SCHEDULE 14A
(Rule 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
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permitted by Rule 14a-
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[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Rule 14a-11(c) or rule 14a-
12
INTEL CORPORATION
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(Name of Registrant as Specified in Its Charter)
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Registrant)
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INTEL CORPORATION
2200 Mission College Blvd.
P. O. Box 58119
Santa Clara, CA 95052-8119
(408) 765-8080
[INTEL LOGO]
Dear Stockholder:
Intel's 1998 Annual Meeting of Stockholders will be held on May
20, 1998 at the Santa Clara Convention Center in Santa Clara,
California, and we look forward to your attending either in
person or by proxy. The Notice of Meeting, the Proxy Statement
and the Proxy Card from the Board of Directors are enclosed. The
materials provide further information concerning the Meeting.
Stockholders who elected to obtain the Notice of Meeting and the
Proxy Statement via the Internet may do so by accessing the
Internet website address indicated on the enclosed Proxy Card.
Some of our stockholders will be accessing these materials and
voting via the Internet and will not be receiving a paper Proxy
Card by mail.
At this year's Meeting, the agenda includes the annual election
of directors, a proposal to ratify the appointment of our
independent auditing firm, and a stockholder proposal to endorse
certain principles (the "CERES Principles"). The Board of
Directors recommends that you vote FOR the election of the slate
of nominees for directors, FOR ratification of the appointment of
the independent auditors, and AGAINST the stockholder proposal to
endorse the CERES Principles.
Please refer to the enclosed Proxy Statement for the detailed
information on each of these proposals. If you have any further
questions concerning the Annual Meeting or any of the proposals,
please feel free to contact Intel at (800) 298-0146 (US) or (312)
360-5125 (outside US, call collect), or speak with D.F. King &
Co., our proxy solicitors, at (800) 431-9643.
Sincerely yours,
/s/Andrew S. Grove
Andrew S. Grove
Chairman of the Board
Notice of
1998
Annual Meeting
of Stockholders
and
Proxy Statement
[INTEL LOGO]
TABLE OF CONTENTS Page
Notice of Annual Meeting of Stockholders
Proxy Statement
Election of Directors (Proposal 1) 2
Board Committees and Meetings 6
Corporate Governance Guidelines and Policies 6
Directors' Compensation 7
Report of the Compensation Committee on Executive 8
Compensation
Compensation Committee Interlocks and Insider 12
Participation
Employment Contracts and Change of Control 12
Arrangements
Certain Relationships and Related Transactions 12
Stock Price Performance Graph 13
Executive Compensation 14
Security Ownership of Certain Beneficial Owners and 17
Management
Ratification of Selection of Independent Auditors 19
(Proposal 2)
Stockholder Proposal (Proposal 3) 19
Other Matters 22
Voting Via the Internet or By Telephone 23
Communicating with the Company 24
Directions to the Santa Clara Convention Center Back Cover
Map to the Santa Clara Convention Center Back Cover
RETURN OF PROXY
Please complete, sign, date, and return the accompanying
Proxy Card promptly in the enclosed addressed envelope even if
you plan to attend the Annual Meeting. Postage need not be
affixed to the enclosed envelope if mailed in the United States.
If you attend the Annual Meeting and vote in person, your
Proxy Card will not be used. The immediate return of your proxy
will be of great assistance in preparing for the Annual Meeting
and is therefore urgently requested.
VOTING ELECTRONICALLY OR BY TELEPHONE
Instead of submitting your proxy vote with the paper Proxy
Card, you can vote electronically via the Internet or by
telephone. See Voting Via the Internet or By Telephone in the
Proxy Statement for further details. Please note that there are
separate Internet and telephone voting arrangements depending
upon whether shares are registered in your name or in the name of
a bank or broker.
IF YOU PLAN TO ATTEND THE MEETING
The Annual Meeting will be held at 10:00 a.m. (PDT) on May
20, 1998 at the Santa Clara Convention Center, Santa Clara,
California, which is located at the corner of Great America
Parkway and Tasman Drive in Santa Clara, California. A map to
the Convention Center is printed on the back cover of this Proxy
Statement. Signs will direct you to the conference room where
the Annual Meeting will be held. Please note that the doors to
the meeting room at the Convention Center will not open for
admission until 9:30 a.m.
If your shares are not registered in your own name and you
plan to attend the Annual Meeting and vote your shares in person,
you should contact your broker or agent in whose name your shares
are registered to obtain a broker's proxy and bring it to the
Annual Meeting in order to vote.
[INTEL LOGO]
INTEL CORPORATION
Notice of Annual Meeting of Stockholders
May 20, 1998
10:00 a.m., Pacific Daylight Time
Dear Stockholder:
You are cordially invited to attend the Annual Meeting of
Stockholders of Intel Corporation ("Intel" or the "Company")
which will be held on May 20, 1998 at the Santa Clara Convention
Center, Santa Clara, California, at 10:00 a.m., Pacific Daylight
time. A map to the location appears on the back cover of the
Proxy Statement. The Annual Meeting is being held for the
following purposes:
1. To elect a Board of Directors to hold office until the next
Annual Meeting of Stockholders or until their respective
successors have been elected or appointed;
2. To ratify the appointment of the accounting firm of Ernst &
Young LLP as independent auditors for the Company for the
current year;
3. To consider a stockholder proposal to endorse the CERES
Principles;
4. To transact such other business as may properly come before
the Annual Meeting or any adjournment or postponement
thereof.
These items are fully discussed in the following pages, which are
made part of this Notice. Only stockholders of record on the
books of the Company at the close of business on March 23, 1998
will be entitled to vote at the Annual Meeting. A list of
stockholders entitled to vote will be available for inspection at
the offices of Intel, 2200 Mission College Blvd., Santa Clara, CA
95052, for ten days prior to the Annual Meeting.
Stockholders are requested to complete, date, sign and return the
enclosed Proxy Card as promptly as possible. Stockholders with
shares registered directly with the Company's transfer agent,
Harris Bank, may also vote via the Internet at Harris Bank's
Internet address:
www.harrisbank.com/corporations/shareholders/proxyhome.html; or
they may vote telephonically by calling Harris Bank at (888) 266-
6795. Stockholders holding Intel shares with a brokerage firm or
a bank may also be eligible to vote via the Internet or to vote
telephonically by calling the telephone number referenced on
their voting form; these proxy services are provided by ADP
Investor Communication Services on behalf of the brokerage firms
and banks. Submitting your proxy with the Proxy Card or via the
Internet or by telephone will not affect your right to vote in
person should you decide to attend the Annual Meeting.
THE BOARD OF DIRECTORS
/s/F. THOMAS DUNLAP, JR.
By: F. THOMAS DUNLAP, JR., Secretary
Santa Clara, California
April 6, 1998
DOORS WILL OPEN AT 9:30 a.m.
First mailed to stockholders and made available on the Internet
(www.intc.com) on or about April 6, 1998
[INTEL LOGO]
INTEL CORPORATION
2200 Mission College Boulevard
Santa Clara, California 95052-8119
PROXY STATEMENT
The enclosed proxy is solicited by the Board of Directors of
Intel Corporation ("Intel" or the "Company") for use in voting at
the Annual Meeting of Stockholders to be held at the Santa Clara
Convention Center, Santa Clara, California, on Wednesday, May 20,
1998, at 10:00 a.m., and at any postponement or adjournment
thereof, for the purposes set forth in the attached notice (the
"Annual Meeting" or the "Meeting").
Voting and Revocability of Proxies
When proxies are properly dated, executed and returned, the
shares they represent will be voted at the Annual Meeting in
accordance with the instructions of the stockholder. If no
specific instructions are given, the shares will be voted FOR the
election of the nominees for directors set forth herein, FOR
ratification of the appointment of auditors, and AGAINST the
stockholder proposal regarding endorsement of the CERES
Principles. In addition, if other matters come before the Annual
Meeting, the persons named in the accompanying form of proxy will
vote in accordance with their best judgment with respect to such
matters. A stockholder giving a proxy has the power to revoke it
at any time prior to its exercise by voting in person at the
Annual Meeting, by giving written notice to the Secretary prior
to the Annual Meeting or by giving a later dated proxy.
If you are a participant in the Company's Sheltered Employee
Retirement Plan (the "SERP"), the Proxy Card represents the
number of Company shares in your plan account as well as other
shares registered in your name. For those shares in your plan
account, the Proxy Card will serve as a voting instruction for
the trustee of the plan. If voting instructions are not received
by the trustee for shares in your plan account, the trustee will
not be able to vote those shares on your behalf.
Each share of Common Stock outstanding on the record date
will be entitled to one vote on all matters. The eleven
candidates for election as directors at the Annual Meeting who
receive the highest number of affirmative votes will be elected.
The ratification of the independent auditors for the Company for
the current year will require the affirmative vote of a majority
of the shares of the Company's Common Stock present or
represented and entitled to vote at the Annual Meeting. Approval
of the stockholder proposal referred to above will require the
affirmative vote of a majority of the shares of the Company's
Common Stock present or represented and entitled to vote at the
Annual Meeting. Because abstentions with respect to any matter
are treated as shares present or represented and entitled to vote
for the purposes of determining whether that matter has been
approved by the stockholders, abstentions have the same effect as
negative votes for Proposals 2 and 3 in this Proxy Statement.
Broker non-votes and shares as to which proxy authority has been
withheld with respect to any matter are not deemed to be present
or represented for purposes of determining whether stockholder
approval of that matter has been obtained.
Record Date and Share Ownership
Only stockholders of record on the books of the Company at
the close of business on March 23, 1998 will be entitled to vote
at the Annual Meeting. Presence in person or by proxy of a
majority of the shares of Common Stock outstanding on the record
date is required for a quorum. As of the close of business on
February 27, 1998 there were outstanding 1,626,757,612 shares of
Common Stock.
ELECTION OF DIRECTORS (Proposal 1)
Unless marked otherwise, proxies received will be voted FOR
the election of each of the nominees named below. Each of the
current directors has been nominated for election to the Board of
Directors. If any such nominee is unable or unwilling to serve
as a nominee for the office of director at the time of the Annual
Meeting, the proxies may be voted for either (i) a substitute
nominee who shall be designated by the proxy holders or by the
present Board of Directors to fill such vacancy or (ii) for the
balance of the nominees, leaving a vacancy. Alternatively, the
size of the Board may be reduced accordingly. The Board of
Directors has no reason to believe that any of such nominees will
be unwilling or unable to serve if elected as a director. Such
persons have been nominated to serve until the next annual
meeting of stockholders following the 1998 Annual Meeting or
until their successors, if any, are elected or appointed. The
Board of Directors recommends a vote FOR the election of each of
the nominees listed below.
Craig R. Barrett (3) Craig R. Barrett has been President
58 Years Old of Intel since May 1997, Chief
Director Since 1992 Operating Officer since 1993 and a
President and Chief director of Intel since 1992. The
Operating Officer of Board of Directors has announced
the Company that it plans to elect Dr. Barrett
Chief Executive Officer effective
May 20, 1998. Dr. Barrett joined
[PHOTO APPEARS HERE] the Company in 1975. In 1984 he
was elected Vice President and in
1985 became Vice President and
General Manager, Components
Technology and Manufacturing Group.
Dr. Barrett became a Senior Vice
President in 1987 and General
Manager of the Microcomputer
Components Group in 1989. Dr.
Barrett was an Executive Vice
President from 1990 to 1997. Dr.
Barrett is also a director of
Komag, Incorporated, and a member
of the National Academy of
Engineering.
John Browne (1,2) John Browne has been a director of
50 Years Old Intel since 1997. He has been a
Director Since Managing Director since 1991 and
January, 1997 the Group Chief Executive since
Group Chief Executive 1995 of The British Petroleum
of The British Company p.l.c. Mr. Browne is also
Petroleum Company a director of SmithKline Beecham
and a Trustee of the British
Museum. Mr. Browne is also a Fellow
[PHOTO APPEARS HERE] of the Royal Academy of Engineering
in the United Kingdom, a Fellow of
the Institute of Mining and
Metallurgy and an Honorary Fellow
of St. John's College, Cambridge.
He is also Emeritus Chairman of the
Advisory Board of the Stanford
Graduate School of Business, a
Trustee of The Conference Board,
Inc. and a Vice President and
Member of the Board of the Prince
of Wales Business Leaders Forum.
Winston H. Chen (1,5) Winston H. Chen has been a director
56 Years Old of Intel since 1993. He is
Director Since 1993 Chairman of Paramitas Foundation, a
Chairman of Paramitas charitable foundation. During 1978-
Foundation 1994, he held several positions at
Solectron Corporation, an
electronics contract manufacturer
[PHOTO APPEARS HERE] in Milpitas, California, including
President, Chief Executive Officer
and Chairman of the Board of
Directors. Dr. Chen continues as a
director of Solectron. He is also
a director of Edison International
(Inc.), and a member of the Board
of Trustees of Santa Clara
University and the Board of
Trustees of Stanford University.
Andrew S. Grove (3) Andrew S. Grove has been a director
61 Years Old of Intel since 1974, Chairman of
Director Since 1974 the Board since May 1997 and Chief
Chairman of the Board Executive Officer of Intel since
and Chief Executive 1987. The Board of Directors has
Officer of the Company announced that it plans to elect
Craig Barrett Chief Executive
Officer effective May 20, 1998.
[PHOTO APPEARS HERE] Dr. Grove participated in the
founding of the Company in 1968 and
served as Vice President and
Director of Operations through
1974. He became Executive Vice
President in 1975, and was Chief
Operating Officer from 1976 to 1989
and President from 1979 to 1997.
Dr. Grove is a member of the
National Academy of Engineering and
a Fellow of the Institute of
Electrical and Electronic Engineers
("IEEE").
D. James Guzy (1,4,5) D. James Guzy has been a director
62 Years Old of Intel since 1969 and is Chairman
Director Since 1969 of the Nominating Committee. Since
Chairman of the Arbor 1969, he has been Chairman of the
Company Arbor Company, a limited
partnership engaged in the
electronics and computer industry.
[PHOTO APPEARS HERE] Mr. Guzy is also a director of
Cirrus Logic, Inc., Micro Component
Technology, Inc., Novellus Systems,
Inc., Davis Selected Group of
Mutual Funds, Alliance Capital
Management Technology Fund and
Chairman, President and Chief
Executive Officer of SRC Computers
Inc.
Gordon E. Moore (3) Gordon E. Moore has been a director
69 Years Old of Intel since 1968 and Chairman
Director Since 1968 Emeritus of the Board since May
Chairman Emeritus of 1997. Dr. Moore co-founded the
the Board of the Company in 1968 and has served on
Company the Board since that time. Prior
to 1975, Dr. Moore served as
Executive Vice President. Between
[PHOTO APPEARS HERE] 1975 and 1979, Dr. Moore served as
President, between 1975 and 1987 he
served as Chief Executive Officer
of the Company, and he served as
Chairman of the Board from 1979 to
1997. Currently, Dr. Moore is also
a director of Gilead Sciences, Inc.
and Transamerica Corporation. He
is also Chairman of the Board of
Trustees of the California
Institute of Technology, a member
of the National Academy of
Engineering, a Fellow of the IEEE
and a member of the Board of
Directors of Conservation
International.
Arthur Rock (1-5) Arthur Rock has been a director of
71 Years Old Intel since its founding in 1968.
Director Since 1968 He is the Lead Independent Director
Venture Capitalist and he is Chairman of the Executive
Committee, the Audit & Finance
Committee, and the Corporate
[PHOTO APPEARS HERE] Governance Committee of the Board
of Directors. Mr. Rock is a
principal of Arthur Rock & Company,
a venture capital firm. He is also
a director of Argonaut Group, Inc.,
AirTouch Communications, Inc. and
Echelon Corporation, and a trustee
of the California Institute of
Technology.
Jane E. Shaw (1, 2) Jane E. Shaw has been a director of
59 Years Old Intel since 1993. She is Chairman
Director Since 1993 and CEO of AeroGen, Inc., a private
Chairman and CEO of company specializing in controlled
AeroGen, Inc. delivery of drugs to the lungs.
She founded The Stable Network, a
biopharmaceutical consulting
[PHOTO APPEARS HERE] company, in 1995. She was
President and Chief Operating
Officer of ALZA Corporation, a drug
delivery company, from 1987 to
1994. She is currently a director
of Aviron, McKesson Corporation,
Boise Cascade Corporation, Point
Biomedical Corporation and Chairman
of the Board of IntraBiotics
Pharmaceuticals, a privately-held
developer of antimicrobial drugs.
Leslie L. Vadasz Leslie L. Vadasz has been a
61 Years Old director of Intel since 1988 and
Director Since 1988 became Senior Vice President,
Senior Vice President, Director of Corporate Business
Director of Corporate Development in 1991. Mr. Vadasz
Business Development of joined the Company in 1968 when it
the Company was founded and became Director of
Engineering in 1972. In 1975 he
was elected Vice President and in
[PHOTO APPEARS HERE] 1976 became Assistant General
Manager of the Microcomputer
Division. From 1977 to 1979, he
was Vice President, General Manager
of the Microcomputer Components
Division. Mr. Vadasz became a
Senior Vice President in 1979 and
served as Director of Corporate
Strategic Staff from 1979 to 1986.
From 1986 to 1990, he was Senior
Vice President, General Manager,
then President of the Systems
Group. He is a Fellow of the IEEE.
David B. Yoffie (2,4,5) David B. Yoffie has been a director
43 Years Old of Intel since 1989. He is
Director Since 1989 Chairman of the Compensation
Professor of Committee of the Board of
International Business Directors. He has been Professor
Administration, Harvard of International Business
University Administration at Harvard
University since 1990 and in June
1993 was appointed to the position
[PHOTO APPEARS HERE] of Max & Doris Starr Professor of
International Business
Administration. He was Associate
Professor of Business
Administration from 1985 to 1990
and has been on the Harvard faculty
since 1981. He is also a member of
the Boards of Directors of Evolve
Software, Inc., Physiologica, Inc.,
Bion, Inc. and the National Bureau
of Economic Research.
Charles E. Young Charles E. Young has been a
(1,4,5) director of Intel since 1974. He
65 Years Old is Chancellor Emeritus of the
Director Since 1974 University of California at Los
Chancellor Emeritus of Angeles. Dr. Young served as
the University of Chancellor of the University of
California, Los Angeles California from 1968 to 1997. He
is also Chairman of the Board of
the Governors Foundation for the
[PHOTO APPEARS HERE] International Exchange of
Scientific and Cultural Information
by Telecommunications, a member of
the National Committee on United
States-China Relations, Inc., a
director of Nicholas-Applegate
Fund, Inc. and a trustee of
Nicholas-Applegate Mutual Funds.
(1) Member of the Audit & Finance Committee.
(2) Member of the Compensation Committee.
(3) Member of the Executive Committee.
(4) Member of the Nominating Committee.
(5) Member of the Corporate Governance Committee
Except as noted above, each of the nominees has been engaged
in the principal occupation set forth above during the past five
years. There are no family relationships among any directors or
executive officers of the Company. Stock ownership information
is shown under the heading "Security Ownership of Certain
Beneficial Owners and Management" and is based upon information
furnished by the respective individuals.
Directors Emeriti
The following have been elected by the Board of Directors to act
as Directors Emeriti. Directors Emeriti are eligible to attend
Board and Committee meetings, but do not have voting rights.
Richard Hodgson Richard. Hodgson is a self-employed
80 Years Old industrialist and was a director of Intel
Director Emeritus from 1974 until 1993. He was formerly a
since 1993. Corporate Senior Vice President of
Self-Employed International Telephone and Telegraph
Industrialist Company and had worldwide responsibility
for the Engineered Products Group.
Sanford Kaplan Sanford Kaplan is a private investor and
81 Years Old was a director of Intel from 1974 until
Director Emeritus 1993. Mr. Kaplan retired from Xerox
since 1993. Corporation in 1977 where he had served as
Private Investor a Senior Vice President and Director since
1969. Prior to that time, Mr. Kaplan was a
Senior Vice President and director of
Scientific Data Systems, Inc., a mainframe
computer manufacturer acquired by Xerox in
1969. Prior thereto, Mr. Kaplan was with
Ford Motor Company for 15 years where he
held various management positions.
Max Palevsky Max Palevsky is a self-employed
72 Years Old industrialist and has been Director
Director Emeritus Emeritus since May 1997. He was a director
since 1997. of Intel from 1968 to 1997. He serves as
Self-Employed a director of Komag, Incorporated. Mr.
Industrialist Palevsky founded Scientific Data Systems,
Inc. in 1961, which was acquired by Xerox
Corporation in 1969, at which time he
became a director and Chairman of the
Executive Committee of Xerox Corporation.
He retired as a director of Xerox in 1972.
BOARD COMMITTEES AND MEETINGS
The Company has standing Executive, Audit & Finance,
Nominating, Compensation, and Corporate Governance Committees of
the Board of Directors. The members of the Committees are
identified with the list of Board nominees on the preceding
pages.
The Executive Committee may exercise the authority of the
Board between Board meetings, except to the extent the Board has
delegated authority to another Committee or to other persons, and
except as limited by Delaware law. The Executive Committee acted
by written consent one time in 1997 and did not hold any formal
meetings.
The Audit & Finance Committee recommends for approval by the
Board of Directors a firm of certified public accountants whose
duty it is to audit the financial statements of the Company for
the fiscal year in which they are appointed. The Committee
monitors the effectiveness of the audit effort, the Company's
internal financial and accounting organization and controls and
financial reporting, and oversees the Company's internal
compliance programs. The Audit & Finance Committee also
considers various capital and investment matters. The Audit &
Finance Committee held 3 meetings during 1997.
The Nominating Committee makes recommendations to the Board
regarding the size and composition of the Board. The Committee
establishes procedures for the nomination process, recommends
candidates for election to the Board of Directors and nominates
officers for election by the Board. The Nominating Committee
held 1 meeting during 1997. The Nominating Committee will
consider nominees proposed by the stockholders. Any stockholder
who wishes to recommend a prospective nominee for the Board of
Directors for the Nominating Committee's consideration may do so
by giving the candidate's name and qualifications in writing to
the Secretary of the Company, M/S SC4-203, 2200 Mission College
Blvd., Santa Clara, CA 95052-8119.
The Corporate Governance Committee was established at the
July 1997 meeting of the Board of Directors and met concurrently
with the Board at that time. The Committee reviews and reports
to the Board on a periodic basis with regard to matters of
corporate governance. The Committee also reviews and assesses
the effectiveness of the Board's Guidelines on Significant
Corporate Governance Issues and recommends to the Board proposed
revisions thereto.
The Compensation Committee administers the Company's stock
option plans, including the review and grant of stock options to
officers and other employees under the Company's stock option
plans. The Compensation Committee also reviews and approves
various other Company compensation policies and matters, and
reviews and approves salaries and other matters relating to
compensation of the executive officers of the Company. The
Compensation Committee acted by written consent 5 times and met 1
time during 1997.
The Board of Directors held 7 meetings and acted by written
consent 2 times during 1997. Each director is expected to attend
each meeting of the Board and those committees on which he or she
serves. No director attended less than 75% of all the meetings
of the Board and those committees on which he or she served in
1997.
CORPORATE GOVERNANCE GUIDELINES AND POLICIES
The Board of Directors has adopted Guidelines on Significant
Corporate Governance Issues (the "Corporate Governance
Guidelines") and in 1997 established a Corporate Governance
Committee to oversee the Guidelines and to report and make
recommendations to the Board concerning corporate governance
matters. Among other matters, the Board's corporate governance
guidelines and policies include the following:
1. A majority of the members of the Board of Directors are
independent directors, as defined in the applicable rules
for NASDAQ-traded issuers. Independent directors do not
receive consulting, legal or other fees from the Company,
other than Board compensation.
2. Directors stand for re-election every year. Directors may
not stand for re-election after age 72.
3. Members of Board Committees are appointed by the Board.
4. The Audit & Finance, Nominating, Compensation and Corporate
Governance Committees consist entirely of independent
directors.
5. The Board has initiated a process whereby the Board and its
members are subject to periodic evaluation and assessment.
6. The Board annually reviews the Strategic Long Range Plan,
business unit initiatives, capital projects and budget
matters.
7. The Board has established the position of Lead Independent
Director, who is currently the independent director who also
serves as Chairman of the Executive Committee. Independent
directors meet on a regular basis apart from other Board
members and management representatives, and the Lead
Independent Director is responsible for setting the agenda
and running these meetings.
8. Succession planning and management development are reported
periodically by the CEO and the President to the Board.
9. The Board evaluates the performance of the CEO and other
senior management personnel at least annually.
10. Incentive compensation plans link pay directly and
objectively to measured financial goals set in advance by
the Compensation Committee. See "Report of the Compensation
Committee on Executive Compensation" for additional
information.
The Corporate Governance Guidelines are published on the Internet
at the Company's Investor Relations web site (www.intc.com).
DIRECTORS' COMPENSATION
Directors who are Company employees receive no additional or
special remuneration for serving as directors. Non-employee
directors are paid $20,000 per year. In addition, non-employee
directors are paid $2,000 plus out-of-pocket expenses per Board
of Directors regular meeting attended. Mr. Rock receives an
additional $6,000 as Chairman of the Executive Committee.
Non-employee directors are also granted stock options by the
Company. In accordance with the Company's 1984 Stock Option Plan,
the exercise price must be equal to the fair market value on the
date of grant. During 1997, each non-employee director was
granted an option to purchase a total of 5,000 shares at an
exercise price of $81.78 per share. Mr. Browne was also granted
an additional 5,000 shares at an exercise price of $70.28 shortly
after he joined the Board of Directors in 1997. Non-employee
director options are exercisable in full one year from the date
of grant. Under the 1984 Stock Option Plan option grants to non-
employee directors may not exceed 10,000 shares per director per
year (as adjusted for stock splits); currently, the non-employee
directors receive option grants for 5,000 shares per year.
In 1990, the Company adopted a retirement program for non-
employee directors. The Director's Retirement Program provides a
retirement benefit to any director who is not an employee of the
Company and who has either been a non-employee director for at
least ten years or has been a non-employee director for at least
five years and retires after age 65. The retirement program will
pay an annual benefit equal to the retainer fee in effect at the
time of payment, to be paid beginning at commencement of
retirement and continuing for the lesser of the number of years
served as a non-employee director or the life of the director.
Pursuant to the Director's Retirement Program, Messrs. Hodgson,
Kaplan and Palevsky are each eligible to receive an annual
benefit equal to $20,000, payable in quarterly installments.
Messrs. Hodgson and Kaplan each received $20,000 under this plan
in 1997. Mr. Palevsky received $15,000 under this plan in 1997.
In March 1998, the Board of Directors decided to vest accrued
benefits under the retirement program and otherwise to terminate
the retirement program.
REPORT OF THE COMPENSATION COMMITTEE ON EXECUTIVE COMPENSATION
The Company's executive compensation program is administered
by the Compensation Committee of the Board of Directors. In this
regard, the role of the Compensation Committee, which is
comprised entirely of outside, non-employee directors, is to
review and approve salaries and other compensation of the
executive officers of the Company and to administer the Executive
Officer Bonus Plan (the "EOBP"). The Committee also reviews and
approves various other Company compensation policies and matters
and administers the Company's stock option plans, including the
review and approval of stock option grants to the executive
officers of the Company.
General Compensation Philosophy
The Company's general compensation philosophy is that total
cash compensation should vary with the performance of the Company
in attaining financial and non-financial objectives and that any
long-term incentive compensation should be closely aligned with
the interests of the stockholders. The Company has several
performance-based compensation programs in which the majority of
Intel's employees are eligible to participate. Most Company
employees not compensated on a commission basis participate in
the Employee Bonus Program (the "EBP"). For the executive
officers, participation in the EOBP is in lieu of participation
in the EBP.
Total cash compensation for the majority of Intel's
employees, including its executive officers, consists of the
following components:
- Base salary;
- A cash bonus (either through the EBP or the EOBP) that
is related to growth in earnings per share of the
Company and is based on an individual bonus target for
the performance period (See "Executive Officer Bonus
Plan" for a discussion of the bonus plan covering
executive officers); and
- A cash bonus that is proportional to corporate
profitability and which is paid to all employees of the
Company (See "Employee Cash Bonus Plan").
Long-term incentive compensation is realized through the
granting of stock options to most employees, including eligible
executive officers. The Company has no other long-term incentive
plans.
In addition to encouraging stock ownership by granting stock
options, the Company further encourages its employees to own
Company stock through a tax-qualified employee stock purchase
plan which is generally available to all employees. This plan
allows participants to buy Company stock at a discount to the
market price with up to 10% of their salary and bonuses (subject
to certain limits), therefore allowing employees to profit when
the value of the Company's stock increases over time.
Setting Executive Compensation
In setting the base salary and individual bonus target
amount (hereafter together referred to as "BSBT") for executive
officers, the Compensation Committee reviews information relating
to executive compensation of US-based companies that are
considered generally comparable to the Company (a substantial
majority of which companies are included in the Dow Jones
Technology Index). While there is no specific formula that is
used to set pay in relation to this market data, executive
officer BSBT is generally set to be slightly below the median
salaries for comparable jobs in the market place. However, when
the Company's business groups meet or exceed certain
predetermined financial and non-financial goals, amounts paid
under the Company's performance-based compensation programs may
lead to total cash compensation levels which are higher than the
median salaries for comparable jobs. The Compensation Committee
also reviews the compensation levels of the executive officers
for internal consistency relative to the 100 most highly paid
employees of the Company.
Section 162(m) of the Internal Revenue Code of 1986, as
amended (the "Code"), places a limit of $1,000,000 on the amount
of compensation that may be deducted by the Company in any year
with respect to each of the Company's five most highly paid
executive officers. Certain performance based compensation that
has been approved by stockholders is not subject to the deduction
limit. The Company's 1984 and 1988 stock option plans
and the EBOP are qualified so that awards under such plans
constitute performance based compensation not subject to Section
162(m) of the Code. However, in order to maintain flexibility in
compensating executive officers in a manner designed to promote
varying corporate goals, the Compensation Committee has not
adopted a policy that all compensation must be deductible.
Base Salary
The Compensation Committee reviews the history of and
proposals for the compensation package of each of the Company's
executive officers, including BSBT and its base salary and
performance based compensation components. The base salary is
then set as a percentage of BSBT, taking into account the level
and amount of responsibility of the individual. In general,
executive officers having the highest level and amount of
responsibility have the lowest percentage of their BSBT as base
salary and the highest percentage of their BSBT as their
individual bonus target amount. For example, in 1997, the base
salary for Dr. Grove, the executive officer with the highest
level and amount of responsibility, was 50% of his total BSBT.
The other executives' base salaries were determined in the same
manner, but the base salary segment as a percentage of their BSBT
for 1997 ranged from 50% to 67% depending on their job
responsibilities. Once fixed, base salary does not depend on the
Company's performance.
As a result of this process, and in accordance with the
Company's compensation philosophy that total cash compensation
should vary with Company performance, the Compensation Committee
establishes base salaries of the Company's executive officers at
levels which the Compensation Committee believes are below the
median base salaries of executives of companies considered by
the Compensation Committee to be comparable to the Company.
Thus, as set forth below, a large part of each executive
officer's potential total cash compensation is dependent on the
performance of the Company as measured through its performance
based compensation programs.
Performance Based Compensation
Executive Officer Bonus Plan
The EOBP is a cash-based incentive bonus program. The
purpose of the EOBP is to motivate and reward eligible employees
for good performance by making a portion of their cash
compensation dependent on growth in diluted earnings per share
("EPS") of the Company.
The EOBP provides for the determination of a maximum bonus
amount which is established annually for each executive officer
pursuant to a predetermined objective formula, subject to a
maximum annual limit of $5,000,000. Under this predetermined
formula, the maximum bonus payment for any performance period is
the product of (i) the executive officer's individual bonus
target for the performance period and (ii) the numerical value of
the Company's EPS for the performance period multiplied by a pre-
established factor (the "multiplier") which is set by the
Compensation Committee. For purposes of this formula, "EPS"
means the greater of (x) the Company's operating income or (y)
the Company's net income, in each case per weighted average
common shares outstanding assuming dilution during such
performance period. Operating income does not include interest
and other income earned by the Company and does not include a
deduction for interest expense and income taxes; as a result, the
figure for operating income per share generally exceeds the
figure for net income per share. The EPS data to be utilized in
the calculations (and which is also used in the Company's
published financial statements) is reviewed and approved by the
Compensation Committee.
In January 1997, the Compensation Committee established
individual bonus targets which ranged from $75,000 to $465,000
for each of the then executive officers (representing a range of
33% to 50% of BSBT), and set the multiplier as 1.26 for the 1997
performance period. During this period, operating income per
share of $5.51 exceeded net income per share of $3.87 and led to
an EPS value, as defined, of $5.51 to be used in the formula for
determining the maximum bonus amount
Under the EOBP, the Compensation Committee has discretion to
reduce (but not to increase) an individual's actual bonus payment
from the amount which would otherwise be payable under the above
formula. In the past, the Compensation Committee has exercised
its discretion to pay bonuses at amounts which were below the
maximum amounts permitted under the EOBP. The EOBP does not
specify the factors which the Compensation Committee evaluates in
the exercise of its discretion to reduce bonus payments under the
EOBP and does not require the
Compensation Committee to make such a reduction. The EOBP
requires that an executive officer be on the Company's payroll as
of the last day of the performance period for which the bonus is
payable in order to be eligible to receive payment of the bonus
for such performance period.
For the 1997 performance period, the Compensation Committee
chose to exercise its discretion to reduce the bonus amounts paid
under the EOBP to the amounts which would have been paid to the
executive officers under the EBP. Bonus payments under the EBP
are generally lower than the maximum bonuses payable under the
EOBP in part because the EBP formula utilizes the reported net
income per share amount (adjusted to reflect any unusual income
statement items) whereas the EPS utilized in the EOBP formula is
based on the greater of operating income or net income as
described above. The EBP formula also takes into account whether
certain business group objectives have been met over the
performance period. For example, for 1997, business group
objectives considered in determining the payouts under the EBP
included financial and non-financial goals such as sales,
customer satisfaction, productivity measures, cost reduction and
employee training. The particular goals are set each year and
vary from year to year. In determining bonuses payable to the
executive officers with responsibility for overall performance of
the Company, such as the Chief Executive Officer and the Chief
Operating Officer, the Compensation Committee took into account
the corporate average score on achievement of business
objectives. For those executive officers with specific
responsibility for a particular business group, achievement
scores were based on either the individual business group's
score, or a combination of the group's score and the corporate
average score.
Employee Cash Bonus Plan
The Employee Cash Bonus Plan (the "ECBP") is a profit-
sharing program that offers cash rewards to all employees,
including executive officers, based on corporate profitability.
Twice a year, employees receive .55 day's pay for every two
percentage points of corporate pretax profit as a percentage of
revenues, or a total payment based on 4% of net income, whichever
is greater. The Employee Cash Bonus is paid in the first and
third quarters of each year based on corporate performance for
the preceding two quarters.
During 1997, payments based on 4% of net income resulted in
an annual cash bonus payout under the ECBP of 27.9 days' pay per
employee or 10.7% of eligible employee earnings. Employees were
awarded an additional 2.0 days' pay during 1997 as a result of
meeting corporate goals under a vendor of choice (customer
satisfaction) program.
Profit Sharing Retirement Plans
The Company has both tax-qualified and non-qualified capital
accumulation/retirement plans (the "Profit Sharing Retirement
Plans"). The tax-qualified plans are available to eligible
employees in the U.S. and Puerto Rico, and there are similar
Plans for certain of the Company's non-U.S. subsidiaries. The
non-qualified plan is a supplemental plan which provides to
eligible employees in the U.S. those contributions that could not
be contributed to their accounts under the qualified plan because
of limitations under the Code. The Profit Sharing Retirement
Plans are defined contribution plans that are designed to
accumulate retirement funds for employees, including the
executive officers, and to allow the Company to make
contributions or allocations to those funds. The Company
contribution is totally discretionary and is not based on any
formula. The contributions approved by the Board may vary with
the financial performance of the Company, in particular, the
revenues and EPS of the Company. However, there are no corporate
performance factors or other specific factors that are required
to be considered by the Board in determining the contribution.
Contributions made by the Company under the plans vest based on
years of service. Vesting begins after three years of service in
20% annual increments until the employee is 100% vested after
seven years.
For 1997, the discretionary Company contributions (including
allocation of forfeitures) to the Profit Sharing Retirement Plans
for all eligible employees, including executive officers, equaled
12.5% of eligible salary. Contributions to the qualified plan
are limited under the Code. Where Code limits applied, the
excess, up to 12.5% of eligible salary, was allocated to the non-
qualified plan for eligible employees, including executive
officers.
Stock Options
Stock options are granted by the Company to aid in the
retention of employees and to align the interests of employees
with those of the stockholders. Stock options have value for an
employee only if the price of the Company's stock increases above
the fair market value on the grant date and the employee remains
in the Company's employ for the period required for the stock
option to be exercisable, thus providing an incentive to remain
in the Company's employ. In addition, stock options directly
link a portion of an employee's compensation to the interests of
stockholders by providing an incentive to maximize stockholder
value.
The Company has a 1997 Stock Option Plan (the "1997 SOP")
for use with employees other than officers and directors; and
1984 and 1988 Stock Option Plans, as amended, which are generally
used for making grants to officers and directors. Grants under
the 1997 SOP may be made at the time an employee commences
working for the Company and thereafter may be made on an annual
basis as a part of the Company's employee performance review
process. In general, initial grants are exercisable in
increasing increments over a five-year period and subsequent
grants are first exercisable five years after the date of grant
(e.g., options granted in 1997 become exercisable in 2002).
Stock options under all three plans are granted at a price equal
to the fair market value on the date of grant.
In 1997, the stock option program was expanded to include
virtually all employees worldwide. This broadened participation
extends the benefits of retention and alignment of employee and
stockholder interests to all employees, providing a competitive
advantage while not exceeding the Company's dilution goals. The
level of stock options granted (i.e., the number of shares
subject to each stock option grant) is based on the Committee's
evaluation of an employee's ability to impact future corporate
results. An employee's ability to affect future corporate
results depends on the level and amount of job responsibility of
the individual. Therefore, the level of stock options granted is
directly proportional to job responsibility. However, the total
number of shares subject to options that may be granted to any
one participant in any year is limited to 1% of the total number
of shares outstanding.
In 1997, stock options for the executive officers were
granted upon recommendation of management and approval of the
Compensation Committee based on their subjective evaluation of
the appropriate amount for the level and amount of responsibility
of each executive officer.
Company Performance and CEO Compensation
The Company's compensation program is leveraged towards the
achievement of corporate and business objectives. This pay-for-
performance program is most clearly exemplified in the
compensation of the Company's Chief Executive Officer, Dr. Grove.
Dr. Grove does not have an employment contract. Dr. Grove's
BSBT is determined in the same manner as described above for all
executive officers. In setting compensation levels for the Chief
Executive Officer, the Compensation Committee considers data
reflecting comparative compensation information from other
companies. In line with the Compensation Committee's general
practice and discretionary authority, however, Dr. Grove's 1997
salary and individual bonus target were not tied directly to the
comparative compensation data. Dr. Grove's base salary and bonus
target were set at levels which, by comparison to selected
companies reflected in the market data (a majority of which
companies are included in the Dow Jones Technology Index), were
54% of the average for base salary, 49% of the average for target
incentive based compensation and 51% of the average for BSBT.
Under the EOBP, Dr. Grove's actual bonus for 1997 (paid in
1998) was $2,669,100. This bonus, like the bonuses paid to each
of the other executive officers under the EOBP, was less than the
maximum bonus provided under the EOBP formula due to the
Compensation Committee's exercise of its discretion to reduce the
maximum bonus to the bonus derived by utilizing the EBP formula
as described above. Although Dr. Grove's BSBT was 51% of the
average total target compensation of the selected peer group, due
to the high variability in the Company's total compensation
program and to the Company's excellent 1997 financial
performance, his actual cash compensation (i.e., base salary and
bonus) for 1997 was 144% of the average total actual cash
compensation of the selected peer group.
In 1997, the Compensation Committee awarded Dr. Grove stock
options to purchase 72,000 shares of stock. The options first
become exercisable in 2002. In 1998, the Company also
contributed $20,000 to Dr. Grove's account under the tax-
qualified retirement plan and allocated $364,000 to Dr. Grove's
account under the non-qualified retirement plan, based on the
Company's 1997 results. In general, Dr. Grove's retirement plan
accounts are available to Dr. Grove only upon termination,
retirement, death or disability.
The Compensation Committee is pleased to submit this report
to the stockholders with regards to the above matters.
Compensation Committee:
David Yoffie, Chairman Arthur Rock
John Browne Jane Shaw
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
From January to May 1997, Messrs. Guzy, Palevsky and Rock
and Dr. Yoffie served on the Compensation Committee. From May to
December, Messrs. Browne and Rock and Drs. Yoffie and Shaw served
on the Compensation Committee. Dr. Moore, who is an officer of
the Company and the Company's Chairman Emeritus of the Board, is
not eligible to receive stock options. Mr. Rock was formerly a
non-employee officer of the Company as Chairman of the Board from
1970 to 1975.
EMPLOYMENT CONTRACTS AND CHANGE OF CONTROL ARRANGEMENTS
None of the Company's executive officers has employment or
severance arrangements with the Company.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
The sister-in-law of David Yoffie, one of the Company's
directors, is President of Research Communications, Inc., a
market research company. During fiscal 1997, Intel paid Research
Communications $64,250 for market research and consulting
services. Dr. Yoffie has no financial interest in Research
Communications.
In November 1997, the Company loaned $1,134,000 to Sean
Maloney pursuant to the Intel employee relocation program. Mr.
Maloney was a Vice President of the Company at the time of the
loan, and became an executive officer in February 1998. This
loan is secured by his house, bears interest at 4.1%, and is due
in full in November 1998.
STOCK PRICE PERFORMANCE GRAPH
COMPARISON OF FIVE-YEAR CUMULATIVE RETURN AMONG INTEL,
THE S&P 500 INDEX AND THE DOW JONES TECHNOLOGY INDEX
Set forth below is a line graph comparing the cumulative total
stockholder return on the Company's Common Stock against the
cumulative total return of the Standard & Poor's 500 Stock Index
and the Dow Jones Technology Index for the period of five years
commencing December 26, 1992 and ending December 27, 1997. The
graph and table assume that $100 was invested on December 26,
1992 in each of the Company's Common Stock, the Standard & Poor's
500 Stock Index and the Dow Jones Technology Index and that all
dividends were reinvested. This data was furnished by Standard &
Poor's Compustat Services, Inc. and Dow Jones and Company, Inc.
Intel and the Dow Jones Technology Index are based on Intel's
fiscal year. The S&P 500 Index is based on a calendar year.
[PERFORMANCE GRAPH APPEARS HERE]
1992 1993 1994 1995 1996 1997
---- ---- ---- ---- ---- ----
Intel Corporation $100 $138 $143 $254 $609 $638
S&P 500 Index $100 $110 $112 $153 $189 $252
Dow Jones Technology $100 $115 $130 $185 $243 $282
Index
EXECUTIVE COMPENSATION
The following tables set forth the annual compensation for
the Chief Executive Officer and the four other most highly
compensated executive officers of the Company. All references to
shares of Common Stock are adjusted for the 2:1 stock split in
1997.
SUMMARY COMPENSATION TABLE
Long-
Term
Compen-
sation All
Awards(2) Other
Name and Principal Annual Compensation Options Compensa-
Position Year Salary($) Bonus($)(1) (#)(3) tion($)(4)
- ------------------ ---- ---------- ---------- ------- ----------
Andrew S. Grove 1997 465,000 2,790,400 72,000 384,000
Chairman of the 1996 425,000 2,578,300 144,000 347,500
Board and Chief 1995 400,000 2,356,700 192,000 266,100
Executive Officer
Craig R. Barrett 1997 365,000 2,190,100 60,000 295,000
President and 1996 325,000 1,971,800 96,000 261,400
Chief Operating 1995 300,000 1,767,500 128,000 196,800
Officer
Gerhard H. Parker 1997 275,000 1,382,300 232,000 187,200
Executive Vice 1996 250,000 1,207,400 48,000 159,900
President 1995 235,000 1,029,500 64,000 120,100
General Manager,
Technology and
Manufacturing Group
Paul S. Otellini 1997 225,000 1,179,800 232,000 161,100
Executive Vice 1996 200,000 1,050,500 48,000 136,600
President 1995 185,000 892,700 64,000 91,100
General Manager,
Intel Architecture
Business Group
Albert Y. C. Yu 1997 215,000 1,185,500 224,000 144,100
Senior Vice 1996 205,000 925,800 36,000 119,300
President 1995 195,000 749,800 48,000 92,400
General Manager
Microprocessor
Products Group
- --------------
(1) This amount includes the bonuses paid under the Executive
Officer Bonus Plan for 1995, 1996 and 1997, the Employee
Cash Bonus Plan for each of the covered years and a one-
time bonus of $1,000 per employee in 1996.
(2) The Company does not offer any Restricted Stock Awards,
Stock Appreciation Rights or other Long-Term Incentive
Programs .
(3) Indicates number of shares of Common Stock underlying
options.
(4) All amounts listed in this column are discretionary
Company contributions made under the Company's non-
qualified, defined contribution plan and amounts
contributed to the Company's broad-based defined
contribution retirement plan (for each of the named
executives such amounts were $20,000 for each of the years
presented). These amounts are to be paid out to the named
executives (or any other plan participant) only upon
retirement, termination, disability or death.
OPTION GRANTS IN LAST FISCAL YEAR
INDIVIDUAL GRANTS
----------------------------------------------
% of Total Potential Realizable
Securities Options Exercise Value at Assumed
Underlying Granted to or Annual Rates of Stock
Options Employees Base Price Price Appreciation for
Granted in Fiscal ($/Share) Expiration option term ($)(3)
Name (#) (1) Year (2) Date 5% 10%
- ----- ------- ------ ------- ------ ------- -------
A. Grove 72,000 0.23% $69.69 4/22/07 3,155,500 7,996,700
C. Barrett 60,000 0.19% $69.69 4/22/07 2,629,600 6,663,900
G. Parker 32,000 0.10% $69.69 4/22/07 1,402,400 3,554,100
200,000 0.64% $76.38 11/12/07 9,606,400 24,344,400
P. Otellini 32,000 0.10% $69.69 4/22/07 1,402,400 3,554,100
200,000 0.64% $76.38 11/12/07 9,606,400 24,344,400
A. Yu 24,000 0.08% $69.69 4/22/07 1,051,800 2,665,600
200,000 0.64% $76.38 11/12/07 9,606,400 24,344,400
- --------------
(1) These options are first exercisable in 2002, except for the
options for 200,000 shares granted to Dr. Parker and
Messrs. Otellini and Yu which are exercisable on various
dates between 2002 and 2005.
(2) Under all stock option plans, the option purchase price is
equal to fair market value at the date of the grant. All
of these options were granted on April 22, 1997, except for
the options for 200,000 shares which were granted to each
of Dr. Parker and Messrs. Otellini and Yu on November 12,
1997.
(3) In accordance with SEC rules, these columns show gains that
might exist for the respective options, assuming the market
price of Intel's Common Stock appreciates from the date of
grant over a period of ten years at the annualized rates of
five and ten percent, respectively. If the stock price
does not increase above the exercise price at the time of
exercise, realized value to the named executives from these
options will be zero.
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR
AND FISCAL YEAR-END OPTION VALUES
Securities Underlying Value of Unexercised
Unexercised Options In-the-Money Options
at December 27, 1997 at December 27, 1997
(#)(1) ($)(2)
---------- ----------
Shares
Acquired on Value Exer- Unexer- Exer- Unexer-
Name Exercise(#) Realized($) cisable cisable cisable cisable
- -------- ----------- ----------- ---------- ---------- --------- ---------
A. Grove 648,000 48,958,356 0 744,000 0 34,337,500
C. Barrett 0 0 1,844,336 508,000 122,877,600 22,905,900
G. Parker 100,000 7,739,100 491,488 456,000 32,606,300 11,455,300
P. Otellini 72,928 5,549,612 359,664 676,000 21,922,700 24,043,300
A. Yu 4,778 332,668 457,502 416,266 30,490,800 9,972,200
- --------------
(1) This represents the total number of shares subject to stock
options held by the named executives at December 27, 1997.
These options were granted on various dates during the
years 1989 through 1997.
(2) These amounts represent the difference between the exercise
price of the stock options and the closing price of Company
stock on December 26, 1997 (last day of trading for the
fiscal year ended December 27, 1997) for all in-the-money
options held by each named executive. The in-the-money
stock option exercise prices range from $3.67 to $69.69.
These stock options were granted at the fair market value
of the stock on the grant date.
PENSION PLAN TABLE
Years of Service at Retirement (2)(3)
---------------------------------------
Eligible 15 20 25 30 35
Compensation (1)
- ------------------- ------ ------ ------ ------ ------
$160,000 and above $30,734 $40,978 $51,223 $61,467 $71,712
- -------------
(1) The plan provides for minimum pension benefits that are
determined by a participant's years of service credited
under the plan, final average compensation, taking into
account the participant's Social Security wage base, and
the value of the participant's Company contributions, plus
earnings, in the profit sharing retirement plan. If the
annuity value of the profit sharing account balance exceeds
the pension guarantee, the participant will receive
benefits from the profit sharing plan only. Compensation
includes regular earnings and most bonuses. However,
maximum eligible compensation for 1997 is $160,000, in
accordance with Internal Revenue Code Section 401(a)(17).
This amount is subject to cost of living adjustments in
accordance with Internal Revenue Code Section 415(d).
(2) For each of the employees named in the Summary Compensation
Table set forth above, the years of credited service as of
year-end 1997 under the Company's pension plan are
currently as follows: Dr. Grove (29); Dr. Barrett (23);
Dr. Parker (28); Mr. Otellini (23); and Mr. Yu (21).
(3) The table illustrates the estimated annual benefits payable
in the form of a straight-life annuity upon retirement at
age 65 under the pension plan to persons in the specified
compensation and years of service classifications for
Social Security benefits. The Employee Retirement Income
Security Act of 1974 contains certain limitations on the
amount of benefits that may be paid under pension plans
qualified under the Internal Revenue Code. The amounts
shown are subject to reduction to the extent they exceed
such limitations but are not subject to reduction for
Social Security benefits.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
To the Company's knowledge, the following sets forth
information regarding ownership of the Company's outstanding
Common Stock on February 28, 1998 by (i) beneficial owners of
more than 5% of the outstanding shares of Common Stock, (ii) each
director, director emeritus and named executive officer, and
(iii) all directors, directors emeriti and executive officers as
a group. Except as otherwise indicated below and subject to
applicable community property laws, each owner has sole voting
and sole investment powers with respect to the stock listed. All
references to shares of Common Stock are adjusted for the 2:1
stock split in 1997.
Number of
Shares of
Common Stock
Beneficially
Owned at Percent
February 28, of
Stockholder 1998 Class
- ---------------- -------- -------
Gordon E. Moore, Director and Chairman 89,796,243 (1) 5.5%
Emeritus
2200 Mission College Blvd.
Santa Clara, California 95052-8119
Craig R. Barrett, Director, President 2,080,351 (2) *
and Chief Operating Officer
John Browne, Director 1,650 (3) *
Winston H. Chen, Director 210,000 (4) *
Andrew S. Grove, Director, Chairman and 2,493,453 (5) *
Chief Executive Officer
D. James Guzy, Director 3,273,088 (6) *
Arthur Rock, Director 6,420,544 (7) *
Jane E. Shaw, Director 134,034 (8) *
Leslie L. Vadasz, Director and Senior 1,921,263 (9) *
Vice President
David B. Yoffie, Director 191,600 (10) *
Charles E. Young, Director 30,900 (11) *
Richard Hodgson, Director Emeritus 106,725 *
Sanford Kaplan, Director Emeritus 81,200 (12) *
Max Palevsky, Director Emeritus 615,836 (13) *
Paul S. Otellini, Executive Vice 473,248 (14) *
President
Gerhard H. Parker, Executive Vice 638,182 (15) *
President
Albert Y. C. Yu, Senior Vice President 596,772 (16)
All directors, directors emeritus and 111,951,829 (17) 6.9%
executive officers as a group
(30 individuals)
____________________
* Less than 1%.
(1) Includes 500,000 shares held in trusts established for
benefit of Dr. Moore's spouse, as to which Dr. Moore
disclaims beneficial ownership.
(2) Includes 500,000 shares held in trusts established for
benefit of Dr. Moore's spouse, as to which Dr. Moore
disclaims beneficial ownership.
(3) Includes outstanding options to purchase 1,250 shares,
which were exercisable as of February 28, 1998, or within
60 days from such date.
(4) Includes outstanding options to purchase 130,000 shares,
which were exercisable as of February 28, 1998, or within
60 days from such date.
(5) Includes outstanding options to purchase 192,000 shares,
which were exercisable as of February 28, 1998, or within
60 days from such date. Also includes 204,000 shares
which are owned by a private charitable foundation as to
which Dr. Grove shares asset voting and disposition
authority. Dr. Grove does not have a pecuniary interest
in the shares held by the foundation.
(6) Includes 3,082,320 shares held by the Arbor Company of
which Mr. Guzy is a general partner. Also includes
outstanding options to purchase 190,000 shares, which were
exercisable as of February 28, 1998, or within 60 days
from such date.
(7) Includes 1,920 shares held by Mr. Rock's spouse as to
which shares Mr. Rock disclaims any beneficial interest
and as to which he has no voting or disposition authority.
Also includes outstanding options to purchase 190,000
shares which were exercisable as of February 28, 1998, or
within 60 days from such date.
(8) Held in a family trust. Includes outstanding options to
purchase 126,000 shares, which were exercisable as of
February 28, 1998, or within 60 days from such date.
(9) Includes outstanding options to purchase 482,336 shares,
which were exercisable as of February 28, 1998, or within
60 days from such date. Also includes 42,000 shares which
are owned by a private charitable foundation as to which
Mr. Vadasz shares asset voting and disposition authority.
Mr. Vadasz does not have a pecuniary interest in the
shares held by the foundation.
(10) Includes outstanding options to purchase 190,000 shares,
which were exercisable as of February 28, 1998, or within
60 days from such date.
(11) Includes outstanding options to purchase 30,000 shares,
which were exercisable as of February 28, 1998, or within
60 days of such date.
(12) Includes 20,000 shares held by a family limited
partnership of which Mr. Kaplan is a partner.
(13) Includes 33,384 shares held by Mr. Palevsky's spouse.
(14) Includes outstanding options to purchase 423,664 shares,
which were exercisable as of February 28, 1998, or within
60 days from such date.
(15) Includes outstanding options to purchase 505,488 shares,
which were exercisable as of February 28, 1998, or within
60 days from such date.
(16) Includes outstanding options to purchase 517,768 shares,
which were exercisable as of February 28, 1998, or within
60 days from such date.
(17) Includes outstanding options to purchase 6,711,508 shares,
which were exercisable as of February 28, 1998, or within
60 days from such date.
RATIFICATION OF SELECTION OF INDEPENDENT AUDITORS (Proposal 2)
Ernst & Young LLP have been the Company's independent
auditors since its incorporation in 1968 and at the
recommendation of the Audit & Finance Committee of the Board have
been selected by the Board of Directors as the Company's
independent auditors for the fiscal year ending December 26,
1998. In the event ratification of this selection of auditors is
not approved by a majority of the shares of Common Stock voting
thereon, management will review its future selection of auditors.
A representative of Ernst & Young LLP is expected to be
present at the Annual Meeting and will have an opportunity to
make a statement if he or she so desires. The representative
will also be available to respond to appropriate questions from
the stockholders.
Audit services of Ernst & Young LLP for 1997 included the
examination of the consolidated financial statements of the
Company and services related to filings made with the Securities
and Exchange Commission, as well as certain services relating to
the consolidated quarterly reports and annual and other periodic
reports at international locations.
The Audit & Finance Committee of the Company meets twice a
year with Ernst & Young LLP and, on an annual basis, reviews both
audit and non-audit services performed by Ernst & Young LLP for
the preceding year as well as the fees charged by Ernst & Young
LLP for such services. Non-audit services are approved by the
Audit & Finance Committee, which considers, among other things,
the possible effect of the performance of such services on the
auditors' independence.
The Board of Directors recommends a vote FOR ratification of
the appointment of Ernst & Young LLP as independent auditors for
the Company for the current year. Unless a contrary choice is
specified, proxies solicited by the Board of Directors will be
voted FOR ratification of the appointment.
STOCKHOLDER PROPOSAL (Proposal 3)
A group of stockholders whose names and addresses and number
of shares will be furnished by the Company promptly upon receipt
of any request therefor, has submitted the following proposal.
The text of the proposal and the supporting statement are set
forth below. The proponents must appear personally or by proxy
at the Annual Meeting to present the proposal.
WHEREAS, WE BELIEVE: Responsible implementation of a sound,
credible environmental policy increases long-term shareholder
value by raising efficiency, decreasing clean-up costs, reducing
litigation, and enhancing public image and product
attractiveness;
Adherence to public standards for environmental performance gives
a company greater public credibility than standards created by
industry alone. For maximum credibility and usefulness, such
standards should specifically meet the concerns of investors and
other stakeholders;
Companies are increasingly being expected by investors to do
meaningful, regular, comprehensive and impartial environmental
reports. Standardized environmental reports enable investors to
compare performance over time. They also attract investment from
investors seeking companies which are environmentally responsible
and which minimize the risk of environmental liability.
WHEREAS: The Coalition for Environmentally Responsible Economies
(CERES) - which includes shareholders of this Company; public
interest representatives, and environmental experts - consulted
with corporations to produce the CERES Principles as
comprehensive public standards for both environmental performance
and reporting. Scores of companies, including Bank of America,
Baxter International, Bethlehem Steel, General Motors, H. B.
Fuller, ITT Industries, Pennsylvania Power and Light, Polaroid,
and Sun [Sunoco], have endorsed these principles to demonstrate
their commitment to public environmental accountability and
standardized reporting. Fortune-500 endorsers say that the
benefits of working with CERES are * public credibility, * direct
access to major environmental and stockholder organizations, *
leadership in designing the rapidly advancing standardization of
environmental disclosure, and * measurable value-added for the
company's environmental initiatives;
A company endorsing the CERES Principles commits to work toward:
1. Protection of the biosphere
2. Sustainable natural resource use
3. Waste reduction and disposal
4. Energy conservation
5. Risk reduction
6. Safe products/services
7. Environmental restoration
8. Informing the public
9. Management commitment
10. Audits and reports
[Materials on the CERES Principles and CERES Report Form are
obtainable from CERES, 711 Atlantic Avenue, Boston MA 02110, Tel:
617-451-0927, fax: 617-482-2028]
CERES is distinguished from other initiatives for corporate
environmental responsibility by being (1) a successful model of
shareholder relations; (2) a leader in public accountability
through standardized environmental reporting; and (3) a catalyst
for significant and measurable environmental improvement within
firms.
RESOLVED: Shareholders request the Company to endorse the CERES
Principles as a part of its commitment to be publicly accountable
for its environmental impact.
SUPPORTING STATEMENT
Many investors support this resolution. Those sponsoring similar
resolutions at various companies have portfolios totaling $75
billion. Furthermore, the number of public pension funds and
foundations supporting this resolution increases every year. We
believe the CERES Principles exceed the European Community
regulation for voluntary participation in verified and publicly-
reported eco-management and auditing, and that they also exceed
the requirements for ISO 14000.
Your vote FOR this resolution will encourage both scrutiny of our
Company's environmental policies and reports and adherence to
goals supported by management and stockholders alike. We believe
the CERES Principles will protect both your investment and your
environment.
RECOMMENDATION OF THE BOARD OF DIRECTORS
THE BOARD OF DIRECTORS RECOMMENDS A VOTE AGAINST THE STOCKHOLDER
PROPOSAL FOR THE FOLLOWING REASONS:
Intel recognizes the Coalition for Environmentally Responsible
Economies (CERES) Principles as a program for environmental
improvement. Intel is committed to achieving high standards of
environmental quality and to providing a safe and healthful
workplace for employees, contractors, and communities. In
pursuing this goal, Intel frequently receives inputs and
suggestions for various programs and has frequently incorporated
ideas obtained from others to improve Intel programs. Intel
publishes its environmental results on the Internet to assure
visibility and opportunity for input. Through this process,
Intel has optimized its own programs to meet the specific needs
of its business rather than aligning itself to broad and generic
guidelines that have been developed to cover industries other
than Intel's. For example, Intel has invested heavily in fully
integrating new environmental process development into the rapid
development of new products.
Intel management has offered (starting well over a year ago) to
meet with the stockholder who has introduced the foregoing
proposal (the "Proponent") for fact finding discussions regarding
CERES and has encouraged the Proponent to "measure us by our
results". Intel's focus has been on achieving superior results
in environmental, health and safety programs. Intel's management
believes the Company's results in the areas of environmental,
health, and safety speak for themselves and continually
encourages employees, stockholders, and other stakeholders to
measure Intel by these results. Intel's results are highlighted
further below and in its Environmental, Health and Safety (EHS)
Report, which Intel has made widely available in hard copy and on
the Internet for the last 4 years.
Intel's policies go beyond merely complying with applicable laws
and regulations. In 1991, Intel adopted its Environment, Health
and Safety Policy (the "EHS Policy"), which formalized specific
environmental, health and safety goals for the Company. The EHS
Policy was most recently revised in late 1995 (which incorporated
some
previous inputs from the Proponent) to reflect Intel's efforts to
implement ever greater levels of protection and to adjust for
changing circumstances and evolving technologies.
While Intel's Board of Directors and management believe that the
concerns of the Proponent are well intentioned, the Board of
Directors and management believe that adoption of the
standardized guidelines represented by the CERES Principles would
divert the Company's time, money and effort away from
environmental programs that currently are developed and
implemented by the Company. Intel management is firmly committed
to excellence in its environmental, health, and safety programs.
Intel's Board of Directors and management believe that adopting a
more generalized and standardized system such as CERES would
detract resources from efforts more appropriate to Intel's unique
and fast-growing industry.
FURTHER DISCUSSION
CERES is a non-profit membership organization comprised of
environmental groups, religious organizations, social investors,
public pension trustees and public interest groups. CERES has
stated that the CERES Principles are intended to help guide the
activities of all corporations, regardless of size or industry.
Intel believes that many of the concepts set forth in the CERES
Principles are already embodied in its EHS Policy.
Intel management expects that implementing the Proposal, i.e.,
endorsing the CERES Principles, would mean that Intel would (1)
revise or supplement its existing environmental policies to
conform to each issue addressed under the CERES Principles,
regardless of whether the specific criteria is relevant to
Intel's operations, (2) consult with CERES in decision making,
and (3) pay CERES an annual membership fee and bear substantial
management and reporting costs. In light of the Company's
existing commitment to environmental policies and its dynamic
pursuit of the best manner to advance environmental interests in
the context of its overall business, Intel's Board of Directors
and management believe that these and other consequences make it
inadvisable to implement the Proposal.
The Board of Directors and management also believe that adoption
of the CERES Principles would not materially enhance Intel's
environmental policy, increase management's awareness of
environmental issues, improve Intel's environmental performance
or increase management's commitment to environment, health and
safety issues or performance. As noted above, Intel has long had
a formal, active and extensive program for addressing
environmental, health and safety issues. Intel's management has
actively pursued full implementation of that program.
As examples of the results of the Company's EHS Policy, Intel has
in the past voluntarily undertaken the following activities:
(1) Periodic publication of an environmental health and safety
report, which is freely available to all interested
stockholders and any other member of the public both
directly from the Company and on its Internet web site.
This report provides specific examples regarding Intel's EHS
environmental policies and practices. Among other things,
the report includes statistical data on health, safety, air
emissions, solid waste recycling, chemical waste management,
water use and toxic chemical releases. The report also sets
forth Intel's environmental goals and targets and Intel's
performance vis-a-vis past targets.
(2) Establishment of Community Advisory Panels ("CAPs"),
representing a community cross-section including business,
academic, health and community interests, where many of
Intel's larger manufacturing facilities are located. These
CAPs actively advise Intel on the community impact of its
activities and ways to eliminate or mitigate negative
impacts.
(3) Voluntary participation in several initiatives, including
the U.S. Environmental Protection Agency's Project XL, which
commits Intel to superior environmental performance in
exchange for the approval of additional manufacturing
flexibility. As part of this project, Intel has developed a
single environmental master plan for one of its facilities
which includes air pollutant emission caps, water
conservation goals, and waste and chemical waste recycling
goals. This plan was developed and is being implemented
with help from a team that includes community members and
EPA and local government representatives.
(4) Use of an active internal audit process pursuant to which
Intel's EHS staff and outside experts periodically audit
each of its operating facilities to assess performance. The
results of these audits are used to help establish areas for
improvement.
(5) Use of OSHA recording definitions on a world-wide basis for
the collection of data on occupational injuries and
illnesses. Over the past 4 years, Intel has reduced
employee injury and illness rates by an average of 30% per
year, and now has one of the lowest rates in all of
industry.
These are just a few examples of Intel's many EHS efforts. More
information can be found in Intel's most recent EHS report,
entitled, "Designing for Safety and the Environment," which is
available directly from the Company or on its Internet web site
at www.intc.com.
Intel continually strives to improve its environmental policies
and to consider and mitigate the environmental impact of its
expanding and changing business. Intel's Board of Directors and
management believe that endorsing the CERES Principles will not
change Intel's substantive commitment to good environmental
policies. Intel's current EHS Policy is one that the Board of
Directors and management believe provides an environmental
program most suited to Intel's business and operations. The
Board of Directors and management believe that the Company should
not lose the flexibility to design the best environmental
programs by adopting and having to conform to the CERES
Principles.
Therefore, the Board of Directors recommends a vote AGAINST
Proposal 3 to endorse the CERES Principles. Unless a contrary
choice is specified, proxies solicited by the Board of Directors
will be voted AGAINST Proposal 3.
OTHER MATTERS
Section 16(a) Beneficial Ownership Reporting Compliance.
Section 16(a) of the Securities Exchange Act of 1934 requires the
Company's directors and executive officers, and persons who own
more than ten percent of a registered class of the Company's
equity securities, to file reports of ownership of, and
transactions in, the Company's securities with the Securities and
Exchange Commission and The Nasdaq Stock Market. Such directors,
executive officers and ten-percent stockholders are also required
to furnish the Company with copies of all Section 16(a) forms
they file.
Based solely on a review of the copies of such forms
received by it, and on written representations from certain
reporting persons, the Company believes that during fiscal 1997,
all Section 16(a) filing requirements applicable to its
directors, officers and ten percent stockholders were complied
with, except: Albert Yu, an officer of the Company filed two
late reports of transactions involving gifts.
1999 Stockholder Proposals or Nominations. From time to
time, stockholders of the Company submit proposals which they
believe should be voted upon at the Annual Meeting or nominate
persons for election to the Board of Directors. In accordance
with the Company's Bylaws, any such proposal or nomination must
be submitted in writing to the Secretary of the Company not less
than 60 days nor more than 120 days prior to the first
anniversary of the preceding year's Annual Meeting of
Stockholders. This submission must include certain specified
information concerning the proposal or nominee, as the case may
be, and information as to the proponent's ownership of Common
Stock of the Company. Proposals or nominations not meeting these
requirements will not be entertained at the Annual Meeting. The
Secretary should be contacted in writing at the address on the
first page of this Proxy Statement to make any submission or to
obtain additional information as to the proper form and content
of submissions.
Pursuant to applicable rules under the Securities Exchange Act of
1934, some stockholder proposals may be eligible for inclusion in
the Company's 1999 Proxy Statement. Any such stockholder
proposals must be submitted in writing to the Secretary of the
Company no later than December 7, 1998. Stockholders interested
in submitting such a proposal are advised to contact
knowledgeable counsel with regards to the detailed requirements
of such securities rules.
Financial Statements. The Company's financial statements
for the year ended December 27, 1997, are included in the
Company's 1997 Annual Report to Stockholders. Copies of the
Annual Report are being sent to the Company's stockholders
concurrently with the mailing of this Proxy Statement.
Stockholders directly registered by name on the books of Harris
Trust and Savings Bank or shares held in nominee name through
certain brokers and banks have in earlier mailings been offered
the opportunity to obtain this Proxy Statement and the Annual
Report by accessing it in electronic form on the Company's
Internet web site instead of receiving paper copies. If you have
not received or had access to the 1997 Annual Report to
Stockholders, please notify the Secretary of the Company, M/S SC4-
203, 2200 Mission College Blvd., Santa Clara, CA 95052-8119 and
a copy will be sent to you. Copies of the Company's Annual
Report and this Proxy Statement are available on Intel's World
Wide Web site at www.intc.com.
Other Matters. At the date hereof, there are no other
matters which the Board of Directors intends to present or has
reason to believe others will present at the Annual Meeting. If
other matters come before the Meeting, the persons named in the
accompanying form of proxy will vote in accordance with their
best judgment with respect to such matters.
Proxy Solicitation. The expense of solicitation of proxies
will be borne by the Company. The Company has retained D. F.
King & Co., Inc. to solicit proxies for a fee of $8,000 plus a
reasonable amount to cover expenses. Proxies may also be
solicited by certain of the Company's directors, officers and
other employees, without additional compensation, personally or
by written communication, telephone or other electronic means.
The Company is required to request brokers and nominees who hold
stock in their name to furnish the Company's proxy material to
beneficial owners of the stock and will reimburse such brokers
and nominees for their reasonable out-of-pocket expenses in so
doing.
VOTING VIA THE INTERNET OR BY TELEPHONE
For Shares Directly Registered in the Name of the
Stockholder. Stockholders with shares registered directly with
Harris Bank (including participants in the SERP) may vote
telephonically by calling Harris Bank at (888) 266-6795 or you
may vote via the Internet at the following address on the World
Wide Web:
www.harrisbank.com/corporations/shareholders/proxyhome.html
For Shares Registered in the Name of a Brokerage Firm or
Bank. A number of brokerage firms and banks are participating in
a program provided through ADP Investor Communication Services
that offers telephone and Internet voting options. This program
is different than the program provided by Harris Bank for shares
registered in the name of the stockholder. If your shares are
held in an account at a brokerage firm or bank participating in
the ADP program, you may vote those shares telephonically by
calling the telephone number referenced on your voting form. If
your shares are held in an account at a brokerage firm or bank
participating in the ADP program, you already have been offered
the opportunity to elect to vote via the Internet. Votes
submitted via the Internet through the ADP program must be
received by 12:00 p.m. midnight (EDT) on May 19, 1998. The
giving of such proxy will not affect your right to vote in person
should you decide to attend the Annual Meeting.
The telephone and Internet voting procedures are designed to
authenticate stockholders identities, to allow stockholders to
give their voting instructions and to confirm that stockholders'
instructions have been recorded properly. The Company has been
advised by counsel that the telephone and Internet voting
procedures that have been made available through Harris Bank and
ADP Investor Communication Services are consistent with the
requirements of applicable law. Stockholders voting via the
Internet through either Harris Bank or ADP Investor Communication
Services should understand that there may be costs associated
with electronic access, such as usage charges from Internet
access providers and telephone companies, that must be borne by
the stockholder.
By Order of the Board of Directors
/s/F. Thomas Dunlap, Jr.
By: F. THOMAS DUNLAP, JR., Secretary
Santa Clara, California
Dated: April 6, 1998
COMMUNICATING WITH THE COMPANY
We have from time-to-time received calls from stockholders
inquiring about the available means of communication with the
Company. We thought that it would be helpful to describe these
arrangements which are available for your use.
- - If you would like to receive information about Intel, you
may use one of these convenient methods:
(1) To have information such as the Company's latest
Quarterly Earnings Release, Form 10-K, Form 10-Q or
Annual Report mailed to you, stockholders residing in
the U.S., please call the transfer agent, Harris
Trust and Savings Bank at (800) 298-0146. (For
investors located outside the U.S, please call
collect (312) 360-5125.)
(2) To listen to a recording of our most recent Quarterly
Earnings Release or to reach a Stockholder Services
representative, stockholders residing in the U.S.,
please call (800) 298-0146. (For investors located
outside the U.S., please call collect (312) 360-
5125.)
(3) To view Intel's home page on the Internet, use
Intel's Internet address: www.intel.com. Intel's
home page gives you access to product, marketing and
financial data, an on-line version of this Proxy
Statement, Intel's Annual Report to Stockholders and
job listings. Internet access to this information
has the advantage of providing you with up-to-date
information about the Company throughout the year.
- - If you would like to write to us, please send your
correspondence to the following address:
Intel Corporation
2200 Mission College Blvd.
Santa Clara, CA 95052
Attn: Investor Relations, RN5-24
Of course, as a stockholder, you will continue to automatically
receive the Annual Report and Proxy Statement by mail or via the
Internet if you choose that option.
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[MAP INDICATING THE LOCATION OF THE 1997 SHAREHOLDER MEETING
APPEARS HERE]
Directions
The Santa Clara Convention Center is located at the corner of
Great America Parkway and Tasman Drive. There is parking in
front of the building and a large parking garage behind the
Center. There is NO CHARGE for parking.
From San Francisco
Take 101 South to the Great America Parkway Exit. Go East onto
Great America Parkway (a left turn). Follow for 1 1/2 miles to
Tasman Drive. Turn Right onto Tasman Drive and the Center will
be on your left.
From Oakland
Take 880 South to 237 West. Turn left at the Great America
Parkway Exit. Follow for about 3/4 mile. Turn left onto bunker
Hill Drive (the Westin Hotel will be on your left). This will
bring you directly into the parking garage for the Center and
Hotel.
From San Jose/Monterey/Morgan Hill
Take 101 North to the Great America Parkway Exit. Go East onto
Great America Parkway (a Right turn). Follow for 1 1/2 miles to
Tasman Drive. Turn Right onto Tasman Drive and the Center will
be on your left.
From Sacramento/Walnut Creek/Dublin
Take 680 South to Calaveras Highway/237 West. See directions
from Oakland (237 West).
From Santa Cruz/Los Gatos
Take 880 North to 101 North. See directions from San Jose.
please mark vote in oval in the following manner using dark ink only [ ]
For Withhold For All For Against Abstain
Except
1.Election of Directors nominees [ ] [ ] [ ] 2.Ratification of [ ] [ ] [ ]
listed below Ernst & Young, LLP
as Independent
Auditors
01 C. Barrett 02 J. Browne 03 W. Chen 3.Stockholder [ ] [ ] [ ]
04 A. Grove 05 J. Guzy 06 G. Moore proposal to
07 A. Rock 08 J. Shaw 09 L. Vadasz endorse the CERES
10 D. Yoffie 11 C. Young Principles.
Except Nominee(s) written
above
Please sign exactly as name appears herein. Joint owners
must each sign. When signing as attorney, executor,
administrator, trustee or guardian, please give full title
as such.
Signature:__________________________ Date:_________
Signature:__________________________ Date:_________
IF YOU WANT TO VOTE BY TELEPHONE OR VIA THE INTERNET, PLEASE READ THE INSTRUCTIONS BELOW.
FOLD AND DETACH HERE
Control Number [INTEL LOGO]
VOTE BY TELEPHONE OR INTERNET
Intel Corporation encourages you to take advantage of the new and convenient
ways to vote your shares on proposals covered in this year's Annual Meeting of
Stockholders. You may choose one of the two voting methods outlined below to
vote your proxy. This year, voting has been made easier than ever.
- - Vote by phone. There is NO CHARGE for this call. On a touch-tone telephone
call TOLL FREE 888-266-6795 to vote your proxy--24 hours a day, 7 days a
week. You will need to have the above proxy card in hand when you call.
Please enter the 10 digit Control Number located in the box in the upper left
corner of this voting form.
1.To vote as the Board of Directors recommends on all proposals, press 1.
Your vote will be confirmed and cast as you directed, then the call will
end. If you wish to cast a separate vote on each proposal, press 0.
2.If you select 0 to vote on each proposal separately, you will hear these
instructions:
Proposal 1-- To vote FOR all nominees, press 1; to WITHHOLD for all
nominees, press 9; to WITHHOLD for AN INDIVIDUAL nominee; press 0 and
enter the two digit number that appears on the above proxy card next to
the name of the nominee you DO NOT wish to vote for. Once you have
completed voting for the Directors, press 0.
Proposals 2 and 3--To vote FOR, press 1; to vote AGAINST, press 0; to
ABSTAIN, press 0. Your vote selection will be repeated and you will
have an opportunity to confirm it.
- - Vote on the Internet 24 hours a day, 7 days a week. Here is the address:
http://www.harrisbank.com/corporations/shareholders/proxyhome.html. Have this
voting form in hand when you access the web site, then follow the
instructions that are provided.
- - If you vote by telephone or the Internet, DO NOT mail back this voting form.
Thank you for voting
PROXY PROXY
INTEL CORPORATION
2200 Mission College Blvd., Santa Clara, California 95052-8119
Proxy Solicited by Board of Directors for Annual Meeting - May 20, 1998
ANDREW S. GROVE, CRAIG R. BARRETT and F. THOMAS DUNLAP, JR., or any of them, each with the power of
substitution, are hereby authorized to represent and vote the shares of the undersigned, with all the
powers which the undersigned would possess if personally present, at the Annual Meeting of Stockholders
of Intel Corporation to be held on Wednesday, May 20, 1998 or at any postponement or adjournment
thereof.
Shares represented by this proxy will be voted as directed by the stockholder. If no such directions
are indicated, the Proxies will have authority to vote FOR Item 1 (the election of directors), FOR Item
2 (ratification of the appointment of independent auditors) and AGAINST Item 3 (the stockholder
proposal for endorsement of the CERES Principles). In their discretion, the Proxies are authorized to
vote upon such other business as may properly come before the meeting.
[ ] Mark here if you plan to attend the Annual Meeting
in person. IF VOTING BY PAPER,
[ ] Mark here for address change and note below. PLEASE MARK, SIGN, DATE AND MAIL
THIS PROXY CARD PROMPTLY, USING
New Address: ______________________________ THE ENCLOSED ENVELOPE
______________________________ (Continued and to be signed on reverse side.)
______________________________
SEE REVERSE SIDE
[INTEL LOGO]
Annual Meeting of Stockholders
Intel Corporation
May 20, 1998 - 10:00 a.m.
[MAP INDICATING THE LOCATION OF THE 1997 SHAREHOLDER MEETING APPEARS HERE]
Santa Clara Convention Center
5001 Great America Parkway
Santa Clara, California