LINEAR TECHNOLOGY CORP /CA/, S-8, 1997-11-19

LINEAR TECHNOLOGY CORP /CA/
S-8, 1997-11-19
SEMICONDUCTORS & RELATED DEVICES

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As filed with the Securities and Exchange Commission on November 19, 1997
Registration No. 333-__________

- --------------------------------------------------------------------------------

SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933

-----------------

LINEAR TECHNOLOGY CORPORATION
(Exact name of registrant as specified in its charter)

CALIFORNIA 94-2778785
(State of incorporation) (I.R.S. Employer Identification No.)

1630 McCarthy Blvd.
Milpitas, California 95035-7417
(Address, including zip code, of principal executive offices)

-----------------

1996 INCENTIVE STOCK OPTION PLAN
1986 EMPLOYEE STOCK PURCHASE PLAN, AS AMENDED
(Full Title of the Plans)

-----------------

Robert H. Swanson, Jr.
Linear Technology Corporation
1630 McCarthy Blvd.
Milpitas, California 95035-7417
(Name and address of agent for service)

(408) 432-1900
(Telephone number, including area code, of agent for service)

-----------------

Copies to:
HERBERT P. FOCKLER, ESQ.
WILSON SONSINI GOODRICH & ROSATI
Professional Corporation
650 Page Mill Road
Palo Alto, California 94304

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<PAGE>

<TABLE>

CALCULATION OF REGISTRATION FEE
<CAPTION>

- ---------------------------------------------------------------------------------------------------------

Title of Amount Proposed Proposed Amount of
Securities to to be Maximum Offering Maximum Aggregate Registration
be Registered Registered Price Per Share* Offering Price* Fee

- ---------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock,
no par value 4,500,000 $65.29 $293,783,125 $89,026

<FN>

* The Proposed Maximum Offering Price Per Share was estimated in part pursuant to Rule 457(h) under
the Securities Act of 1933, as amended (the "Act"), and, in part, pursuant to Rule 457(c) under
the Act. With respect to (i) 57,500 shares which are subject to outstanding options to purchase
Common Stock under the 1996 Incentive Stock Option Plan (the "Option Plan"), the Proposed Maximum
Offering Price Per Share was estimated pursuant to Rule 457(h) under which Rule the per share
price of options to purchase stock under an employee stock option plan may be estimated by
reference to the exercise price of such options. The weighted average exercise price of the
57,500 shares subject to outstanding options under the Option Plan is $68.00. With respect to
3,942,500 shares of Common Stock available for future grant under the Option Plan and 500,000
shares available for future grant under the 1986 Employee Stock Purchase Plan, as amended (the
"Purchase Plan"), the estimated Proposed Maximum Offering Price Per Share was estimated pursuant
to Rule 457(c) whereby the per share price was determined by reference to the average between the
high and low price reported in the Nasdaq National Market on November 14, 1997, which average was
$65.25. The number referenced above in the table entitled "Proposed Maximum Offering Price per
Share" represents a weighted average of the foregoing estimates calculated in accordance with
Rules 457(h) and 457(c).
</FN>
</TABLE>

<PAGE>

PART II

INFORMATION REQUIRED IN THE REGISTRATION STATEMENT

Item 3. Incorporation of Documents by Reference.

There are hereby incorporated by reference in this Registration
Statement the following documents and information heretofore filed with the
Securities and Exchange Commission:

(a) The Registrant's Annual Report on Form 10-K for the fiscal year
ended June 30, 1997, filed pursuant to Section 13 of the Securities Exchange Act
of 1934 (the "Exchange Act").

(b) The Registrant's Quarterly Report on Form 10-Q for the fiscal
quarter ended September 28, 1997, filed pursuant to Section 13 of the Exchange
Act.

(c) The description of the Registrant's Common Stock contained in the
Registrant's registration statement filed pursuant to the Exchange Act,
including any amendment or report filed for the purpose of updating such
description.

All documents subsequently filed by the Registrant pursuant to Sections
13(a), 13(c), 14 and 15(d) of the Exchange Act, prior to the filing of a
post-effective amendment which indicates that all securities offered have been
sold or which deregisters all securities then remaining unsold, shall be deemed
to be incorporated by reference in this registration statement and to be part
hereof from the date of filing such documents.

Item 4. Description of Securities.

Not applicable.

Item 5. Interests of Named Experts and Counsel.

Not applicable.

Item 6. Indemnification of Directors and Officers.

Section 317 of the California Corporations Code ("Section 317")
authorizes a corporation to indemnify a person against expenses and liabilities
arising from third party or derivative actions to which the person is or is
threatened to be made a party by reason of the fact that such person is or was
an agent of the corporation, so long as such person acted in good faith and in a
manner the person reasonably believed to be in the best interest of the
corporation and, in the case of a criminal proceeding, had no reasonable cause
to believe the conduct of the person was unlawful. Section 317 requires a
corporation to indemnify an agent who has been successful on the merits in
defense of any third party or derivative

II-1

<PAGE>

action against expenses actually and reasonably incurred in connection
therewith. The indemnification authorized by Section 317 is not exclusive of
additional indemnification rights which an agent may have.

In accordance with Section 204 of the California Corporations Code, the
Registrant's Articles of Incorporation eliminate the liability of directors for
monetary damages to the fullest extent permissible under California law. The
Registrant's Articles of Incorporation also authorize the Registrant to
indemnify the directors and officers to the fullest extent permissible under
California law.

The Registrant's Bylaws require the Registrant to indemnify directors
and officers of the Registrant, and authorize the Registrant to indemnify other
agents, to the maximum extent permitted under the California Corporations Code.
Such provisions also apply to former directors, officers and agents of the
Registrant, and persons serving as directors, officers or agents of another
entity at the request of the Registrant.

The Registrant has entered into indemnification agreements with its
directors and officers providing for indemnification of such directors and
officers to the maximum extent permitted by law, including future changes to the
law permitting broader indemnification than that currently permitted. These
agreements also resolve certain procedural and substantive matters that are not
covered, or are covered in less detail, in the California Corporations Code or
the Registrant's Bylaws.

The Registrant currently maintains liability insurance for its
directors and officers.

Item 7. Exemption from Registration Claimed.

Not applicable.

<TABLE>
Item 8. Exhibits.
<CAPTION>
Exhibit
Number
-------
<S> <C> <C>
4.1 1996 Incentive Stock Option Plan
4.2 Form of Stock Option Agreement for use with 1996 Incentive
Stock Option Plan
4.3 1986 Employee Stock Purchase Plan, as amended.
5.1 Opinion of Wilson Sonsini Goodrich & Rosati, P.C., as to legality of
securities being registered
23.1 Consent of Ernst & Young LLP, Independent Auditors
23.2 Consent of Counsel (contained in Exhibit 5.1)
24.1 Power of Attorney (See signature page)
</TABLE>

II-2

<PAGE>

Item 9. Undertakings.

(a) The undersigned Registrant hereby undertakes:

(1) To file, during any period in which offers or sales are
being made, a post-effective amendment to this registration statement to include
any material information with respect to the plan of distribution not previously
disclosed in the registration statement or any material change to such
information in the registration statement.

(2) That, for the purpose of determining any liability under
the Securities Act of 1933, as amended (the "Securities Act"), each such
post-effective amendment shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.

(3) To remove from registration by means of a post-effective
amendment any of the securities being registered which remain unsold at the
termination of the offering.

(b) The undersigned Registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act, each filing of the
Registrant's annual report pursuant to Section 13(a) or Section 15(d) of the
Exchange Act (and, where applicable, each filing of an employee benefit plan's
annual report pursuant to Section 15(d) of the Exchange Act) that is
incorporated by reference in the registration statement shall be deemed to be a
new registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.

(c) Insofar as indemnification for liabilities arising under the
Securities Act may be permitted to directors, officers and controlling persons
of the Registrant pursuant to the foregoing provisions, or otherwise, the
Registrant has been advised that in the opinion of the Securities and Exchange
Commission such indemnification is against public policy as expressed in the
Securities Act and is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by the
Registrant of expenses incurred or paid by a director, officer or controlling
person of the Registrant in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling person in
connection with the securities being registered, the Registrant will, unless in
the opinion of its counsel the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the question whether such
indemnification by it is against public policy as expressed in the Securities
Act and will be governed by the final adjudication of such issue.

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<PAGE>

SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, the
Registrant certifies that it has reasonable grounds to believe that it meets all
of the requirements for filing on Form S-8 and has duly caused this registration
statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Milpitas, State of California, on November 18, 1997.

LINEAR TECHNOLOGY CORPORATION

By: /S/ ROBERT H. SWANSON, JR.
--------------------------------------
Robert H. Swanson, Jr.
President and Chief Executive Officer

POWER OF ATTORNEY

KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below constitutes and appoints Robert H. Swanson, Jr. and Paul Coghlan,
jointly and severally, his attorneys-in-fact, each with the power of
substitution, for him in any and all capacities, to sign any amendments to this
registration statement on Form S-8, and to file the same, with exhibits thereto
and other documents in connection therewith, with the Securities and Exchange
Commission, hereby ratifying and confirming all that each of said
attorney-in-fact, or his substitute or substitutes, may do or cause to be done
by virtue hereof.

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<PAGE>

<TABLE>

Pursuant to the requirements of the Securities Act of 1933, this
registration statement has been signed by the following persons in the
capacities and on the dates indicated.

<CAPTION>
SIGNATURE TITLE DATE
- ----------------------------------- ----------------------------- -----------------

<S> <C> <C>
/S/ ROBERT H. SWANSON, JR. President, Chief Executive November 18, 1997
- ----------------------------------- Officer and Director
(Robert H. Swanson, Jr.) (Principal Executive Officer)

/S/ PAUL COGHLAN Vice President, Finance and November 18, 1997
- ----------------------------------- Chief Financial Officer
(Paul Coghlan) (Principal Financial and
Accounting Officer)

Director
- -----------------------------------
(Thomas S. Volpe)

/S/ DAVID S. LEE Director November 18, 1997
- -----------------------------------
(David S. Lee)

/S/ LEO T. MCCARTHY Director November 18, 1997
- -----------------------------------
(Leo T. McCarthy)

/S/ RICHARD M. MOLEY Director November 18, 1997
- -----------------------------------
(Richard M. Moley)

</TABLE>

II-5

<PAGE>

<TABLE>

LINEAR TECHNOLOGY CORPORATION

REGISTRATION STATEMENT ON FORM S-8

INDEX TO EXHIBITS

Exhibit
Number Description
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<S> <C>
4.1 1996 Incentive Stock Option Plan

4.2 Form of Stock Option Agreement for use with 1996 Incentive Stock Option Plan

4.3 1986 Employee Stock Purchase Plan, as amended.

5.1 Opinion of Wilson, Sonsini, Goodrich & Rosati, P.C., as to legality of securities being
registered

23.1 Consent of Ernst & Young LLP, Independent Auditors

23.2 Consent of Counsel (contained in Exhibit 5.1)

24.1 Power of Attorney (See signature page).

</TABLE>
II-6

LINEAR TECHNOLOGY CORPORATION
1996 INCENTIVE STOCK OPTION PLAN

1. Purposes of the Plan. The purposes of this Stock Plan are:

o to attract and retain the best available personnel for positions
of substantial responsibility,

o to provide additional incentive to Employees, Directors and
Consultants, and

o to promote the success of the Company's business.

Options granted under the Plan may be Incentive Stock Options or
Non-statutory Stock Options, as determined by the Administrator at the time of
grant.

2. Definitions. As used herein, the following definitions shall apply:

(a) "Administrator" means the Board or any of its Committees as shall
be administering the Plan, in accordance with Section 4 of the Plan.

(b) "Applicable Laws" means the requirements relating to the
administration of stock option plans under U. S. state corporate laws, U.S.
federal and state securities laws, the Internal Revenue Code, any stock exchange
or quotation system on which the Common Stock is listed or quoted and the
applicable laws of any foreign country or jurisdiction where Options are, or
will be, granted under the Plan.

(d) "Internal Revenue Code" means the Internal Revenue Code of 1986, as
amended.

(e) "Committee" means a committee of Directors appointed by the Board
in accordance with Section 4 of the Plan.

(f) "Common Stock" means the Common Stock of the Company.

(g) "Company" means Linear Technology Corporation, a California
corporation.

(h) "Consultant" means any person, including an advisor, engaged by the
Company or a Parent or Subsidiary to render services to such entity.

(i) "Director" means a member of the Board.

<PAGE>

(j) "Disability" means total and permanent disability as defined in
Section 22(e)(3) of the Internal Revenue Code.

(k) "Employee" means any person, including Officers and Directors,
employed by the Company or any Parent or Subsidiary of the Company. A Service
Provider shall not cease to be an Employee in the case of (i) any leave of
absence approved by the Company or (ii) transfers between locations of the
Company or between the Company, its Parent, any Subsidiary, or any successor.
For purposes of Incentive Stock Options, no such leave may exceed ninety days,
unless reemployment upon expiration of such leave is guaranteed by statute or
contract. If reemployment upon expiration of a leave of absence approved by the
Company is not so guaranteed, on the 181st day of such leave any Incentive Stock
Option held by the Optionee shall cease to be treated as an Incentive Stock
Option and shall be treated for tax purposes as a Non-statutory Stock Option.
Neither service as a Director nor payment of a director's fee by the Company
shall be sufficient to constitute "employment" by the Company.

(l) "Exchange Act" means the Securities Exchange Act of 1934, as
amended.

(m) "Fair Market Value" means, as of any date, the value of Common
Stock determined as follows:

(i) If the Common Stock is listed on any established stock
exchange or a national market system, including without limitation the Nasdaq
National Market or The Nasdaq SmallCap Market of The Nasdaq Stock Market, its
Fair Market Value shall be the closing bid price for such stock as quoted on
such exchange or system for the last market trading day prior to the time of
determination, as reported in The Wall Street Journal or such other source as
the Administrator deems reliable;

(ii) If the Common Stock is regularly quoted by a recognized
securities dealer but selling prices are not reported, the Fair Market Value of
a Share of Common Stock shall be the mean between the high bid and low asked
prices for the Common Stock on the last market trading day prior to the day of
determination, as reported in The Wall Street Journal or such other source as
the Administrator deems reliable;

(iii) In the absence of an established market for the Common
Stock, the Fair Market Value shall be determined in good faith by the
Administrator.

(n) "Incentive Stock Option" means an Option intended to qualify as an
incentive stock option within the meaning of Section 422 of the Internal Revenue
Code and the regulations promulgated thereunder.

(o) "Non-statutory Stock Option" means an Option not intended to
qualify as an Incentive Stock Option.

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<PAGE>

(p) "Notice of Grant" means a written or electronic notice evidencing
certain terms and conditions of an individual Option grant. The Notice of Grant
is part of the Option Agreement.

(q) "Officer" means a person who is an officer of the Company within
the meaning of Section 16 of the Exchange Act and the rules and regulations
promulgated thereunder.

(r) "Option" means a stock option granted pursuant to the Plan.

(s) "Option Agreement" means an agreement between the Company and an
Optionee evidencing the terms and conditions of an individual Option grant. The
Option Agreement is subject to the terms and conditions of the Plan.

(t) "Option Exchange Program" means a program whereby outstanding
options are surrendered in exchange for options with a lower exercise price.

(u) "Optioned Stock" means the Common Stock subject to an Option.

(v) "Optionee" means the holder of an outstanding Option granted under
the Plan.

(w) "Parent" means a "parent corporation," whether now or hereafter
existing, as defined in Section 424(e) of the Internal Revenue Code.

(x) "Plan" means this 1996 Incentive Stock Option Plan.

(y) "Rule 16b-3" means Rule 16b-3 of the Exchange Act or any successor
to Rule 16b-3, as in effect when discretion is being exercised with respect to
the Plan.

(z) "Section 16(b)" means Section 16(b) of the Exchange Act.

(aa) "Service Provider" means an Employee, Director or Consultant.

(bb) "Share" means a share of the Common Stock, as adjusted in
accordance with Section 13 of the Plan.

(cc) "Subsidiary" means a "subsidiary corporation", whether now or
hereafter existing, as defined in Section 424(f) of the Internal Revenue Code.

3. Stock Subject to the Plan. Subject to the provisions of Section 13 of
the Plan, the maximum aggregate number of Shares which may be optioned and sold
under the Plan is 4,000,000 Shares. The Shares may be authorized, but unissued,
or reacquired Common Stock.

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<PAGE>

If an Option expires or becomes unexercisable without having been exercised
in full, or is surrendered pursuant to an Option Exchange Program, the
unpurchased Shares which were subject thereto shall become available for future
grant or sale under the Plan (unless the Plan has terminated); provided,
however, that Shares that have actually been issued under the Plan, whether upon
exercise of an Option or Right, shall not be returned to the Plan and shall not
become available for future distribution under the Plan.

4. Administration of the Plan.

(a) Procedure.

(i) Multiple Administrative Bodies. The Plan may be administered
by different Committees with respect to different groups of Service Providers.

(ii) Section 162(m). To the extent that the Administrator
determines it to be desirable to qualify Options granted hereunder as
"performance-based compensation" within the meaning of Section 162(m) of the
Internal Revenue Code, the Plan shall be administered by a Committee of two or
more "outside directors" within the meaning of Section 162(m) of the Internal
Revenue Code.

(iii) Rule 16b-3. To the extent desirable to qualify transactions
hereunder as exempt under Rule 16b-3, the transactions contemplated hereunder
shall be structured to satisfy the requirements for exemption under Rule 16b-3.

(iv) Other Administration. Other than as provided above, the Plan
shall be administered by (A) the Board or (B) a Committee, which committee shall
be constituted to satisfy Applicable Laws.

(b) Powers of the Administrator. Subject to the provisions of the Plan,
and in the case of a Committee, subject to the specific duties delegated by the
Board to such Committee, the Administrator shall have the authority, in its
discretion:

(i) to determine the Fair Market Value;

(ii) to select the Service Providers to whom Options may be
granted hereunder;

(iii) to determine the number of shares of Common Stock to be
covered by each Option granted hereunder;

(iv) to approve forms of agreement for use under the Plan;

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<PAGE>

(v) to determine the terms and conditions, not inconsistent with
the terms of the Plan, of any Option granted hereunder. Such terms and
conditions include, but are not limited to, the exercise price, the time or
times when Options may be exercised (which may be based on performance
criteria), any vesting acceleration or waiver of forfeiture restrictions, and
any restriction or limitation regarding any Option or the shares of Common Stock
relating thereto, based in each case on such factors as the Administrator, in
its sole discretion, shall determine;

(vi) to reduce the exercise price of any Option to the then
current Fair Market Value if the Fair Market Value of the Common Stock covered
by such Option shall have declined since the date the Option was granted;

(vii) to institute an Option Exchange Program;

(viii) to construe and interpret the terms of the Plan and awards
granted pursuant to the Plan;

(ix) to prescribe, amend and rescind rules and regulations
relating to the Plan, including rules and regulations relating to sub-plans
established for the purpose of qualifying for preferred tax treatment under
foreign tax laws;

(x) to modify or amend each Option (subject to Section 15(c) of
the Plan), including the discretionary authority to extend the post-termination
exercisability period of Options longer than is otherwise provided for in the
Plan;

(xi) to allow Optionee to satisfy withholding tax obligations by
electing to have the Company withhold from the Shares to be issued upon exercise
of an Option that number of Shares having a Fair Market Value equal to the
amount required to be withheld. The Fair Market Value of the Shares to be
withheld shall be determined on the date that the amount of tax to be withheld
is to be determined. All elections by an Optionee to have Shares withheld for
this purpose shall be made in such form and under such conditions as the
Administrator may deem necessary or advisable;

(xii) to authorize any person to execute on behalf of the Company
any instrument required to effect the grant of an Option previously granted by
the Administrator;

(xiii) to make all other determinations deemed necessary or
advisable for administering the Plan.

(c) Effect of Administrator's Decision. The Administrator's decisions,
determinations and interpretations shall be final and binding on all Optionees
and any other holders of Options.

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<PAGE>

5. Eligibility. Non-statutory Stock Options may be granted to Service
Providers. Incentive Stock Options may be granted only to Employees.

6. Limitations.

(a) Each Option shall be designated in the Option Agreement as either
an Incentive Stock Option or a Non-statutory Stock Option. However,
notwithstanding such designation, to the extent that the aggregate Fair Market
Value of the Shares with respect to which Incentive Stock Options are
exercisable for the first time by the Optionee during any calendar year (under
all plans of the Company and any Parent or Subsidiary) exceeds $100,000, such
Options shall be treated as Non- statutory Stock Options. For purposes of this
Section 6(a), Incentive Stock Options shall be taken into account in the order
in which they were granted. The Fair Market Value of the Shares shall be
determined as of the time the Option with respect to such Shares is granted.

(b) Neither the Plan nor any Option shall confer upon an Optionee any
right with respect to continuing the Optionee's relationship as a Service
Provider with the Company, nor shall they interfere in any way with the
Optionee's right or the Company's right to terminate such relationship at any
time, with or without cause.

(i) No Service Provider shall be granted, in any fiscal year of
the Company, Options to purchase more than 500,000 Shares.

(ii) In connection with his or her initial service, a Service
Provider may be granted Options to purchase up to an additional 500,000 Shares
which shall not count against the limit set forth in subsection (i) above.

(iii) The foregoing limitations shall be adjusted proportionately
in connection with any change in the Company's capitalization as described in
Section 13.

(iv) If an Option is cancelled in the same fiscal year of the
Company in which it was granted (other than in connection with a transaction
described in Section 13), the cancelled Option will be counted against the
limits set forth in subsections (i) and (ii) above. For this purpose, if the
exercise price of an Option is reduced, the transaction will be treated as a
cancellation of the Option and the grant of a new Option.

7. Term of Plan. Subject to Section 19 of the Plan, the Plan shall become
effective upon its adoption by the Board. It shall continue in effect for a term
of ten (10) years unless terminated earlier under Section 15 of the Plan.

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<PAGE>

8. Term of Option. The term of each Option shall be stated in the Option
Agreement. In the case of an Incentive Stock Option, the term shall be ten (10)
years from the date of grant or such shorter term as may be provided in the
Option Agreement. Moreover, in the case of an Incentive Stock Option granted to
an Optionee who, at the time the Incentive Stock Option is granted, owns stock
representing more than ten percent (10%) of the voting power of all classes of
stock of the Company or any Parent or Subsidiary, the term of the Incentive
Stock Option shall be five (5) years from the date of grant or such shorter term
as may be provided in the Option Agreement.

9. Option Exercise Price and Consideration.

(a) Exercise Price. The per share exercise price for the Shares to be
issued pursuant to exercise of an Option shall be determined by the
Administrator, subject to the following:

(i) In the case of an Incentive Stock Option

(A) granted to an Employee who, at the time the Incentive
Stock Option is granted, owns stock representing more than ten percent (10%) of
the voting power of all classes of stock of the Company or any Parent or
Subsidiary, the per Share exercise price shall be no less than 110% of the Fair
Market Value per Share on the date of grant.

(B) granted to any Employee other than an Employee
described in paragraph (A) immediately above, the per Share exercise price shall
be no less than 100% of the Fair Market Value per Share on the date of grant.

(ii) In the case of a Non-statutory Stock Option, the per Share
exercise price shall be determined by the Administrator. In the case of a
Non-statutory Stock Option intended to qualify as "performance-based
compensation" within the meaning of Section 162(m) of the Internal Revenue Code,
the per Share exercise price shall be no less than 100% of the Fair Market Value
per Share on the date of grant.

(iii) Notwithstanding the foregoing, Options may be granted with
a per Share exercise price of less than 100% of the Fair Market Value per Share
on the date of grant pursuant to a merger or other corporate transaction.

(b) Waiting Period and Exercise Dates. At the time an Option is
granted, the Administrator shall fix the period within which the Option may be
exercised and shall determine any conditions which must be satisfied before the
Option may be exercised.

(c) Form of Consideration. The Administrator shall determine the
acceptable form of consideration for exercising an Option, including the method
of payment. In the case of an Incentive Stock Option, the Administrator shall
determine the acceptable form of consideration at the time of grant. Such
consideration may consist entirely of:

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<PAGE>

(i) cash;

(ii) check;

(iii) promissory note;

(iv) other Shares which (A) in the case of Shares acquired upon
exercise of an option, have been owned by the Optionee for more than six months
on the date of surrender, and (B) have a Fair Market Value on the date of
surrender equal to the aggregate exercise price of the Shares as to which said
Option shall be exercised;

(v) consideration received by the Company under a cashless
exercise program implemented by the Company in connection with the Plan;

(vi) a reduction in the amount of any Company liability to the
Optionee, including any liability attributable to the Optionee's participation
in any Company-sponsored deferred compensation program or arrangement;

(vii) any combination of the foregoing methods of payment; or

(viii) such other consideration and method of payment for the
issuance of Shares to the extent permitted by Applicable Laws.

10. Exercise of Option.

(a) Procedure for Exercise; Rights as a Shareholder. Any Option granted
hereunder shall be exercisable according to the terms of the Plan and at such
times and under such conditions as determined by the Administrator and set forth
in the Option Agreement. Unless the Administrator provides otherwise, vesting of
Options granted hereunder shall be suspended during any unpaid leave of absence.
An Option may not be exercised for a fraction of a Share.

An Option shall be deemed exercised when the Company receives: (i)
written or electronic notice of exercise (in accordance with the Option
Agreement) from the person entitled to exercise the Option, and (ii) full
payment for the Shares with respect to which the Option is exercised. Full
payment may consist of any consideration and method of payment authorized by the
Administrator and permitted by the Option Agreement and the Plan. Shares issued
upon exercise of an Option shall be issued in the name of the Optionee or, if
requested by the Optionee, in the name of the Optionee and his or her spouse.
Until the Shares are issued (as evidenced by the appropriate entry on the books
of the Company or of a duly authorized transfer agent of the Company), no right
to vote or receive dividends or any other rights as a shareholder shall exist
with respect to the Optioned Stock, notwithstanding the exercise of the Option.
The Company shall issue (or cause to be issued) such Shares promptly after the
Option is exercised. No adjustment will be made for a

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<PAGE>

dividend or other right for which the record date is prior to the date the
Shares are issued, except as provided in Section 13 of the Plan.

Exercising an Option in any manner shall decrease the number of Shares
thereafter available, both for purposes of the Plan and for sale under the
Option, by the number of Shares as to which the Option is exercised.

(b) Termination of Relationship as a Service Provider. If an Optionee
ceases to be a Service Provider, other than upon the Optionee's death or
Disability, the Optionee may exercise his or her Option within such period of
time as is specified in the Option Agreement to the extent that the Option is
vested on the date of termination (but in no event later than the expiration of
the term of such Option as set forth in the Option Agreement). In the absence of
a specified time in the Option Agreement, the Option shall remain exercisable
for three (3) months following the Optionee's termination. If, on the date of
termination, the Optionee is not vested as to his or her entire Option, the
Shares covered by the unvested portion of the Option shall revert to the Plan.
If, after termination, the Optionee does not exercise his or her Option within
the time specified by the Administrator, the Option shall terminate, and the
Shares covered by such Option shall revert to the Plan.

(c) Disability of Optionee. If an Optionee ceases to be a Service
Provider as a result of the Optionee's Disability, the Optionee may exercise his
or her Option within such period of time as is specified in the Option Agreement
to the extent the Option is vested on the date of termination (but in no event
later than the expiration of the term of such Option as set forth in the Option
Agreement). In the absence of a specified time in the Option Agreement, the
Option shall remain exercisable for twelve (12) months following the Optionee's
termination. If, on the date of termination, the Optionee is not vested as to
his or her entire Option, the Shares covered by the unvested portion of the
Option shall revert to the Plan. If, after termination, the Optionee does not
exercise his or her Option within the time specified herein, the Option shall
terminate, and the Shares covered by such Option shall revert to the Plan.

(d) Death of Optionee. If an Optionee dies while a Service Provider,
the Option may be exercised within such period of time as is specified in the
Option Agreement (but in no event later than the expiration of the term of such
Option as set forth in the Notice of Grant), by the Optionee's estate or by a
person who acquires the right to exercise the Option by bequest or inheritance,
but only to the extent that the Option is vested on the date of death. In the
absence of a specified time in the Option Agreement, the Option shall remain
exercisable for twelve (12) months following the Optionee's termination. If, at
the time of death, the Optionee is not vested as to his or her entire Option,
the Shares covered by the unvested portion of the Option shall immediately
revert to the Plan. The Option may be exercised by the executor or administrator
of the Optionee's estate or, if none, by the person(s) entitled to exercise the
Option under the Optionee's will or the laws of descent or distribution. If the
Option is not so exercised within the time specified herein, the Option shall
terminate, and the Shares covered by such Option shall revert to the Plan.

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<PAGE>

(e) Buyout Provisions. The Administrator may at any time offer to buy
out for a payment in cash or Shares, an Option previously granted based on such
terms and conditions as the Administrator shall establish and communicate to the
Optionee at the time that such offer is made.

11. Non-Transferability of Options. Unless determined otherwise by the
Administrator, an Option may not be sold, pledged, assigned, hypothecated,
transferred, or disposed of in any manner other than by will or by the laws of
descent or distribution and may be exercised, during the lifetime of the
Optionee, only by the Optionee. If the Administrator makes an Option
transferable, such Option shall contain such additional terms and conditions as
the Administrator deems appropriate.

12. Adjustments Upon Changes in Capitalization, Dissolution, Merger or
Asset Sale.

(a) Changes in Capitalization. Subject to any required action by the
shareholders of the Company, the number of shares of Common Stock covered by
each outstanding Option, and the number of shares of Common Stock which have
been authorized for issuance under the Plan but as to which no Options have yet
been granted or which have been returned to the Plan upon cancellation or
expiration of an Option, as well as the price per share of Common Stock covered
by each such outstanding Option, shall be proportionately adjusted for any
increase or decrease in the number of issued shares of Common Stock resulting
from a stock split, reverse stock split, stock dividend, combination or
reclassification of the Common Stock, or any other increase or decrease in the
number of issued shares of Common Stock effected without receipt of
consideration by the Company; provided, however, that conversion of any
convertible securities of the Company shall not be deemed to have been "effected
without receipt of consideration." Such adjustment shall be made by the Board,
whose determination in that respect shall be final, binding and conclusive.
Except as expressly provided herein, no issuance by the Company of shares of
stock of any class, or securities convertible into shares of stock of any class,
shall affect, and no adjustment by reason thereof shall be made with respect to,
the number or price of shares of Common Stock subject to an Option.

(b) Dissolution or Liquidation. In the event of the proposed
dissolution or liquidation of the Company, the Administrator shall notify each
Optionee as soon as practicable prior to the effective date of such proposed
transaction. The Administrator in its discretion may provide for an Optionee to
have the right to exercise his or her Option until ten (10) days prior to such
transaction as to all of the Optioned Stock covered thereby, including Shares as
to which the Option would not otherwise be exercisable. In addition, the
Administrator may provide that any Company repurchase option applicable to any
Shares purchased upon exercise of an Option shall lapse as to all such Shares,
provided the proposed dissolution or liquidation takes place at the time and in
the manner contemplated. To the extent it has not been previously exercised, an
Option will terminate immediately prior to the consummation of such proposed
action.

(c) Merger or Asset Sale. In the event of a merger of the Company with
or into another corporation, or the sale of substantially all of the assets of
the Company, each outstanding Option shall be assumed or an equivalent option or
right substituted by the successor corporation or

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<PAGE>

a Parent or Subsidiary of the successor corporation. In the event that the
successor corporation refuses to assume or substitute for the Option, the
Optionee shall fully vest in and have the right to exercise the Option as to all
of the Optioned Stock, including Shares as to which it would not otherwise be
vested or exercisable. If an Option becomes fully vested and exercisable in lieu
of assumption or substitution in the event of a merger or sale of assets, the
Administrator shall notify the Optionee in writing or electronically that the
Option shall be fully vested and exercisable for a period of thirty (30) days
from the date of such notice, and the Option shall terminate upon the expiration
of such period. For the purposes of this paragraph, the Option shall be
considered assumed if, following the merger or sale of assets, the option or
right confers the right to purchase or receive, for each Share of Optioned Stock
subject to the Option immediately prior to the merger or sale of assets, the
consideration (whether stock, cash, or other securities or property) received in
the merger or sale of assets by holders of Common Stock for each Share held on
the effective date of the transaction (and if holders were offered a choice of
consideration, the type of consideration chosen by the holders of a majority of
the outstanding Shares); provided, however, that if such consideration received
in the merger or sale of assets is not solely common stock of the successor
corporation or its Parent, the Administrator may, with the consent of the
successor corporation, provide for the consideration to be received upon the
exercise of the Option, for each Share of Optioned Stock subject to the Option,
to be solely common stock of the successor corporation or its Parent equal in
fair market value to the per share consideration received by holders of Common
Stock in the merger or sale of assets.

13. Date of Grant. The date of grant of an Option shall be, for all
purposes, the date on which the Administrator makes the determination granting
such Option, or such other later date as is determined by the Administrator.
Notice of the determination shall be provided to each Optionee within a
reasonable time after the date of such grant.

14. Amendment and Termination of the Plan.

(a) Amendment and Termination. The Board may at any time amend, alter,
suspend or terminate the Plan.

(b) Shareholder Approval. The Company shall obtain shareholder approval
of any Plan amendment to the extent necessary and desirable to comply with
Applicable Laws.

(c) Effect of Amendment or Termination. No amendment, alteration,
suspension or termination of the Plan shall impair the rights of any Optionee,
unless mutually agreed otherwise between the Optionee and the Administrator,
which agreement must be in writing and signed by the Optionee and the Company.
Termination of the Plan shall not affect the Administrator's ability to exercise
the powers granted to it hereunder with respect to options granted under the
Plan prior to the date of such termination.

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<PAGE>

15. Conditions Upon Issuance of Shares.

(a) Legal Compliance. Shares shall not be issued pursuant to the
exercise of an Option unless the exercise of such Option and the issuance and
delivery of such Shares shall comply with Applicable Laws and shall be further
subject to the approval of counsel for the Company with respect to such
compliance.

(b) Investment Representations. As a condition to the exercise of an
Option, the Company may require the person exercising such Option to represent
and warrant at the time of any such exercise that the Shares are being purchased
only for investment and without any present intention to sell or distribute such
Shares if, in the opinion of counsel for the Company, such a representation is
required.

16. Inability to Obtain Authority. The inability of the Company to obtain
authority from any regulatory body having jurisdiction, which authority is
deemed by the Company's counsel to be necessary to the lawful issuance and sale
of any Shares hereunder, shall relieve the Company of any liability in respect
of the failure to issue or sell such Shares as to which such requisite authority
shall not have been obtained.

17. Reservation of Shares. The Company, during the term of this Plan, will
at all times reserve and keep available such number of Shares as shall be
sufficient to satisfy the requirements of the Plan.

18. Shareholder Approval. The Plan shall be subject to approval by the
shareholders of the Company within twelve (12) months after the date the Plan is
adopted. Such shareholder approval shall be obtained in the manner and to the
degree required under Applicable Laws.

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LINEAR TECHNOLOGY CORPORATION
NONSTATUTORY STOCK OPTION AGREEMENT
1996 INCENTIVE STOCK OPTION PLAN

Linear Technology Corporation, a California corporation (the
"Company"), has granted to _________________ (the "Optionee"), an option (the
"Option") to purchase a total of ________ shares of Common Stock (the "Shares"),
at the price determined as provided herein, and in all respects subject to the
terms, definitions and provisions of the 1996 Incentive Stock Option Plan, as
amended (the "Plan"), adopted by the Company, which is incorporated herein by
reference. Unless otherwise defined herein, the terms defined in the Plan shall
have the same defined meanings herein. In the event of a conflict between the
terms and conditions of the Plan and the terms and conditions of this Option
Agreement, the terms and conditions of the Plan shall prevail.

1. Nature of the Option. This Option is intended by the Company and the
Optionee to be a Nonstatutory Stock Option ("NSO"), and does not qualify for any
special tax benefits to the Optionee. This Option is not an Incentive Stock
Option.

2. Exercise Price. The exercise price is $_________ for each share of
Common Stock.

3. Exercise of Option. This Option shall be exercisable during its term
in accordance with the provisions of Section 9 of the Plan as follows:

(i) Right to Exercise.

(a) Subject to subsections 3(i)(b), (c) and (d) below,
this Option shall be exercisable cumulatively, to the extent of that percentage
of the Shares subject to the Option determined by multiplying the total number
of Shares originally subject to the Option by a fraction the numerator of which
is the number of whole six month periods elapsed since ___________ and the
denominator of which is 10.

(b) This Option may not be exercised for a fraction of a
share.

(c) In the event Optionee ceases to be a Service
Provider, the exercisability of the Option is governed by Sections 6, 7 and 8
below.

(d) In no event may this Option be exercised after the
date of expiration of the term of this Option as set forth in Section 10 below.

(ii) Method of Exercise. This Option shall be exercisable by
delivery of written notice which shall state the election to exercise the
Option, the number of Shares in respect of which the Option is being exercised,
and such other representations and agreements as to the holder's investment
intent with respect to such shares of Common Stock as may be required by the
Company pursuant to the provisions of the Plan. Such written notice shall be
signed by the Optionee and shall

<PAGE>

be delivered in person or by certified mail to the Secretary of the Company. The
written notice shall be accompanied by payment of the exercise price. This
Option shall be deemed exercised upon receipt by the Company of such written
notice accompanied by the exercise price.

No Shares will be issued pursuant to the exercise of an Option unless
such issuance and such exercise shall comply with all relevant provisions of law
and the requirements of any stock exchange upon which the Shares may then be
listed. Assuming such compliance, for income tax purposes the Shares shall be
considered transferred to the Optionee on the date on which the Option is
exercised with respect to such Shares.

4. Method of Payment. Payment of the exercise price shall be by any of
the following, or a combination thereof, at the election of the Optionee:

(i) personal, certified or bank cashier's check; or

(ii) delivery of a properly executed exercise notice together
with irrevocable instructions to a broker to promptly deliver to the Company the
amount of sales or loan proceeds required to pay the exercise price.

5. Restrictions on Exercise. This Option may not be exercised until
such time as the Plan has been approved by the shareholders of the Company, or
if the issuance of such Shares upon such exercise or the method of payment of
consideration for such shares would constitute a violation of any applicable
federal or state securities or other law or regulation, including any rule under
Part 207 of Title 12 of the Code of Federal Regulations ("Regulation G") as
promulgated by the Federal Reserve Board. As a condition to the exercise of this
Option, the Company may require Optionee to make any representation and warranty
to the Company as may be required by any applicable law or regulation.

6. Termination of Status as an Employee, Consultant or Director. Except
as provided for in Sections 7 and 8 below, in the event Optionee ceases to be a
Service Provider, Optionee may, but only within three (3) months after the date
he or she ceases to be a Service Provider, exercise this Option to the extent
that he or she was entitled to exercise it at the date of such termination. To
the extent that Optionee was not entitled to exercise this Option at the date of
such termination, or if Optionee does not exercise this Option within the time
specified herein, the Option shall terminate.

7. Disability of Optionee. Notwithstanding the provisions of Section 6
above, if Optionee ceases to be a Service Provider as a result of Optionee's
Disability, Optionee may, but only within six (6) months from the date of
termination of employment, exercise his or her Option to the extent Optionee was
entitled to exercise it at the date of such termination. To the extent that
Optionee was not entitled to exercise the Option at the date of termination, or
if Optionee does not exercise such Option (which Optionee was entitled to
exercise) within the time specified herein, the Option shall terminate.

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<PAGE>

8. Death of Optionee. In the event of the death of Optionee during the
term of this Option and while a Service Provider since the date of grant of the
Option, the Option may be exercised, at any time within six (6) months following
the date of death, by Optionee's estate or by a person who acquired the right to
exercise the Option by bequest or inheritance, but only to the extent of the
right to exercise that the Option vested as of the Optionee's date of death.

9. Non-Transferability of Option. This Option may not be transferred in
any manner otherwise than by will or by the laws of descent or distribution and
may be exercised during the lifetime of Optionee only by him. The terms of this
Option shall be binding upon the executors, administrators, heirs, successors
and assigns of the Optionee.

10. Term of Option. This Option may not be exercised more than ten (10)
years from the date of grant of this Option, and may be exercised during such
term only in accordance with the Plan and the terms of this Option.

11. Taxation Upon Exercise of Option. Optionee understands that, upon
exercise of this Option, he or she will be treated as having received
compensation income (taxable at ordinary income rates) equal to the excess, if
any, of the fair market value of the exercised shares over the exercise price.
If the Optionee is an employee, the Company will be required to withhold tax
upon exercise as if the net proceeds were compensation income. The Company may
use guidelines for withholding published by taxing authorities in order to meet
its withholding responsibilities. These amounts withheld may not be sufficient
to meet the employee's tax liability on the transaction. It is the employee's
responsibility to meet his or her total tax liability. We advise the employee to
seek assistance and guidance on this matter from his or her own tax advisor. If
the Optionee holds NSO shares for at least one year, any gain realized on
disposition of the Shares will be treated as long-term capital gain for federal
income tax purposes (holding the shares for at least eighteen months will result
in lower capital gains tax rates). THE SUMMARY OF SOME OF THE FEDERAL TAX
CONSEQUENCES RELATING TO THIS OPTION, IS NECESSARILY INCOMPLETE AND THE TAX LAWS
AND REGULATIONS DISCUSSED HEREIN ARE SUBJECT TO CHANGE. YOU ARE URGED TO CONSULT
A TAX ADVISOR BEFORE EXERCISING THE OPTION OR DISPOSING OF THE SHARES.

DATE OF GRANT: _________________

LINEAR TECHNOLOGY CORPORATION
a California corporation

By: _____________________________

Title: _____________________________

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<PAGE>

OPTIONEE ACKNOWLEDGES AND AGREES THAT THE VESTING OF SHARES PURSUANT TO
SECTION 3 HEREOF IS EARNED ONLY BY CONTINUING SERVICE AS A SERVICE PROVIDER AT
THE WILL OF THE COMPANY (NOT THROUGH THE ACT OF BEING HIRED, BEING GRANTED THIS
OPTION OR ACQUIRING SHARES HEREUNDER). OPTIONEE FURTHER ACKNOWLEDGES AND AGREES
THAT NOTHING IN THIS AGREEMENT, NOR IN THE COMPANY'S STOCK OPTION PLAN WHICH IS
INCORPORATED HEREIN BY REFERENCE, SHALL CONFER UPON OPTIONEE ANY RIGHT WITH
RESPECT TO CONTINUATION AS A SERVICE PROVIDER WITH THE COMPANY, NOR SHALL IT
INTERFERE IN ANY WAY WITH OPTIONEE'S RIGHT OR THE COMPANY'S RIGHT TO TERMINATE
OPTIONEE'S EMPLOYMENT OR CONSULTANCY AT ANY TIME, WITH OR WITHOUT CAUSE.

By your signature and the signature of the Company's representative,
you and the Company agree that this Option is granted under and governed by the
terms and conditions of the Plan and this Option Agreement. Optionee has
reviewed the Plan and this Option Agreement in their entirety, has had an
opportunity to obtain the advice of counsel prior to executing this Option
Agreement and fully understands all provisions of the Plan and Option Agreement.
Optionee hereby agrees to accept as binding, conclusive and final all decisions
or interpretations of the Administrator upon any questions relating to the Plan
and Option Agreement.

Dated: ______________ ____________________________________
Optionee

Residence Address:

____________________________________

-4-

EXHIBIT 4.3

LINEAR TECHNOLOGY CORPORATION

1986 EMPLOYEE STOCK PURCHASE PLAN
(AS AMENDED)

The following constitute the provisions of the 1986 Employee Stock
Purchase Plan of Linear Technology Corporation.

1. Purpose. The purpose of the Plan is to provide employees of the
Company and its Designated Subsidiaries with an opportunity to purchase Common
Stock of the Company through accumulated payroll deductions. It is the intention
of the Company to have the Plan qualify as an "Employee Stock Purchase Plan"
under Section 423 of the Internal Revenue Code of 1986, as amended. The
provisions of the Plan shall, accordingly, be construed so as to extend and
limit participation in a manner consistent with the requirements of that section
of the Code.

2. Definitions.

(a) "Board" shall mean the Board of Directors of the Company.

(b) "Code" shall mean the Internal Revenue Code of 1986, as
amended.

(d) "Company" shall mean Linear Technology Corporation, a
California corporation.

(e) "Compensation" shall mean all regular straight time gross
earnings, exclusive of payments for overtime, shift premium, incentive
compensation, incentive payments, bonuses or other compensation.

(f) "Continuous Status as an Employee" shall mean the absence
of any interruption or termination of service as an Employee. Continuous Status
as an Employee shall not be considered interrupted in the case of a leave of
absence agreed to in writing by the Company, provided that such leave is for a
period of not more than 90 days or reemployment upon the expiration of such
leave is guaranteed by contract or statute.

(g) "Designated Subsidiaries" shall mean the Subsidiaries
which have been designated by the Board from time to time in its sole discretion
as eligible to participate in the Plan.

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<PAGE>

(h) "Employee" shall mean any person, including an officer,
who is customarily employed for at least twenty (20) hours per week and more
than five (5) months in a calendar year by the Company or one of its Designated
Subsidiaries.

(i) "Exercise Date" shall mean the last day of each offering
period of the Plan.

(j) "Offering Date" shall mean the first day of each offering
period of the Plan.

(k) "Plan" shall mean this 1986 Employee Stock Purchase Plan.

(l) "Subsidiary" shall mean a corporation, domestic or
foreign, of which not less than 50% of the voting shares are held by the Company
or a Subsidiary, whether or not such corporation now exists or is hereafter
organized or acquired by the Company or a Subsidiary.

3. Eligibility.

(a) Any person who is an Employee as of the Offering Date of a
given offering period shall be eligible to participate in such offering period
under the Plan, subject to the requirements of paragraph 5(a) and the
limitations imposed by Section 423(b) of the Code.

(b) Any provisions of the Plan to the contrary
notwithstanding, no Employee shall be granted an option under the Plan (i) if,
immediately after the grant, such Employee (or any other person whose stock
would be attributed to such Employee pursuant to Section 425(d) of the Code)
would own stock and/or hold outstanding options to purchase stock possessing
five percent (5%) or more of the total combined voting power or value of all
classes of stock of the Company or of any subsidiary of the Company, or (ii)
which permits his rights to purchase stock under all employee stock purchase
plans (described in Section 423 of the Code) of the Company and its subsidiaries
to accrue at a rate which exceeds Twenty-Five Thousand Dollars ($25,000) of fair
market value of such stock (determined at the time such option is granted) for
each calendar year in which such option is outstanding at any time.

4. Offering Periods. The Plan shall be implemented by one offering
during each six-month period of the Plan, commencing on or about November 1,
1986, and continuing thereafter until terminated in accordance with paragraph 19
hereof. The Board of Directors of the Company shall have the power to change the
duration of offering periods with respect to future offerings without
shareholder approval if such change is announced at least fifteen (15) days
prior to the scheduled beginning of the first offering period to be affected.

5. Participation.

(a) An eligible Employee may become a participant in the Plan
by completing a subscription agreement authorizing payroll deduction on the form
provided by the Company and filing it with the Company's payroll office prior to
the applicable Offering Date, unless a later time for filing

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<PAGE>

the subscription agreement is set by the Board for all eligible Employees with
respect to a given offering.

(b) Payroll deductions for a participant shall commence on the
first payroll following the Offering Date and shall end on the Exercise Date of
the offering to which such authorization is applicable, unless sooner terminated
by the participant as provided in paragraph 10.

6. Payroll Deductions.

(a) At the time a participant files his subscription
agreement, he shall elect to have payroll deductions made on each payday during
the offering period in an amount not less than five percent (5%) and not
exceeding ten percent (10%) of the Compensation which he received on the payday
immediately preceding the Offering Date, and the aggregate of such payroll
deductions during the offering period shall not exceed ten percent (10%) of his
aggregate Compensation during said offering period.

(b) All payroll deductions made by a participant shall be
credited to his account under the Plan. A participant may not make any
additional payments into such account.

(c) A participant may discontinue his participation in the
Plan as provided in paragraph 10, or may lower, but not increase, the rate of
his payroll deductions during the offering period by completing or filing with
the Company a new authorization for payroll deduction. The change in rate shall
be effective fifteen (15) days following the Company's receipt of the new
authorization.

(d) Notwithstanding the foregoing, to the extent necessary to
comply with Section 423(b)(8) of the Code and paragraph 3(b) herein, a
participant's payroll deductions may be decreased to 0% at such time during any
Offering Period which is scheduled to end during the current calendar year that
the aggregate of all payroll deductions accumulated with respect to such
Offering Period and any other Offering Period ending within the same calendar
year equal $21,250. Payroll deductions shall recommence at the rate provided in
such participant's subscription agree ment at the beginning of the first
Offering Period which is scheduled to end in the following calendar year, unless
terminated by the participant as provided in paragraph 10.

7. Grant of Option.

(a) On the Offering Date of each offering period, each
eligible Employee participating in the Plan shall be granted an option to
purchase (at the per share option price) up to a number of shares of the
Company's Common Stock determined by dividing such Employee's payroll deductions
to be accumulated during such offering period (to be an amount not less than
five percent (5%) and not to exceed an amount equal to ten percent (10%) of his
Compensation as of the date of the commencement of the applicable offering
period) by the lower of (i) eighty-five percent (85%) of the fair market value
of a share of the Company's Common Stock on the Offering Date, or (ii)
eighty-five percent (85%) of the fair market value of a share of Common Stock on
the Exercise

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<PAGE>

Date, subject to the limitations set forth in Section 3(b) and 12 hereof,
provided that the number of shares of the Company's Common Stock subject to any
option granted to a participant pursuant to this Plan shall not exceed 300. Fair
market value of a share of the Company's Common Stock shall be determined as
provided in Section 7(b) herein.

(b) The option price per share of the shares offered in a
given offering period shall be the lower of: (i) 85% of the fair market value of
a share of the Common Stock of the Company on the Offering Date; or (ii) 85% of
the fair market value of a share of the Common Stock of the Company on the
Exercise Date. The fair market value of the Company's Common Stock on a given
date shall be determined by the Board in its discretion; provided, however, that
where there is a public market for the Common Stock, the fair market value per
Share shall be the mean of the bid and asked prices of the Common Stock for such
date, as reported in the Wall Street Journal (or, if not so reported, as
otherwise reported by the National Association of Securities Dealers Automated
Quotation (NASDAQ) System) or, in the event the Common Stock is listed on a
stock exchange, the fair market value per Share shall be the closing price on
such exchange on such date, as reported in the Wall Street Journal.

8. Exercise of Option. Unless a participant withdraws from the Plan as
provided in paragraph 10, his option for the purchase of shares will be
exercised automatically on the Exercise Date of the offering period, and the
maximum number of full shares subject to option will be purchased for him at the
applicable option price with the accumulated payroll deductions in his account.
The shares purchased upon exercise of an option hereunder shall be deemed to be
transferred to the participant on the Exercise Date. During his lifetime, a
participant's option to purchase shares hereunder is exercisable only by him.

9. Delivery. As promptly as practicable after the Exercise Date of each
offering period, the Company shall arrange the delivery to each participant, as
appropriate, of a certificate representing the shares purchased upon exercise of
his option. Any cash remaining to the credit of a participant's account under
the Plan after a purchase by him of shares at the termination of each offering
period, or which is insufficient to purchase a full share of Common Stock of the
Company, shall be returned to said participant.

10. Withdrawal; Termination of Employment.

(a) A participant may withdraw all but not less than all the
payroll deductions credited to his account under the Plan at any time prior to
the Exercise Date of the offering period by giving written notice to the
Company. All of the participant's payroll deductions credited to his account
will be paid to him promptly after receipt of his notice of withdrawal and his
option for the current period will be automatically terminated, and no further
payroll deductions for the purchase of shares will be made during the offering
period.

(b) Upon termination of the participant's Continuous Status as
an Employee prior to the Exercise Date of the offering period for any reason,
including retirement or death, the payroll

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<PAGE>

deductions credited to his account will be returned to him or, in the case of
his death, to the person or persons entitled thereto under paragraph 14, and his
option will be automatically terminated.

(c) In the event an Employee fails to remain in Continuous
Status as an Employee of the Company for at least twenty (20) hours per week
during the offering period in which the employee is a participant, he will be
deemed to have elected to withdraw from the Plan and the payroll deductions
credited to his account will be returned to him and his option terminated.

(d) A participant's withdrawal from an offering will not have
any effect upon his eligibility to participate in a succeeding offering or in
any similar plan which may hereafter be adopted by the Company.

11. Interest. No interest shall accrue on the payroll deductions of a
participant in the Plan.

12. Stock.

(a) The maximum number of shares of the Company's Common Stock
which shall be made available for sale under the Plan shall be 2,100,000*
shares, subject to adjustment upon changes in capitalization of the Company as
provided in paragraph 18. If the total number of shares which would otherwise be
subject to options granted pursuant to Section 7(a) hereof on the Offering Date
of an offering period exceeds the number of shares then available under the Plan
(after deduction of all shares for which options have been exercised or are then
outstanding), the Company shall make a pro rata allocation of the shares
remaining available for option grant in as uniform a manner as shall be
practicable and as it shall determine to be equitable. In such event, the
Company shall give written notice of such reduction of the number of shares
subject to the option to each Employee affected thereby and shall similarly
reduce the rate of payroll deductions, if necessary.

(b) The participant will have no interest or voting right in
shares covered by his option until such option has been exercised.

(c) Shares to be delivered to a participant under the Plan
will be registered in the name of the participant or in the name of the
participant and his spouse.

13. Administration. The Plan shall be administered by the Board of the
Company or a committee of members of the Board appointed by the Board. The
administration, interpretation or application of the Plan by the Board or its
committee shall be final, conclusive and binding upon all participants. Members
of the Board who are eligible Employees are permitted to participate in the
Plan, provided that:

(a) Members of the Board who are eligible to participate in
the Plan may not vote on any matter affecting the administration of the Plan or
the grant of any option pursuant to the Plan.

- --------
* Available share number reflects two-for-one stock splits effected in 1992 and
1995.

-5-

<PAGE>

(b) If a Committee is established to administer the Plan, no
member of the Board who is eligible to participate in the Plan may be a member
of the Committee.

14. Designation of Beneficiary.

(a) A participant may file a written designation of a
beneficiary who is to receive any shares and cash, if any, from the
participant's account under the Plan in the event of such partici pant's death
subsequent to the end of the offering period but prior to delivery to him of
such shares and cash. In addition, a participant may file a written designation
of a beneficiary who is to receive any cash from the participant's account under
the Plan in the event of such participant's death prior to the Exercise Date of
the offering period.

(b) Such designation of beneficiary may be changed by the
participant at any time by written notice. In the event of the death of a
participant and in the absence of a beneficiary validly designated under the
Plan who is living at the time of such participant's death, the Company shall
deliver such shares and/or cash to the executor or administrator of the estate
of the participant, or if no such executor or administrator has been appointed
(to the knowledge of the Company), the Company, in its discretion, may deliver
such shares and/or cash to the spouse or to any one or more dependents or
relatives of the participant, or if no spouse, dependent or relative is known to
the Company, then to such other person as the Company may designate.

15. Transferability. Neither payroll deductions credited to a
participant's account nor any rights with regard to the exercise of an option or
to receive shares under the Plan may be assigned, transferred, pledged or
otherwise disposed of in any way (other than by will, the laws of descent and
distribution or as provided in paragraph 14 hereof) by the participant. Any such
attempt at assignment, transfer, pledge or other disposition shall be without
effect, except that the Company may treat such act as an election to withdraw
funds in accordance with paragraph 10.

16. Use of Funds. All payroll deductions received or held by the
Company under the Plan may be used by the Company for any corporate purpose, and
the Company shall not be obligated to segregate such payroll deductions.

17. Reports. Individual accounts will be maintained for each
participant in the Plan. Statements of account will be given to participating
Employees promptly following the Exercise Date, which statements will set forth
the amounts of payroll deductions, the per share purchase price, the number of
shares purchased and the remaining cash balance, if any.

18. Adjustments Upon Changes in Capitalization. Subject to any required
action by the shareholders of the Company, the number of shares of Common Stock
covered by each option under the Plan which has not yet been exercised and the
number of shares of Common Stock which have been authorized for issuance under
the Plan but have not yet been placed under option (collectively, the
"Reserves"), as well as the price per share of Common Stock covered by each
option under the Plan which has not yet been exercised, shall be proportionately
adjusted for any increase or decrease in the number of issued shares of Common
Stock resulting from a stock split, reverse stock split,

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<PAGE>

stock dividend, combination or reclassification of the Common Stock, or any
other increase or decrease in the number of shares of Common Stock effected
without receipt of consideration by the Company; provided, however, that
conversion of any convertible securities of the Company shall not be deemed to
have been "effected without receipt of consideration." Such adjustment shall be
made by the Board, whose determination in that respect shall be final, binding
and conclusive. Except as expressly provided herein, no issue by the Company of
shares of stock of any class, or securities convertible into shares of stock of
any class, shall affect, and no adjustment by reason thereof shall be made with
respect to, the number or price of shares of Common Stock subject to an option.

In the event of the proposed dissolution or liquidation of the Company,
the offering period will terminate immediately prior to the consummation of such
proposed action, unless otherwise pro vided by the Board. In the event of a
proposed sale of all or substantially all of the assets of the Company, or the
merger of the Company with or into another corporation, each option under the
Plan shall be assumed or an equivalent option shall be substituted by such
successor corporation or a parent or subsidiary of such successor corporation,
unless the Board determines, in the exercise of its sole discretion and in lieu
of such assumption or substitution, that the participant shall have the right to
exercise the option as to all of the optioned stock, including shares as to
which the option would not otherwise be exercisable. If the Board makes an
option fully exercisable in lieu of assumption or substitution in the event of a
merger or sale of assets, the Board shall notify the participant that the option
shall be fully exercisable for a period of thirty (30) days from the date of
such notice, and the option will terminate upon the expiration of such period.

The Board may, if it so determines in the exercise of its sole
discretion, also make provision for adjusting the Reserves, as well as the price
per share of Common Stock covered by each outstanding option, in the event that
the Company effects one or more reorganizations, recapitalizations, rights
offerings or other increases or reductions of shares of its outstanding Common
Stock, and in the event of the Company being consolidated with or merged into
any other corporation.

19. Amendment or Termination. The Board of Directors of the Company may
at any time and for any reason terminate or amend the Plan. Except as provided
in paragraph 18, no such termination can affect options previously granted,
provided that an Offering Period may be terminated by the Board of Directors on
any Exercise Date if the Board determines that the termination of the Plan is in
the best interests of the Company and its shareholders. Except as provided in
paragraph 18, no amendment may make any change in any option theretofore granted
which adversely affects the rights of any participation. In addition, to the
extent necessary to comply with Rule 16b-3 under the Securities Exchange Act of
1934, as amended, or under Section 423 of the Code (or any successor rule or
provision or any other applicable law or regulation), the Company shall obtain
shareholder approval in such a manner and to such a degree as so required.

20. Notices. All notices or other communications by a participant to
the Company under or in connection with the Plan shall be deemed to have been
duly given when received in the form specified by the Company at the location,
or by the person, designated by the Company for the receipt thereof.

-7-

<PAGE>

21. Shareholder Approval. Continuance of the Plan shall be subject to
approval by the shareholders of the Company within twelve months before or after
the date the Plan is adopted. Such shareholder approval shall be obtained in the
manner and degree required under the California General Corporate Law.

22. Conditions Upon Issuance of Shares. Shares shall not be issued with
respect to an option unless the exercise of such option and the issuance and
delivery of such shares pursuant thereto shall comply with all applicable
provisions of law, domestic or foreign, including, without limitation, the
Securities Act of 1933, as amended, the Securities Exchange Act of 1934, as
amended, the rules and regulations promulgated thereunder, and the requirements
of any stock exchange upon which the shares may then be listed, and shall be
further subject to the approval of counsel for the Company with respect to such
compliance.

As a condition to the exercise of an option, the Company may require
the person exercising such option to represent and warrant at the time of any
such exercise that the shares are being purchased only for investment and
without any present intention to sell or distribute such shares if, in the
opinion of counsel for the Company, such a representation is required by any of
the aforementioned applicable provisions of law.

23. Term of Plan. The Plan shall become effective upon the earlier to
occur of its adoption by the Board of Directors or its approval by the
shareholders of the Company as described in paragraph 21. It shall continue in
effect for a term of twenty (20) years unless sooner terminated under paragraph
19.

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<PAGE>

LINEAR TECHNOLOGY CORPORATION

1986 EMPLOYEE STOCK PURCHASE PLAN
SUBSCRIPTION AGREEMENT

_____ Original Application Offering Date: ___________
_____ Change in Payroll Deduction Rate
_____ Change of Beneficiary(ies)

1. __________________________________ hereby elects to participate in the
Linear Technology Corporation 1986 Employee Stock Purchase Plan (the
"Stock Purchase Plan") and subscribes to purchase shares of the
Company's Common Stock, without par value, in accordance with this
Subscription Agreement and the Stock Purchase Plan.

2. I hereby authorize payroll deductions from each paycheck in the amount
of $__________ (which equals ____% of my Base compensation as of the
payday immediately preceding the Offering Date) in accordance with the
Stock Purchase Plan.

3. I understand that said payroll deductions shall be accumulated for the
purchase of shares of Common Stock, without par value, at the
applicable purchase price determined in accordance with the Stock
Purchase Plan. I further understand that, except as otherwise set forth
in the Stock Purchase Plan, shares will be purchased for me
automatically on the Exercise Date of the offering period unless I
otherwise withdraw from the Stock Purchase Plan by giving written
notice to the Company for such purpose.

4. I have received a copy of the Company's most recent prospectus which
describes the Stock Purchase Plan and a copy of the complete "Linear
Technology Corporation 1986 Employee Stock Purchase Plan." I understand
that my participation in the Stock Purchase Plan is in all respects
subject to the terms of the Stock Purchase Plan.

5. Shares purchased for me under the Stock Purchase Plan should be issued
in the name(s) of:

----------------------------------------------------------------------.

6. I understand that if I dispose of any shares received by me pursuant to
the Stock Purchase Plan within 2 years after the Offering Date (the
first day of the offering period during which I purchased such shares)
or within 1 year after the date on which such shares were transferred
to me, I may be treated for federal income tax purposes as having
received ordinary income at the time of such disposition in an amount
equal to the excess of the fair market value of the shares at the time
such shares were transferred to me over the price which I paid for the
shares. I hereby agree to notify the Company in writing within 30 days
after the date of any such disposition. However, if I dispose of such
shares at any time after the expiration of the 2 year and 1 year
holding periods, I understand that I will be treated for federal income
tax purposes as having received income only at the time of such
disposition, and that such income

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<PAGE>

will be taxed as ordinary income only to the extent of an amount equal
to the lesser of (1) the excess of the fair market value of the shares
at the time of such disposition over the purchase price which I paid
for the shares under the option, or (2) the excess of the fair market
value of the shares over the option price, measured as if the option
had been exercised on the Offering Date. The remainder of the gain, if
any, recognized on such disposition will be taxed as capital gains.

7. I hereby agree to be bound by the terms of the Stock Purchase Plan. The
effectiveness of this Subscription Agreement is dependent upon my
eligibility to participate in the Stock Purchase Plan.

8. In the event of my death, I hereby designate the following as my
beneficiary(ies) to receive all payments and shares due me under the
Stock Purchase Plan:

NAME: (Please print)
-----------------------------------------------------------
(First) (Middle) (Last)

- ---------------------------- ------------------------------------------------
Relationship

------------------------------------------------
(Address)

NAME: (Please print)
-----------------------------------------------------------
(First) (Middle) (Last)

- ---------------------------- ------------------------------------------------
Relationship

------------------------------------------------
(Address)

Dated:
- ---------------------------- ------------------------------------------------
Signature of Employee

-2-

EXHIBIT 5.1

WILSON SONSINI GOODRICH & ROSATI
650 Page Mill Road
Palo Alto, California 94304
(650) 493-9300

November 19, 1997

Linear Technology Corporation
1630 McCarthy Boulevard
Milpitas, CA 95035-7417

Re: Registration Statement on Form S-8

Ladies and Gentlemen:

We have examined the Registration Statement on Form S-8 to be filed by
you with the Securities and Exchange Commission on or about November 19, 1997
(the "Registration Statement"), in connection with the registration under the
Securities Act of 1933, as amended, of an aggregate of 4,500,000 shares of your
Common Stock (the "Shares"), consisting of 4,000,000 shares reserved for
issuance under the 1996 Incentive Stock Option Plan (the "Option Plan") and
500,000 shares reserved for issuance under the 1986 Employee Stock Purchase
Plan, as amended (the "Purchase Plan"). As your legal counsel, we have examined
the proceedings taken and proposed to be taken in connection with the issuance,
sale and payment of consideration for the Shares to be issued under the Option
Plan and the Purchase Plan.

It is our opinion that, when issued and sold in compliance with
applicable prospectus delivery requirements and in the manner referred to in the
Option Plan and the Purchase Plan and pursuant to the agreements which accompany
the Option Plan and the Purchase Plan, the Shares will be legally and validly
issued, fully paid and non-assessable.

We consent to the use of this opinion as an exhibit to the Registration
Statement and further consent to the use of our name wherever appearing in the
Registration Statement and any amendments thereto.

Sincerely,

WILSON SONSINI GOODRICH & ROSATI
Professional Corporation

/s/ WILSON SONSINI GOODRICH & ROSATI
------------------------------------------------

II-1

EXHIBIT 23.1

CONSENT OF ERNST & YOUNG LLP, INDEPENDENT AUDITORS

We consent to the incorporation by reference in the Registration Statement (Form
S-8) pertaining to the 1996 Incentive Stock Option Plan and the 1986 Employee
Stock Purchase Plan, As Amended, of Linear Technology Corporation of our reports
dated July 18, 1997, with respect to the consolidated financial statements of
Linear Technology Corporation incorporated by reference in its Annual Report
(Form 10-K) for the year ended June 30, 1997 and the related financial statement
schedule included therein, filed with the Securities and Exchange Commission.

ERNST & YOUNG LLP
/s/ Ernst & Young LLP

San Jose, California
November 17, 1997