, in March of 1995, Lake Hazel Shopping Center, an Idaho general
partnership, of which Mr. Nicholson is a partner, sold approximately 80 acres of
real property located in Ada County, Idaho, to the Company for $708,445. The
acquisition of the real estate was in the Company's ordinary course of obtaining
property for expansion of its operations at its Boise, Idaho site.
13
<PAGE>
PERFORMANCE GRAPH
The following graph illustrates a five-year comparison of cumulative total
returns for the Company's Common Stock, the S&P 500 Composite Index, and the S&P
Electronics (Semiconductors) Index from August 31, 1990, through August 31,
1995. In September 1994, the Company was added to the S&P Electronics
(Semiconductors) Index. For purpose of this disclosure, current companies of S&P
Electronics (Semiconductors) Index include Advanced Micro Devices, Inc.; Applied
Materials, Inc.; Intel Corporation; Micron Technology, Inc.; Motorola, Inc.;
National Semiconductor Corporation; and Texas Instruments Incorporated.
NOTE: MANAGEMENT CAUTIONS THAT THE STOCK PRICE PERFORMANCE INFORMATION SHOWN
IN THE GRAPH BELOW IS PROVIDED AS OF FISCAL YEAR-END AND MAY NOT BE INDICATIVE
OF CURRENT STOCK PRICE LEVELS OR FUTURE STOCK PRICE PERFORMANCE.
[GRAPHIC]
The Company operates on a 52/53 week fiscal year which ends on the Thursday
closest to August 31. Accordingly, the last trading day of the Company's fiscal
year varies. For consistent presentation and comparison to the industry indices
shown herein, the Company has calculated its stock performance graph assuming an
August 31 year-end. The performance graph assumes $100 invested on August 31,
1990, in common stock of Micron Technology, Inc., the S&P 500 Composite Index,
and the S&P Electronics (Semiconductors) Index. Any dividends paid during the
period presented are assumed to be reinvested. The performance was plotted using
the following data:
<TABLE>
<CAPTION>
YEAR ENDING AUGUST 31
----------------------------------------------------------------
1990 1991 1992 1993 1994 1995
--------- --------- --------- --------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
Micron Technology, Inc...................................... $ 100 $ 157 $ 170 $ 597 $ 1,130 $ 4,333
S&P Electronics (Semiconductors) Index...................... 100 120 146 327 346 616
S&P 500 Composite Index..................................... 100 127 137 158 166 202
</TABLE>
2. PROPOSAL TO APPROVE THE AMENDMENT TO THE COMPANY'S CERTIFICATE OF
INCORPORATION
The Company's Certificate of Incorporation (the "Certificate"), as currently
in effect, provides that the Company is authorized to issue one class of stock,
consisting of 300,000,000 shares of Common Stock, $0.10 par value per share. On
October 2, 1995, the Board of Directors authorized an amendment to the
Certificate to increase the authorized number of shares of Common Stock to
14
<PAGE>
1,000,000,000 shares. The shareholders are being asked to approve at the Annual
Meeting such amendment to the Certificate. Under the proposed amendment,
paragraph 4 of the Certificate would be amended to read as follows:
"4. The total number of shares of common stock which the corporation shall
have the authority to issue is one billion (1,000,000,000), and the par
value of each of such shares is Ten Cents ($0.10)."
The Company currently has 300,000,000 authorized shares of Common Stock. As
of November 30, 1995, 206,970,339 shares of Common Stock were issued and
outstanding. In addition, as of November 30, 1995, 17,765,495 shares were
reserved for future grant or for issuance upon the exercise of outstanding
options under the Company's 1985 Incentive Stock Option Plan, 1994 Stock Option
Plan and 1989 Employee Stock Purchase Plan.
PURPOSE AND EFFECT OF THE AMENDMENT
The principal purpose of the proposed amendment to the Certificate is to
authorize additional shares of Common Stock which will be available in the event
the Board of Directors determines that it is necessary or appropriate to permit
future stock dividends, stock splits or to utilize such shares for business
purposes. The Board of Directors has no present plan, agreement, or arrangement
to issue any of the shares for which approval is sought. If the amendment is
approved by the shareholders, the Board of Directors does not intend to solicit
further shareholder approval prior to the issuance of any additional shares of
Common Stock, except as may be required by applicable law.
The increase in authorized Common Stock will not have any immediate effect
on the rights of existing shareholders. To the extent that the additional
authorized shares are issued in the future in a transaction other than in a
stock split or stock dividend, the existing shareholders' percentage equity
ownership will decrease and, depending on the price at which shares are issued,
could have the effect of diluting the earnings per share and book value per
share of outstanding shares of Common Stock. The holders of Common Stock have no
preemptive rights. The increase in the authorized number of shares of Common
Stock and the subsequent issuance of such shares could have the effect of
delaying or preventing a change in control of the Company without further action
by the shareholders by diluting the stock ownership or voting rights of a person
seeking to obtain control of the Company.
THE BOARD OF DIRECTORS RECOMMENDS VOTING "FOR" APPROVAL OF THE AMENDMENT.
3. AMENDMENT TO THE COMPANY'S 1994 STOCK OPTION PLAN
The Micron Technology, Inc. 1994 Stock Option Plan (the "1994 Plan"), as
currently in effect, reserves 2,000,000 shares of Common Stock for issuance
thereunder. On October 30, 1995, the Board of Directors authorized an amendment
to the 1994 Plan, subject to shareholder approval, to increase by an additional
5,000,000 the number of shares available for grant under the 1994 Plan. The
purpose of the amendment is to provide the Company with an additional 5,000,000
shares of Common Stock that can be awarded or granted to officers, employees and
consultants of the Company in future years through the expiration of the 1994
Plan in 2004. All such awards or grants under the 1994 Plan would be made only
upon approval by the Board of Directors.
The 1994 Plan was approved by shareholders at the 1994 Annual Meeting. The
following is a summary of the material features of the 1994 Plan. A copy of the
1994 Plan has been filed with the Securities & Exchange Commission and the
following summary is qualified in its entirety by reference to the 1994 Plan.
PURPOSE OF THE 1994 PLAN AMENDMENT
The purpose of the proposed amendment is to ensure that the Company has a
sufficient number of shares of Common Stock reserved under the 1994 Plan to
accomplish the 1994 Plan's objective, i.e.,
15
<PAGE>
to align management and shareholder long-term interests and to attract,
motivate, and retain experienced and qualified management personnel. Assuming
approval of the proposed amendment, the 7,000,000 total shares reserved for
issuance under the 1994 Plan will represent approximately 3.38% of the Company's
Common Stock outstanding as of November 30, 1995.
ADMINISTRATION
The 1994 Plan is administered by either (i) the Board of Directors, if the
Board may administer the 1994 Plan in compliance with Rule 16b-3 ("Rule 16b-3")
promulgated under the Securities Exchange Act of 1934 (the "Exchange Act") or
(ii) a committee appointed by the Board and constituted so as to permit the 1994
Plan to comply with the provisions of Rule 16b-3. If permitted by Rule 16b-3,
the 1994 Plan may be administered by different bodies with respect to employees
who are directors, non-director officers, employees who are neither directors
nor officers, and consultants. For purposes of this plan description, the term
"Committee" shall mean the Compensation Committee of the Board. Members of the
Board receive no additional compensation for their services in connection with
the administration of the 1994 Plan.
The Committee has the discretion to select the employees and consultants to
whom options may be granted (an "Optionee"), to determine the number of shares
granted under each option, and to make all other determinations which it deems
necessary or appropriate in the interpretation and administration of the 1994
Plan. Historically, any grants approved by the Committee also have been approved
by the Board of Directors. The Committee, in its discretion, may accelerate the
vesting of any option, may reduce the exercise price of any option, and amend or
modify any option (provided that such amendment may not impair the rights of any
Optionee unless mutually agreed otherwise by the Optionee and the Committee).
ELIGIBLE PARTICIPANTS
Only persons who are officers, employees, or consultants, including
advisors, of the Company are eligible to participate in, and to receive options
under, the 1994 Plan. Neither the members of the Committee, nor any member of
the Company's Board of Directors who is not also an officer or employee of the
Company, may participate in the 1994 Plan. As of November 30, 1995, there were
approximately 6,310 employees of the Company who were eligible to participate in
the 1994 Plan and 452 actually participating. Currently, 11,260 shares of Common
Stock have been issued upon exercise of options granted pursuant to the 1994
Plan. An additional 1,544,068 shares of Common Stock are subject to options
granted, but unexercised, under the 1994 Plan. An Optionee may be granted more
than one option under the 1994 Plan and any option that terminates without being
exercised reverts to the 1994 Plan and becomes available for future grant. Under
the terms of the 1994 Plan, no employee of the Company can be granted options to
purchase more than 500,000 shares during any fiscal year, subject to adjustment
upon changes in capitalization.
TERMS OF OPTIONS
The 1994 Plan provides for the grant of incentive stock options ("ISOs") as
defined in Section 422 of the Code, or nonstatutory stock options ("NSOs").
Options granted to consultants are nonstatutory stock options.
The purchase price per share payable by an Optionee upon the exercise of
each ISO granted under the 1994 Plan equals the fair market value of the
Company's Common Stock on the date of the grant. The fair market value of a
share of the Company's Common Stock is deemed to be the average closing price of
the Company's Common Stock as quoted on the New York Stock Exchange for the five
(5) business days preceding the date the Option is granted. As of November 30,
1995, the fair market value of a share of Common Stock was $51.00. The purchase
price per share payable by an Optionee upon the exercise of each NSO granted
under the 1994 Plan is determined by the Committee.
The exercise price of an option granted under the 1994 Plan may be paid in
cash, check, promissory note, or, at the discretion of the Committee, in shares
of the Company's Common Stock, or in any combination thereof. Other methods of
payment available under the Plan include the acceptance by
16
<PAGE>
the Committee and stockbroker of documentation necessary to perform a cashless
exercise transaction or the reduction of any Company liability to an Optionee.
In general, if an Optionee's employment with the Company is terminated for any
reason, options exercisable as of the date of termination may be exercised for a
period of 30 days following such date. Options yet to be exercisable terminate
immediately upon the date of the termination. However, the Committee may grant
options under the 1994 Plan which survive the termination of an Optionee's
employment with the Company, and may accelerate the vesting of options upon such
terms and conditions as the Committee may determine.
Options granted under the 1994 Plan cannot be assigned, transferred,
pledged, or otherwise encumbered in any way, except in the event of the death of
an Optionee, by the Optionee's will, or by the applicable laws of descent or
distribution. Options granted under the 1994 Plan are exercisable during an
Optionee's lifetime only by the Optionee.
Options granted under the 1994 Plan are evidenced by a written agreement
between the Company and the Optionee, containing the specific terms and
conditions of each option. The current form of agreement provides for an option
term of six (6) years with the shares vesting over a five (5) year period in
increments of twenty percent (20%) per year.
ADJUSTMENTS UPON CHANGES IN CAPITALIZATION
Subject to adjustment in the case of certain changes in the capital
structure of the Company, and subject to the shareholders' approval of the
amendment to the 1994 Plan as proposed hereby, a maximum of 7,000,000 shares of
the Company's $.10 par value Common Stock will be reserved for issuance pursuant
to options granted under the 1994 Plan. In the event of a change in the number
or nature of the Company's shares of outstanding Common Stock by reason of a
stock dividend, stock split, recapitalization, reorganization, merger, exchange
of shares, or other similar capital adjustment, a proportionate adjustment may
be made in the number of shares reserved for issuance under the 1994 Plan and
will be made to the number, class, and exercise price of shares subject to any
outstanding options under the 1994 Plan, in order to maintain the purpose of the
original grant.
AMENDMENT AND TERMINATION OF THE 1994 PLAN
The 1994 Plan was effective upon the adoption by the Company's Board of
Directors and approval by the Company's shareholders at the 1994 Annual Meeting.
It will terminate ten (10) years from such date, unless earlier terminated by
the Board of Directors. However, the Company's Board of Directors may, at any
time, terminate the 1994 Plan on an earlier date, provided that such termination
will not affect the rights of the Optionees under any outstanding options
previously granted under the 1994 Plan. In addition, and subject to the
limitations in the 1994 Plan, the Company's Board of Directors may amend the
Plan at any time.
FEDERAL INCOME TAX CONSEQUENCES
The following discussion of the federal income tax consequences of the 1994
Plan is intended to be a summary of applicable federal law. State and local tax
consequences may differ. Because the federal income tax rules governing options
and related payments are complex and subject to frequent change, Optionees are
advised to consult their tax advisors prior to exercise of options or
dispositions of stock acquired pursuant to option exercise.
ISOs and NSOs are treated differently for federal tax purposes. ISOs are
intended to comply with the requirements of Section 422 of the Code. NSOs need
not comply with such requirements.
An Optionee is not taxed on the grant or exercise of an ISO. The difference
between the exercise price and the fair market value of the shares on the
exercise date will, however, be a preference item for purposes of the
alternative minimum tax. If an Optionee holds the shares acquired upon exercise
of an ISO for at least two years following grant and at least one year following
exercise, the Optionee's gain, if any, upon a subsequent disposition of such
shares is long-term capital gain. The measure of the gain is the difference
between the proceeds received on disposition and the Optionee's basis in the
shares (which generally equals the exercise price). If an Optionee disposes of
stock acquired pursuant to exercise of an ISO before satisfying either of the
one and two-year holding periods described above,
17
<PAGE>
the disposition disqualifies the option from favorable tax treatment as an ISO,
and the Optionee will recognize ordinary income in the year of disposition. The
amount of the ordinary income will be the lesser of (i) the amount realized on
disposition less the Optionee's adjusted basis in the stock (usually the
exercise price) or (ii) the difference between the fair market value of the
stock on the exercise date and the exercise price. The balance of the
consideration received on such a disposition will be capital gain. The Company
is not entitled to an income tax deduction on the grant or exercise of an ISO or
on the Optionee's disposition of the shares after satisfying the holding period
requirement described above. If the holding periods are not satisfied, the
Company is entitled to a deduction in the year the Optionee disposes of the
shares in an amount equal to the ordinary income recognized by the Optionee.
An Optionee is not taxed on the grant of an NSO. On exercise, however, the
Optionee recognizes ordinary income equal to the difference between the exercise
price and the fair market value of the shares on the date of exercise. The
Company is entitled to an income tax deduction in the year of exercise in the
amount recognized by the Optionee as ordinary income. Any gain on subsequent
disposition of the shares is long-term capital gain if the shares are held for
at least one year following exercise. The Company does not receive a deduction
for this gain.
The 1994 Plan includes provisions necessary for the plan to comply with
Section 162(m) of the Internal Revenue Code of 1986. Section 162(m) places a
limit of $1,000,000 on the amount of certain compensation that may be deducted
by the Company in any tax year with respect to each of the Company's highest
paid executives, including compensation relating to stock option exercises. The
compensation of the highest paid executives relating to stock option exercises
is not subject to the deduction limit if certain limitations approved by
shareholders are applied to stock options granted to executive officers.
PLAN BENEFITS
Because options under the 1994 Plan are granted in the discretion of the
Board of Directors (or such committee, if any, to whom the Board has delegated
such authority), it is not possible for the Company to determine and disclose
the amount of options that may be granted to the named executive officers and
the executive officers as a whole, if the amendment is approved. However, see
"Eligible Participants" above for a description of the limitations as to
granting of options.
PROPOSED AMENDMENT
Under the terms of the 1994 Plan, as originally approved by the
shareholders, there were 1,000,000 shares reserved for issuance. On May 4, 1995,
the Company effected a 2-for-1 stock split of its Common Stock pursuant to a
stock dividend. This adjustment caused the 1,000,000 shares reserved for
issuance to increase to 2,000,000 shares. Accordingly, following the stock
split, the 1994 Plan authorized the issuance of 2,000,000 shares of Common
Stock. The proposed amendment will increase the number of authorized shares of
Common Stock reserved for issuance by an additional 5,000,000 shares by revising
the final sentence of Section 3 of the 1994 Plan to read as follows:
"Subject to the provisions of Section 12 of the Plan, the maximum aggregate
number of Shares which may be optioned and sold under the Plan is 7,000,000
Shares."
THE BOARD OF DIRECTORS RECOMMENDS VOTING "FOR" APPROVAL OF THE AMENDMENT.
4. RATIFICATION OF APPOINTMENT OF INDEPENDENT ACCOUNTANTS
The Board of Directors has appointed Coopers & Lybrand L.L.P., independent
accountants, to audit the consolidated financial statements of the Company for
the fiscal year ending August 29, 1996. Coopers & Lybrand L.L.P. has been the
Company's independent accountants since fiscal year 1985. Representatives of
Coopers & Lybrand L.L.P. are expected to be present at the meeting, will have
the opportunity to make a statement if they so desire, and are expected to be
available to respond to appropriate questions.
18
<PAGE>
THE BOARD OF DIRECTORS RECOMMENDS VOTING "FOR" THE
RATIFICATION OF THE APPOINTMENT OF COOPERS & LYBRAND L.L.P.
5. OTHER MATTERS
The Company knows of no other matters to be submitted at the meeting. If any
other matters properly come before the meeting, the persons named in the
accompanying form of Proxy will vote, in their discretion, the shares they
represent.
THE BOARD OF DIRECTORS
Dated: December 18, 1995
19
<PAGE>
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
[LOGO OF MICRON TECHNOLOGY, INC.]
1995 ANNUAL MEETING OF SHAREHOLDERS
January 29, 1996
The undersigned shareholder(s) of Micron Technology, Inc., a Delaware
corporation, hereby acknowledges receipt of the Notice of 1995 Annual Meeting of
Shareholders and Proxy Statement, each dated December 18, 1995, and hereby
appoints Steven R. Appleton and Wilbur G. Stover, Jr., and each of them, proxies
and attorneys-in-fact, with full power to each of substitution, on behalf and in
the name of the undersigned, to represent the undersigned at the 1995 Annual
Meeting of Shareholders of Micron Technology, Inc., to be held January 29, 1996,
at 9:00 a.m., Mountain Standard Time, at the Boise Centre on the Grove, 850 W.
Front Street, Boise, Idaho 83702, and at any adjournment or adjournments
thereof, and to vote (including cumulatively, if required) all shares of Common
Stock which the undersigned would be entitled to vote if then and there
personally present, on the matters set forth below:
<TABLE>
<S> <C> <C>
1. ELECTION OF DIRECTORS: / / FOR nominees listed below / / WITHHOLD authority to vote for all
(except as indicated) nominees listed below
</TABLE>
If you wish to withhold authority to vote for any individual nominee, strike a
line through that nominee's name in the list below:
<TABLE>
<S> <C>
Steven R. Appleton; Jerry M. Hess; Robert A. Lothrop; Tyler A. Lowrey; Thomas T. Nicholson;
Allen T. Noble; Don J. Simplot; John R. Simplot; Gordon C. Smith; Wilbur G. Stover, Jr.
</TABLE>
2. PROPOSAL TO APPROVE AN AMENDMENT TO THE COMPANY'S CERTIFICATE OF
INCORPORATION TO INCREASE THE NUMBER OF AUTHORIZED SHARES OF THE COMPANY'S
COMMON STOCK FROM 300,000,000 SHARES TO 1,000,000,000 SHARES:
/ / FOR / / AGAINST / / ABSTAIN
(to be signed on reverse side)
<PAGE>
(continued from other side)
3. PROPOSAL TO APPROVE AN AMENDMENT TO THE COMPANY'S 1994 STOCK OPTION PLAN TO
INCREASE THE NUMBER OF SHARES OF THE COMPANY'S COMMON STOCK RESERVED FOR
FUTURE GRANT FROM 2,000,000 TO 7,000,000 SHARES:
/ / FOR / / AGAINST / / ABSTAIN
4. PROPOSAL TO RATIFY THE APPOINTMENT OF COOPERS & LYBRAND L.L.P. AS THE
COMPANY'S INDEPENDENT ACCOUNTANTS FOR FISCAL 1996:
/ / FOR / / AGAINST / / ABSTAIN
and in their discretion, upon such other matter or matters which may properly
come before the meeting or any adjournment or adjournments thereof.
The shares represented by this proxy when properly executed will be voted in the
manner directed herein by the undersigned shareholder(s). If no direction is
made, this proxy will be voted FOR items 1, 2, 3, and 4. If any other matters
properly come before the meeting, or if cumulative voting is required, the
persons named in this proxy will vote, in their discretion, provided, that they
will not vote in the election of directors for persons for whom authority to
vote has been withheld.
Dated __________________, 199____
_________________________________
Signature
_________________________________
Signature
(This proxy should be voted, signed, and dated by the shareholder(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.)
