<PAGE>
Schedule 14A Information
Proxy Statement
Pursuant to Section 14(a) of the Securities Exchange Act of 1934
(Amendment No. 3)
Filed by the Registrant [ ]
Filed by a Party other than the Registrant [X]
Check the appropriate box:
[ ] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission Only (as permitted by Rule
14a-6(e)(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to ss. 240.14a-11(c) or ss. 240.14a-12
Integrated Circuit Systems, Inc.
2435 Boulevard of the Generals
P.O. Box 968
Valley Forge, Pennsylvania
(Name of Registrant as Specified In Its Charter)
Stavro E. Prodromou
14975 Page Mill Road
Los Altos, California 94022
(Name of Person(s) Filing Proxy Statement if other than the Registrant)
Payment of filing Fee (Check the appropriate box):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
1) Title of each class of securities to which transaction applies:
2) Aggregate number of securities to which transaction applies:
3) Per unit price or other underlying value of transaction
computed pursuant to Exchange Act Rule 0-11 (Set forth the
amount on which the filing fee is calculated and state how it
was determined):
4) Proposed maximum aggregate value of transaction:
5) Total fee paid:
[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee was
paid previously. Identify the previous filing by registration statement
number, or the Form or Schedule and the date of its filing.
1) Amount Previously Paid:
2) Form, Schedule or Registration Statement No.:
3) Filing Party:
Ehmann, Van Denbergh & Trainor, P.C.
Two Penn Center Plaza, Suite 725, Philadelphia, Pennsylvania 19102
4) Dated Filed:
January 11, 1999
<PAGE>
INTEGRATED CIRCUIT SYSTEMS, INC.
NOTICE OF ANNUAL MEETING
JANUARY 25, 1999
REVISED NOTICE OF SOLICITATION OF PROXIES BY DR. STAVRO E. PRODROMOU
--------------------------------------------------------------------
JANUARY 11, 1999
NOTICE IS HEREBY given that the Annual Meeting of the
Shareholders of INTEGRATED CIRCUIT SYSTEMS, INC. (the "Corporation"), a
Pennsylvania corporation, will be held at the office of the Corporation, 2435
Boulevard of the Generals, Norristown, Pennsylvania, on Monday, January 25,
1999, at 10:00 a.m., local time, to consider and take action upon the following
matters:
(1) The election of Directors of the Corporation
(2) The voting on the Corporation's proposal to amend the 1997 Equity
Compensation Plan;
(3) The ratification of KPMG Peat Marwick LLP as the Corporation's
independent accountants for Fiscal Year ending June 30, 1999; and
(4) Such other matters as may properly come before the meeting.
Stockholders of record at the close of business on November 23, 1998
will be entitled to vote at the meeting.
Under the Pennsylvania Business Corporation Law, of 1988, as amended, a
complete list of Stockholders entitled to vote at the meeting is required to be
kept at the offices of the Corporation, 2435 Boulevard of the Generals,
Norristown, Pennsylvania, for examination by any Stockholder, during ordinary
business hours, for a period of not less than ten (10) days prior to the
meeting.
Attached to this Notice is the Proxy Statement, and Proxy (OR PROXY INSTRUCTION
FORM) in favor, of Dr. Stavro E. Prodromou which should be returned, if you
elect to use it, not later than close of business on January 24, 1999. A
self-addressed envelope is included for your convenience. IF YOUR SHARES ARE
HELD IN STREET NAME, PLEASE RETURN YOUR PROXY INSTRUCTION FORM TO YOUR BROKER
AND INSTRUCT HIM TO VOTE YOUR SHARES IN ACCORDANCE WITH YOUR INSTRUCTIONS.
Sincerely;
Stavro E. Prodromou, Ph.D.
IMPORTANT: PLEASE FILL IN, DATE, SIGN AND RETURN THE ENCLOSED PROXY OR
- --------- PROXY INSTRUCTION FORM IN THE SELF-ADDRESSED RETURN ENVELOPE
FURNISHED FOR THAT PURPOSE AS PROMPTLY AS POSSIBLE, WHETHER OR
NOT YOU PLAN TO ATTEND THE ANNUAL MEETING. IF LATER YOU DESIRE
TO REVOKE YOUR PROXY FOR ANY REASON, YOU MAY DO SO IN THE
MANNER DESCRIBED IN THE ATTACHED PROXY STATEMENT.
<PAGE>
INTEGRATED CIRCUIT SYSTEMS, INC.
REVISED
PROXY STATEMENT
ANNUAL MEETING OF STOCKHOLDERS TO BE HELD JANUARY 25, 1999
This PROXY STATEMENT is furnished to the Stockholders of Integrated
Circuit Systems, Inc. (the "Company") in connection with the solicitation of the
accompanying proxy by Stavro E. Prodromou to be voted at the Annual Meeting of
Stockholders (the "Annual Meeting") and any adjournment thereof with respect to
the election of a Board of Directors ("Shareholder Nominees") DIFFERENT THAN THE
NOMINEES PROPOSED BY THE COMPANY ("Company Nominees"). The Annual Meeting will
be held on January 25, 1999 at 10:00 a.m., local time. Dr. Prodromou is the only
party soliciting proxies pursuant to this Proxy Statement.
The approximate date on which this Proxy Statement and the accompanying
proxy card were first being sent or given to stockholders was on or about
December 11, 1998, WITH THIS REVISED Proxy Statement being sent to stockholders
on or about January 11, 1999.
This Proxy Statement incorporates by reference the Company's Annual
Financial Statement on Form 10-K as filed with the Securities and Exchange
Commission on or about September 23, 1998, and to the extent required, the
Company's Proxy Statement, other than the Company's recommendation for election
of the Company's Nominees to serve as the Board of Directors of the Company.
Specifically incorporated herein by reference are those matters dealing with
Stockholder's Proposal, designation of a "record date" for voting, designation
of issued and outstanding capital stock of the Company, Principal Holders of
Voting Securities, Security Ownership of existing Management, Compensation and
related Schedules of Management, Meetings of the Board of Directors, Market
Comparison Tables, Certain Relationships, Anti-takeover Provisions and
Compensation of Directors.
This Proxy Statement relates to the solicitation of Proxies by Stavro
E. Prodromou, and no other party, to vote: (i) FOR the Shareholder Nominees set
forth below to serve until the next Annual Meeting of Shareholders; (ii) AGAINST
the Company's Nominees; (iii) AGAINST the Company's proposed amendment to the
1997 Equity Compensation Plan; and (iv) FOR the ratification of KPMG Peat
Marwick, LLP as the Company's independent certified public accountants. By Press
Release dated December 29, 1998, the Company indicated that it was withdrawing
from consideration at the Annual Meeting consideration of the amendment to the
1997 Equity Compensation Plan.
The Record Date for persons eligible to vote at the Annual Meeting is
November 23, 1998.
You are requested to return only the BLUE Proxy Card attached herewith
in lieu of returning the proxy card solicited by the Company. If you send in two
proxy cards, your vote may not be counted.
Quorum and Vote Required
- ------------------------
The presence, in person or by proxy, of A MAJORITY of the outstanding
shares of Common Stock is necessary to constitute a quorum at the Annual
Meeting. The affirmative vote of a majority of the shares of Common Stock
represented in person or by proxy at the Annual Meeting is required to pass any
matter put to a vote at the Annual Meeting.
When voting by proxy, stockholders should specify their election as to
each matter to be voted upon. If no specific instructions are given with regard
to the matter to be voted upon, the shares represented by a signed proxy card
will be voted "FOR" that matter.
<PAGE>
Any stockholder delivering a proxy has the power to revoke same at any
time before it is voted by giving written notice to Stavro E. Prodromou and the
Secretary of the Company, by executing and delivering to Stavro E. Prodromou
and/or the Secretary of the Company a proxy card bearing a later date or by
voting in person at the Annual Meeting.
With regard to the election of directors, votes may be cast in favor of
or withheld from any or all nominees. Votes that are withheld and abstentions
will be excluded entirely from the vote and will have no effect, other than for
purposes of determining the presence of a quorum.
Brokers who hold shares in street name for customers have the authority
under the rules of the various stock exchanges to vote on certain issues when
they have not received instructions from beneficial owners. Since this is a
contested proxy fight, Dr. Prodromou believes that brokers that do not receive
instructions are not entitled to vote those shares with respect to the matters
to be acted upon at the Annual Meeting. Shares not voted by brokers under such
circumstances are referred to as "broker non-votes". Broker non-votes will not
be counted as votes cast on a proposal and will have no effect on matters to be
voted upon. It is thus essential that if your shares are held in street name you
direct your broker to vote your shares in accordance with your instructions.
Execution of the accompanying proxy will not affect a shareholder's
right to attend the meeting and vote in person. Any shareholder giving a proxy
has the right to revoke it by giving written notice of revocation to the
Secretary of the Company, or by delivering a subsequently executed proxy card,
at any time before the proxy is voted.
In addition to soliciting proxies through the mail, Dr. Prodromou may
solicit proxies in person by e-mail and by telephone. Brokerage firms, nominees,
custodians, and fiduciaries may also be requested to forward proxy materials to
the beneficial owners of shares held of record by them. Costs of this Proxy
Statement will be borne by Dr. Prodromou. If Dr. Prodromou is successful in
having the Shareholder Nominees elected, Dr. Prodromou will request that the
Company reimburse him for his actual out-of-pocket costs associated with this
Proxy Solicitation. A this time, it is impossible for Dr. Prodromou to
anticipate the totality of his costs associated with this Proxy Solicitation,
however, Dr. Prodromou believes that it will be less than One Hundred Thousand
Dollars ($100,000) inclusive of legal, printing and other costs of solicitation.
To date, Dr. Prodromou has expended, after providing for payment of the costs of
mailing and printing the Proxy materials, approximately $50,000 to date. Because
the Company refused to provide Dr. Prodromou with a mailing list of
shareholders, and was thus required to utilize the entity hired by the Company
to mail the Proxy materials, Dr. Prodromou believes that his cost of mailing the
Proxy materials exceeded the costs of having the materials had been sent out
directly by Dr. Prodromou's printer by approximately $5,000. Dr. Prodromou
incurred additional costs by having to bring a lawsuit against the Company to
obtain shareholder lists and to stay the Meeting to enable him to communicate
with all shareholders. Additional costs are being incurred by re-sending his
proxy materials to all shareholders as Dr. Prodromou believes, after discussion
with the Company's proxy solicitation company that all beneficial shareholders
may not have received his original proxy materials. Dr. Prodromou does not
presently intend to submit the issue of reimbursement to a vote of the
Shareholders.
Banks, brokerage houses and other institutions, nominees or fiduciaries
will be required to forward the proxy materials to beneficial owners in order to
solicit authorizations for the execution of proxies. Dr. Prodromou will, upon
request, reimburse such entities for their expenses in forwarding the proxy
materials to beneficial owners of the Company's Common Stock.
<PAGE>
OPPOSITION TO SHAREHOLDER NOMINEES
----------------------------------
On November 17, 1998, the Company advised Dr. Prodromou that, in its
opinion, Dr. Prodromou had not properly complied with the provisions of Section
10.4 of the Company's By-laws dealing with the giving of timely notice to the
Company of the nomination of persons to serve as directors by a shareholder.
Specifically, the Company alleged that Dr. Prodromou had failed to give the
required notice and supporting documentation to the Company of his intention to
nominate an opposition slate of directors not less than 50 nor more than 75 days
prior to the shareholder's meeting. Dr. Prodromou advised the Company on
November 20, 1998 that he believed that: (i) the Company was prevented from
enforcing this provision based on the Company's failure to properly disclose
this provision in its proxy materials for previous years; (ii) its knowledge of
Dr. Prodromou's intent to propose an opposition slate of directors if
management's nominees were not satisfactory; (iii) the Company's failure to
announce its proposed nominees until after the period in which the By-laws would
have required Dr. Prodromou give the Company the required notice of an
opposition slate; (iv) the Company's historical practice of requesting nominees
from the floor for election as directors over the past several years; and (v)
the Company's failure to notify Dr. Prodromou of the existence of this provision
of the By-laws even though it was aware of Dr.Prodromou's intentions regarding a
potential opposition slate as early as October 16, 1998. While it is not known,
as of the date hereof, whether or not the Company intends to block voting on the
Shareholder Nominees at the annual meeting, Dr. Prodromou believes that should
he obtain the necessary proxies to elect the Shareholder Nominees the Company
will attempt to prevent the election by relying on Section 10.4 of the Company's
By-laws. The Company has made no reference to its knowledge of the Shareholder
Nominees or its intent to oppose a vote on the Shareholder Nominees in its
definitive proxy materials which were filed with the Securities and Exchange
Commission on November 25, 1998, although it did make corrections to the
provision dealing with shareholder proposals based, Dr. Prodromou believes, on
his having pointed out this deficiency in his correspondence of November 18,
1998. On December 24, 1998, Dr. Prodromou filed an action in the Court of Common
Pleas, Montgomery County, Pennsylvania, seeking a stay of the annual meeting and
that the Company provide him with the list of shareholders as required by the
Pennsylvania Business Corporation Law of.1988, as amended and Regulation 14A
under the Securities and Exchange Act of 1934. On December 29, 1998, Dr.
Prodromou and the Company entered into a settlement agreement by which the
Company agreed to continue the annual meeting of Shareholders until January 25,
1999, provide Dr. Prodromou the shareholder materials and allow the shareholders
to vote on the opposition slate without contesting its invalidity.
SECURITY OWNERSHIP OF SHAREHOLDER NOMINEES
-------------------------------------------
The following table sets forth the shares of Common Stock of the
Company beneficially owned as of the Record Date by each of the Shareholder
Nominees for director of the Company:
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------------------------------------------
AMOUNT OF
CLASS OF NAME, AGE AND POSITION BENEFICIAL PERCENT
STOCK WITH THE COMPANY OWNERSHIP OF CLASS (%)(1)(4)
(SHARES)
<S> <C> <C> <C>
- ------------------ ----------------------------------------------- -------------------- ------------------------
Common Stavro E. Prodromou (54) 74,000(2) 0.6%
- ------------------ ----------------------------------------------- -------------------- ------------------------
Common John W. White (60) 1,000 less than 0.1%
- ------------------ ----------------------------------------------- -------------------- ------------------------
Common Anthony J. Ley (60) 100 less than 0.1%
- ------------------ ----------------------------------------------- -------------------- ------------------------
Common G. Wesley Patterson, Ph.D. (51) 200 less than 0.1%
- ------------------ ----------------------------------------------- -------------------- ------------------------
Common All Proposed Directors of the Company as a 75,300 0.6%
Group (3)
- -------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) Percentages of less than one percent (0.1%) are not shown.
(2) Under the terms of Dr. Prodromou's Termination Agreement with the
Company, he relinquished 125,000 of the 250,000 options previously
granted to him as the chief executive officer of the Company. Of the
remaining 125,000 options, 62,500 became fully vested on April 2, 1998
with the remaining 62,500 becoming fully vested on April 2, 1999, and
can be exercised in full through the close of business on October 2,
1999. The exercise price for all 125,000 options is $13.25 per share.
Dr. Prodromou owns 11,500 shares of Common Stock.
(3) Includes four (4) persons.
(4) None of the parties is a participant to any agreement or arrangement
with regard to the voting of his securities.
<PAGE>
ELECTION OF DIRECTORS
---------------------
The current Board of Directors consists of four (4) directors who were
elected to serve for a period of one (1) year or until their successors are
elected and qualified. The directors elected at this Annual Meeting and who
qualify to serve will serve until their successors can be elected at the Annual
Meeting to be held in 1999.
REASONS FOR PROPOSED SLATE
--------------------------
Dr. Prodromou is the former President and Chief Operating officer of
the Company as well as a former member of the Company's Board of Directors,
having terminated his employment and resigned as a Director on March 20, 1998
("Effective Date"). Dr. Prodromou resigned from the Company and relinquished his
position as a Director of the Company as part of a comprehensive Termination
Agreement signed and effective as of the Effective Date. Although there were a
variety of reasons for his departure, Dr. Prodromou's principal reasons for
terminating his relationship with the Company are the same which have lead to
the decline in the value of the Company's stock and the Board of Directors
refusal to authorize him, as the President and Chief Executive Officer, to
oversee and guide the operations and direction of the Company. The following
opinions are those of Dr. Prodromou. All factual matters to which reference is
made have been taken from press releases or public filings made by the Company.
Since the resignation of Dr. Prodromou as President, CEO and Director,
the Board has failed to recruit a new CEO further adding, in Dr. Prodromou's
opinion, to the perception by the market place that the Company has not
enunciated a clear and achievable strategic plan for its growth. By continuing
to operate under its current Chairman and CEO, the Company has compounded the
very issues of executive management and direction, which led Dr. Prodromou to
resign. Despite the promise by the Chairman of the Board of Directors in April
1998 that the Company would immediately undertake a search for a new CEO, no
such search has been commenced. Later, following announcement of discussions by
the Company of possible strategic alliances, the Company acknowledged that the
search for a CEO had been suspended. The Company has issued a press releases
that announce a renewed initiative to either find a qualified CEO; however, Dr.
Prodromou believes that this announcement was merely made in response to his
initiatives and there is no actual commitment by the Company to fulfill this
promise. The announcement on or about November 4, 1998 of the appointment of a
current member of the Board of Directors to the post of Chairman of the Board
effective January 1, 1999 did not remedy the perception by the market place that
the Company is lacking strong executive leadership.
Instead of opening itself to the needs of stockholders and encouraging
stockholder relations, the Company has taken steps to reduce the access of
stockholders to the management and has limited or retarded communication to the
stockholders. First, the Company's Director of Investor Relations terminated his
services and was not replaced. Telephone calls, letters and electronic mail from
stockholders and brokers have been either ignored or have remained unanswered.
Shareholders who attempted to participate in the Company's August 3, 1998 and
October 23, 1998 earnings conference calls reportedly were denied access and,
furthermore, have not been provided an alternative means by which to access the
information which had been selectively disclosed to those participating in the
call. Later, the Company appointed an external agency as its investor relation's
advisor to respond to stockholder inquiries. The agency, which operates under
the direction of the Company's management, has maintained a similar posture of
non-response to stockholders' expressions of concerns through letters and
electronic mail.
<PAGE>
In December 1997, the Company's Board of Directors announced the
authorization of a repurchase program for up to 1.5 million shares of the
Company's common stock. For several months, the Company has not executed the
stock repurchase program to any significant effect, citing, as excuses, the
supposed on-going discussions regarding possible "strategic alliances" with a
"listed company" and "associations with other companies". Eventually, the
Company issued announcements related to an "unfair" management-led leveraged
buyout proposal that contradicted earlier claims of possible "associations with
other companies". In Dr. Prodromou's opinion, based on his discussions with
other shareholders and stock analysts, the self-imposed news blackout and the
suspension of stock repurchase for more than five months is a principal reason
for the substantial decline in the Company's share price. In direct response to
Dr. Prodromou's actions in this proxy contest, the Company has made an
announcement indicating the intent to resume the share repurchase program. In
his opinion, the only reason that the Company has made this announcement is in
response to Dr. Prodromou's proposals.
Dr. Prodromou is convinced that certain key members of management and a
select number of Directors, demonstrated their true intent for the actions of
the preceding five months when the Company announced on October 19, 1998 that
they had proposed taking the Company private through a tender offer at $17.50
per share. Before the next day of trading began, the Company announced that a
Special Committee of the Board rejected the offer as "not fair to the
shareholders from a financial point of view." Dr. Prodromou further believes
that this insider group must have been perceived by the market place as
attempting to capitalize on the currently depressed market value for the
Company's stock, for which they must accept responsibility, for their own
benefit and to the detriment of shareholders. The conduct and intent of the
management appears to be a material breach of their fiduciary duty to the
shareholders.
In the Company's 10K filed on or about September 23, 1998, as amended,
and definitive proxy statement filed November 25, 1998, certain information is
disclosed that makes it clear that the Board of Directors chose to reward the
Chairman of the Board and interim CEO, Mr. Boreen with substantial blocks of
stock options, despite the decline in the price of the Company's stock. The 10K
further disclosed that the independent directors had been retained by the
Company to act in a consulting capacity reporting to the Chairman and interim
CEO, for fees of $2,000 per day for up to 10 days per month in addition to their
shareholder approved BOD fees!
Specifically, Mr. Boreen was granted fully vested stock options for
50,000 shares of Company Common Stock on May 6, 1998, at an exercise price of
$16.0625, as part of a contract with Mr. Boreen to serve as the Company's Chief
Executive Officer through September 1998. An additional fully vested option for
30,000 shares of the Company's Common Stock was given to Mr. Boreen for a three
month extension of his contract to serve as the Company's CEO, which now expires
on December 31, 1998. The options are in addition to Mr. Boreen's compensation
of $12,000 per month.
The current Directors, having been elected by a majority of
stockholders to serve the interests of all shareholders, have presided over the
dramatic decline in the Company's share value. Shareholders are entitled to
exercise their rights through the process of Director elections in order to
protect their interests. It is incumbent upon the elected Directors to oversee
the policies of the Company and to put in place management capable of
implementing those policies and directives for the growth and prosperity of the
Company. It is self-evident that as a company grows, develops and becomes more
prosperous, the market's perception of the company grows, confidence in
management is earned and the market place rewards this with a high value for the
company's stock. While a decline in the market's valuation of a company's stock
is indicative of the market's lack of faith in current management and the board
of directors, mandating a change. Based on Dr. Prodromou's experience as a
director, chief executive officer and member of senior management throughout his
career, the market has lost faith in present management and the Board of
Directors and a change is in order.
<PAGE>
If the Shareholder Nominees for Election to the Board of Directors
listed below are elected, it is Dr. Prodromou's intent, and the nominees have
agreed to deliberate and consider the following actions, at such time as they
may take office as Directors, in order to ameliorate the current condition of
the Company:
1. Begin the recruitment of a qualified chief executive officer with the
highest priority,
2. Reinstate the Company's policy of repurchasing up to 1.5 million shares
of the Company's common stock, from time to time, when and if permitted
by applicable laws and regulations, as and when deemed by the Board and
management to be in the best interests of the Company's stockholders.
3. Take immediate steps to improve investor relations and build confidence
in the Company and its management by the investment community.
4. Continue the growth and development of the Company for the benefit of
the Shareholders.
5. Evaluate opportunities for sale, acquisitions, mergers or alliances,
from time to time, as they are presented, and which are beneficial and
fair to Shareholders.
There can be no assurance that even if these steps are taken that the
intended results can be achieved.
Required Vote
- -------------
The shares represented by the enclosed proxy will be voted at the
meeting as directed. If no choice is specified in the proxy, the shares
represented by the enclosed proxy will be voted "FOR" the election of the
Shareholder Nominees listed below and AGAINST the Company's Nominees. None of
the Shareholder Nominees are currently an officer or Director of the Company. If
any Shareholder Nominee becomes unavailable for any reason or if another vacancy
should occur before the election (which events are not anticipated), the shares
represented by the enclosed proxy may be voted by the holder of the proxy in his
sole discretion. Stavro E. Prodromou recommends that you vote "FOR" the
Shareholder Nominees listed below and AGAINST the Company's Nominees. (See also,
Quorum and Vote Required above.)
- ------------------------
Nominees
- --------
For information regarding the number of shares of the Company's stock
beneficially owned by each of the Shareholder Nominees, see "SECURITY OWNERSHIP
OF SHAREHOLDER NOMINEES" as set forth above. For information regarding the
number of shares of the Company's stock beneficially owned by each of the
Company's Nominees, see the Company's Proxy Statement. Set forth below is
certain information about each of the Shareholder Nominees nominated by Dr.
Prodromou, each of whom has agreed to serve as Directors of the Company, if
elected. None of the shareholder's nominees has any arrangement or understanding
with respect to future employment by the Company or with respect to future
transactions to which the Company will or may be a party. Specifically, Dr.
Prodromou will NOT seek any position with the Company other than as a director
and will not accept any position with the Company if same is offered to him
other than as a member of the Board of Directors.
Business Experience
- -------------------
Anthony J. Ley
Chairman of the Board, President and Chief Executive Officer, Harmonic
Lightwaves, Inc. (NASDAQ: HLIT) since November 1988. Mr. Ley was elected
Chairman of the Board of Directors in February 1995. Harmonic Lightwaves
designs, manufactures and markets digital and lightwave based communications
systems that deliver video, audio and data over hybrid fiber/coax, satellite and
wireless networks. From 1963 to 1987, Mr. Ley was employed at Schlumberger
(NYSE: SLB), both in Europe and the United States, holding various senior
business management and research development positions, most recently as Vice
President, Research and Engineering at Fairchild Semiconductor in Palo Alto,
California. Mr. Ley holds an M.A. in mechanical sciences from the University of
Cambridge and an S.M.E.E. from the Massachusetts Institute of Technology. He is
named as an inventor on 29 patents and is a Fellow of the I.E.E. (U.K.) and a
senior member of the I.E.E.E.
<PAGE>
G. Wesley Patterson, Ph.D.
CEO and Chairman of Chromatic Research of Sunnyvale, CA. Chromatic
Research, Inc. is the pioneer and leader in media processor technology, a
combination of hardware and software that provides advanced multimedia
capabilities, such as DVD high quality 3D graphics for PCs. Before joining
Chromatic in 1995, Dr. Patterson was the Executive Vice President and Chief
Operating Officer at Xilinx, Inc. (NASDAQ: XLNX). He joined Xilinx as Vice
President of marketing in 1985, and was promoted to Chief Operating Officer
prior to the IPO in 1990. Before Xilinx, he worked in various engineering and
business management positions in the semiconductor industry at VLSI Technology,
Inc. (NASDAQ: VLSI) and Motorola (NYSE: MOT), and in the mainframe computer
business at Honeywell Information Systems, Inc./ GE Information Systems
Equipment Division. Dr. Patterson holds a dozen patents in the area of computer
architectures. He was a National Merit Scholar, and holds a BS in Computer
Science from Michigan State University, and an MSE and Ph.D. in Electrical
Engineering from Arizona State University.
Stavro E. Prodromou, Ph.D.
Dr. Prodromou is the President and Chief Executive Officer of Peregiene
Semiconductor Company in San Diego, California. Dr. Prodromou was formerly the
President and CEO of Integrated Circuit Systems, Inc. (NASDAQ: ICST) of Valley
Forge, PA, until his resignation in March 1998. He had previously served as a
Director of the Company since October 1993. Prior to ICS, Dr. Prodromou was the
President, CEO and sole investor of Palo Alto Digital Systems, Inc. In 1997,
Palo Alto voluntarily filed for protection under Chapter 7 of the Bankruptcy Act
of 1978, as amended. This action was taken as part of Dr. Prodromou's winding-up
of the affairs of Palo Alto. Dr. Prodromou was also the President and CEO of
PADSystems, Inc. a company that he founded, specializing in the areas of
computers & peripherals, integrated circuits, and software. Dr. Prodromou was
the founder, President and CEO of Poqet Computer Corporation of Santa Clara, CA.
Earlier in his career, he served in executive management capacities at Texas
Instruments (NYSE: TXN), General Electric (NYSE: GE), Fairchild Semiconductor,
and Mattel Electronics. Dr. Prodromou received his B.S. in Electrical
Engineering from Rutgers University, and his M.S. and Ph.D. from the Polytechnic
Institute of New York. Dr. Prodromou is a member of the Sigma Xi, Tau Beta Pi
and Eta Kappa Nu honorary societies..
John W. White
Mr. White was most recently the Vice President and Chief Information
Officer of Compaq Computer Corp. (NYSE: CPQ), headquartered in Houston, TX. In
this role, Mr. White served as a member of the executive management team of
Compaq, the world leader in the PC business, and directly responsible for their
worldwide management information systems activities. Previously, over a span of
28 years, Mr. White served in various technical and management positions with
Texas Instruments (NYSE: TXN), headquartered in Dallas, TX, including 13 years
as its Chief Information Officer and 5 years as President of its Information
Technology Group. Additionally, he spent 4 years with Electronic Data Systems
(NYSE: EDS) in Dallas, TX, developing on-line transaction processing systems for
the health care, life insurance and banking industries. Mr. White earned a B.S.
in mathematics and physics from Central Missouri State University, and a M.S. in
mathematics from the University of Kansas.
<PAGE>
Amendment to the 1997 Equity Compensation Plan
- ----------------------------------------------
The Company has proposed an amendment to the 1997 Equity Compensation
Plan which would allow a committee composed of Non-Employee Directors
("Committee") to grant discretionary options to non-employee directors. At
present, the Company has only proposed as directors of the Company three (3)
non-employee candidates. Thus, absent a provision in the amendment to the
contrary, the existing non-employee directors could, under the Company's
proposal, award themselves discretionary options. While Dr. Prodromou believes
that non-employee directors of the Company should be entitled to receive
discretionary options, the amendment, as proposed, fails to contain those
safeguards, which are necessary to ensure that members of the Committee are not
awarding themselves discretionary options.
Although the Company has indicated in its press release of December 29,
1998 that it is withdrawing this matter from consideration at the Annual
Meeting, Dr. Prodromou recommends that you vote AGAINST the Company's proposed
Amendment to the 1997 Equity Compensation Plan.
Independent Certified Public Accountant
---------------------------------------
The Company has selected the accounting firm of KPMG Peat Marwick, LLP
to be the Company's accountant to audit the books of the Company for the current
fiscal year. This firm audited the books for the prior fiscal year. Mr.
Prodromou recommends that you vote FOR the ratification of KMPG Peat Marwick,
LLP as the Company's accountant for the fiscal year ending June 30, 1999.
EXPENSES OF SOLICITATION
------------------------
The expenses associated with the preparation, assembling, printing and
mailing of the Notice of Annual Meeting, Proxy Statement and Proxy will be borne
by Stavro E. Prodromou.
Dated: January 11, 1999
-------------------------------------
Stavro E. Prodromou
<PAGE>
Use this
PROXY INSTRUCTION FORM
To transmit your proxy voting instructions to your broker or bank
To our clients:
- ---------------
We have been requested to forward to you the enclosed proxy material relative to
shares carried by us in your account but not registered in your name. Only the
holder of record can vote such shares.
In order for your shares to be represented at the meeting, it will be necessary
for us to have your specific voting instructions. Accordingly, please give your
instructions over your signature on this Proxy Instruction Form below and
continuing on the reverse side on this sheet and return it to us promptly in the
self-addressed, stamped envelope, also enclosed. It is understood that, if you
sign without otherwise marking the form, the shares will be voted as recommended
by Dr. Prodromou, on all matters to be considered at the meeting.
Should you wish to have a proxy covering your shares issued to yourself or to
others, we shall be pleased to issue the same.
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------------------------------------------
INTEGRATED CIRCUIT SYSTEMS, INC.
<S> <C>
THIS PROXY IS SOLICITED ON BEHALF OF The undersigned hereby appoints Stavro E.
Prodromou, Ph.D. proxy with full authority to
Dr. Stavro E. Prodromou vote, as designated below, all shares of Stock
which the undersigned is entitled to vote at the
Annual Meeting of Stockholders of Integrated
PLEASE CHECK HERE IF YOU PLAN TO ATTEND THE ANNUAL Circuit Systems, Inc. to be held on January 25,
MEETING. [ ] 1999, or any adjournment thereof.
X
PLEASE MARK, SIGN, DATE AND RETURN THIS PROXY DATED: ------------------, 1999
PROMPTLY IN THE ENCLOSED ENVELOPE.
------------------------------
------------------------------
X
------------------------------
NAME AND ADDRESS X
(PLACE LABEL HERE) ------------------------------
(SIGNATURE)
</TABLE>
IMPORTANT: Please sign on the signature line exactly as your name is
- ---------- printed on this Proxy. When shares are held by joint tenants,
both should sign. When signing as attorney, executor,
administrator, trustee or guardian, please give full title as
such. If a corporation, please sign in full corporate name by
authorized officer. If a partnership, please sign in
partnership name by authorized partner.
<PAGE>
If instructions are not given in the spaces provided, the shares represented by
this Proxy, duly executed, will be voted (i) AGAINST Management's Proposal for
the election of directors; (ii) FOR the Shareholder's Nominees listed below in
Proposal 2; (iii) AGAINST the Company's amendment to the 1997 Equity
Compensation Plan; and (iv) FOR the ratification of KPMG Peat Marwick LLP as the
Company's certified independent accountants for the fiscal year ending June 30,
1999.
<TABLE>
<CAPTION>
<S> <C>
1. Against Management's Recommendation for Persons to serve as Directors of the Company.
AGAINST Management's Nominees FOR Management's Nominees WITHHOLD AUTHORITY
(except as marked below) [ ] (except as marked below) [ ] to vote for all
nominees [ ]
To withhold authority to vote for any individual nominee, write that nominee's name here.
2. Election of Shareholder's Nominees as DIRECTORS for a term expiring in 1999: Stavro E. Prodromou,
John W. White, Anthony J. Ley, G. Wesley Patterson.
FOR all nominees (except as marked to WITHHOLD AUTHORITY to vote for all nominees [ ]
the contrary below) [ ]
To withhold authority to vote for any individual nominee, write that nominee's name here.
3. AGAINST Management's proposal to Amend the 1997 Equity Compensation Plan.
AGAINST Management's FOR Management's ABSTAIN [ ]
Proposal [ ] Proposal [ ]
4. FOR the ratification of KPMG Peat Marwick, LLP, as the Company's certified independent accountants
for fiscal year ending June 30, 1999.
FOR [ ] AGAINST [ ] ABSTAIN [ ]
5. To vote for such other matters as may properly come before the meeting as the Proxy believes in the
best intent of the Company and the Shareholders.
FOR [ ] AGAINST [ ] ABSTAIN [ ]
</TABLE>
-2-
<PAGE>
PROXY
SOLICITED BY DR. STAVRO E. PRODROMOU
------------------------------------
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------------------------------------------
INTEGRATED CIRCUIT SYSTEMS, INC.
<S> <C>
THIS PROXY IS SOLICITED ON BEHALF OF The undersigned hereby appoints Stavro E. Prodromou,
Ph.D. proxy with full authority to vote, as
Dr. Stavro E. Prodromou designated below, all shares of Stock which the
undersigned is entitled to vote at the Annual
Meeting of Stockholders of Integrated Circuit
PLEASE CHECK HERE IF YOU PLAN TO ATTEND THE ANNUAL Systems, Inc. to be held on January 25, 1999, or any
MEETING. / / adjournment thereof.
PLEASE MARK, SIGN, DATE AND RETURN THIS PROXY DATED: _X______________________________, 1999
PROMPTLY IN THE ENCLOSED ENVELOPE.
---------------------------------------
---------------------------------------
---------------------------------------
NAME AND ADDRESS
(PLACE LABEL HERE) _X_____________________________________
(SIGNATURE)
</TABLE>
IMPORTANT: Please sign on the signature line exactly as your name is
- ---------- printed on this Proxy. When shares are held by joint tenants,
both should sign. When signing as attorney, executor,
administrator, trustee or guardian, please give full title as
such. If a corporation, please sign in full corporate name by
authorized officer. If a partnership, please sign in
partnership name by authorized partner.
<PAGE>
If instructions are not given in the spaces provided, the shares represented by
this Proxy, duly executed, will be voted (i) AGAINST Management's Proposal for
the election of directors; (ii) FOR the Shareholder's Nominees listed below in
Proposal 2; (iii) AGAINST the Company's amendment to the 1997 Equity
Compensation Plan; and (iv) FOR the ratification of KPMG Peat Marwick LLP as the
Company's certified independent accountants for the fiscal year ending June 30,
1999.
<TABLE>
<CAPTION>
<S> <C>
1. Against Management's Recommendation for Persons to serve as Directors of the Company.
AGAINST Management's Nominees FOR Management's Nominees WITHHOLD AUTHORITY
(except as marked below) / / (except as marked below) / / to vote for all
nominees / /
To withhold authority to vote for any individual nominee, write that nominee's name here.
2. Election of Shareholder's Nominees as DIRECTORS for a term expiring in 1999: Stavro E. Prodromou,
John W. White, Anthony J. Ley, G. Wesley Patterson.
FOR all nominees (except as marked to the WITHHOLD AUTHORITY to vote for all nominees / /
the contrary below) / /
To withhold authority to vote for any individual nominee, write that nominee's name here.
3. AGAINST Management's proposal to Amend the 1997 Equity Compensation Plan.
AGAINST Management's FOR Management's ABSTAIN / /
Proposal / / Proposal / /
4. FOR the ratification of KPMG Peat Marwick, LLP, as the Company's certified independent accountants for
fiscal year ending June 30, 1999.
FOR / / AGAINST / / ABSTAIN / /
5. To vote for such other matters as may properly come before the meeting as the Proxy believes in the best
intent of the Company and the Shareholders.
FOR / / AGAINST / / ABSTAIN / /
</TABLE>
