<PAGE> 1
SCHEDULE 14A
(RULE 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(a) OF THE
SECURITIES EXCHANGE ACT OF 1934
Filed by the registrant [X]
Filed by a party other than the registrant [ ]
Check the appropriate box:
[X] Preliminary proxy statement [ ] Confidential, for Use of the
Commission Only (as permitted by
Rule 14a-6(e)(2))
[ ] Definitive proxy statement
[ ] Definitive additional materials
[ ] Soliciting material pursuant to Section 240.14a-11(c) or Section 240.14a-12
SANMINA CORPORATION
- --------------------------------------------------------------------------------
(Name of Registrant as Specified in Its Charter)
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of filing fee (Check the appropriate box):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
(1) Title of each class of securities to which transaction applies:
(2) Aggregate number of securities to which transaction applies:
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which the
filing fee is calculated and state how it was determined):
(4) Proposed maximum aggregate value of transaction:
(5) Total fee paid:
[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee was
paid previously. Identify the previous filing by registration statement
number, or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
(2) Form, Schedule or Registration Statement No.:
(3) Filing Party:
(4) Date Filed: December 15, 1999
<PAGE> 2
SANMINA CORPORATION
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON JANUARY 28, 2000
The Annual Meeting of Stockholders of Sanmina Corporation (the 'Company')
will be held on Friday, January 28, 2000, at 11:00 a.m., local time, at the
Sheraton San Jose Hotel located at 1801 Barber Lane, Milpitas, California 95035
(telephone 408-943-0600) for the following purposes (as more fully described in
the Proxy Statement accompanying this Notice):
1. To elect directors of Sanmina.
2. To approve amendment to the Company's Restated Certificate of
Incorporation to increase the number of authorized shares of Common
Stock.
3. To confirm the appointment of Arthur Andersen LLP as the independent
public accountants of Sanmina for the fiscal year ending September 30,
2000.
4. To transact such other business as may properly come before the meeting.
Stockholders of record at the close of business on December 18, 1999 are
entitled to vote at the Annual Meeting and are cordially invited to attend the
meeting. However, to ensure your representation at the meeting, you are urged to
mark, sign, date and return the enclosed proxy as promptly as possible in the
postage-prepaid envelope enclosed for that purpose. If you attend the meeting,
you may vote in person even if you return a proxy.
FOR THE BOARD OF DIRECTORS
Christopher D. Mitchell
Secretary
San Jose, California
December 27, 1999
IMPORTANT
WHETHER OR NOT YOU PLAN TO ATTEND THE MEETING, PLEASE COMPLETE AND PROMPTLY
RETURN THE ENCLOSED PROXY IN THE ENVELOPE PROVIDED. IF YOU ATTEND THE MEETING,
YOU MAY VOTE IN PERSON, EVEN IF YOU RETURN A PROXY.
<PAGE> 3
SANMINA CORPORATION
PROXY STATEMENT FOR
2000 ANNUAL MEETING OF STOCKHOLDERS
INFORMATION CONCERNING VOTING AND PROXY SOLICITATION
GENERAL
The enclosed proxy is solicited on behalf of the Board of Directors of
Sanmina Corporation ("Sanmina") for use at the Annual Meeting of Stockholders to
be held on Friday, January 28, 2000 at 11:00 a.m., local time, or at any
adjournment thereof. The Annual Meeting will be held at the Sheraton San Jose
Hotel located at 1801 Barber Lane, Milpitas, California 95035. The telephone
number at the meeting location is (408) 943-0600.
This Proxy Statement was mailed on or about December 27, 1999, to all
stockholders entitled to vote at the meeting.
RECORD DATE AND STOCK OWNERSHIP
Stockholders of record at the close of business on December 18, 1999 (the
"Record Date") are entitled to vote at the meeting. As of December 18, 1999,
58,995,519 shares of Sanmina's Common Stock were issued and outstanding and held
of record by approximately 1,030 stockholders.
The following table sets forth certain information regarding the beneficial
ownership of the Common Stock of Sanmina as of October 2, 1999, as to (i) each
person who is known to Sanmina to beneficially own more than five percent of the
outstanding shares of its Common Stock, (ii) each director and nominee for
election, (iii) each officer named in the Summary Compensation Table below and
(iv) all directors and executive officers as a group.
<TABLE>
<CAPTION>
SHARES APPROXIMATE
BENEFICIALLY PERCENT
NAME OWNED OWNED
---- ------------ -----------
<S> <C> <C>
AXA Assurances I.A.R.D. Mutuelle............................ 9,692,971 16.5%
1290 Avenue of the Americas
New York, New York 10104
Jure Sola(1)................................................ 1,051,182 1.8%
Randy W. Furr(1)............................................ 384,841 *
Michael Landy(1)............................................ 117,088 *
Bernard V. Vonderschmitt(1)................................. 58,032 *
Mario M. Rosati(1).......................................... 36,457 *
John C. Bolger(1)........................................... 23,582 *
Neil R. Bonke(1)............................................ 19,191 *
Elizabeth D. Jordan(1)...................................... 10,376 *
Joseph M. Schell(1)......................................... -- *
All Directors and executive officers as a group(1).......... 1,700,749 2.9%
</TABLE>
- ---------------
* Less than 1%.
(1) Includes stock issuable upon exercise of options that are exercisable within
60 days after October 2, 1999.
REVOCABILITY OF PROXIES
Any proxy given pursuant to this solicitation may be revoked by the person
giving it at any time before its use by delivering to the Secretary of Sanmina a
written notice of revocation or a duly executed proxy bearing a later date or by
attending the meeting and voting in person. Attending the Annual Meeting in and
of itself may not constitute a revocation of a proxy.
<PAGE> 4
VOTING AND SOLICITATION
Each stockholder is entitled to one vote for each share held as of the
record date. Stockholders will not be entitled to cumulate their votes in the
election of directors.
Votes cast by proxy or in person at the Annual Meeting will be tabulated by
the Inspector of Elections (the "Inspector") with the assistance of Sanmina's
Transfer Agent. The Inspector will also determine whether or not a quorum is
present. Except in certain specific circumstances, the affirmative vote of a
majority of shares present in person or represented by proxy at a duly held
meeting at which a quorum is present is required under Delaware law for approval
of proposals presented to stockholders. In general, Delaware law also provides
that a quorum consists of a majority of shares entitled to vote and present or
represented by proxy at the meeting. The Inspector will treat abstentions as
shares that are present and entitled to vote for purposes of determining the
presence of a quorum but will not be treated as votes in favor of approving any
matter submitted to the stockholders for a vote. Any proxy which is returned
using the form of proxy enclosed and which is not marked as to a particular item
will be voted for the election of directors and for the confirmation of the
appointment of the designated independent public accountants and, as the proxy
holders deem advisable, on other matters that may come before the meeting, as
the case may be with respect to the items not marked. If a broker indicates on
the enclosed proxy or its substitute that it does not have discretionary
authority as to certain shares to vote on a particular matter ("Broker
Non-Votes"), those shares will not be considered as present with respect to that
matter. Sanmina believes that the tabulation procedures to be followed by the
Inspector are consistent with the general statutory requirements in Delaware
concerning voting of shares and determination of a quorum.
The cost of soliciting proxies will be borne by Sanmina. Sanmina may retain
the services of its transfer agent, Norwest Bank Minnesota, N.A., or other proxy
solicitors to solicit proxies, for which Sanmina estimates that it would pay
fees not to exceed an aggregate of $20,000. In addition, Sanmina expects to
reimburse brokerage firms and other persons representing beneficial owners of
shares for their expense in forwarding solicitation material to such beneficial
owners. Proxies may be solicited by certain of Sanmina's directors, officers and
regular employees, without additional compensation, in person or by telephone or
facsimile.
STOCKHOLDER PROPOSALS FOR 2001 ANNUAL MEETING
Proposals that are intended to be presented by stockholders of Sanmina at
the 2001 Annual Meeting must be received by Sanmina no later than September 1,
2000 in order that they may be included in the proxy statement and form of proxy
relating to that meeting.
PROPOSAL NO. 1:
ELECTION OF DIRECTORS
A board of seven directors will be elected at the Annual Meeting. Unless
otherwise instructed, the proxy holders will vote the proxies received by them
for the seven nominees named below. Messrs. Sola, Bolger, Bonke, Furr, Rosati,
Schell, and Vonderschmitt are presently directors of Sanmina. If any nominee is
unable or declines to serve as a director at the time of the Annual Meeting, the
proxies will be voted for any nominee who shall be designated by the present
Board of Directors to fill the vacancy. It is not expected that any nominee will
be unable or will decline to serve as a director. If stockholders nominate
additional persons for election as directors, the proxy holders will vote all
proxies received by them in accordance to assure the election of as many of the
Board's nominees as possible, with the proxy holder making any required
selection of specific nominees to be voted for. The term of office of each
person elected as a director will continue until the next annual meeting of
stockholders or until that person's successor has been elected.
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<PAGE> 5
The Board of Directors recommends a vote FOR the nominees listed below:
<TABLE>
<CAPTION>
NAME OF NOMINEE AGE PRINCIPAL OCCUPATION DIRECTOR SINCE
--------------- --- -------------------- --------------
<S> <C> <C> <C>
Jure Sola.................. 47 Chairman and Chief Executive Officer of 1989
Sanmina Corporation
John C. Bolger............. 53 Independent Consultant 1994
Neil R. Bonke.............. 58 Chairman of Electroglas, Inc. (Retired), 1995
Private Investor
Randy W. Furr.............. 45 President and Chief Operating Officer of 1999
Sanmina Corporation
Mario M. Rosati............ 53 Member, Wilson Sonsini Goodrich & Rosati 1997
Joseph M. Schell........... 53 Independent Consultant 1999
Bernard V. Vonderschmitt... 76 Chairman of the Board of Xilinx, Inc. 1990
</TABLE>
Mr. Sola co-founded Sanmina in 1980 and initially held the position of Vice
President of Sales and was responsible for the development and growth of
Sanmina's sales organization. He became Vice President and General Manager in
October 1987 with responsibility for all manufacturing operations as well as
sales and marketing. Mr. Sola has been a director of Sanmina since July 1989,
was elected President in October 1989 and has served as Chairman of the Board
and Chief Executive Officer since April 1991.
Mr. Bolger has been a director of Sanmina since 1994. From June 1989
through April 1992, he served as Vice President of Finance and Administration of
Cisco Systems, Inc., a manufacturer of computer networking systems. Mr. Bolger
is currently an independent business consultant and serves as a director of
Integrated Device Technology, Inc., Integrated Systems, Inc., TCSI, Inc. and
Mission West Properties, Inc.
Mr. Bonke has been a director of Sanmina since 1995. He also serves on the
Board of Directors of Electroglas, Inc., FSI International and SpeedFam
International, all semiconductor equipment companies. Mr. Bonke previously
served as the Chairman of the Board of Electroglas, Inc. From April 1993 to
April 1996, he served as Chief Executive Officer of Electroglas. From September
1990 to April 1993, Mr. Bonke was a Group V.P. and President of Semiconductor
Operations of General Signal Corp.
Mr. Furr joined Sanmina as Vice President and Chief Financial Officer in
August 1992. In March 1996, Mr. Furr was appointed President and Chief Operating
Officer. Mr. Furr was appointed to the board of directors in December 1999. From
April to August 1992, Mr. Furr was Vice President and Chief Financial Officer of
Aquarius Systems Inc. North America ("ASINA"), a manufacturer of personal
computers. Prior to working at ASINA, he held numerous positions in both
financial and general management for General Signal Corporation during a 13-year
period, serving most recently as Vice President and General Manager of General
Signal Thinfilm Company. Mr. Furr is a Certified Public Accountant.
Mr. Rosati has been a director of Sanmina since 1997. He has been a member
of the law firm Wilson Sonsini Goodrich & Rosati, Professional Corporation since
1971. Mr. Rosati is a director of Aehr Test Systems, a manufacturer of computer
hardware testing systems, Genus, Inc., a semiconductor equipment manufacturer,
Ross Systems, Inc., a software company, C-ATS Software, Inc., a financial
database software company, MyPoints.com, Inc., a web and email-based direct
marketing company, Symyx Technologies, Inc., a combinatorial materials science
company and The Management Network Group, Inc., a management consulting firm
focused on the telecommunications industry, all publicly-held companies. He is
also a director of several privately-held companies.
Mr. Schell was appointed to the board of directors in December 1999. From
1985 to 1999, he served as Senior Managing Director at Montgomery Securities
(recently named Banc of America Securities). Mr. Schell also serves on the board
of directors of Dycom Industries, Inc. and the Good Guys, Inc., both publicly
traded companies.
Mr. Vonderschmitt has been a director of Sanmina since October 1990. He
co-founded Xilinx, Inc., a manufacturer of field programmable gate array
semiconductor products and related system software, served as its Chief
Executive Officer and as a director from its inception in February 1984 through
February 1996, and
3
<PAGE> 6
has served as the Chairman of its Board of Directors since February, 1996. He is
also a director of International Microelectronic Products, Inc., and Credence
Systems Corporation.
There are no family relationships among directors or executive officers of
Sanmina.
BOARD MEETINGS, COMMITTEES AND DIRECTOR COMPENSATION
The Board of Directors of Sanmina held five meetings during the fiscal year
ended October 2, 1999. No nominee who was a director during the entire fiscal
year attended fewer than 75 percent of the meetings of the Board of Directors or
of committees on which such person served.
The Board of Directors has an Officer Stock Committee, an Audit Committee
and a Compensation Committee. It does not have a nominating committee or a
committee performing the functions of a nominating committee. From time to time,
the Board has created various ad hoc committees for special purposes. No such
committee is currently functioning.
The Officer Stock Committee consists of directors Bonke and Vonderschmitt.
The Officer Stock Committee reviews and makes recommendations to the Board
concerning option grants to executive officers of Sanmina. The Officer Stock
Committee held one meeting during the last fiscal year.
The Audit Committee consists of directors Bonke and Bolger. The Audit
Committee is responsible for reviewing the results and scope of the audit and
other services provided by Sanmina's independent public accountants. The Audit
Committee held five meetings in the last fiscal year.
The Compensation Committee consists of directors Bonke, Sola and
Vonderschmitt. The Compensation Committee reviews and makes recommendations to
the Board concerning salaries and incentive compensation for executive officers
and certain employees of Sanmina. The Compensation Committee held two meetings
during the last fiscal year. Mr. Sola, Chairman and Chief Executive Officer of
Sanmina, participates fully with all other committee members in recommending
salaries and incentive compensation to the board of directors, except that he
does not participate in committee proceedings relating to his salary and
compensation.
Directors who are not employees of Sanmina ("Outside Directors") are paid
an annual retainer of $10,000, a fee of $2,000 for attending each board meeting
and a fee of $1,000 for attending each committee meeting. The directors are
reimbursed for travel and related expenses incurred by them in attending board
and committee meetings. Prior to the adoption of Sanmina's 1995 Director Option
Plan (the "Director Option Plan"), Outside Directors received initial and annual
grants of options to purchase shares of Sanmina's Common Stock under Sanmina's
Amended 1990 Incentive Stock Plan. Since the adoption of the Director Option
Plan in January 1996, Outside Directors have received the same initial and
annual grants only under the Director Option Plan under substantially similar
terms as under the Stock Plan.
Under the Director Option Plan, upon first becoming a director, each new
Outside Director will receive an automatic grant of an option to purchase up to
20,000 shares of Common Stock and each continuing Outside Director will receive
(provided that such Outside Director has been a director for at least four
months prior to such grant), on October 1 of each year, an automatic grant of an
option to purchase up to 10,000 shares of Common Stock.
CHANGE OF CONTROL ARRANGEMENTS
In June 1999, Sanmina's Board of Directors approved a change of control
arrangement with Elizabeth D. Jordan, Sanmina's Executive Vice President and
Chief Financial Officer. Under the arrangement, all unvested stock options held
by such individual under any of Sanmina's stock option plans would become fully
vested and exercisable upon the occurrence of a change of control of Sanmina. A
change of control is defined to include certain mergers, asset sales, or
consolidations, the acquisition of more than fifty percent (50%) of Sanmina by
any person or certain changes in the composition of the Board of Directors.
Sanmina's other executive officers are covered under similar arrangements that
were approved by Sanmina's board of directors in January 1998.
4
<PAGE> 7
EXECUTIVE COMPENSATION
COMPENSATION TABLES
Summary Compensation Table. The following table sets forth the compensation
paid by Sanmina for each of the three fiscal years in the period ended October
2, 1999 to the Chief Executive Officer and all other executive officers of
Sanmina:
<TABLE>
<CAPTION>
LONG-TERM
COMPENSATION
ANNUAL COMPENSATION AWARDS ALL OTHER
FISCAL -------------------- OF OPTIONS COMPENSATION
NAME AND PRINCIPAL POSITION YEAR SALARY($) BONUS($) (# OF SHARES)(2) ($)(1)
--------------------------- ------ --------- -------- ---------------- ------------
<S> <C> <C> <C> <C> <C>
Jure Sola................................ 1999 $425,000 $530,000 125,000 $50,569
Chief Executive Officer and 1998 375,000 470,000 200,000 49,684
Chairman of the Board 1997 310,000 385,000 203,000 48,237
Randy W. Furr............................ 1999 $325,000 $400,000 100,000 $27,596
President, Chief Operating Officer 1998 290,000 365,000 140,000 26,711
1997 240,000 295,000 110,000 25,266
Elizabeth D. Jordan...................... 1999 $141,000 $ 70,000 22,500 $ 2,940
Executive Vice President and 1998 112,000 35,000 25,000 2,750
Chief Financial Officer(3)
Michael J. Landy......................... 1999 $210,000 $100,000 30,000 $ 7,964
Executive Vice President, Sales and 1998 190,000 90,000 40,000 7,426
Marketing(4)........................... 1997 140,000 75,000 33,000 7,200
Bernard J. Whitney....................... 1999 $158,000 -- 50,000 $ 5,985
Executive Vice President and 1998 185,000 100,000 $ -- 10,021
Chief Financial Officer(5) 1997 27,750 10,000 100,000 1,110
</TABLE>
- ---------------
(1) Includes car allowance and premium payments for executive life, medical and
dental insurance.
(2) All share amounts reported reflect the 2 for 1 stock splits of Sanmina's
Common Stock effected in March 1996 and June 1998.
(3) Ms. Jordan joined Sanmina in October 1997 as Corporate Controller and was
named Vice President of Finance in October 1998. She became Executive Vice
President and Chief Financial Officer in June 1999.
(4) Mr. Landy was promoted to Vice President, Sales and Marketing in October
1997 and to Executive Vice President, Sales and Marketing in October 1998.
(5) Mr. Whitney resigned from Sanmina in June 1999.
Option Grants in Last Fiscal Year. The following table sets forth each
grant of stock options made during the fiscal year ended October 2, 1999 to each
executive officer named in the Summary Compensation Table above:
<TABLE>
<CAPTION>
% OF TOTAL
OPTIONS STOCK PRICE APPRECIATION FOR
GRANTED TO EXERCISE OR OPTION TERM(2)
OPTIONS EMPLOYEES BASE PRICE(1) EXPIRATION -----------------------------
NAME GRANTED(1)(#) IN FY99 ($/SH) DATE 5%($) 10%($)
---- ------------- ---------- ------------- ---------- ------------- -------------
<S> <C> <C> <C> <C> <C> <C>
Jure Sola................. 125,000 6.3 $23.88 10/05/08 $1,877,250 $4,757,321
Randy W. Furr............. 100,000 5.1 $23.88 10/05/08 $1,501,800 $3,805,857
Elizabeth D. Jordan....... 7,500 0.4 $23.88 10/05/08 $ 112,635 $ 285,439
Elizabeth D. Jordan....... 15,000 0.8 $73.63 06/11/09 $ 694,583 $1,760,209
Michael J. Landy.......... 30,000 1.5 $23.88 10/05/08 $ 450,540 $1,141,757
</TABLE>
- ---------------
(1) The exercise price and tax withholding obligations related to exercise may
in some cases, be paid by delivery of other shares or by offset of the
shares subject to the options.
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<PAGE> 8
(2) The dollar amounts under these columns are the result of calculations at the
5% and 10% rates set by the SEC and therefore are not intended to forecast
possible future appreciation, if any, of Sanmina's stock price. The Company
did not use an alternative formula for a grant date valuation, as Sanmina
does not believe that any formula will determine with reasonable accuracy a
present value based on future unknown or volatile factors.
(3) All share amounts reported reflect the 2 for 1 splits of Sanmina's Common
Stock effected in March 1996 and June 1998.
Aggregate Option Exercises in Last Fiscal Year and Fiscal Year-End Values.
The following table sets forth, for each of the executive officers named in the
Summary Compensation Table above, each exercise of stock options during the
fiscal year ended October 2, 1999 and the year-end value of unexercised options:
<TABLE>
<CAPTION>
NUMBER OF
UNEXERCISED
OPTIONS VALUE OF UNEXERCISED
SHARES VALUE AT YEAR-END IN-THE-MONEY OPTIONS
ACQUIRED ON REALIZED EXERCISABLE/ AT YEAR-END (2)
NAME EXERCISE(#) (1)($) UNEXERCISABLE(#) EXERCISABLE/UNEXERCISABLE($)
---- ----------- ---------- ---------------- ----------------------------
<S> <C> <C> <C> <C>
Jure Sola...................... -- -- 872,251/395,749 $66,238,741/$30,053,179
Randy W. Furr.................. 30,500 $1,825,790 321,884/234,216 $24,443,871/$17,786,363
Elizabeth D. Jordan............ 3,000 $213,000 8,293/36,207 $629,770/$2,749,560
Michael J. Landy............... 30,000 $2,213,010 101,101/74,899 $7,601,670/$5,687,830
Bernard J. Whitney............. 39,567 $3,033,322 --/-- --/--
</TABLE>
- ---------------
(1) Based on the last reported sale price of Sanmina's Common Stock on the date
of exercise.
(2) Based on a fair market value of $75.94, which was the last reported sale
price of Sanmina's Stock on October 2, 1999.
COMPENSATION COMMITTEE AND OFFICER STOCK COMMITTEE REPORTS
The following reports are provided to stockholders by the members of the
Compensation Committee and the Officer Stock Committee of the Board of
Directors.
Compensation Committee Report
Compensation Philosophy. The goals of Sanmina's executive compensation
program are to attract and retain executive officers who will strive for
excellence, and to motivate those individuals to achieve superior performance by
providing them with rewards for assisting Sanmina in meeting revenue and
profitability targets.
Compensation for Sanmina's executive officers consists of base salary and
potential cash bonus, as well as potential long-term incentive compensation
through stock options. The Compensation Committee considers the total current
and potential long-term compensation of each executive officer in establishing
each element of compensation.
Cash-Based Compensation. Each fiscal year, the Compensation Committee
reviews with the Chief Executive Officer and approves, with appropriate
modifications, an annual base salary plan for Sanmina's executive officers. This
base salary plan is based on industry and peer group surveys and performance
judgements as to the past and expected future contributions of the individual
executive officers. The Compensation Committee reviews and fixes the base salary
of the Chief Executive Officer based on similar competitive compensation data
and the Committee's assessment of his past performance and its expectation as to
his future contributions in leading Sanmina.
Each officer who served in an executive capacity throughout the last fiscal
year, including the Chief Executive Officer, received a cash bonus for such
service. These bonuses ranged in amount from approximately 50% annualized to
approximately 125% of base salary. In determining the bonus paid to each officer
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<PAGE> 9
(other than the Chief Executive Officer), the Compensation Committee reviewed
with the Chief Executive Officer the performance of each of the officers in
their respective areas of accountability as compared to Sanmina's operating
plan, and each officer's respective contribution to Sanmina's operating
performance in its electronics manufacturing services, backplane assembly and
subassembly and printed circuit board fabrication businesses. The members of the
Compensation Committee (other than the Chief Executive Officer) reviewed these
same factors in determining the bonus paid to the Chief Executive Officer.
Respectfully submitted,
Neil Bonke, Jure Sola and
Bernard Vonderschmitt
Officer Stock Committee Report
Stock Options. During each fiscal year, the Officer Stock Committee
considers the desirability of granting to executive officers awards under
Sanmina's Amended 1990 Incentive Stock Plan, which allows for the grant of
longer-term incentives in the form of stock options. In fixing the grants of
stock options to executive officers (other than the Chief Executive Officer) in
the last fiscal year, the Committee reviewed with the Chief Executive Officer
the recommended individual award, taking into account the officer's scope of
responsibility and specific assignments, strategic and operational goals
applicable to the officer, anticipated performance requirements and
contributions of the officer, and the number of options previously granted to
the officer. All stock options granted to executive officers in the last fiscal
year provide for vesting over a five-year period. During the fiscal year ended
October 2, 1999, an option award exercisable for up to 125,000 shares of
Sanmina's Common Stock was made to the Chief Executive Officer and options
exercisable for up to 277,500 shares were granted to all executive officers as a
group. In addition, in October 1999, in part in recognition of their performance
during fiscal 1999, the Officer Stock Committee approved grants of options in
the amount of 125,000 and 100,000 to the Chief Executive Officer and Chief
Operating Officer, respectively.
Respectfully submitted,
Neil Bonke and
Bernard Vonderschmitt
7
<PAGE> 10
STOCK PERFORMANCE GRAPH
The following graph shows a comparison of cumulative total stockholder
returns for Sanmina's Common Stock, the Nasdaq Stock Market Index, and an index
based on companies in a peer group (Standard Industrial Classification 3670
-- Electronic Components). The graph assumes the investment of $100 on
September 30, 1993. The performance shown is not necessarily indicative of
future performance.
COMPARISON OF 60 MONTH CUMULATIVE TOTAL RETURN*
AMONG SANMINA CORPORATION, THE NASDAQ STOCK MARKET
(U.S.) INDEX AND A PEER GROUP
<TABLE>
<CAPTION>
NASDAQ STOCK MARKET
SANMINA CORPORATION (U.S.) PEER GROUP
------------------- ------------------- ----------
<S> <C> <C> <C>
Sep-94 100 100 100
Sep-95 196.91 138.12 198.66
Sep-96 331.96 163.91 152.37
Sep-97 713.92 225.05 227.65
Sep-98 463.92 228.89 111.65
Oct-99 1276.29 371.62 239.2
</TABLE>
* $100 Invested on 9/30/93 in Stock or Index -- including reinvestment of
dividends. Fiscal year ending October 2.
PROPOSAL NO. 2:
APPROVAL OF AMENDMENT TO RESTATED CERTIFICATE OF INCORPORATION
The Company's Restated Certificate of Incorporation (the "Certificate"), as
currently in effect, provides that authorized capital stock shall consist of
200,000,000 shares of Common Stock, $0.01 par value (the "Common Stock"), and
5,000,000 shares of Preferred Stock, $0.01 par value (the "Preferred Stock"). On
December 13, 1999, the Company's Board of Directors approved an amendment to the
Certificate (the "Amendment") to increase the number of shares of Common Stock
authorized for issuance under the Certificate by 300,000,000 to a total of
500,000,000 shares. As more fully described below, the proposed Amendment is
intended to provide the Company flexibility to meet future needs for unreserved
Common Stock. The affirmative vote of holders of a majority of shares of Common
Stock represented at the meeting is necessary to approve the Amendment. The
Board of Directors recommends that stockholders vote FOR approval of the
Amendment. The reasons for and the possible effects of the amendment to the
Certificate and certain information regarding the Certificate are set forth
below.
8
<PAGE> 11
Reasons for Amendment. As of October 2, 1999, 58,891,980 shares of Common
Stock, par value $0.01 per share, were issued and outstanding and 12,614,811
were reserved for issuance under the Company's stock option and stock purchase
plans. During fiscal 1999, Sanmina issued convertible subordinated notes in the
amount of $350,000,000. Sanmina has reserved 4,035,181 shares of Common Stock
for issuance upon conversion of these notes. Sanmina's market capitalization has
increased from $1,357,000,000 as of September 30, 1998 to $4,472,000,000 as of
October 2, 1999.
THE NUMBER OF SHARES REMAINING AVAILABLE IS NOT CONSIDERED ADEQUATE FOR THE
COMPANY'S FUTURE POSSIBLE REQUIREMENTS.
Although the Company has no firm plans to use the additional authorized
shares of Common Stock, the Company's Board of Directors believes that it is
prudent to increase the number of authorized shares of Common Stock to the
proposed level in order to provide a reserve of shares available for issuances
in connection with possible future actions. In particular, the Company's Board
of Directors believes that the current number of authorized shares needs to be
increased to provide the flexibility to effect other possible actions such as
financings, corporate mergers, acquisitions of property, establishing strategic
relationships with corporate partners, employee benefit plans and for other
general corporate purposes. Currently there are no plans, agreements or
arrangements in place requiring the utilization of these additional shares for
financing, corporate mergers, acquisitions of property, establishment of
strategic relationships with corporate partners, employee benefit plans or other
general corporate purposes. Having such additional authorized Common Stock
available for issuance in the future would allow the Board of Directors to issue
shares of Common Stock without the delay and expense associated with seeking
stockholder approval. Elimination of such delays and expense occasioned by the
necessity of obtaining stockholder approval will better enable the Company,
among other things, to engage in financing transactions and acquisitions as well
as to take advantage of changing market and financial conditions on a more
competitive basis as determined by the Board of Directors.
The additional Common Stock to be authorized by adoption of the Amendment
would have rights identical to the currently outstanding Common Stock of the
Company. Adoption of the proposed Amendment and issuance of the Common Stock
would not affect the rights of the holders of currently outstanding Common Stock
of the Company. If the Amendment is adopted, it will become effective upon
filing of the Amendment with the Secretary of the State of Delaware. Stockholder
approval may be required if it is proposed that any such shares, other than
those shares provided for by the terms of 1999 Stock Plan, are to be added to
the number of shares reserved for issuance under the Company's option plans, in
compliance with applicable rules and laws.
Possible Effects of the Amendment. If the proposed Amendment is approved,
the Board of Directors may cause the issuance of additional shares of Common
Stock without further vote of stockholders of the Company, except as provided
under the Delaware corporate law or under the rules of any national securities
exchange on which shares of Common Stock of the Company are then listed. Current
holders of Common Stock have no preemptive or like rights, which means that
current stockholders do not have a prior right to purchase any new issue of
capital stock of the Company in order to maintain their proportionate ownership
thereof. The effects of the authorization of additional shares of Common Stock
may also include dilution of the voting power of currently outstanding shares
and reduction of the portion of dividends and of liquidation proceeds payable to
the holders of currently outstanding Common Stock.
In addition, the Board of Directors could use authorized but unissued
shares to create impediments to a takeover or a transfer of control of the
Company. Accordingly, the increase in the number of authorized shares of Common
Stock may deter a future takeover attempt which holders of Common Stock may deem
to be in their best interest or in which holders of Common Stock may be offered
a premium for their shares over the market price.
The Board of Directors is not currently aware of any attempt to take over
or acquire the Company. While it may be deemed to have potential anti-takeover
effects, the proposed Amendment to increase the authorized Common Stock is not
prompted by any specific effort or takeover threat currently perceived by
management. Moreover, management does not currently intend to propose additional
anti-takeover measures in the foreseeable future.
9
<PAGE> 12
PROPOSAL NO. 3:
CONFIRMATION OF APPOINTMENT OF INDEPENDENT PUBLIC ACCOUNTANTS
The Board of Directors has selected Arthur Andersen LLP, independent public
accountants, to audit the financial statements of Sanmina for the year ending
September 30, 2000. Arthur Andersen LLP has audited the financial statements of
Sanmina for each fiscal year since the fiscal year ending September 30, 1992.
The affirmative vote of holders of a majority of the shares of Common Stock
represented at the meeting is necessary to appoint Arthur Andersen LLP as
Sanmina's independent public accountants and the Board of Directors recommends
that the stockholders vote FOR confirmation of such selection. In the event of a
negative vote, the Board of Directors will reconsider its selection.
Representatives of Arthur Andersen LLP are expected to be present at the Annual
Meeting with the opportunity to make a statement if they desire to do so, and
are expected to be available to respond to appropriate questions.
CERTAIN TRANSACTIONS
Sanmina's Certificate of Incorporation, as amended, provides that the
personal liability of its directors for monetary damages arising from a breach
of their fiduciary duties in certain circumstances shall be eliminated to the
fullest extent permitted by Delaware law. The Certificate of Incorporation, as
amended, also authorizes Sanmina to indemnify its directors and officers to the
fullest extent permitted by Delaware law. Sanmina has entered into
indemnification agreements with its officers and directors providing such
indemnification. The indemnification agreements may require Sanmina, among other
things, to indemnify such officers and directors against certain liabilities
that may arise by reason of their status or service as directors or officers
(other than liabilities arising from willful misconduct of a culpable nature),
to advance their expenses incurred as a result of any proceeding against them as
to which they could be indemnified, and to obtain directors' and officers'
insurance.
On April 4, 1999, Sanmina loaned $500,000 to Mr. Randy Furr, Sanmina's
President and Chief Operating Officer. Mr. Furr executed a promissory note in
favor of Sanmina which bears interest at a rate of 4.67% and matured on August
27, 1999. The loan was repaid on August 27, 1999 (representing $500,000 in
principal and $8,756 in accrued interest).
During fiscal 1998, Mario M. Rosati, a nominee for election to the Board of
Directors of Sanmina, and Christopher D. Mitchell, Secretary of Sanmina, were
also members of the law firm of Wilson Sonsini Goodrich & Rosati, Professional
Corporation, Palo Alto, California ("WSGR"). Sanmina retained WSGR as its legal
counsel during the fiscal year. Sanmina plans to retain WSGR as its legal
counsel again during fiscal 2000. The amounts paid by Sanmina to WSGR were less
than 5% of WSGR's total gross revenues for its last completed fiscal year.
OTHER MATTERS
Sanmina knows of no other matters to be submitted to the meeting. If any
other matters properly come before the meeting, it is the intention of the
persons named in the accompanying form of proxy to vote the shares they
represent as the Board of Directors may recommend.
SANMINA WILL MAIL WITHOUT CHARGE TO ANY STOCKHOLDER UPON WRITTEN REQUEST A
COPY OF SANMINA'S ANNUAL REPORT ON FORM 10-K, INCLUDING THE FINANCIAL
STATEMENTS, SCHEDULES AND A LIST OF EXHIBITS. REQUESTS SHOULD BE SENT TO
INVESTOR RELATIONS, SANMINA CORPORATION, 2700 NORTH FIRST STREET, SAN JOSE,
CALIFORNIA 95134.
10
<PAGE> 13
SANMINA CORPORATION PROXY
-----------------------------------------------------------------------------
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
2000 ANNUAL MEETING OF STOCKHOLDERS -- JANUARY 28, 2000
The undersigned stockholder of SANMINA CORPORATION, a Delaware corporation,
hereby acknowledges receipt of the Notice of Annual Meeting of Stockholders
and Proxy Statement, each dated December 27, 1999, and 1999 Annual Report to
Stockholders and hereby appoints Jure Sola, Randy W. Furr, or either of them,
proxies and attorneys-in-fact, with full power to each of substitution, on
behalf and in the name of the undersigned, to represent the undersigned at the
2000 Annual Meeting of Stockholders of SANMINA CORPORATION to be held on
January 28, 2000 at 11:00 a.m., local time, at the Sheraton San Jose Hotel
located at 1801 Barber Lane, Milpitas, California 95035, and at any
adjournment or adjournments thereof, and to vote all shares of Common Stock
which the undersigned would be entitled to vote if then and there personally
present, on the matters set forth on reverse.
<PAGE> 14
1. ELECTION OF DIRECTORS:
<TABLE>
<S> <C> <C>
John C. Bolger; Neil R. Bonke; Randy W. Furr; Joseph M. Schell; Jure Sola; [ ] FOR ALL [ ] WITHHOLD
Mario M. Rosati; Bernard V. Vonderschmitt NOMINEES LISTED
TO THE LEFT (EXCEPT AS
INDICATED.)
</TABLE>
IF YOU WISH TO WITHHOLD AUTHORITY TO VOTE FOR ANY INDIVIDUAL NOMINEE, STRIKE A
LINE THROUGH THAT NOMINEE'S NAME IN THE LIST ABOVE.
<TABLE>
<S> <C> <C> <C>
2. Proposal to approve the amendment to the Restated Certificate of [ ] FOR [ ] AGAINST [ ] ABSTAIN
Incorporation to increase the number of authorized shares of Common Stock:
3. Proposal to ratify the appointment of Arthur Andersen LLP as the independent [ ] FOR [ ] AGAINST [ ] ABSTAIN
public accountants of Sanmina for its fiscal year ending September 30, 2000:
</TABLE>
and, in their discretion, upon such other matter or matters which may properly
come before the meeting or any adjournment or adjournments thereof.
This Proxy will be voted as directed or, if no contrary direction is indicated,
will be voted for the election of directors, for the ratification of the
appointment of Arthur Andersen LLP as independent public accountants, and as
said proxies deem advisable on such other matters as may properly come before
the meeting.
Dated:____________________ , 2000
(Signature(s))
(This Proxy should be marked, dated and
signed by the stockholder(s) exactly as
his, her or its name appears hereon,
and returned promptly in the enclosed
envelope. Persons signing in a
fiduciary capacity should so indicate.
If shares are held by joint tenants or
as community property, both should sign.)
Proxy # Account # Issue or Issuer #
