Urges Stockholders to Vote FOR CMD’s Nominees on the WHITE Proxy Card
Today
California Micro Devices (Nasdaq Global: CAMD) ( “CMD” or “The Company”)
today announced that it filed with the Securities and Exchange
Commission (“SEC”) definitive proxy materials in connection with the
Company’s 2009 Annual Meeting of Stockholders. Stockholders of record at
the close of business on July 20, 2009 will be entitled to vote at the
September 17, 2009 Annual Meeting.
CMD’s Board of Directors unanimously recommends that stockholders vote
FOR ALL of the Company’s directors – Jon Castor, Robert Dickinson, Wade
Meyercord, Ed Ross, David Sear, John Sprague and David Wittrock– on the
WHITE proxy card. Stockholders are encouraged to vote by telephone,
Internet or by signing, dating and returning the WHITE proxy card.
The Company also today filed the following letter with the SEC, which
will be mailed to its stockholders:
RE-ELECT ALL CALIFORNIA MICRO DEVICES’ DIRECTORS
VOTE THE ENCLOSED WHITE PROXY
CARD TODAY
July 31, 2009
Dear Fellow California Micro Devices Stockholder:
At California Micro Devices’ 2009 Annual Meeting of Stockholders on
Thursday, September 17, 2009, you will have the opportunity to re-elect
the highly qualified members of your Board of Directors.
As a result of the collective guidance and experience of your Board, the
Company has made solid progress towards meeting a number of challenges
over the past few years, including the recent global economic crisis,
and as a result, the Company is well-positioned to compete going
forward. Your Board and management have confidence in the Company’s
future and the commitment and incentive to create stockholder value. A
dissident stockholder, Dialectic Capital, however, has launched a
disruptive hostile proxy contest in an attempt to replace three of our
talented, experienced directors with its own nominees and thereby
advance Dialectic’s own self-serving agenda rather than the common
interests of all our stockholders.
We ask you to protect the future value of your investment by voting
your shares FOR ALL of the Company’s directors – Jon Castor, Robert
Dickinson, Wade Meyercord, Ed Ross, David Sear, John Sprague and David
Wittrock – on the WHITE proxy card.
Your Board and management team have always been committed to strong
corporate governance, and we recognize the importance of bringing fresh
and diverse perspectives to the boardroom. That is precisely why, with
the assistance of a leading executive search firm, the Company recently
conducted a nationwide search for another independent director with the
particular skills and experience that would assist the Company in
achieving its next stage of development. During that time, we solicited
the input of some of our largest stockholders. We were pleased to
announce that this process led to the addition of Mr. Castor to the
Board. Mr. Castor brings to the Board more than thirty years of industry
experience, much of it in the semiconductor industry. He is a veteran
public company executive and board member, with a deep background in
corporate strategy.
CALIFORNIA MICRO DEVICES IS MOVING IN THE RIGHT DIRECTION
WITH A CLEAR PLAN TO BUILD STOCKHOLDER VALUE
The current environment is a challenging one for our industry, and for
this company. That is why your Board and management team have developed
a clear action plan to address the challenges we face and continue to
build value for all stockholders:
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We are focused on high growth markets (mobile handsets, high
brightness LEDs and digital consumer electronics) that give California
Micro Devices the opportunity to grow, even in a down economy;
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Because we currently have the strongest product portfolio and pipeline
in our history and our value proposition of innovation and
responsiveness is resonating strongly with many of our customers (who
include the top five mobile handset manufacturers, three of the top
consumer electronics manufacturers and one of the top HBLED
manufacturers) we have the opportunity to increase share in these
growth markets; and
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We have the financial staying power to invest in the future and to
ensure that our customers can continue to count on us to meet their
needs in the future, despite the current economic disruption.
Building on these strengths, we are confident that the Company will
emerge from this challenging period in the best possible position to
capitalize on our opportunities. Our near term priorities include:
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Returning to positive operating cash flow and profitability;
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Improving gross margin through a continued focus on cost reduction and
higher margin market segments;
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Increasing revenue by growing market share in high growth market
segments;
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Continuing to strengthen key customer relationships;
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Accelerating design win activity in key markets; and
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Investing in key new products.
Your Board and management team are dedicated to building value for all
stockholders. We are excited by the opportunities that lie ahead, and
look forward to executing on our plans.
YOUR BOARD IS INDEPENDENT, EXPERIENCED AND COMMITTED TO BUILDING
STOCKHOLDER VALUE
California Micro Devices has a dedicated and hard working Board. All
members of your Board, other than our Chief Executive Officer, are
independent. Every board member has many years of relevant industry
experience and has served as either a director or senior executive of
other public companies, with the exception of the Chairman of our Audit
Committee, who has many years of experience as a partner at a leading
accounting firm. The depth and breadth of expertise in
public company leadership, finance, the semiconductor industry and overall
executive management that your directors possess has helped them develop
and implement the Company’s strategy to enhance value for all of the
Company’s stockholders. The Board has successfully led this Company
through adversity in the past and we are confident that this is the
right Board to lead this Company to renewed success in the future. Accompanying
this letter is biographical information regarding each of your Board
nominees.
DIALECTIC OFFERS NO PLAN TO BUILD STOCKHOLDER VALUE AND HAS NOT SHOWN
THAT ELECTING ITS NOMINEES IN PLACE OF THREE DEDICATED MEMBERS OF YOUR
BOARD WOULD BE BENEFICIAL TO YOUR COMPANY
Your Board and management are continuously engaged in seeking ways to
augment stockholder value and welcome stockholder engagement. The
specific proposals made by Dialectic, however, have been misguided.
Furthermore, Dialectic has refused to allow us appropriate access to its
director nominees, leading us to question Dialectic’s intentions and the
commitment of Dialectic’s nominees to the interests of all California
Micro Devices stockholders.
Late last year, Dialectic’s Managing Member, John Fichthorn, who is now
one of Dialectic’s director nominees, wrote a letter to your Board
proposing that California Micro Devices deplete its cash reserves by
issuing a large cash dividend. The letter also demanded that the Company
“immediately engage an investment bank and begin a sale process of the
Company.” I wrote back personally thanking Mr. Fichthorn for his
interest in the Company, but explaining the shared view of your Board
and management that it was important to retain the Company’s cash for
operations and as a reserve to show financial strength to our customers,
particularly in the current troubled economy. I also expressed our view
that it was not in our stockholders’ interests to explore a sale of the
Company when the stock market and our stock price were at close to their
low points over the past several years and when the Company had solid
plans for growth. We continue to hold those views and even Dialectic may
be having second thoughts about the wisdom of its previously requested
course of action, stating in its preliminary proxy statement that its
nominees “are not committed to paying a large special cash dividend or
pursuing a sale of the Company.”
Your Company has continued its engagement with Dialectic. Both your
Chief Executive Officer and I have spoken with Mr. Fichthorn on numerous
occasions and, mindful of the potential expense and disruption a proxy
contest would cause, we tried to arrange for the Dialectic nominees to
meet with the Company’s Nominating and Corporate Governance Committee to
determine their suitability as potential directors – as we would do for
any potential nominee. Dialectic raised an insurmountable obstacle to
the Company’s process: Dialectic would only permit the Committee to meet
with its nominees if we first agreed to accept them as directors. In
fact, Dialectic’s actions have made it clear that Dialectic refuses to
consider any outcome other than the addition of one or more of its
nominees to your Board.
Based on the background information Dialectic has provided, the
replacement of three of your directors with Dialectic’s nominees would not
enhance the experience or expertise of your Board, and would act in the
interests of Dialectic, and not of all California Micro Devices
stockholders. Dialectic has not proposed any plan or ideas that would
produce greater value for the Company. We urge you to re-elect ALL of
your Company’s directors on the WHITE proxy card.
YOUR VOTE IS IMPORTANT –
RE-ELECT YOUR DIRECTORS BY VOTING THE WHITE
PROXY CARD TODAY
California Micro Devices’ strategic and operational achievements
demonstrate that we have the right plan and the right team in place to
reach our goals and continue to create significant stockholder value.
Your vote is important, no matter how many or how few shares you own.
To vote your shares, please sign, date and return the enclosed WHITE proxy
card by mailing it in the enclosed pre-addressed, stamped envelope. You
may also vote by phone or Internet by following the instructions on the
enclosed proxy card.
On behalf of the Board of Directors, we thank you for your continued
support of California Micro Devices.
Sincerely,
/s/
Wade Meyercord
Chairman
California Micro Devices
KNOW YOUR DIRECTORS
CALIFORNIA MICRO DEVICES HAS A HIGHLY EXPERIENCED, INDEPENDENT &
QUALIFIED BOARD
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Jon S. Castor
Director since 2009
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Mr. Castor has been a member of our Board of Directors since July
2009. He has been a private investor and a member of public and
private boards of directors since June 2004. Previously, from August
2003 to June 2004, Mr. Castor was an executive with Zoran
Corporation, a provider of digital solutions for applications in the
digital entertainment and digital imaging markets, as the Senior
Vice President and General Manager of Zoran’s DTV Division and then
as a post-acquisition advisor to the CEO. From October 2002 to
August 2003, Mr. Castor was the Senior Vice President and General
Manager of the TeraLogic Group at Oak Technology Inc., a developer
of integrated circuits and software for digital televisions and
printers, which was acquired by Zoran. In 1996, Mr. Castor
co-founded TeraLogic, Inc., a developer of digital television
integrated circuits, software and systems, where he served in
several capacities, including as its Chief Executive Officer and
director from November 2000 to October 2002, when it was acquired,
first by Oak Technology in 2002 for approximately $55 million and
then indirectly in 2003 by Zoran when Zoran acquired Oak Technology.
Mr. Castor has served as a director of publicly-traded Adaptec, Inc.
(data storage hardware and software solutions) since July 2006;
Omneon (video server and media storage equipment) since December
2006 and Chairman since April 2007; Staccato Communications (Ultra
Wideband (UWB) silicon and software solutions) since the merger of
Artimi and Staccato in November 2007; and publicly-traded Genesis
Microchip from November 2004 until its sale to ST Microelectronics
in January 2008. Mr. Castor earned a B.A. from Northwestern
University in Evanston, Illinois and an MBA from Stanford University
in Stanford California.
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Robert V. Dickinson
President, CEO and Director since 2001
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Mr. Dickinson has been President, Chief Executive Officer, and a
member of our Board of Directors since April 2001. From August 1999
to April 2001, he was Vice President and General Manager of the
Optical Storage Division of Cirrus Logic, Inc., a semiconductor
manufacturer, where, starting in 1992, he served in several other
senior executive roles including President of its Japanese
subsidiary. Previously, he held senior management positions at
Western Digital Corporation, a semiconductor and disk drive
manufacturer, from 1988 to 1992, following its acquisition of
Verticom, Inc., where he served as President and Chief Executive
Officer, from 1987 to 1988. Mr. Dickinson also served as a Director
of Transmeta Corporation, a publicly-traded semiconductor company,
from May 2005 though its acquisition by Novafora in January, 2009.
Mr. Dickinson earned an A.B. in Physics from the University of
California in Berkeley, California and an M.S. in Physics from the
University of Washington in Seattle, Washington. He also was a Sloan
Fellow at the Stanford University Graduate School of Business in
Stanford, California.
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Wade F. Meyercord
Director since 1992
Chairman since 1994
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Mr. Meyercord has been Chairman of the Board since 1994 and a
Director since December 1992. Mr. Meyercord has been President of
and a consultant for Meyercord & Associates, Inc., a consulting firm
primarily to publicly-traded companies about their management and
director compensation, since 1987. From 1999 to 2002, he was Senior
Vice President, Finance and Administration, and Chief Financial
Officer of Rioport, Inc., an applications service provider for
digital music distribution. Previously he was Senior Vice President
of Diamond Multimedia Systems, Inc., a multimedia and connectivity
products company, from 1997 to 1999, and Chief Executive Officer of
Read-Rite Corp., an electronic data storage products company, from
1984 to 1987. Mr. Meyercord is a Director and member of the Audit,
Compensation, and Nominating and Corporate Governance Committees of
Microchip Technology, Incorporated, a publicly-traded $900 million
semiconductor manufacturer, and a Director, Chairman of the
Compensation Committee and member of the Nominating and Corporate
Governance Committee of Endwave Corporation, a publicly-traded
supplier of RF subsystems for broadband wireless devices. Mr.
Meyercord earned a B.S. in Mechanical Engineering from Purdue
University in West Lafayette, Indiana and a M.S. in Engineering
Administration from Syracuse University in Syracuse, New York.
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Edward C. Ross
Director since 2002
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Dr. Ross has been a Director since June 2002. He is currently
retired, having previously served as President (2000 through
December 2004) and President Emeritus (January 2005 through December
2005) of TSMC North America, the multi-billion dollar US subsidiary
of Taiwan Semiconductor Manufacturing Company Ltd., a Taiwanese
semiconductor manufacturer. Previously, he was Senior Vice President
of Synopsys, Inc., an electronic design automation supplier, from
1998 to 2000, and President of Technology and Manufacturing at
Cirrus Logic, Inc., a semiconductor manufacturer, from 1995 to 1998.
Dr. Ross has been a Director of publicly-traded semiconductor
companies Volterra Semiconductor, Inc., since May, 2004, and Atmel
Corporation since April 2008. Dr. Ross earned a B.S.E.E. from Drexel
Institute of Technology (now Drexel University) in Philadelphia,
Pennsylvania and a M.S.E.E., M.A., and Ph.D. in Solid State
Electronics from Princeton University in Princeton, New Jersey.
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David W. Sear
Director since 2003
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Dr. Sear has been a Director since December 2003. He currently is an
independent consultant. Previously he was Chief Executive Officer of
Forte Design Systems, an EDA software provider, from January 2006
through December 2006, and previously was the Chief Executive
Officer of NeoAxiom, Inc., a semiconductor manufacturer, from
February 2004 through December 2005. Prior to joining NeoAxiom, Dr.
Sear was an independent consultant from April 2003 to February 2004.
Dr. Sear also served as Chief Executive Officer of Optics Networks
from January 2002 to March 2003. Previously, he served as President
and Chief Executive Officer of Vaishali Semiconductor (1999 to
2002), President and Chief Operating Officer of Quality
Semiconductor (1997 to 1999), President and Chief Executive Officer
of Integrated Circuit Systems (1994 to 1997), President and Chief
Operating Officer of Catalyst Semiconductor (1991 to 1994), as well
as senior management positions with Fujitsu Microelectronics (1987
to 1991) and ICI Array Technology (1984 to 1987). Dr. Sear earned a
B.Sc. in Electronic Engineering and a Ph.D. in Solid State Physics
and Quantum Mechanics from the University of London in London,
England.
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John L. Sprague
Director since 1996
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Dr. Sprague has been a Director since July 1996 and previously from
January 1994 until July 1995. He is a consultant and was President
of John L. Sprague Associates, a consulting company, from 1988
through 2002. He was President and Chief Executive Officer of
Sprague Electric Company, a manufacturer of electronics components,
from 1981 to 1987, and served in various technical and operations
positions with that company from 1959 to 1981. During the mid 1980s,
when Dr. Sprague was President & CEO, Sprague Electric Company
employed more than 10,000 persons worldwide and had revenues in
excess of $500 million. Dr. Sprague is a Director of MRA Labs, a
private research and development and electronic materials company
and was a director of SIPEX Corporation, a publicly-traded
semiconductor company from 1993 until May 2004. Dr. Sprague earned
an A.B. in chemistry from Princeton University in Princeton, New
Jersey, and a Ph.D. in chemistry from Stanford University in
Stanford, California.
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David L. Wittrock Director since 2003
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Mr. Wittrock has been a Director since June 2003. Mr. Wittrock has
been in private practice as a tax and financial consultant to high
technology and healthcare companies since October 2002. Previously,
he was Vice President, Finance and Business Affairs for Rioport,
Inc., an applications service provider for digital music
distribution, from 2000 through September 2002, and was a tax
partner at KPMG, LLP from 1988 to 1999 where he served as the
partner in charge of the tax practice professional standards for the
firm’s Northern California offices. Mr. Wittrock is the past
President of the Silicon Valley Chapter of Financial Executives
International. Mr. Wittrock earned a B.S. in Business
Administration, Accounting from Creighton University in Omaha,
Nebraska and a J.D. from Drake University in Des Moines, Iowa.
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Your Vote Is Important, No Matter How Many Or How Few Shares You Own.
If you have questions about how to vote your shares, or need additional
assistance, please contact the firm assisting us in the solicitation of
proxies:
INNISFREE M&A INCORPORATED
Stockholders Call Toll-Free: (877) 456-3442
Banks and Brokers May Call Collect: (212) 750-5833
IMPORTANT
We urge you NOT to sign any GOLD proxy card sent to you by Dialectic
Capital.
If you have already done so, you have every legal right to change your
vote by using the enclosed WHITE proxy card to vote TODAY—by
telephone,
by Internet, or by signing, dating and returning the WHITE proxy
card
in the postage-paid envelope provided.
About California Micro Devices Corporation
California Micro Devices Corporation is a leading supplier of
application specific analog and mixed signal semiconductor products for
the mobile handset, high brightness LED (HBLED), digital consumer
electronics and personal computer markets. Key product lines include
protection devices for mobile handsets, HBLEDs, digital consumer
electronics products and personal computers and mixed signal ICs for
mobile handset displays. Detailed corporate and product information may
be accessed at http://www.cmd.com.
Forward Looking Statement Disclaimer
All statements contained in this release that are not historical facts
are forward-looking statements which are made pursuant to the safe
harbor provisions of the Private Securities Litigation Reform Act of
1995. They are not guarantees of future performance or events. Rather,
they are based on current expectations, estimates, beliefs, assumptions,
and goals and objectives and are subject to uncertainties that are
difficult to predict. As a result, our actual results may differ
materially from the statements made. Often such statements can be
identified by their use of words such as will, intends, expects, plans,
believes, anticipates, and estimates. Forward-looking statements made in
this release include that the mobile handset, high brightness LED, and
digital consumer electronics markets on which we focus are high-growth
markets; that our focus on these markets provides us with opportunity to
grow even in down markets; that we have an opportunity to increase
market share in these markets due in part to our strong product
portfolio; that we have financial staying power to invest in the future;
our near priorities, including those relating to financial performance
such as revenue growth and returning to positive operating cash flow and
profitability; and that we have the right plan and team to reach our
goals and continue to create significant stockholder value. These
forward-looking statements are based upon our assumptions about and
assessment of the future, which may or may not prove true, and involve a
number of risks and uncertainties including, but not limited to whether
our customers experience the demand we anticipate for their products,
whether there is increasing economic stability, whether the designed
performance of our devices satisfies our customers' requirements so that
they continue to design our devices into their products, whether our
devices perform to their design specification, whether competitors
introduce devices at lower prices than our devices causing price erosion
and/or loss of market share for us, whether we encounter any difficulty
in obtaining the requisite supply of quality product from our contract
manufacturers, contract assemblers and test houses without interruption
or unanticipated price increases, whether we have success in our R&D
programs, and whether we incur unexpected operating expenses or
obstacles to our cost reductions as well as the risk factors detailed in
the company's Form 8K, 10K, and 10Q filings with the Securities and
Exchange Commission. Due to these and other risks, the company's future
actual results could differ materially from those discussed above. These
forward-looking statements speak only as to the date of this release,
and, except as required by law, we undertake no obligation to publicly
release updates or revisions to these statements whether as a result of
new information, future events, or otherwise.
Additional Information
This letter to stockholders is intended to be mailed to stockholders on
or about August 4, 2009, and was made publicly available via news
release on July 31, 2009.
In connection with its 2009 annual meeting of stockholders, California
Micro Devices Corporation filed a cover letter to stockholders, notice
of annual meeting, and definitive proxy statement with the Securities
and Exchange Commission (“SEC”) on July 29, 2009. STOCKHOLDERS OF
CALIFORNIA MICRO DEVICES CORPORATION ARE URGED TO READ THE COVER LETTER
TO STOCKHOLDERS, NOTICE OF ANNUAL MEETING, AND DEFINITIVE PROXY
STATEMENT AND ANY OTHER RELEVANT DOCUMENTS FILED WITH THE SEC WHEN THEY
BECOME AVAILABLE BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION.
Investors and stockholders can obtain free copies of the cover letter to
stockholders, notice of annual meeting, and definitive proxy statement
and other relevant documents when they become available by contacting
investor relations at ir@calmicro.com,
or by mail at California Micro Devices Corporation Investor Relations,
490 N. McCarthy Blvd., No. 100, Milpitas, CA 95051, or by telephone at
1- 408-934-3144. In addition, documents filed with the SEC by California
Micro Devices Corporation are available free of charge at the SEC’s
website at www.sec.gov.
Furthermore, such documents and the annual report to stockholders and
other information related to the annual meeting can be viewed on-line at http://annualmeeting.cmd.com
California Micro Devices Corporation and its directors and executive
officers may be deemed to be participants in the solicitation of proxies
from the stockholders of California Micro Devices Corporation in
connection with the 2009 annual meeting of stockholders. Information
regarding the special interests of these directors and executive
officers in the proposed election of directors is included in California
Micro Devices Corporation’s definitive proxy statement for its 2009
annual meeting which is available free of charge at the SEC’s website at www.sec.gov
and at http://annualmeeting.cmd.com
and from Investor Relations at California Micro Devices Corporation as
described above.
California Micro Devices
Kevin Berry, Chief Financial Officer
408-934-3144
or
Media
Joele
Frank, Wilkinson Brimmer Katcher
Jeremy Jacobs / Rachel Ferguson
212-355-4449
or
Investor
Innisfree
Arthur
Crozier / Peter Walsh
212-750-5833
