LECROY CORP, DEF 14A, 1998-09-18

LECROY CORP
DEF 14A, 1998-09-18
INSTRUMENTS FOR MEAS & TESTING OF ELECTRICITY & ELEC SIGNALS

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<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 (Amendment No. )

Filed by the Registrant [X]

Filed by a Party other than the Registrant [ ]

Check the appropriate box:

<TABLE>
<S> <C>
[ ] Preliminary Proxy Statement
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Rule 14a-11(c) or Rule 14a-12
[ ] Confidential, for the Use of the Commission Only (as permitted by Rule 14a-6(e)(2))
</TABLE>

LECROY CORPORATION
- --------------------------------------------------------------------------------
(Name of Registrant as Specified in Its Charter)

- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement)

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:

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

(4) Date Filed:
<PAGE> 2

LECROY CORPORATION

NOTICE OF THE ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD OCTOBER 28, 1998

Chestnut Ridge, New York
September 28, 1998

To the Stockholders of
LeCroy Corporation:

NOTICE IS HEREBY GIVEN that the Annual Meeting of Stockholders of LeCroy
Corporation will be held at the KPMG Center for Leadership Development, 3
Chestnut Ridge Road, Montvale, N.J., on Wednesday, October 28, 1998 at 10:00
a.m., local time, for the following purposes:

1. To elect two directors to serve for three-year terms and until their
successors are duly elected and qualified;

2. To approve the Company's 1998 Non Employee Directors Stock Option Plan;

3. To consider and act upon any other matters which may properly come
before the meeting or any adjournment thereof.

Stockholders of record at the close of business on September 11, 1998 will
be entitled to notice of and vote at the meeting or any adjournment thereof.

By Order of the Board of Directors

JOHN C. MAAG
Secretary

IF YOU ARE UNABLE TO BE PRESENT AT THE MEETING, YOU ARE REQUESTED TO
COMPLETE, DATE, AND SIGN THE ENCLOSED PROXY AND RETURN IT PROMPTLY IN THE
ENCLOSED ENVELOPE.
<PAGE> 3

LECROY CORPORATION
------------------------

PROXY STATEMENT

RECORD DATE, SOLICITATION, VOTING AND REVOCABILITY OF PROXIES, VOTING RIGHTS

This Proxy Statement and the accompanying Notice of Annual Meeting and form
of proxy are being furnished to the holders of the Common Stock of LeCroy
Corporation (the "Company") in connection with the solicitation by the Board of
Directors of the Company of proxies to be used at the Annual Meeting of
Stockholders to be held on October 28, 1998 at 10:00 a.m., local time, to be
held at the KPMG Center for Leadership Development, 3 Chestnut Ridge Road,
Montvale, N.J., and at any adjournment or postponement thereof. The close of
business September 11, 1998 is the record date for the determination of
stockholders entitled to notice of and to vote at the Annual Meeting.

This Proxy Statement and proxies for use at the meeting will be mailed to
stockholders on or about September 28, 1998, and such proxies will be solicited
chiefly by mail, but additional solicitations may be made by telephone or in
person by the officers, directors or regular employees of the Company. The
Company may enlist the assistance of brokerage houses in soliciting proxies. All
solicitation expenses, including costs of preparing, assembling and mailing
proxy material, will be borne by the Company.

A form of proxy for use at the meeting and a return envelope for the proxy
are enclosed. Stockholders may revoke the authority granted by their execution
of proxies at any time before their effective exercise by filing with the
Secretary of the Company a written revocation or a duly executed proxy bearing a
later date or by voting in person at the meeting. Shares represented by executed
and unrevoked proxies will be voted in accordance with the choice or
instructions specified thereon. If no specifications are given, the proxies
intend to vote the shares represented thereby for the election of all directors
as indicated in Proposal No. 1, and for the approval of the 1998 Non-Employee
Directors Stock Option Plan as set forth in Proposal No. 2, both as set forth in
the accompanying Notice of Annual Meeting of Stockholders, and in accordance
with their best judgment on any other matters that may properly come before the
meeting.

As of the close of business on September 11, 1998, the Company had
outstanding 7,575,541 shares of Common Stock, $.01 par value. Each share of
Common Stock is entitled to one vote on all matters presented at the Annual
Meeting. The presence, either in person or by duly executed proxy, of the
holders of a majority of outstanding shares of Common Stock entitled to vote at
a meeting is necessary to constitute a quorum. Shares that reflect abstentions
or "broker non-votes" (i.e., shares held by brokers that are represented at the
meeting but as to which such brokers have not received instructions from the
beneficial owners and, with respect to one or more but not all issues, such
brokers do not have discretionary voting power to vote such shares) will be
counted for purposes of determining whether a quorum is present for the
transaction of business at the meeting but will not be counted as votes on any
proposals at the meeting. Accordingly, abstentions and broker non-votes will
have no impact on the outcome of the vote on the election of directors or the
proposed approval of the 1998 Non-Employee Directors Stock Option Plan. The
affirmative vote of the holders of a plurality of the shares of Common Stock
present or represented and actually voted at the meeting is required for the
election of directors and the affirmative vote of the holders of a majority of
the shares of Common Stock present or represented and actually voting at the
meeting is required for the approval of the 1998 Non-Employee Directors Stock
Option Plan.

The Company's Annual Report on Form 10-K for the fiscal year ended June 30,
1998, containing the financial statements and notes thereto, is being mailed to
stockholders concurrently with this statement.

The Board of Directors knows of no matters, other than those stated above,
to be presented for consideration at the Annual Meeting. If, however, any other
matters properly come before the Annual Meeting or any adjournment or
postponement thereof, it is the intention of the persons named in the enclosed
proxy to vote the shares represented by the proxy in accordance with their
judgment on any such matters. The persons named in the enclosed proxy may also,
if a quorum is not present, vote such proxy to adjourn the Annual Meeting from
time to time.
<PAGE> 4

PRINCIPAL STOCKHOLDERS AND MANAGEMENT OWNERSHIP

The following table sets forth certain information regarding beneficial
ownership of the Common Stock as of July 31, 1998 by (i) each person or group
who is known by the Company to own beneficially more than five percent (5%) of
the issued and outstanding Common Stock, (ii) each director and nominee for
director of the Company, (iii) each named executive officer described in the
section of this Proxy Statement captioned "Executive Compensation," and (iv) all
directors and executive officers of the Company as a group. Except as otherwise
indicated below, to the knowledge of the Company, all persons listed below have
sole voting and investment power with respect to their shares of Common Stock
shown as of July 31, 1998, except to the extent authority is shared by spouses
under applicable law.

<TABLE>
<CAPTION>
AMOUNT &
NATURE OF PERCENT
BENEFICIAL OF
NAME OF BENEFICIAL OWNER OWNERSHIP CLASS
- ------------------------ ---------- -------
<S> <C> <C>
Kopp Investment Advisors, Inc. ............................. 1,725,110 22.8
7701 France Avenue South
Suite 500
Edina, Minnesota 55435
State of Wisconsin Investment Board......................... 811,200 10.7
P.O. Box 7842
Madison, Wisconsin 53707
Walter O. LeCroy, Jr.(1).................................... 698,756 9.2
c/o LeCroy Corporation
700 Chestnut Ridge Road
Chestnut Ridge, New York 10977
TCW Asset Management........................................ 530,300 7.0
865 South Figueroa Street
Suite 1800
Los Angeles, California 90017
Lord, Abbett & Co. ......................................... 441,800 5.8
767 Fifth Avenue
11th Floor
New York, New York 10153
Lutz P. Henckels(2)......................................... 289,838 3.8
Thomas H. Reslewic(3)....................................... 47,352 *
Werner H. Brokatzky(4)...................................... 12,024 *
Ronald S. Nersesian(5)...................................... 21,724 *
Robert E. Anderson(6)....................................... 11,870 *
William G. Scheerer(7)...................................... 8,023 *
Douglas A. Kingsley(7)...................................... 7,923 *
Charles A. Dickinson(8)..................................... 545 *
Allyn C. Woodward, Jr....................................... 0 *
All executive officers and directors as a group (17 1,211,731 15.4%
persons)(9)...............................................
</TABLE>

- ---------------
* Less than 1% of the outstanding Common Stock

(1) Includes 43,356 shares of Common Stock held by the Employee Stock Ownership
Trust ("ESOT") and allocated to the account of Mr. LeCroy.

(2) Includes 2,071 shares of Common Stock held by the ESOT and allocated to the
account of Mr. Henckels, 119,174 shares of Common Stock issuable upon
exercise of presently exercisable options and an aggregate of 62,210 shares
held in certain trusts for the benefit of Mr. Henckels' children. Mr.
Henckels disclaims beneficial ownership of the 62,210 shares held in such
trusts.

2
<PAGE> 5

(3) Includes 2,504 shares of Common Stock held by the ESOT and allocated to the
account of Mr. Reslewic and 43,696 shares of Common Stock issuable upon
exercise of presently exercisable options.

(4) Includes 3,260 shares of Common Stock issuable upon exercise of presently
exercisable options.

(5) Includes 20,500 shares of Common Stock issuable upon exercise of presently
exercisable options.

(6) Includes 10,870 shares of Common Stock issuable upon exercise of presently
exercisable options.

(7) Includes 7,923 shares of Common Stock issuable upon exercise of presently
exercisable options.

(8) Includes 545 shares of Common Stock issuable upon exercise of presently
exercisable options.

(9) Includes an aggregate of 66,736 shares of Common Stock held by the ESOT and
allocated to the accounts of the directors and executive officers. Includes
an aggregate of 299,750 shares of Common Stock issuable upon exercise of
certain presently exercisable options.

PROPOSAL NO. 1 -- ELECTION OF A CLASS OF DIRECTORS

The Company has a classified Board of Directors consisting of three
classes. At each Annual Meeting, a class of directors is elected for a full term
of three years to succeed those whose terms are expiring. All of the Company's
directors are listed below with their principal occupations for the last five
years.

At the Annual Meeting, two directors are to be elected in Class III, to
hold office for three years or until their respective successors are elected and
qualified. The remaining Directors will continue to serve as set forth below. It
is intended that the shares represented by the enclosed proxy will be voted for
the election of the nominees named below.

Should such nominees be unable or unwilling to accept nomination or
election, it is intended that the accompanying proxy will be voted for such
other persons as may be nominated by the Board of Directors.

The nominees have been previously elected by stockholders. The Board of
Directors has no reason to believe that the nominees will be unavailable to
serve if elected.

"THE BOARD OF DIRECTORS DEEMS PROPOSAL NO. 1 TO BE IN THE BEST INTERESTS OF
THE COMPANY AND ITS STOCKHOLDERS AND RECOMMENDS A VOTE FOR ELECTION OF THE TWO
CANDIDATES FOR ELECTION."

INFORMATION REGARDING NOMINEES AND DIRECTORS

The following sets forth certain information with respect to the Nominees
and those Continuing Directors of the Company whose terms expire at the annual
meetings of stockholders in 1999 and 2000.

NOMINEES FOR ELECTION AS
CLASS III DIRECTORS FOR A THREE YEAR TERM EXPIRING
AT THE 2001 ANNUAL MEETING

<TABLE>
<CAPTION>
DIRECTOR, YEAR FIRST ELECTED AS DIRECTOR AGE PRINCIPAL OCCUPATIONS, BUSINESS AND DIRECTORSHIPS
- ---------------------------------------- --- -------------------------------------------------
<S> <C> <C>
Walter O. LeCroy, Jr........... 63 Founder of the Company; Chairman of the Board of LeCroy
1964 Corporation since 1964.
Robert E. Anderson............. 57 President of Omniken, Inc., a private consulting firm,
1995 since September 1993; President and Chief Executive
Officer of GenRad, Inc., a manufacturer of electronic test
systems, from 1988 to June 1993 and as Chairman in 1993.
Mr. Anderson is also Vice Chair of the MIT Enterprise
Forum, an Advisor to the Board of the National Association
of Corporate Directors (New England) and a director of
Technology Capital Network at MIT, Indian Hill Arts, Inc.
and several private companies.
</TABLE>

3
<PAGE> 6

CLASS I DIRECTOR CONTINUING IN OFFICE WHOSE TERM EXPIRES
AT THE 1999 ANNUAL MEETING

CLASS II DIRECTORS FOR CONTINUING IN OFFICE WHOSE TERMS EXPIRES
AT THE 2000 ANNUAL MEETING

<TABLE>
<CAPTION>
DIRECTOR, YEAR FIRST ELECTED AS DIRECTOR AGE PRINCIPAL OCCUPATIONS, BUSINESS AND DIRECTORSHIPS
- ---------------------------------------- --- -------------------------------------------------
<S> <C> <C>
Douglas A. Kingsley............ 36 Vice President of Advent International Corporation, a
1995 venture capital firm, since January 1996; Investment
Manager of Advent International Corporation from September
1990 to December 1995. Mr. Kingsley is also a director of
Lightbridge, Inc.
William G. Scheerer............ 60 President of Performance Quest LLC, a private consulting
1995 corporation, since January 1997; Vice President of Kalman
Saffran Associates, Inc., a high technology R&D contract
company, since November of 1997; Infrastructure Operations
Vice President at Lucent Technologies, a
telecommunications software company, from March 1996 to
December 1996; Quality, Engineering, Software and
Technologies (QUEST) Vice President at AT&T Bell
Laboratories from May 1990 to February 1996. Mr. Scheerer
is also a director of GenRad, Inc.
Allyn C. Woodward Jr........... 57 President of Adams, Harkness & Hill, Inc., an
1998 institutional research, brokerage and investment banking
firm since June 1995 and Director since June 1995; Senior
Executive Vice President and Chief Operating Officer for
Silicon Valley Bank, a commercial banking institution,
from April 1990 to April 1995. Mr. Woodward is also a
Director of Cayenne Software, Inc., and several private
companies.
</TABLE>

ADDITIONAL INFORMATION RELATING TO THE BOARD OF DIRECTORS

Attendance at Board and Committee Meetings

During fiscal year 1998, the Board of Directors held ten meetings. During
that fiscal year, each Director attended 75% or more of the aggregate of (i) the
meetings of the Board of Directors and (ii) the meetings of the committees on
which such director served that were held during the period in which he was a
director.

Committees of the Board

The Company's Board of Directors has a Compensation Committee and an Audit
Committee. The responsibilities of these committees of the Company's Board of
Directors are described as follows.

4
<PAGE> 7

Compensation Committee. The Compensation Committee during fiscal 1998
consisted of Messrs. Robert E. Anderson, Douglas A. Kingsley and William G.
Scheerer, each of whom is an independent director. Such committee reviews the
Company's executive compensation and benefit policies and administers the
Amended and Restated 1993 Stock Incentive Plan. The Compensation Committee met
six times during fiscal year 1998.

Audit Committee. The Audit Committee during fiscal 1998 also consisted of
Messrs. Robert E. Anderson, Douglas A. Kingsley and William G. Scheerer, each of
whom is an independent director. This committee recommends to the Board of
Directors the appointment of the independent public accountants, reviews the
scope and budget for the annual audit, and reviews the results of the
examination of the Company's financial statements by the independent public
accountants. The Audit Committee met four times during fiscal year 1998.

Compensation of Directors

The Company's directors receive an annual Board retainer of $20,000,
payable quarterly. In addition, each non-employee director currently receives an
option to purchase that number of shares of Common Stock equal to the quotient
of $100,000 divided by the fair market value of the Common Stock on the date of
grant, reduced by the remaining term of service if less than 36 months. The
directors do not receive any additional cash compensation for service on the
Board, telephone meetings of the Board, or any committee thereof, or for
attendance at board or committee meetings.

PROPOSAL NO. 2 -- ADOPTION OF 1998 NON-EMPLOYEE DIRECTORS OPTION PLAN

At the Meeting, you are being asked to approve the adoption of the 1998
Non-Employee Directors Stock Option Plan ("Plan"). For the reasons set forth
below, the Board recommends that stockholders approve the Plan.

The purpose of the Plan is to promote the best interests of the Company and
its stockholders by providing a compensation arrangement which will help to
attract and retain non-employee directors whose services are considered
essential to the Company's continued progress by providing them with long-term
financial incentives to increase the value of the Company.

PRINCIPAL FEATURES OF THE PLAN

The full text of the Plan is set forth as Appendix A hereto, and readers
are urged to refer to it for a complete description of the proposed Plan. The
summary of the principal features of the Plan which follows is qualified
entirely by such reference.

ELIGIBLE PARTICIPANTS

Under the proposed Plan, directors of the Company who are not employees of
the Company or any subsidiary of the Company would be eligible to participate in
the Plan. Should the proposed slate of directors be approved by the
stockholders, currently five directors will be eligible to participate in the
Plan.

ADMINISTRATION

The Board of Directors shall supervise and administer the Plan.

NUMBER OF SHARES SUBJECT TO THE PLAN

A total of 500,000 shares of Common Stock are to be reserved for issuance
pursuant to the Plan. The Company expects to register the shares in late 1998.

5
<PAGE> 8

FORMS OF AWARDS

Under the Plan, non-employee directors will each receive upon adoption of
the Plan or will receive upon his or her initial election or appointment to the
Board an option grant of 15,000 shares, to be vested ratably on a monthly basis
over 36 months. Additionally, after a director's initial grant, such director
will receive annual option grants of 5,000 shares, to be vested immediately, on
each anniversary date of the initial grant.

STOCK OPTION

Exercise of Stock Option. A Stock Option may be exercised only by written
notice to the Company accompanied by payment in cash of the full consideration
for the shares as to which it is exercised. No Stock Option can be exercised
after the expiration of ten years from the date the option was granted.

Options are exercisable to the extent vested only while the optionee is
serving as a director of the Company or within three months after the optionee
ceases to serve as a director of the Company (except that if a director dies or
becomes disabled while he or she is serving as a director of the Company, the
option is exercisable for a maximum of one year after the optionee ceases to be
a director).

Price of Stock Option. The exercise price of a Stock Option will be the
fair market value of the Common Stock on the date of grant.

Stock Option Nontransferable. Each Stock Option granted under the Plan by
its terms shall not be transferable by the optionee otherwise than by will, or
by the laws of descent and distribution, and shall be exercised during the
lifetime of the optionee only by him. No Stock Option or interest therein maybe
transferred, assigned, pledged or hypothecated by the optionee during his
lifetime, whether by operation of law or otherwise, or be made subject to
execution, attachment or similar process.

EFFECTIVE DATE AND DURATION

Assuming approval of the Plan by the stockholders, the effective date of
the Plan shall be October 28, 1998. The Plan shall terminate on October 27,
2008, unless earlier terminated by the Board of Directors or the Committee. No
Stock Options shall be granted after the date on which this Plan terminates. The
applicable terms of this Plan, and any terms and conditions applicable to the
Stock Options granted made prior to such date, shall survive the termination of
the Plan and continue to apply to such Stock Options. The Plan is the successor
plan to the 1995 Non-Employee Director Stock Option Plan. Upon approval of the
Plan by stockholders, no future awards will be made under 1995 Non-Employee
Director Stock Option Plan.

AMENDMENTS

The Board of Directors shall have the right to amend, modify, suspend or
terminate the Plan at any time for any purpose; provided, that following
approval of the Plan by the Company's stockholders, the Company will seek
stockholder approval for any change to the extent required by applicable law,
regulation or rule.

ADJUSTMENTS

In the event of any merger, consolidation, reorganization,
recapitalization, stock dividend, stock split, or other change in the corporate
structure or capitalization affecting the Company's present Common Stock, at the
time of such event the Board or the Committee shall make appropriate adjustments
to the number (including the aggregate number of shares that may be issued under
the Plan) and kind of shares to be issued under the Plan and the price of any
Stock Option.

FEDERAL INCOME TAX CONSEQUENCES

The description of the federal income tax consequences set forth below is
necessarily general in nature and does not purport to be complete. Moreover,
statutory provisions are subject to change, as are their interpretations, and
their applications in may vary in individual circumstances. Finally, the tax
consequences under applicable state and local income tax laws may not be the
same as under the federal income tax laws.

6
<PAGE> 9

All options to be granted under the Plan are nonstatutory options not
entitled to special tax treatment under Section 422 of the Internal Revenue
Code. The grant of a Stock Option does not result in taxable income to the
recipient. Upon the exercise of an option, the recipient generally recognizes
ordinary income in an amount equal to the difference between the option price
and the fair market value of the shares on the date of exercise. The Company is
not entitled to an income tax deduction with respect to the grant of a Stock
Option or the sale of stock acquired pursuant thereto. The Company is permitted
a deduction equal to the amount of ordinary income the recipient is required to
recognize as a result of the exercise of a Stock Option. The non-employee
director recognizes as a capital gain or loss any subsequent profit or loss
realized on the sale or exchange of any shares disposed of or sold.

BOARD RECOMMENDATION

The Board of Directors believes that the Company's grant of Stock Options
will provide significant incentives to non-employee directors who contribute and
are expected to contribute materially to the continued success of the Company.

THE BOARD OF DIRECTORS RECOMMENDS THAT THE STOCKHOLDERS VOTE "FOR" ADOPTION
OF THE PLAN.

EXECUTIVE COMPENSATION AND OTHER INFORMATION

SUMMARY COMPENSATION TABLE

The following table sets forth information with respect to all compensation
awarded to, earned by, or paid to (i) the Chief Executive Officer of the
Company, and (ii) the four highest compensated executive officers who were
serving as executive officers at the end of fiscal 1998 (collectively, the
"Named Executive Officers"):

<TABLE>
<CAPTION>
LONG-TERM
COMPENSATION
AWARDS
------------
ANNUAL COMPENSATION SECURITIES
--------------------- UNDERLYING ALL OTHER
NAME AND PRINCIPAL POSITION YEAR SALARY($) BONUS($) OPTIONS(#) COMPENSATION($)(3)
- --------------------------- ---- --------- -------- ------------ ------------------
<S> <C> <C> <C> <C> <C>
Walter O. LeCroy, Jr. .............. 1998 305,000 -- -- 13,717(5)
Chairman of the Board of Directors 1997 305,000 -- -- 10,769
1996 305,000 -- -- 10,180
Lutz P. Henckels.................... 1998 333,654 106,425 60,000 16,665(5)
Chief Executive Officer and
President 1997 300,000 165,340 -- 19,829
1996 300,000 114,900 12,500 17,080
Thomas H. Reslewic.................. 1998 290,061 83,850 30,000 10,800
Executive Vice President and Chief 1997 302,782 15,000 54,000 19,760
Operating Officer 1996 247,594 7,500 20,000 15,280
Werner H. Brokatzky................. 1998 220,229(2) 17,793(2) 10,000 24,268(2)(4)
Vice President -- Operations
(Geneva) 1997 221,137(2) 10,615 10,000 25,788(2)(4)
1996 248,040(2) -- 5,000 28,034(2)(4)
Ronald S. Nersesian(1).............. 1998 176,577 47,300 15,000 14,268(5)
Senior Vice President 1997 157,308 62,500 20,000 10,692
1996 40,385 38,300 62,000 2,154
</TABLE>

- ---------------
(1) Mr. Nersesian's employment with the Company commenced in March 1996.

(2) Dollar amount reflects the conversion of compensation amounts from Swiss
francs to United States dollars using the average exchange rate during
fiscal 1998, 1997 and 1996, respectively.

(3) Includes the value of Company-provided automobile.

(4) Includes $10,584, $10,558 and $10,953 for Mr. Brokatzky representing the
Company's payment to the subsidiary defined contribution plan in fiscal
1998, 1997 and 1996, respectively.

7
<PAGE> 10

(5) For 1998 includes estimated amounts to be paid to individual 401(k) accounts
as a matching contribution by the Company as follows: Mr. LeCroy $4,750, Mr.
Henckels $5,865 and Mr. Nersesian $3,468.

AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR AND FISCAL YEAR-END OPTION
VALUES

The following table sets forth information concerning the exercise of stock
options during fiscal year 1998 by each of the named executive officers and the
fiscal year-end value of unexercised options.

<TABLE>
<CAPTION>
VALUE OF
UNEXERCISED
NUMBER OF IN-THE-MONEY
OPTIONS AT FISCAL OPTIONS AT FISCAL
YEAR-END(#) YEAR-END(2)($)
SHARES ----------------- -----------------
ACQUIRED ON VALUE EXERCISABLE/ EXERCISABLE/
NAME EXERCISE(#) REALIZED(1)($) UNEXERCISABLE UNEXERCISABLE
---- ----------- -------------- ----------------- -----------------
<S> <C> <C> <C> <C>
Walter O. LeCroy, Jr.......... -- -- -- --
Lutz P. Henckels.............. 94,783 892,856 119,174/80,109 1,853,985/347,703
Werner H. Brokatzky........... -- -- 3,260/23,261 53,937/ 56,453
Thomas H. Reslewic............ 10,000 260,450 43,696/88,870 385,592/252,031
Ronald S. Nersesian........... 15,500 294,500 20,500/61,000 94,937/193,625
</TABLE>

- ---------------
(1) Calculated on the basis of the fair market value of the Common Stock on the
date of exercise, less the option exercise price.

(2) Calculated on the basis of the fair market value of the Common Stock on June
30, 1998 ($22.875), less the applicable option exercise price.

OPTION GRANTS IN LAST FISCAL YEAR

The following table sets forth information concerning individual grants of
stock options made during fiscal year 1998 to each of the named executive
officers.

<TABLE>
<CAPTION>
GRANT DATE VALUE
---------------------
POTENTIAL REALIZABLE
INDIVIDUAL GRANTS VALUE AT ASSUMED
-------------------------------------------------------- ANNUAL RATES OF STOCK
NUMBER OF PERCENT OF TOTAL PRICE
SECURITIES OPTIONS APPRECIATION FOR
UNDERLYING GRANTED EXERCISE OR OPTION TERM
OPTIONS TO EMPLOYEES BASE PRICE EXPIRATION ---------------------
NAME GRANTED(#) IN FISCAL YEAR ($/SHARE) DATE 5%($) 10%($)
---- ---------- ---------------- ----------- ---------- -------- ----------
<S> <C> <C> <C> <C> <C> <C>
Walter O. LeCroy, Jr. .... -- -- -- -- -- --
Lutz P. Henckels.......... 60,000 6.2 22.63 02/04/08 853,500 2,163,300
Werner H. Brokatzky....... 10,000 1.0 23.50 04/28/08 147,800 374,500
Thomas H. Reslewic........ 30,000 3.1 22.63 02/04/08 426,750 1,081,650
Ronald S. Nersesian....... 15,000 1.6 22.63 02/04/08 213,375 540,825
</TABLE>

Options described in this table were issued under the Company's Amended and
Restated 1993 Stock Incentive Plan, and consist primarily of incentive stock
options, as permitted by such Plan. The options have a term of ten years from
the date of grant, were issued with an exercise price equal to the fair market
value of a share of common stock at the time of grant, and permit exercise of
one fourth of the options on the first, second, third and fourth anniversaries
of the date of grant, respectively. The purchase price upon exercise of an
option may be paid either in cash or, if the option permits, in shares of
Company common stock already owned, or a combination thereof. If the employment
of a member of the management group, which includes the five individuals
described in this table, terminates by reason of early retirement, his vested
options may thereafter be exercised in full if permitted by the Board of
Directors, or otherwise only to the extent they were exercisable at time of
early retirement for three months from the date of termination or the stated
period of

8
<PAGE> 11

the option, whichever is shorter. On death of an optionee, the vested options
are exercisable for twelve months from the date of death, or the expiration of
the option period, whichever is shorter.

TRANSACTIONS INVOLVING OFFICERS, DIRECTORS OR AFFILIATES

The Company has adopted a policy that all transactions between the Company
and its officers, directors and affiliates must be on terms no less favorable to
the Company than those that could be obtained from unrelated third parties and
must be approved by a majority of the disinterested members of the Board of
Directors.

EMPLOYMENT AGREEMENT

Mr. Lutz Henckels and the Company have entered into an employment agreement
providing for his services as President and Chief Executive Officer of the
Company. The contract will immediately terminate if Mr. Henckels voluntarily
leaves the employment of the Company. Mr. Henckels is currently being paid
compensation at the annual rate of $335,000, and he will receive an annual cash
bonus of up to $206,250 if the Company achieves certain financial targets for
the fiscal year ended June 30, 1999.

COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION

The Compensation Committee of the Board of Directors is comprised solely of
independent, Non-Employee Directors. The Compensation Committee reviews and
approves all compensation plans, benefit programs, and perquisites for
executives and other employees. The Compensation Committee sets the salary of
the Chief Executive Officer (CEO), sets relative relationships between the CEO
salary and salary of other key executives, and recommends to the Board the
compensation program for Directors. The Compensation Committee reviews and
approves management recommendations for stock option grants under the Company's
stock option plan. The Compensation Committee periodically reviews the job
performance of the Chief Executive Officer.

COMPENSATION PHILOSOPHY

The Company's executive compensation program has been designed to attract
and retain exceptional executives who seek a long-term association with the
Company and who enjoy the challenge of pay for performance. The basic program
consists of two cash compensation components: base salary and a performance
based annual bonus. A third component, ownership-linked stock options, is used
for executive retention, to attract new key people, to recognize accomplishments
under individually tailored business growth programs, and to align the long-term
interests of eligible executives with those of the stockholders.

BASE SALARY

Base salary for the CEO is set annually taking into consideration Company
sales and profit growth, overall job performance, and mid-range pay levels for
CEOs of corporations of a similar size. The Committee utilizes, as a reference,
up-to-date information on compensation practices of other companies from several
independent sources. Base salary is then set so as to represent no more than 70%
of total attainable compensation, the balance of which is fully contingent upon
the achievement of both qualitative and quantitative levels of performance and
stockholder return. Mr. Henckels' base salary is $335,000 effective July 1,
1997. His prior increase as Chief Executive Officer of the Company was on July
1, 1995. Mr. Henckels' base salary is considered to be at approximately the
median base compensation level paid to chief executive officers of corporations
of a similar size and complexity to the Company.

ANNUAL CASH INCENTIVES

The Company's pay for performance annual bonus program is a significant
cash-based compensation component for senior executives of the Company.
Executives in this program earn a bonus set by specific performance levels in
areas applicable to their individual business unit. The plan is designed to
reward

9
<PAGE> 12

efficient, profitable performance with the highest payout. The intent is to
encourage management decisions that will provide the best financial results for
the Company. For fiscal year 1998, Mr. Henckels' bonus, earned as a result of
current year performance measurements, was $106,425 and represents approximately
31.8% of his current base salary. This compares to fiscal year 1997 when his
bonus was $165,340 and represented 55.1% of his base salary.

STOCK OPTIONS

The third compensation component is an ownership-linked stock option
program, which provides long-term incentives to executives that are aligned with
the interests of the Company's stockholders. Stock options, granted at market
price, typically vest annually in 25% increments over four years. A longer term
perspective is established by the sequential vesting of options. The program is
designed to encourage senior executives to be long-term stockholders and to have
owner concern and care for the Company as a whole. The intent of the option
program is to provide an executive with the opportunity for financial gain which
is larger than the cumulative annual bonuses but which takes much longer to
achieve; and which requires meaningful long-term growth in the market price of
the Company's Common Stock for the gain to be realized.

The size and frequency of option grants are based on level of
responsibility, performance of the Company as a whole and the executive's
personal performance. Annually, both financial and non-financial specific goals
are set aimed at building future marketplace strengths and achieving corporate
success factors. Other option grants may be made based upon management's
specific recommendations, and review and approval by the Compensation Committee.
Grants are made from a Compensation Committee defined pool of shares.

REPORT ON REPRICING OF OPTIONS

In February 1998, the Board determined that the purposes of the 1993
Amended and Restated Stock Incentive Plan were not being adequately achieved
because a significant percentage of our employees held options with exercise
prices greater than the then-current market value of the Common Stock. The Board
also determined that it was in the best interests of LeCroy and its stockholders
to retain and motivate those employees. As a result, the Board decided to
provide its U.S. employees with an opportunity to exchange their existing
options for options having an exercise price of $22.63 per share ("New
Options"), the closing price of the Common Stock on February 4, 1998, the date
of the Board's decision. On March 19, 1998 the Board decided to provide its
Swiss employees the same opportunity to exchange existing options for options
having an exercise price of $19.38 per share (also the "New Options"), the
closing price of the Common Stock at that date. The New Options, depending on
the length of time previously vested, create a lower number of option shares and
forfeiture of previous vesting. Forty employees of LeCroy were eligible to
participate in the repricing, and those employees' existing options had prices
ranging from $27.25 to $40.00 per share prior to the repricing. Twenty-six of
the eligible employees participated in the repricing, including the executives
noted in the table below.

TEN YEAR OPTION REPRICING

<TABLE>
<CAPTION>
NEW EXERCISE
NUMBER OF PRICE/MARKET EXERCISE
SECURITIES OF STOCK AT PRICE AT NUMBER OF LENGTH OF ORIGINAL
UNDERLYING TIME OF TIME OF ORIGINAL OPTION TERM
OPTIONS REPRICING REPRICING UNDERLYING REMAINING AT DATE
NAME AND PRINCIPAL POSITION DATE REPRICED ($/SHARE) ($/SHARE) OPTIONS OF REPRICING
- --------------------------- -------- ---------- ------------ --------- ---------- ------------------
<S> <C> <C> <C> <C> <C> <C>
Werner H. Brokatzky....... 03/19/98 10,000 $19.38 $32.25 10,000 8 years - 339 days
Vice President --
Operations (Geneva)
Brian V. Cake............. 02/04/98 20,000 22.63 32.25 20,000 9 years - 17 days
Vice President -- Chief
Technical Officer
Dennis A. Carpenter....... 02/04/98 39,000 22.63 38.63 50,000 9 years - 288 days
Vice President --
Worldwide Sales
</TABLE>

10
<PAGE> 13

SECTION 162(M)

Section 162(m) of the Internal Revenue Code ("the Code"), which became
effective on January 1, 1994, generally limits the Company's ability to deduct
compensation expense in excess of $1 million paid to the Company's Chief
Executive Officer or other executive officers named in the Summary Compensation
Table contained in this proxy statement. The Committee's policy with respect to
Section 162(m) is to make every reasonable effort to insure that compensation is
deductible to the extent permitted while simultaneously providing Company
executives with appropriate rewards for their performance. Towards this end, the
Company's Amended and Restated 1993 Stock Incentive Plan has been drafted in a
manner that will qualify stock options as performance-related compensation not
subject to the cap on deductibility imposed by Section 162(m).

Douglas A. Kingsley, Chairman
Robert E. Anderson
William G. Scheerer

COMPARISON OF 33 MONTH CUMULATIVE TOTAL RETURN*
AMONG LECROY CORPORATION, THE NASDAQ STOCK MARKET (U.S.) INDEX
AND THE S & P TECHNOLOGY SECTOR INDEX

<TABLE>
<CAPTION>
S & P
MEASUREMENT PERIOD LECROY NASDAQ STOCK TECHNOLOGY
(FISCAL YEAR COVERED) CORPORATION MARKET (U.S.) SECTOR
<S> <C> <C> <C>
10/6/95 100.00 100.00 100.00
JUN-96 166.67 114.59 112.19
JUN-97 307.29 139.33 170.55
JUN-98 190.63 183.85 229.15
</TABLE>

* $100 INVESTED ON 10/6/95 IN STOCK OR ON 9/30/95
IN INDEX - INCLUDING REINVESTMENT OF DIVIDENDS.
FISCAL YEAR ENDING JUNE 30.

COMPLIANCE WITH SECTION 16(a) OF THE EXCHANGE ACT

Section 16(a) of the Securities Exchange Act of 1934, as amended, requires
the Company's executive officers and directors and persons who own more than 10%
of outstanding shares of the Company's Common

11
<PAGE> 14

Stock to file certain reports on Securities and Exchange Commission Forms 3, 4,
and 5 with respect to their beneficial ownership of the Company's equity
securities.

Based solely upon a review of Forms 3 and 4 furnished to the Company
pursuant to Securities and Exchange Commission Rule 16a-3(e) during its fiscal
year ended June 30, 1998, Forms 5 furnished to the Company with respect to such
fiscal year, and certain written representations furnished to the Company, it
appears that the following persons made late filings during the year: Thomas H.
Reslewic, an executive officer of the Company, filed a Form 4 in June 1998,
reporting one transaction that should have been reported in February 1998;
Warren Davis, an executive officer of the Company, filed a Form 4 in January
1998, reporting four transactions that should have been reported in November
1997; Brian V. Cake, an executive officer of the Company, filed a Form 4 in
January 1998, reporting one transaction that should have been reported in
November 1997; Walter O. LeCroy, Jr., an executive officer of the Company filed
a Form 4 in February 1998, reporting eight transactions that should have been
reported in July, August and October 1997. The Company believes that these
failures to file reports on a timely basis were inadvertent and has implemented
routine procedures designed to periodically remind its officers and directors of
the filing requirements.

SELECTION OF AUDITORS

The Board of Directors has selected the accounting firm of Ernst & Young
LLP to serve as the Company's principal accountant for the fiscal year ending
June 30, 1999. Ernst & Young LLP acted as principal accountant for the fiscal
year ended June 30, 1998. A representative of Ernst & Young LLP will be present
at the Annual Meeting; available to respond to appropriate questions and will
have the opportunity to make a statement if he so desires to do so.

PROPOSALS BY STOCKHOLDERS

In order for a proposal of a stockholder to be included in the Board of
Director's proxy statement for the Company's 1998 Annual Meeting, it must be
received at the principal executive office of the Company on or before May 28,
1999, pursuant to Rule 14a-8 under the Exchange Act. Such a proposal must comply
with the requirements as to form and substance established by the Securities and
Exchange Commission in order to be included in the proxy statement.

OTHER MATTERS

The Board of Directors of the Company is not aware of any other matters
which may come before the meeting. It is the intention of the persons named in
the enclosed proxy to vote the proxy in accordance with their best judgment if
any other matters should properly come before the meeting, including voting for
election of a Director in place of any person named in the proxy who may not be
available for election.

REGARDLESS OF WHETHER YOU PLAN TO BE PRESENT AT THE MEETING, IT WOULD BE
APPRECIATED IF YOU WOULD COMPLETE, DATE, AND SIGN THE ENCLOSED PROXY AND RETURN
IT PROMPTLY IN THE ENCLOSED ENVELOPE. IF YOU ATTEND THE MEETING AND WISH TO VOTE
IN PERSON, YOUR PROXY WILL NOT BE USED.

Chestnut Ridge, New York
September 28, 1998

12
<PAGE> 15

APPENDIX A

LECROY CORPORATION
1998 NON-EMPLOYEE DIRECTOR STOCK OPTION PLAN

PART 1. PLAN ADMINISTRATION AND ELIGIBILITY

I. PURPOSE

The purpose of this 1998 Non-Employee Director Stock Option Plan (the
"Plan") of LeCroy Corporation (the "Company") is to encourage ownership in the
Company by outside directors of the Company (each, a "Non-Employee Director," or
collectively, the "Non-Employee Directors") whose continued services are
considered essential to the Company's continued progress and thus to provide
them with a further incentive to remain as directors of the Company.

II. ADMINISTRATION

The Board of Directors (the "Board") of the Company or any committee (the
"Committee") of the Board that will satisfy Rule 16b-3 of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), and any regulations
promulgated thereunder, as from time to time in effect, including any successor
rule ("Rule 16b-3"), shall supervise and administer the Plan. The Committee
shall consist solely of two or more non-employee directors of the Company, who
shall be appointed by the Board. A member of the Board shall be deemed to be a
"non-employee director" only if he satisfies such requirements as the Securities
and Exchange Commission may establish for non-employee directors under Rule
16b-3. Members of the Board receive no additional compensation for their
services in connection with the administration of the Plan.

The Board or the Committee may adopt such rules or guidelines as it deems
appropriate to implement the Plan. All questions of interpretation of the Plan
or of any options issued under it shall be determined by the Board or the
Committee and such determination shall be final and binding upon all persons
having an interest in the Plan. Any or all powers and discretion vested in the
Board or the Committee under this Plan may be exercised by any subcommittee so
authorized by the Board or the Committee and satisfying the requirements of Rule
16b-3.

III. PARTICIPATION IN THE PLAN

Each member of the Board who is not an employee of the Company or any of
its subsidiaries or affiliates shall be eligible for grants of options under the
Plan.

IV. STOCK SUBJECT TO THE PLAN

The maximum number of shares of the Company's $.01 par value Common Stock
("Common Stock") which may be issued under the Plan shall be Five Hundred
Thousand (500,000). The limitation on the number of shares which may be issued
under the Plan shall be subject to adjustment as provided in Section X of the
Plan.

If any outstanding option under the Plan for any reason expires,
terminated, or is cancelled without having been exercised in full, the shares
allocable to the unexercised portion of such option shall again become available
for grant pursuant to the Plan.

PART 2. TERMS OF THE PLAN

V. EFFECTIVE DATE OF THE PLAN

The Plan shall take effect on the date of adoption by the stockholders of
the Company. The Plan shall terminate on October 27, 2008, unless earlier
terminated by the Board of Directors or the Committee.

A-1
<PAGE> 16

VI. TIME FOR GRANTING OPTIONS AND ISSUING SHARES

No options shall be granted after the date on which this Plan terminates.
The applicable terms of this Plan, and any terms and conditions applicable to
the options granted or the shares issued prior to such date, shall survive the
termination of the Plan and continue to apply to such options and shares.

VII. TERMS AND CONDITIONS

1. Initial Award. Beginning with the adoption of the Plan or upon his or
her initial election or appointment to the Board, each Non-Employee Director
will receive an option grant of 15,000 shares, to be vested ratably on a monthly
basis over 36 months.

2. Subsequent Awards. Additionally, after a director's initial grant, each
director will receive an annual option grant of 5,000 shares, to be vested
immediately.

3. Price of Options. The exercise price of the option will be the Fair
Market Value of the Common Stock on the date of grant.

4. Exercise of Options. Options may be exercised only by written notice to
the Company accompanied by payment in cash of the full consideration for the
shares as to which they are exercised.

5. Period of Option. No option shall be exercisable after the expiration
of ten (10) years from the date upon which such option is granted. Options are
exercisable to the extent vested only while the optionee is serving as a
director of the Company or within three months after the optionee ceases to
serve as a director of the Company (except that if a director dies or becomes
disabled while he or she is serving as a director of the Company, the option is
exercisable for a maximum of one year after the optionee ceases to be a
director).

6. Exercise by Representative Following Death of Director. A Non-Employee
Director, by written notice to the Company, may designate one or more
persons(and from time to time change such designation) including his legal
representative, who, by reason of his death, shall acquire the right to exercise
all or a portion of the option. If the person or persons so designated wish to
exercise any portion of the option, they must do so within the term of the
option as provided in Section VII.5. Any exercise by a representative shall be
subject to the provisions of this Plan.

7. Options Nontransferable. Each option granted under the Plan by its
terms shall not be transferable by the optionee otherwise than by will, or by
the laws of descent and distribution, and shall be exercised during the lifetime
of the optionee only by him. No option or interest therein may be transferred,
assigned, pledged or hypothecated by the optionee during his lifetime, whether
by operation of law or otherwise, or be made subject to execution, attachment or
similar process.

PART 3. GENERAL PROVISIONS

VIII. ASSIGNMENTS

The rights and benefits under this Plan may not be assigned except for the
designation of a beneficiary as provided in Section VII.

IX. LIMITATION OF RIGHTS

No Right to Continue as a Director. Neither the Plan, nor the issuance of
shares of Common Stock nor any other action taken pursuant to the Plan, shall
constitute or be evidence of any agreement or understanding, express or implied,
that the Company will retain a director for any period of time, or at any
particular rate of compensation.

No Stockholders' Rights for Options. An optionee shall have no rights as a
stockholder with respect to the shares covered by his options until the date of
the issuance to him of a stock certificate therefor or the making of a book
entry with the Company's transfer agent, and no adjustment will be made for
dividends or other rights for which the record date is prior to the date such
certificate is issued.
A-2
<PAGE> 17

X. CHANGES IN PRESENT STOCK

In the event of any merger, consolidation, reorganization,
recapitalization, stock dividend, stock split, or other change in the corporate
structure or capitalization affecting the Company's present Common Stock, at the
time of such event the Board or the Committee shall make appropriate adjustments
to the number (including the aggregate numbers specified in Section IV) and kind
of shares to be issued under the Plan, and any outstanding Stock Option, and the
price of any Stock Option.

XI. AMENDMENT OF THE PLAN

The Board shall have the right to amend, modify, suspend or terminate the
Plan at any time for any purpose; provided, that following the approval of the
Plan by the Company's stockholders, the Company will seek stockholder approval
for any change to the extent required by applicable law, regulation or rule.

XII. DEFINITIONS

"Fair Market Value" shall be the mean the last sales price for the Common
Stock as reported on the NASDAQ National Market System on the date in question,
or if no sales of such stock were made on that date, the last sales price of the
Common Stock on the next preceding day on which sales were made.

XIII. COMPLIANCE WITH SECTION 16 OF THE EXCHANGE ACT

It is the Company's intent that the Plan comply in all respects with Rule
16b-3. If any provision of this Plan is found not to be in compliance with such
rule and regulations, the provision shall be deemed null and void, and the
remaining provisions of the Plan shall continue in full force and effect. All
transactions under this Plan shall be executed in accordance with the
requirements of Section 16 of the Exchange Act and regulations promulgated
thereunder. The Board or the Committee may, in its sole discretion, modify the
terms and conditions of this Plan in response to and consistent with any changes
in applicable law, rule or regulation.

XIV. NOTICE

Any written notice to the Company required by any of the provisions of this
Plan shall be addressed to the Secretary of the Company and shall become
effective when it is received.

XV. GOVERNING LAW

This Plan and all determinations made and actions taken pursuant hereto
shall be governed by the law of the State of Delaware and construed accordingly.

A-3
<PAGE> 18
PROXY

LECROY CORPORATION

THIS PROXY IS SOLICITED BY THE BOARD OF DIRECTORS

The undersigned stockholder of LeCroy Corporation hereby appoints each of
Walter O. LeCroy, Jr., Lutz P. Henckels and John C. Maag, as the undersigned's
attorney-in-fact and proxy, with full powers of substitution and
resubstitution, and hereby authorizes each of them, acting individually, to
vote in the name and on behalf of the undersigned all shares of the Common
Stock of LeCroy Corporation that the undersigned may be entitled to vote at the
Annual Meeting of Stockholders of LeCroy Corporation to be held on Wednesday,
October 28, 1998, and at any adjournment or postponement thereof, with all
powers that the undersigned would have if personally present.

WHEN PROPERLY EXECUTED THIS PROXY WILL BE VOTED AS SPECIFIED BUT IF NO
SPECIFICATION IS MADE IT WILL BE VOTED FOR PROPOSAL 1, THE ELECTION OF THE
NOMINEES LISTED ON THE REVERSE SIDE, PROPOSAL 2, THE APPROVAL OF THE 1998
NON-EMPLOYEE DIRECTORS STOCK OPTION PLAN, AND IN THE DISCRETION OF THE PERSONS
NAMED AS PROXIES AS TO SUCH OTHER MATTERS AS MAY PROPERLY COME BEFORE THE
MEETING AND ANY ADJOURNMENTS OR POSTPONEMENTS THEREOF.

PLEASE DATE AND SIGN ON REVERSE SIDE AND MAIL YOUR PROXY CARD PROMPTLY IN THE
ENCLOSED ENVELOPE.

- -------------------------------------------------------------------------------
The Board of Directors recommends a vote FOR Proposal 1 and Proposal 2.
- -------------------------------------------------------------------------------

1. To elect Directors for a term expiring in 2001 (as set forth in the
Proxy Statement).
Nominees: Walter O. LeCroy, Jr. and Robert E. Anderson

FOR WITHHELD
ALL / / / / FROM ALL
NOMINEES NOMINEES

/ /
---------------------------------------
For both nominees except as noted above

2. To approve the adoption of the 1998 FOR AGAINST ABSTAIN
Non-Employee Directors Stock Option / / / / / /
Plan (as set forth in the Proxy Statement).

MARK HERE FOR ADDRESS CHANGE AND NOTE AT LEFT / /

MARK HERE IF YOU PLAN TO ATTEND THE MEETING / /

Sign exactly as name appears hereon. When signing as Executor,
Administrator, Trustee, or Guardian, etc., please add full title.
This proxy votes all shares held in all capacities.