LINEAR TECHNOLOGY CORP /CA/ - FORM 10-Q/A

Attached files

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EX-31.1 - CERTIFICATION OF CEO PURSUANT TO SEC. 302 - LINEAR TECHNOLOGY CORP /CA/	ex31-1.htm
EX-31.2 - CERTIFICATION OF CFO PURSUANT TO SEC. 302 - LINEAR TECHNOLOGY CORP /CA/	ex31-2.htm
EX-32.1 - CERTICATION PURSUANT TO SEC. 906 - LINEAR TECHNOLOGY CORP /CA/	ex32-1.htm

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q/A

(Mark One)

x	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 26, 2010

o	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from

Commission File Number 0-14864

LINEAR TECHNOLOGY CORPORATION

(Exact name of registrant as specified in its charter)

DELAWARE		94-2778785
(State or other jurisdiction of		(I.R.S. Employer Identification No.)
incorporation or organization)

1630 McCarthy Boulevard, Milpitas, California		95035
(Address of principal executive offices)		(Zip Code)

(408) 432-1900

(Registrant’s telephone number, including area code)

N/A

(Former name, former address and former fiscal year, if changed since last report)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

Yes x

No o

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).

Yes x

No o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or a smaller reporting company. See the definition of “large accelerated filing,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer x		Accelerated filer o

Non-accelerated filer o ( Do not check if a smaller reporting company)		Smaller reporting company o

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Yes o

No x

Shares outstanding of the registrant’s common stock:

Class		Outstanding at October 22, 2010
Common Stock, $0.001 par value per share		225,404,643 shares

EXPLANATORY NOTE

This Quarterly Report on Form 10-Q/A for the period ended September 26, 2010 is being filed for the purposes of refiling Exhibit 32.1, and supersedes the prior filing of the Quarterly Report on Form 10-Q for the period ended September 26, 2010 in its entirety. In addition, the Company is adding additional disclosures in Management’s Discussion and Analysis of Financial Condition and Results of Operations as to why revenues increased 65% in the period ended September 26, 2010 as compared to the period ended September 27, 2009. No changes other than the changes to Exhibit 32.1 and to Management’s Discussion and Analysis of Financial Condition and Results of Operations are being made by means of this filing.

LINEAR TECHNOLOGY CORPORATION

FORM 10-Q/A

THREE MONTHS ENDED SEPTEMBER 26, 2010

INDEX

			Page
Part I:	Financial Information

	Item 1.	Financial Statements

		Consolidated Statements of Income for the three months
		ended September 26, 2010 (unaudited) and September 27, 2009 (unaudited)	4

		Consolidated Balance Sheets at September 26, 2010 (unaudited) and
		June 27, 2010	5

		Consolidated Statements of Cash Flows for the three months ended
		September 26, 2010 (unaudited) and September 27, 2009 (unaudited)	6

		Notes to Consolidated Financial Statements (unaudited)	7-15

	Item 2.	Management’s Discussion and Analysis of Financial Condition and
		Results of Operations	16-19

	Item 3.	Quantitative and Qualitative Disclosures About Market Risk	19

	Item 4.	Controls and Procedures	19

Part II:	Other Information

	Item 1.	Legal Proceedings	20-21

	Item 1A.	Risk Factors	22-27

	Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	28

	Item 3.	Defaults Upon Senior Securities	28

	Item 4.	(Removed and Reserved)	28

	Item 5.	Other Information	28

	Item 6.	Exhibits	28


Signatures:			29

Item 1. Financial Statements

LINEAR TECHNOLOGY CORPORATION

CONSOLIDATED STATEMENTS OF INCOME

(In thousands, except per share amounts)

(unaudited)


	Three Months Ended
	September 26,		September 27,
	2010		2009
Revenues	$ 388,592		$ 236,135
Cost of sales (1)	83,731		59,583
Gross profit	304,861		176,552
Operating expenses:
Research and development (1)	56,202		45,340
Selling, general and administrative (1)	44,082		31,659
Total operating expenses	100,284		76,999
Operating income	204,577		99,553
Interest expense(2)	(17,183)		(19,121)
Interest income	1,916		3,856
Income before income taxes	189,310		84,288
Provision for income taxes	52,060		23,601
Net income	$ 137,250		$ 60,687
Basic earnings per share	$ 0.60		$ 0.27
Shares used in the calculation of basic earnings per share	229,367		226,909
Diluted earnings per share	$ 0.59		$ 0.27
Shares used in the calculation of diluted earnings per share	231,073		227,852
Cash dividends per share	$ 0.23		$ 0.22

Includes the following non-cash charges:
(1)Stock-based compensation
Cost of sales	$ 2,183	$ 2,295
Research and development	9,767	9,719
Selling, general and administrative	5,241	5,475
(2)Amortization of debt discount (non- cash interest expense)	6,766	7,229

See accompanying notes

LINEAR TECHNOLOGY CORPORATION

CONSOLIDATED BALANCE SHEETS

(In thousands, except par value)


	September 26,			June 27,
	2010			2010
	(unaudited)
Assets
Current assets:
Cash and cash equivalents	$	499,152		$	295,854
Marketable securities		552,550			662,215
Accounts receivable, net of allowance for doubtful accounts of $2,043 ($2,043 at June 27, 2010)		205,923			176,874
Inventories:
Raw materials		6,306			5,430
Work-in-process		41,420			39,799
Finished goods		10,634			8,815
Total inventories		58,360			54,044
Deferred tax assets		38,004			38,689
Prepaid expenses and other current assets		34,509			36,625
Total current assets		1,388,498			1,264,301
Property, plant and equipment, at cost:
Land		28,837			28,837
Buildings and improvements		201,015			199,817
Manufacturing and test equipment		564,655			527,230
Office furniture and equipment		3,815			3,789
Property, plant and equipment, total		798,322			759,673
Accumulated depreciation and amortization		(512,580	)		(502,638	)
Property, plant and equipment, net		285,742			257,035
Other noncurrent assets		67,099			69,382
Total assets	$	1,741,339		$	1,590,718
Liabilities and stockholders’ equity
Current liabilities:
Accounts payable	$	27,740		$	21,235
Accrued payroll and related benefits		64,643			80,796
Deferred income on shipments to distributors		31,814			33,700
Income taxes payable		53,964			19,615
Other accrued liabilities		46,559			34,238
Convertible senior notes- current portion		395,099			392,926
Total current liabilities		619,819			582,510
Deferred tax liabilities		110,410			108,665
Convertible senior notes (1)		771,553			766,960
Other noncurrent liabilities		91,263			92,798
Total liabilities		1,593,045			1,550,933
Commitments and contingencies
Stockholders’ equity:
Preferred stock, $0.001 par value, 2,000 shares authorized; none issued or outstanding		-			-
Common stock, $0.001 par value, 2,000,000 shares authorized; 225,066 shares issued and outstanding at September 26, 2010 (224,231 shares at June 27, 2010)		225			224
Additional paid-in capital		1,360,327			1,331,664
Accumulated other comprehensive income, net of tax		1,889			1,974
Accumulated deficit		(1,214,147	)		(1,294,077	)
Total stockholders’ equity		148,294			39,785
Total liabilities and stockholders’ equity	$	1,741,339		$	1,590,718

(1)	See “Note 12. Subsequent Events” regarding the redemption of the current portion of the Company’s senior convertible notes on November 1, 2010.

See accompanying notes

LINEAR TECHNOLOGY CORPORATION

CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands)

(unaudited)

	Three Months Ended
	September 26,			September 27,
	2010			2009
Cash flow from operating activities:
Net income	$	137,250		$	60,687
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization		11,502			11,677
Tax benefit (deficit) received on the exercise of stock-based awards		639			(1,644	)
Stock-based compensation		17,191			17,489
Amortization of convertible senior notes discount		6,766			7,229
Change in operating assets and liabilities:
Increase in accounts receivable		(29,049	)		(17,805	)
(Increase) decrease in inventories		(4,316	)		3,192
Decrease in prepaid expenses, other current assets and deferred tax assets		3,134			2,162
Decrease in long-term assets		869			111
Increase in accounts payable, accrued payroll, other accrued liabilities and noncurrent liabilities		1,138			6,239
Decrease in deferred income on shipments to distributors		(1,886	)		(1,199	)
Increase in income taxes payable		36,337			19,921
Cash provided by operating activities		179,575			108,059
Cash flow from investing activities:
Purchases of marketable securities		(134,270	)		(94,165	)
Proceeds from sales and maturities of available-for-sale securities		243,274			82,898
Purchases of property, plant and equipment		(38,795	)		(3,359	)
Cash provided by (used in) investing activities		70,209			(14,626	)
Cash flow from financing activities:
Retirement of convertible senior notes		-			(9,815	)
Issuance of common stock under employee stock plans		11,863			893
Purchases of common stock		(5,523	)		(4,243	)
Payments of cash dividends		(52,826	)		(49,937	)
Cash used in financing activities		(46,486	)		(63,102	)
Increase in cash and cash equivalents		203,298			30,331
Cash and cash equivalents, beginning of period		295,854			217,018
Cash and cash equivalents, end of period	$	499,152		$	247,349

See accompanying notes

LINEAR TECHNOLOGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

1.	Basis of Presentation

Interim financial statements and information are unaudited; however, in the opinion of management, all adjustments necessary for a fair and accurate presentation of the interim results have been made. All such adjustments were of a normal recurring nature. The results for the three month period ended September 26, 2010 are not necessarily an indication of results to be expected for the entire fiscal year. All information reported in this Form 10-Q/A should be read in conjunction with the Company’s annual consolidated financial statements for the fiscal year ended June 27, 2010 included in the Company’s Annual Report on Form 10-K. The accompanying balance sheet at June 27, 2010 has been derived from audited financial statements. Because the Company is viewed as a single operating segment for management purposes, no segment information has been disclosed.

Revenue Recognition

The Company recognizes revenues when the earnings process is complete, when persuasive evidence of an arrangement exists, the product has been delivered, the price is fixed and determinable and collection is reasonably assured. During the first quarter of fiscal year 2011, the Company recognized approximately 14% of net revenues from domestic distributors that are recognized under agreements which provide for certain sales price rebates and limited product return privileges. Given the uncertainties associated with the levels of pricing rebates, the ultimate sales price on domestic distributor sales transactions is not fixed or determinable until domestic distributors sell the merchandise to the end-customer. At the time of shipment to domestic distributors, the Company records a trade receivable and deferred revenue at the distributor purchasing price since there is a legally enforceable obligation from the distributor to pay for the products delivered. The Company relieves inventory as title has passed to the distributor and recognizes deferred cost of sales in the same amount. “Deferred income on shipments to distributors” represents the difference between deferred revenue and deferred cost of sales and is recognized as a current liability until such time as the distributor confirms a final sale to its end customer. At September 26, 2010, the Company had approximately $39.1 million of deferred revenue and $7.3 million of deferred cost of sales recognized as $31.8 million of “Deferred income on shipments to distributors.” The Company believes that its deferred costs of revenues have limited risk of material impairment as the Company offers stock rotation privileges to distributors (up to 3% to 5% of quarterly purchases) which enable distributors to rotate slow moving inventory. In addition, stock rotated inventory that is returned to the Company is generally resalable. The Company reviews distributor ending on-hand inventory balances, as well as orders placed on the Company to ensure that distributors are not overstocking parts and are ordering to forecasted demand. To the extent the Company had a significant reduction in distributor price or grants significant price rebates, there could be a material impact on the ultimate revenue and gross profit recognized. The price rebates that have been remitted back to distributors have generally ranged from $2.2 million to $3.2 million per quarter.

The Company’s sales to international distributors are made under agreements which permit limited stock return privileges but not sales price rebates. Revenue on these sales is recognized upon shipment at which time title passes. The Company has reserves to cover expected product returns. If product returns for a particular fiscal period exceed or are below expectations, the Company may determine that additional or less sales return allowances are required to properly reflect its estimated exposure for product returns. Generally, changes to sales return allowances have not had a significant impact on operating margin.

2.	Fiscal Period

The Company operates on a 52/53-week fiscal year ending on the Sunday nearest June 30. Fiscal year 2010 was a 52-week year. Fiscal year 2011 is a 53-week fiscal year, with the additional week falling in the three month period ending January 2, 2011, the Company’s second quarter.

3.	Earning Per Share

Basic earnings per share is calculated using the weighted average shares of common stock outstanding during the period. Diluted earnings per share is calculated using the weighted average shares of common stock outstanding, plus the dilutive effect of stock options using the treasury stock method. The following table sets forth the reconciliation of weighted average common shares outstanding used in the computation of basic and diluted earnings per share:

	Three Months Ended
In thousands, except per share	September 26,		September 27,
amounts	2010		2009

Numerator - net income	$	137,250	$	60,687

Denominator for basic earnings
per share- weighted
average shares		229,367		226,909

Effect of dilutive securities –
employee stock options		1,706		943

Denominator for diluted earnings
per share		231,073		227,852

Basic earnings per share	$	0.60	$	0.27

Diluted earnings per share	$	0.59	$	0.27

4.	Fair Value

The Company has determined that the only assets and liabilities in the Company’s financial statements that are required to be measured at fair value on a recurring basis are the Company’s investment portfolio assets. GAAP establishes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants on the measurement date. A fair value measurement assumes that the transaction to sell the asset or transfer the liability occurs in the principal market for the asset or liability. The three levels of the fair value hierarchy are described below:

Level 1. Valuations based on quoted prices in active markets for identical assets or liabilities that an entity has the ability to access.

The Company’s Level 1 assets consist of investments in money-market funds and United States Treasury securities that are actively traded.

Level 2. Valuations based on quoted prices for similar assets or liabilities, quoted prices for identical assets or liabilities in markets that are not active, or other inputs that are observable or can be corroborated by observable data for substantially the full term of the assets or liabilities.

The Company’s Level 2 assets consist of municipal bonds, obligations of U.S. government-sponsored enterprises, corporate debt and commercial paper that are less actively traded in the market, but where quoted market prices exist for similar instruments that are actively traded. The Company determines the fair value of its Level 2 assets by obtaining non-binding market prices from its third-party portfolio managers on the last day of the quarter.

Level 3. Valuations based on inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities.

The Company has no Level 3 assets.

The following table presents the Company’s fair value hierarchy for its financial assets (cash equivalents and marketable securities) measured at fair value on a recurring basis as of September 26, 2010:

In thousands	Quoted Prices in
	Active Markets		Significant Other
	for Identical		Observable Inputs
Description	Instruments (Level 1)		(Level 2)		Total
Assets
Investments in U.S. Treasury securities and money-market funds	$	180,351	$	-	$	180,351
Investments in municipal bonds, obligations of U.S. government- sponsored enterprises, corporate debt and commercial paper		-		667,190		667,190
Total assets measured at fair value	$	180,351	$	667,190	$	847,541

5. Marketable Securities

The Company currently does not hold any investments in auction rate securities or asset backed securities. The Company’s cash equivalents and marketable securities in debt instruments are classified as available-for-sale; most of the debt instruments have an investment rating of AAA. The following is a summary of cash equivalents and marketable securities at September 26, 2010 and June 27, 2010:

	September 26, 2010
In thousands	Amortized		Unrealized		Unrealized			Fair
	Cost		Gain		(Loss) (1)			Value
U.S. Treasury securities	$	96,902	$	184	$	-		$	97,086
Obligations of U.S. government-sponsored enterprises		193,623		575		-			194,198
Municipal bonds		294,354		1,632		(2	)		295,984
Corporate debt securities and other		176,783		226		(1	)		177,008
Money market funds		83,265		-		-			83,265
Total	$	844,927	$	2,617	$	(3	)	$	847,541

Amounts included in:
Cash equivalents	$	294,991	$	-	$	-		$	294,991
Marketable securities		549,936		2,617		(3	)		552,550
Total	$	844,927	$	2,617	$	(3	)	$	847,541

	June 27, 2010
In thousands	Amortized		Unrealized		Unrealized			Fair
	Cost		Gain		(Loss) (1)			Value
U.S. Treasury securities	$	61,074	$	135	$	-		$	61,209
Obligations of U.S. government-sponsored enterprises		106,630		532		(1	)		107,161
Municipal bonds		407,068		2,387		(1	)		409,454
Corporate debt securities and other		134,892		229		(8	)		135,113
Money market funds		78,835		-		-			78,835
Total	$	788,499	$	3,283	$	(10	)	$	791,772

Amounts included in:
Cash equivalents	$	129,557	$	-	$	-		$	129,557
Marketable securities		658,942		3,283		(10	)		662,215
Total	$	788,499	$	3,283	$	(10	)	$	791,772

(1) The Company evaluated the nature of the investments with a loss position at September 26, 2010 and June 27, 2010, which are primarily obligations of the U.S. government and its sponsored enterprises, municipal bonds and U.S. corporate notes. In evaluating the investments, the Company considered the duration of the impairments, and the amount of the impairments relative to the underlying portfolio and concluded that such amounts were not other-than-temporary. The Company principally holds securities until maturity, however, they may be sold under certain circumstances. Unrealized losses on the investments greater than twelve months old were not significant as of September 26, 2010 and June 27, 2010.

The estimated fair value of debt investments in marketable securities by effective maturity date, is as follows:

In thousands	September 26,		June 27,
	2010		2010
Due in one year or less	$	339,787	$	393,350
Due after one year through three years		212,763		268,865
Total	$	552,550	$	662,215

6.	Stock-Based Compensation

Equity Incentive Plans

At September 26, 2010, 12.9 million shares were available for grant under the Company’s 2005 Equity Incentive Plan and 2001 Nonstatutory Stock Option Plan. At the 2010 Annual Meeting of Stockholders, the Company’s stockholders approved a new 2010 Equity Incentive Plan that will replace the 2001 Nonstatutory Stock Option Plan. The shares from the 2001 Nonstatutory Stock Option Plan rolled into the 2010 Equity Incentive Plan and the Company’s stockholders approved an additional 5.0 million shares, resulting in an increase to the total number of shares available for grant from 12.9 million to 17.9 million. The Company’s restricted awards generally vest annually over a period of five years (20% a year) based upon continued employment with the Company. Options also generally become exercisable over a five-year period (generally 10% every six months) based upon continued employment. Options granted prior to January 11, 2005 expire ten years after the date of grant; options granted after January 11, 2005 expire seven years after the date of the grant.

The Company has an Employee Stock Purchase Plan (“ESPP”) that permits eligible employees to purchase common stock through payroll deductions at 85% of the fair market value of the common stock at the end of each six-month offering period. The offering periods generally commence on approximately May 1 and November 1 of each year. At September 26, 2010, 1.8 million shares were available for issuance under the ESPP.

Accounting for Stock-Based Compensation

Compensation cost for restricted stock awards is based on the fair market value of the Company’s stock on the date of grant. Compensation cost for stock options is calculated on the date of grant using the fair value of stock options as determined using the Black-Scholes valuation model. The Company amortizes the compensation cost straight-line over the vesting period, which is generally five years. The Black-Scholes valuation model requires the Company to estimate key assumptions such as expected option term, stock price volatility and forfeiture rates to determine the fair value of a stock option. The estimate of these key assumptions is based on historical information and judgment regarding market factors and trends.

As of September 26, 2010, there was approximately a total of $146.9 million of unrecognized stock-based compensation cost related to share-based payments granted under the Company’s stock-based compensation plans that will be recognized over a period of approximately five years. Future grants will add to this total, whereas quarterly amortization and the vesting of the existing grants will reduce this total.

The Company issues new shares of common stock upon exercise of stock options. For the three months ended September 26, 2010, options for approximately 0.5 million shares were exercised for a gain to the optionee (aggregate intrinsic value) of $3.6 million determined as of the dates of the option exercises.

Stock Options

The following table summarizes stock option activity and related information under all stock option plans during the period indicated:

				Weighted-
	Stock			Average
	Options			Exercise
	Outstanding			Price
Outstanding options, June 27, 2010		25,436,140		$	33.83

Granted		-			-
Forfeited and expired		(1,853,000	)		49.92
Exercised		(483,610	)		24.44
Outstanding options, September 26, 2010		23,099,530		$	32.74

Options vested and exercisable at:
September 26, 2010		18,600,435		$	35.15

Restricted Stock

The following table summarizes the Company’s restricted stock and restricted stock unit activity under all equity award plans during the period indicated:

	Restricted Awards Outstanding			Weighted-Average Grant-Date Fair Value
Nonvested at June 27, 2010		5,609,419		$	30.10

Granted		404,905			31.86
Vested		(525,483	)		32.23
Forfeited		(47,273	)		28.86
Nonvested at September 26, 2010		5,441,568		$	30.03

7. Comprehensive Income

Accumulated other comprehensive income consists of unrealized gains or losses on available-for-sale securities. The components of comprehensive income were as follows:

	Three Months Ended
In thousands	September 26,			September 27,
	2010			2009

Net income	$	137,250		$	60,687

Changes in unrealized gains on
available-for-sale securities		(85	)		(505	)

Total comprehensive income	$	137,165		$	60,182

8. Convertible Senior Notes

During the fourth quarter of fiscal year 2007, the Company issued $1.0 billion aggregate principal amount of its 3.00% Convertible Senior Notes due May 1, 2027 (the “2027A notes”) and $700 million aggregate principal amount of its 3.125% Convertible Senior Notes due May 1, 2027 (the “2027B notes” and, together with the 2027A notes, the “Notes”) to an initial purchaser in a private offering. The Company received net proceeds from the issuance of the Notes of $1,678.0 million after the deduction of issuance costs of $22.0 million. The Company used the entire net proceeds of the offering to fund a portion of its repurchase of $3.0 billion of its common stock pursuant to an accelerated stock repurchase transaction it entered into with an affiliate of the initial purchaser of the Notes simultaneously with the offering of the Notes. Through the first quarter of fiscal year 2011 the Company has repurchased $304.2 million (principal amount) of its 2027B notes and $154.9 million (principal amount) of its 2027A notes, resulting in approximately $1.2 billion (principal amount) of debt outstanding as of September 26, 2010. The Company redeemed for cash the remaining $395.8 million (principal amount) of its 2027B notes on November 1, 2010 using a portion of its existing cash and marketable securities balances. Accordingly, subsequent to November 1, 2010, the Company’s outstanding debt consists of $845.1 million principal amount of its 2027A notes. Interest is payable semiannually in arrears on May 1 and November 1. At September 26, 2010, no shares related to the Notes were included in the computation of diluted earnings per share.

At September 26, 2010, the conversion rate of the 2027A notes is 22.044810 shares of common stock per $1,000 principal amount of the 2027A notes, subject to adjustment upon the occurrence of certain events as described in the Indenture for the 2027A notes (including the payment of dividends). At September 26, 2010, the conversion rate of the 2027B notes, that were redeemed on November 1, 2010 was 21.839572 shares of common stock per $1,000 principal amount of the 2027B notes, subject to adjustment upon the occurrence of certain events as described in the Indenture for the 2027B notes (including the payment of dividends). The payment of the dividend approved by the Company’s Board of Directors in October 2010 will cause a further minor adjustment in the conversion rate of the Notes. The Company may redeem all or some of the 2027A notes for cash at any time on or after May 1, 2014, and holders may require the Company to repurchase the 2027A notes for cash on specified dates beginning May 1, 2014 or upon a fundamental change.

The 2027A and 2027B notes pay cash interest of 3.0% and 3.125%, respectively. As a result of adopting the provisions of ASC 470-20-10 to 35 during the first quarter of fiscal year 2010 the Company recognizes an effective interest rate of 5.69% on the carrying value of the 2027A notes and 5.35% on the carrying value of the 2027B notes. The effective rates are based on the interest rates of similar instruments issued at the time of issuance of the Notes that do not have conversion features such as the Notes. The differences between the effective interest rates of 5.69% and 5.35% and the coupon rates of 3.0% and 3.125%, results in non-cash interest expense that will never be paid by the Company.

The carrying values of the liability and equity components of the Notes are reflected in the Company’s condensed consolidated balance sheets as follows:

	September 26,			June 27,
In thousands	2010			2010
Liability components
Principal amount of the Notes	$	1,240,917		$	1,240,917
Unamortized discount of liability component*		(74,265	)		(81,031	)
Carrying value of liability component	$	1,166,652		$	1,159,886


Equity component-net carrying value	$	122,639		$	122,639

*The remaining unamortized debt discount as of September 26, 2010 will be amortized as additional non-cash interest expense over the remaining terms of the 2027A notes and 2027B notes, which are approximately 3.5 years and 1 month, respectively, the time at which the Notes become initially redeemable.

Interest expense related to the Notes included in interest expense on the condensed consolidated statements of income was recognized as follows:

	Three Months Ended
	September 26,		September 27,
In thousands	2010		2009
Contractual coupon interest	$	9,431	$	10,644
Amortization of debt discount		6,766		7,229
Amortization of debt issuance costs		778		971
Total interest expense related to the Notes	$	16,975	$	18,844

9. Product Warranty and Indemnification

The Company’s warranty policy provides for the replacement of defective parts. In certain large contracts, the Company has agreed to negotiate in good faith a product warranty in the event that an epidemic failure of its parts were to take place. To date there have been no such occurrences. Warranty expense historically has been negligible.

The Company provides a limited indemnification for certain customers against intellectual property infringement claims related to the Company's products. In certain cases, there are limits on and exceptions to the Company's potential liability for indemnification relating to intellectual property infringement claims. To date, the Company has not incurred any significant indemnification expenses relating to intellectual property infringement claims. The Company cannot estimate the amount of potential future payments, if any, that it might be required to make as a result of these agreements, and accordingly, the Company has not accrued any amounts for its indemnification obligations.

10. Income Taxes

The Company must recognize the tax benefit from an uncertain tax position only if it is more likely than not that the tax position will be sustained on examination by the taxing authorities, based on the technical merits of the position. The tax benefits recognized in the financial statements from such a position are measured based on the largest benefit that has a greater than fifty percent likelihood of being realized upon ultimate resolution. As of September 26, 2010, the Company’s other long-term liabilities account includes $72.9 million of unrecognized tax benefits which, if the Company’s positions on these tax matters are upheld, would favorably impact its effective income tax rate in future periods. The Company’s policy is to recognize interest and/or penalties related to income tax matters in income tax expense. Included in the liability for unrecognized tax benefits was $14.2 million accrued for interest at September 26, 2010.

The Company’s annual effective income tax rate for the first quarter of fiscal year 2011 includes no research & development tax credit (“R&D credit”), whereas the prior year period includes an R&D credit for six months, as the R&D credit expired on December 31, 2009. If the R&D credit is reinstated retroactive to the expiration date, as has occurred on several occasions in the past, then the Company’s effective tax rate will receive a tax benefit in future periods including a discrete tax benefit in the quarter of reinstatement.

During the first quarter of fiscal year 2009, the Company and the Appeals Division of the Internal Revenue Service (“IRS Appeals”) agreed to settle certain disputed export tax benefits the Company claimed as its extraterritorial income (“ETI”) exclusion under the Internal Revenue Code for fiscal years 2002 through 2006. As a result of the settlement, the Company recognized a discrete tax benefit during the first quarter of fiscal 2009 totaling $6.7 million, primarily due to the reversal of liabilities for uncertain tax positions pertaining to ETI. IRS Appeals and the Company have reached a tentative settlement on additional outstanding ETI refund claims that is potentially favorable for the Company. This tentative settlement, together with certain other refund claims that continue to be reviewed by the IRS, is subject to review by the Joint Committee on Taxation. It is expected that these matters will be resolved during fiscal year 2011.

11. Contingencies

Litigation

The Company is subject to various legal proceedings and claims that arise in the ordinary course of business on a wide range of matters, including, among others, patent suits and employment claims. The Company does not believe that any such current suits will have a material impact on its business or financial condition. However, current lawsuits and any future lawsuits will divert resources and could result in the payment of substantial damages.

Certain current and former directors and officers of the Company have been named as defendants in two consolidated shareholder derivative actions filed in the United States District Court for the Northern District of California and captioned In re Linear Technology Corporation Shareholder Derivative Litigation (the “Federal Action”), in three consolidated shareholder derivative actions filed in the Superior Court for Santa Clara County, California, also captioned In re Linear Technology Corporation Shareholder Derivative Litigation (the “California State Action”), and in a shareholder derivative action filed in Delaware Chancery Court, captioned Weiss v. Swanson (the “Delaware Action”). The Company has been named in each of these Actions as a nominal defendant against which no recovery is sought.

In the Federal Action, the plaintiffs alleged that the individual defendants breached their fiduciary duties by allegedly backdating stock option grants between 1995 and 2002, and asserted derivative claims against them based on alleged violations of Section 10(b) of the Securities Exchange Act of 1934 (“Exchange Act”) and Rule 10b-5 thereunder. On December 7, 2006, the Court granted Linear’s motion to dismiss the complaint for failure to make a pre-suit demand or to demonstrate that a demand would have been futile. The plaintiffs filed an amended complaint on January 5, 2007 asserting derivative claims against the individual defendants for alleged violations of Sections 10(b), 14(a), and 20(a) of the Exchange Act, and Rules 10b-5 and 14a-9. Pursuant to stipulation, on February 14, 2007, the District Court stayed the Federal Action.

In the California State Action, plaintiffs initially asserted claims against the individual defendants for breaching their, and aiding and abetting breaches of others’, fiduciary duty in connection with the alleged backdating of stock option grants between 1995 and 2002. The plaintiffs also alleged that certain defendants were unjustly enriched, that defendants wasted corporate assets, and that the officers violated California insider trading laws. The plaintiffs sought unspecified money damages, disgorgement of profits and benefits, restitution, rescission of option contracts, imposition of a constructive trust over option contracts, and attorneys’ fees and costs. On July 13, 2007, the Court sustained the Company’s demurrer, and granted plaintiffs leave to amend the complaint. The Court did not address the individual defendants’ demurrer.

On August 13, 2007, the California plaintiffs filed an amended complaint, asserting claims against the individual defendants for breaching, and aiding and abetting breaches of fiduciary duty in connection with the grant of allegedly “spring-loaded” and “bullet-dodged” stock options between 1995 and 2005. The amended complaint also alleged that individual defendants were unjustly enriched, and violated California insider trading laws, and that the director defendants wasted corporate assets. Plaintiffs seek unspecified damages, disgorgement of profits and benefits, restitution, rescission of option contracts, imposition of a constructive trust over executory option contracts, and attorneys’ fees and costs. On September 12, 2007, the Company and the individual defendants filed demurrers to the amended complaint. Before the demurrers were fully briefed, the parties stipulated to stay the California State Action pending the resolution of the motion to dismiss the complaint in the Delaware Action. The Delaware Court denied that motion on March 7, 2008.

On May 5, 2008, the individual defendants moved to stay the California State Action; Linear joined in that motion. That same day, plaintiffs moved to coordinate discovery in the California State Action and the Delaware Action. The individual defendants opposed that motion and Linear joined in their opposition. In a June 18, 2008 order, the Court granted the motion to stay the California State Action, and rejected, in part, the plaintiffs’ request to coordinate discovery. The Court ordered the defendants to supply the California plaintiffs with copies of documents produced and transcripts of depositions conducted in the Delaware Action. Subsequently, on December 31, 2009, the California plaintiffs filed a motion to lift the stay in the California State Action. On January 25, 2010, the individual defendants filed their opposition to this motion. On February 8, 2010, the Court issued an order denying the California plaintiffs’ motion to lift the stay. The Court is continuing to monitor the progress of the Delaware Action.

In the Delaware Action, filed on March 23, 2007, the plaintiff alleges that the defendant directors breached their fiduciary duty by granting “spring-loaded” and “bullet-dodged” stock options to certain officers and directors between 1996 and 2005. The plaintiff also asserts claims for unjust enrichment against defendants who received the option grants. The plaintiff seeks unspecified money damages, disgorgement of profits and benefits, restitution, rescission of certain defendants’ option contracts, imposition of a constructive trust over the option contracts, and attorneys’ fees and costs. The defendants moved to dismiss the Delaware Action on May 25, 2007. Rather than respond, the plaintiff filed his first amended complaint on August 10, 2007, making substantially the same allegations as those in the original complaint. On September 19, 2007, the Company and the individual defendants filed a Motion to Dismiss the first amended complaint on the grounds that the plaintiff had failed to make a pre-suit demand on the Board or to plead facts demonstrating that such a demand would have been futile, and that the first amended complaint failed to state a claim against each of the individual defendants. On March 7, 2008, the Court denied the motion. Linear answered the first amended complaint on April 7, 2008.

On January 25, 2010, the plaintiff in the Delaware Action filed a motion to amend the first amended complaint. This second amended complaint was filed under seal, with a redacted copy filed publicly, on February 15, 2010. The second amended complaint adds allegations that the defendant directors breached their fiduciary duty by: (1) granting additional stock options (beyond those identified in the first amended complaint) to employees, which grants plaintiff claims were manipulated during the 1996-2005 time period; (2) granting and receiving “backdated” and/or otherwise allegedly manipulated stock options, in addition to the allegedly “spring-loaded” and “bullet-dodged” options; and (3) granting additional stock options whose exercise price did not conform to the terms of the applicable stock option plans. The defendants answered the second amended complaint on March 17, 2010.

On June 10, 2010, the officer and director defendants filed motions for summary judgment. On August 6, 2010, and thereafter on August 25, 2010, the parties in the Delaware Action stipulated to an extension of time to file opposition and reply briefs, and related pleadings. On September 23, 2010, the parties to the Delaware Action filed a stipulation and proposed order advising the Delaware Court of Chancery that they had executed a Memorandum of Understanding providing for settlement of the Delaware Action. The Delaware Court granted the stipulation and entered the order that same day. The stipulation notes that the Memorandum of Understanding contemplates a stay of the Delaware Action and that the parties anticipate filing a Stipulation of Settlement along with a proposed Scheduling Order that would set a settlement approval hearing and a briefing schedule for the Delaware Court’s consideration of the settlement. The Court of Chancery stayed all proceedings in the Delaware Action, other than proceedings related to the review and approval of the anticipated Stipulation of Settlement.

The Stipulation of Settlement has not yet been filed, and there can be no assurance that the Delaware Court will approve the settlement.

12. Subsequent events:

As discussed in Note 8, the Company redeemed for cash the remaining $395.8 million (principal amount) of its 2027B notes on November 1, 2010 using a portion of its existing cash and marketable securities balances. The redemption of debt did not result in any gains or losses in the statement of income. Periods subsequent to the redemption will have lower interest expense as a result of the redemption. The remaining outstanding principal ($845.1 million) can be redeemed by the Company beginning May 1, 2014 and holders of the debt may require the Company to repurchase the debt for cash on specified dates beginning May 1, 2014.

Item 2.

Management’s Discussion and Analysis of Financial Condition and Results of Operations

Overview

Linear Technology Corporation is a manufacturer of high performance linear integrated circuits. The Company generates revenue exclusively from the sale of analog integrated circuits. The Company targets the high performance segment of the analog integrated circuit market. The Company was founded in 1981 and became a public company in 1986. Linear Technology products include high performance amplifiers, comparators, voltage references, monolithic filters, linear regulators, DC-DC converters, battery chargers, data converters, communications interface circuits, RF signal conditioning circuits, uModuleTM products, and many other analog functions. Applications for Linear Technology’s high performance circuits include telecommunications, networking products such as optical switches, industrial instrumentation, security monitoring devices, complex medical devices, automotive electronics, factory automation, process control, military and space systems, notebook and desktop computers, computer peripherals, video/multimedia, high-end consumer products such as digital cameras and MP3 players; and cellular telephones.

The Company achieved record quarterly revenues of $388.6 million during the first quarter of fiscal year 2011, an increase of $22.4 million or 6% over the fourth quarter of fiscal year 2010 and 65% or $152.5 million over the first quarter of fiscal year 2010. Net income of $137.3 million increased $12.7 million or 10% over the fourth quarter of fiscal year 2010 and increased $76.6 million or 126% over the first quarter of fiscal year 2010. The results for the first quarter of fiscal year 2011 were impacted by a one-time pre-tax legal charge of $5.3 million included in selling, general and administrative expenses. The resulting first quarter diluted earnings per share (“EPS”) increased $0.05 cents per share or 9% over the fourth quarter of fiscal year 2010 and increased $0.32 cents per share or 119% over the first quarter of fiscal year 2010.

Critical Accounting Estimates

There have been no significant changes to the Company’s critical accounting policies during the three months ended September 26, 2010, as compared to the previous disclosures in Management’s Discussion and Analysis of Financial Condition and Results of Operations included in the Company’s Annual Report on Form 10-K for the fiscal year ended June 27, 2010.

Results of Operations

The table below summarizes the income statement items for the three months ended September 26, 2010 and September 27, 2009 as a percentage of total revenue and provides the percentage change in absolute dollars of such items comparing the interim period ended September 26, 2010 to the corresponding period from the prior fiscal year:

	Three Months Ended
	September 26,	September 27,	Increase/
	2010	2009	(Decrease)

Revenues	100.0%	100.0%	65%
Cost of sales	21.5	25.2	41
Gross profit	78.5	74.8	73
Expenses:
Research and development	14.5	19.2	24
Selling, general and
administrative	11.3	13.4	39

	25.8	32.6	30
Operating income	52.7	42.2	106
Interest expense	(4.4)	(8.1)	(10)
Interest income	0.4	1.6	(50)
Income before
income taxes	48.7%	35.7%	125
Tax rate	27.5%	28.0%

Revenue for the quarter ended September 26, 2010 was $388.6 million, an increase of $152.5 million or 65% over revenue of $236.1 million for the same quarter of the previous fiscal year. The substantial year-over-year increase in revenue was primarily due to an improving global macro-economic climate. The results from the first quarter of fiscal year 2010 were adversely impacted by the worldwide global credit and financial crisis, whereas the results for the first quarter of fiscal year 2011 reflect a recovery from the worldwide recession. The increase in revenues was the primary driver in a 106% increase in operating income. Operating income improved faster than revenues due to the impact of spreading fixed costs over a higher revenue base and the Company maintaining tight expense controls through the recovery period.

Revenue grew primarily due to an increase in the number of units shipped and marginally due to the increase in the average selling price (“ASP”). The number of units shipped increased by approximately 52% from 152.4 million units in the first quarter of fiscal year 2010 to 232.3 million units in the first quarter of fiscal year 2011. The ASP of $1.65 per unit in the first quarter of fiscal year 2011 was higher compared to the ASP of $1.49 per unit in the first quarter of fiscal year 2010. The 11% increase in ASP was due to a proportionally higher percentage of the increased quarterly revenue being in the industrial and communication infrastructure end-markets rather than in the cell-phone and consumer end-markets. The Company’s revenues from the industrial and communication infrastructure end-markets generally have higher ASPs than products that go into the cell-phone and consumer end-markets.

Over the past few years the Company has been reducing its exposure to the consumer and cell-phone end-markets in favor of the industrial, automotive, communication infrastructure and military end-markets because these latter end-markets tend to demand more complex technology products, which have higher ASPs and are less price sensitive. During the first quarter of fiscal year 2011, 77% of the Company’s revenues were in the industrial, automotive, communication infrastructure, and military end-markets as compared to 74% in the first quarter of fiscal year 2010.

Geographically, revenues increased in each major geographical region. International revenues were $285.9 million or 74% of revenues, an increase of $119.0 million as compared to international revenues of $166.9 million or 71% of revenues for the same period in the previous fiscal year. Internationally, revenues to Rest of the World (“ROW”), which is primarily Asia excluding Japan, represented $159.2 million or 41% of revenues, while sales to Europe and Japan were $72.5 million or 19% of revenues and $54.2 million or 14% of revenues, respectively. Domestic revenues were $102.7 million or 26% of revenues in the first quarter of fiscal year 2011, an increase of $33.5 million over $69.2 million or 29% of revenues in the same period in fiscal year 2010.

Gross profit of $304.9 million for the quarter ended September 26, 2010 increased $128.3 million or 73% over gross profit of $176.6 million in the first quarter of fiscal year 2010. Gross profit as a percentage of revenues increased to 78.5% in the first quarter of fiscal year 2011 as compared to 74.8% for the same period in the previous fiscal year. The improvement in gross profit as a percentage of revenues for the quarter ended September 26, 2010 was primarily due to spreading fixed costs over a higher sales base and higher ASP’s, partially offset by increased profit sharing.

Research and development (“R&D”) expenses for the quarter ended September 26, 2010 were $56.2 million, an increase of $10.9 million or 24% over R&D expenses of $45.3 million for the same period in the previous fiscal year. The increase in R&D expenses was primarily due to a $6.0 million increase in employee profit sharing and a $3.5 million increase in compensation costs. Compensation costs increased due to increased headcount over the first quarter of fiscal 2010 and due to the first quarter of fiscal year 2010 having a temporary 10% reduction in base pay that was gradually eliminated during the second and the third quarters of fiscal year 2010. In addition, the increase in R&D expense was due to a $1.4 million increase in other R&D expenses, primarily mask costs.

Selling, general and administrative expenses (“SG&A”) for the quarter ended September 26, 2010 were $44.1 million, an increase of $12.4 million or 39% over SG&A expense of $31.7 million for the same period in the previous fiscal year. The largest contributor to the increase in SG&A expense was a one-time legal charge of $5.3 million. In addition, SG&A expenses increased due to a $4.4 million increase in profit sharing and a $1.7 million increase in compensation costs. Compensation costs increased due to increased headcount over the first quarter of fiscal 2010 and due to the first quarter of fiscal year 2010 having a temporary 10% reduction in base pay that was gradually eliminated during the second and the third quarters of fiscal year 2010. Other SG&A expenses increased $1.0 million, primarily advertising related expenses.

Interest expense was $17.2 million for the first quarter of fiscal year 2011, a decrease of $1.9 million from the corresponding period of fiscal year 2010. The decrease in interest expense was primarily due to the retirement of $154.9 million principal amount of the Company’s 3.0% Convertible Senior Notes during the fourth quarter of fiscal year 2010.

Interest income was $1.9 million for the first quarter of fiscal year 2011, a decrease of $1.9 million from the corresponding period of fiscal year 2010. Interest income decreased primarily due to a decrease in the average interest rate earned on the Company’s cash, cash equivalents and marketable securities balances.

The Company’s tax rate for the first quarter of fiscal year 2011 was 27.5% as compared to 28% in the same quarter of fiscal year 2010. The decrease in the effective income tax rate was primarily due to an increase in the Company’s domestic manufacturing deduction and higher earnings in foreign jurisdictions with lower tax rates. This decrease in the effective tax rate was partially offset by lower tax exempt interest income and the expiration of the R&D tax credit on December 31, 2009, as the current fiscal year includes no R&D tax benefit whereas the prior year period included the R&D tax credit for six months.

IRS Appeals and the Company have reached a tentative settlement on additional outstanding ETI refund claims that is potentially favorable for the Company. This tentative settlement, together with certain other refund claims that continue to be reviewed by the IRS, is subject to review by the Joint Committee on Taxation. It is expected that these matters will be resolved during fiscal year 2011.

Factors Affecting Future Operating Results

Except for historical information contained herein, the matters set forth in this Form 10-Q/A, including the statements in the following paragraphs, are forward-looking statements that are dependent on certain risks and uncertainties including such factors, among others, as the timing, volume and pricing of new orders received and shipped during the quarter, the timely introduction of new processes and products; increases in costs associated with utilities, transportation and raw materials; currency fluctuations; the effects of adverse economic conditions in the United States and international markets and other factors described below and in “Item 1A – Risk Factors” section of this Quarterly Report on Form 10-Q/A.

Revenue grew 6% over the fourth quarter of fiscal year 2010 and marks the sixth consecutive quarter that the Company has grown revenues and the third consecutive quarter that the Company has achieved record quarterly revenues. The Company grew in the first quarter more in-line with its historical quarterly growth patterns after a year in which quarterly revenues grew sequentially 14%, 9%, 21% and 18%. The Company’s strategy of focusing on traditional analog end-markets (industrial, automotive and communications) has been instrumental in achieving these results.

The Company had a positive book-to-bill ratio although bookings in total were less than the previous quarter. During the quarter the Company added more capacity and its average lead times have decreased to eight weeks from ten weeks, as it continues to bring its lead times into more historic levels of four to six weeks. As the Company enters the December quarter there is more uncertainty than in recent quarters which makes forecasting difficult. Although the Company had another positive book-to-bill ratio, bookings decreased as the quarter progressed. Customers are more confident in their ability to get parts and therefore may order less as they continue to adjust inventory levels and safety stocks downward. Given the above, the Company expects that revenue will be flat to down 4% sequentially for the second quarter of fiscal 2011.

Although the Company believes that it has the product lines, manufacturing facilities and technical and financial resources for its current operations, sales and profitability could be significantly affected by factors described above and other factors. Additionally, the Company’s common stock could be subject to significant price volatility should sales and/or earnings fail to meet expectations of the investment community. Furthermore, stocks of high technology companies are subject to extreme price and volume fluctuations that are often unrelated or disproportionate to the operating performance of these companies.

Liquidity and Capital Resources

At September 26, 2010, the Company’s cash, cash equivalents and marketable securities balances were $1,051.7 million in aggregate, representing an increase of $93.6 million over the June 27, 2010 balances of $958.1 million. This increase was primarily due to positive cash flows from operations of $179.6 million offset by cash outflows of $38.8 million for capital additions; $5.5 million to purchase its common stock; and $52.8 million for the payment of cash dividends, representing $0.23 per share for the first quarter of fiscal year 2011. Working capital as of September 26, 2010 was $768.7 million.

Accounts receivable totaled $205.9 million at the end of the first quarter of fiscal year 2011, an increase of $29.0 million over the June 27, 2010 balance of $176.9 million. The increase is primarily due to higher shipments in the first quarter of fiscal year 2011 as compared to the fourth quarter of fiscal year 2010. In addition, the month of September is a heavy shipment month coming off an August vacation month and some build-up of consumer related shipments in anticipation of holiday season sales. Inventory totaled $58.4 million at the end of the first quarter of fiscal year 2011, an increase of $4.3 million over the fourth quarter of fiscal year 2010. The increase in inventory was primarily due to increased production capacity to support higher revenue levels and to accommodate lowering lead-times.

Net property, plant and equipment increased $28.7 million over the fourth quarter of fiscal year 2010 primarily due to fixed assets additions of $38.8 million related to the expansion of the Company’s production capacity to decrease the lead times from ten weeks to eight weeks. These additions were offset by $10.1 million in depreciation expense.

Accrued payroll and related benefits decreased $16.2 million from the fourth quarter of fiscal year 2010 primarily due to the payment of profit sharing partially offset by an increase in the profit sharing accrual. The Company accrues for profit sharing on a quarterly basis, but distributes payouts to employees on a semi-annual basis during the first and third quarters of each fiscal year. Income taxes payable totaled $54.0 million at the end of the first quarter of fiscal year 2011, an increase of $34.3 million over the fourth quarter of fiscal year 2010 primarily due to the Company’s quarterly tax provision offset by quarterly tax payments. Other accrued liabilities of $46.6 million increased $12.3 million over the fourth quarter of fiscal year 2010 primarily due to accrued interest on the Company’s Convertible Senior Notes. The Company makes semi-annual interest payments during the second and fourth quarter of each fiscal year. In addition, there was an increase to the legal accrual as result of the $5.3 million one-time pre-tax legal charge.

In October 2010, the Company’s Board of Directors declared a cash dividend of $0.23 per share. The cash dividend of $0.23 per share will be paid on November 24, 2010 to stockholders of record on November 12, 2010. The payments of future dividends will be based on the Company’s financial performance.

The Company redeemed for cash the remaining $395.8 million (principal amount) of its 2027B notes on November 1, 2010 using a portion of its existing cash and marketable securities balances. The redemption of debt did not result in any gains or losses in the statement of income. Periods subsequent to the redemption will have lower interest expense as a result of the redemption.

Historically, the Company has satisfied its liquidity needs through cash generated from operations. Given its financial condition and historical operating performance, the Company believes that current capital resources and cash generated from operating activities will be sufficient to meet its liquidity, capital expenditures requirements, and debt retirement for the near future.

Off Balance-Sheet Arrangements

As of September 26, 2010, the Company had no off-balance sheet financing arrangements.

Contractual Obligations

In April 2007, the Company issued $1.0 billion principal amount of it’s 3.0% Convertible Senior Notes due May 1, 2027. Through the first quarter of fiscal year 2011, the Company has retired $154.9 million in face value, leaving a remaining balance of $845.1 million. The Company pays cash interest at an annual rate of 3.0%, payable semiannually on November 1 and May 1 of each year. See Note 8 to the consolidated financial statements, included in Part 1, “Financial Information,” for additional information.

Fair Value

As of September 26, 2010, the Company’s cash and cash equivalents, and marketable securities investment portfolio had a fair value of $847.5 million. The Company’s cash and cash equivalents, and marketable securities investment portfolio consists of money-market funds, U.S. Treasury securities, obligations of U.S. government-sponsored enterprises, municipal bonds, commercial debt and corporate debt securities. The Company currently does not hold any investments in auction rate securities or asset backed securities. Most of the Company’s investments in debt instruments have an investment rating of AAA. As of September 26, 2010, the Company’s cash and cash equivalents, and marketable securities investment portfolio had a remaining maturity of approximately one year.

Item 3. Quantitative and Qualitative Disclosures About Market Risk

For additional quantitative and qualitative disclosures about market risk affecting the Company, see item 7A of the Company’s Form 10-K for the fiscal year ended June 27, 2010. There have been no material changes in the market risk affecting the Company since the filing of the Company’s Form 10-K for fiscal year 2010. At September 26, 2010, the Company’s cash and cash equivalents, and marketable securities consisted of money-market funds, U.S. Treasury securities, obligations of U.S. government sponsored enterprises, municipal bonds, commercial debt and corporate debt securities. The Company did not hold any derivative financial instruments. The Company’s interest income is sensitive to changes in the general level of interest rates. In this regard, changes in interest rates can affect the interest earned on cash and cash equivalents and short-term investments.

The Company’s revenues outside the United States are transacted in U.S. dollars; accordingly the Company’s revenues are not impacted by foreign currency rate changes. To date, fluctuations in foreign currency exchange rates have not had a material impact on the results of operations.

Item 4. Controls and Procedures

(a)	Evaluation of Disclosure Controls and Procedures.

The Company’s management, with the participation of its Chief Executive Officer and Chief Financial Officer, evaluated the effectiveness of the Company’s disclosure controls and procedures as of the end of the period covered by this Quarterly Report on Form 10-Q/A. For purposes of this section, the term disclosure controls and procedures means controls and other procedures of an issuer that are designed to ensure that information required to be disclosed by the issuer in the reports that it files or submits under the Securities Exchange Act of 1934 (15 U.S.C. 78a et seq.) is recorded, processed, summarized and reported within the time periods specified in the Commission's rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by an issuer in the reports that it files or submits under the Securities Exchange Act of 1934 is accumulated and communicated to the issuer's management, including its principal executive and principal financial officers, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure.

The Company’s management evaluated, with the participation of its Chief Executive Officer and Chief Financial Officer, the effectiveness of the Company’s disclosure controls and procedures as of September 26, 2010. Based on this evaluation, the Company’s Chief Executive Officer and Chief Financial Officer have concluded that, as of such date, the Company’s disclosure controls and procedures are effective to ensure that information it is required to disclose in reports that it files or submits under the Securities Exchange Act of 1934 is accumulated and communicated to the Company’s management, including its principal executive and principal financial officers, as appropriate to allow timely decisions regarding required disclosure, and that such information is recorded, processed, summarized and reported within the time periods specified in Securities and Exchange Commission rules and forms

(b) Changes in Internal Control over Financial Reporting.

No change in the Company’s internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Securities Exchange Act of 1934) occurred during the quarter ended September 26, 2010 that has materially affected, or is reasonably likely to materially affect, the Company’s internal control over financial reporting.

PART II. OTHER INFORMATION

Item 1.

Legal Proceedings

The Stipulation of Settlement has not yet been filed, and there can be no assurance that the Delaware Court will approve the settlement.

Item 1A.

Risk Factors

A description of the risk factors associated with the Company’s business is set forth below. In addition to the risk factors discussed below, see “Factors Affecting Future Operating Results” included in “Management's Discussion and Analysis” for further discussion of other risks and uncertainties that may affect the Company.

Erratic consumer and/or corporate spending due to uncertainties in the macroeconomic environment could adversely affect our revenues and profitability.

We depend on demand from the industrial, communication, computer, consumer and automotive end-markets we serve. Our revenues and profitability are based on certain levels of consumer and corporate spending. Reductions or other fluctuations in consumer and/or corporate spending as a result of uncertain conditions in the macroeconomic environment, such as global credit conditions, reduced demand, imbalanced inventory levels, mortgage failures, fluctuations in interest rates, higher energy prices, or other conditions, could adversely affect, our revenues and profitability.

Sudden adverse shifts in the business cycle could adversely affect our revenues and profitability.

The semiconductor market has historically been cyclical and subject to significant economic downturns at various times. The cyclical nature of the semiconductor industry may cause us to experience substantial period-to-period fluctuations in our results of operations, which could adversely affect our revenues and profitability. The growth rate of the global economy is one of the factors affecting demand for semiconductor components. Many factors could adversely affect regional or global economic growth including turmoil or depressed conditions in financial or credit markets, depressed business or consumer confidence, inventory excesses, increased unemployment, increased price inflation for goods, services or materials, rising interest rates in the United States and the rest of the world, a significant act of terrorism which disrupts global trade or consumer confidence, geopolitical tensions including war and civil unrest, reduced levels of economic activity, or disruptions of international transportation.

Typically, our ability to meet our revenue goals and projections is dependent to a large extent on the orders we receive from our customers within the period and by our ability to match inventory and current production mix with the product mix required to fulfill orders on hand and orders received within a period for delivery in that period. Because of this complexity in our business, no assurance can be given that we will achieve a match of inventory on hand, production units, and shippable orders sufficient to realize quarterly or annual revenue and net income goals.

Volatility in customer demand in the semiconductor industry could affect future levels of sales and profitability and limit our ability to predict such levels.

Historically, we have maintained low lead times, which has enabled customers to place orders close to their true needs for product. In defining our financial goals and projections, we consider inventory on hand, backlog, production cycles and expected order patterns from customers. If our estimates in these areas become inaccurate, we may not be able to meet our revenue goals and projections. In addition, some customers require us to manufacture product and have it available for shipment, even though the customer is unwilling to make a binding commitment to purchase all, or even some, of the products. As a result, in any quarterly fiscal period we are subject to the risk of cancellation of orders leading to a fall-off of sales and backlog. Further, those orders may be for products that meet the customer’s unique requirements so that those cancelled orders would, in addition, result in an inventory of unsaleable products, and thus potential inventory write-offs. We routinely estimate inventory reserves required for such products, but actual results may differ from these reserve estimates.

We generate revenue from thousands of customers worldwide and our revenues are diversified by end-market and geographical region. Our results in any period, or sequence of periods, may be positively affected by the fact that a customer has designed one of our products into one of their high selling products. This positive effect may not last, however, as our customers frequently redesign their high selling products, especially to lower their products’ costs. In such redesigns, they may decide to no longer use our product or may seek pricing terms from us that we choose not to accede to, thus resulting in the customer ceasing or significantly decreasing its purchases from us. The loss of, or a significant reduction in purchases by a portion of our customer base, for this or other reasons, such as changes in purchasing practices, could adversely affect our results of operations. In addition, the timing of customers’ inventory adjustments may adversely affect our results of operations.

We may be unsuccessful in developing and selling new products required to maintain or expand our business.

The markets for our products depend on continued demand for our products in the communications, industrial, computer, high-end consumer and automotive end-markets. The semiconductor industry is characterized by rapid technological change, variations in manufacturing efficiencies of new products, and significant expenditures for capital equipment and product development. New product offerings by competitors and customer demands for increasing linear integrated circuit performance or lower prices may render our products less competitive over time, thus necessitating our continual development of new products. New product introductions are thus a critical factor for maintaining or increasing future sales growth and sustained or increased profitability, but they can present significant business challenges because product development commitments and expenditures must be made well in advance of the related revenues. The success of a new product depends on a variety of factors including accurate forecasts of long-term market demand and future technological developments, accurate anticipation of competitors’ actions and offerings, timely and efficient completion of process design and development, timely and efficient implementation of manufacturing and assembly processes, product performance, quality and reliability of the product, and effective marketing, sales and service.

Although we believe that the high performance segment of the linear integrated circuit market is generally less affected by price erosion or by significant expenditures for capital equipment and product development than other semiconductor market sectors, future operating results may reflect substantial period-to-period fluctuations due to these or other factors.

Our manufacturing operations may be interrupted or suffer yield problems.

We rely on our internal manufacturing facilities located in California and Washington to fabricate most of our wafers. We depend on outside silicon foundries for a small portion (less than 5%) of our wafer fabrication. We could be adversely affected in the event of a major earthquake, which could cause temporary loss of capacity, loss of raw materials, and damage to manufacturing equipment. Additionally, we rely on our internal and external assembly and testing facilities located in Singapore and Malaysia. We are subject to economic and political risks inherent to international operations, including changes in local governmental policies, currency fluctuations, transportation delays and the imposition of export controls or increased import tariffs. We could be adversely affected if any such changes are applicable to our foreign operations.

Our manufacturing yields are a function of product design and process technology, both of which are developed by us. The manufacture and design of integrated circuits is highly complex. We may experience manufacturing problems in achieving acceptable yields or experience product delivery delays in the future as a result of, among other things, capacity constraints, equipment malfunctioning, construction delays, upgrading or expanding existing facilities or changing our process technologies, any of which could result in a loss of future revenues or increases in fixed costs. To the extent we do not achieve acceptable manufacturing yields or there are delays in wafer fabrication, our results of operations could be adversely affected. In addition, operating expenses related to increases in production capacity may adversely affect our operating results if revenues do not increase proportionately.

Our dependence on third party foundries and other manufacturing subcontractors may cause delays beyond our control in delivering our products to our customers.

A portion of our wafers (approximately 5% to 15%) are processed offshore by independent assembly subcontractors located in Malaysia and Thailand. These subcontractors separate wafers into individual circuits and assemble them into various finished package types. During periods of increasing demand and volatile lead times, sub-contractors can become over committed and therefore unable to meet all of their customer demand requirements thereby causing inconsistencies in availability of supply. In addition, reliability problems experienced by our assemblers could cause problems in delivery and quality, resulting in potential product liability to us. We could also be adversely affected by political disorders, labor disruptions, and natural disasters in these locations.

We are dependent on outside silicon foundries for a small portion (less than 5%) of our wafer fabrication. As a result, we cannot directly control delivery schedules for these products, which could lead to product shortages, quality assurance problems and increases in the cost of our products. We may experience delays in delivering our products to our customers. If these foundries are unable or unwilling to produce adequate supplies of processed wafers conforming to our quality standards, our business and relationships with our customers for the limited quantities of products produced by these foundries could be adversely affected. Finding alternate sources of supply or initiating internal wafer processing for these products may not be economically feasible. In addition, the manufacture of our products is a highly complex and precise process, requiring production in a highly controlled environment. Changes in manufacturing processes or the inadvertent use of defective or contaminated materials by a third party foundry could adversely affect the foundry’s ability to achieve acceptable manufacturing yields and product reliability.

We rely on third party vendors for materials, supplies, critical manufacturing equipment and freight services that may not have adequate capacity or may be impacted by outside influences such as natural disasters that could impact our product delivery requirements.

The semiconductor industry has experienced a very large expansion of fabrication capacity and production worldwide over time. As a result of increasing demand from semiconductor and other manufacturers, availability of certain basic materials and supplies, such as chemicals, gases, polysilicon, silicon wafers, ultra-pure metals, lead frames and molding compounds, and of subcontract services, like epitaxial growth, ion implantation and assembly of integrated circuits into packages, have from time to time, over the past several years, been in short supply and could come into short supply again if overall industry demand continues to increase in the future. In addition, from time to time natural disasters can lead to a shortage of some of the above materials due to disruption of the manufacturer’s production. We do not have long-term agreements providing for all of these equipment, materials, supplies, and services, and shortages could occur as a result of capacity limitations or production constraints on suppliers that could have a materially adverse effect on our ability to achieve our planned production.

A number of our products use components that are purchased from third parties. Supplies of these components may not be sufficient to meet all customer requested delivery dates for products containing the components, which could adversely affect future sales and earnings. Additionally, significant fluctuations in the purchase price for these components could affect gross margins for the products involved. Suppliers could also discontinue the manufacture of such purchased products or could have quality problems that could affect our ability to meet customer commitments.

Our manufacturing processes rely on critical manufacturing equipment purchased from third party suppliers. During periods of increasing demand we could experience difficulties or delays in obtaining additional critical manufacturing equipment. In addition, suppliers of semiconductor manufacturing equipment are sometimes unable to deliver test and/or fabrication equipment to a schedule or equipment performance specification that meets our requirements. Delays in delivery of equipment needed for growth could adversely affect our ability to achieve our manufacturing and revenue plans in the future.

We rely on third parties including freight forwarders, airlines, and ground transportation companies to deliver our products to customers. Interruptions in the ability of these third parties to deliver our products to customers due to geological events such volcanic eruptions, earthquakes, hurricanes or other such natural disasters may cause a temporary delay in meeting our shipping estimates and schedules.

We are exposed to business, economic, political and other risks through our significant worldwide operations.

During the first quarter of fiscal year 2011, 74% of our revenues were derived from customers in international markets. Also, the Company has test and assembly facilities in Singapore and Malaysia. Accordingly, we are subject to the economic and political risks inherent in international sales and operations and their impact on the United States economy in general, including the risks associated with ongoing uncertainties and political and economic instability in many countries around the world as well as the economic disruption from financial and economic declines or turmoil, dysfunction in the credit markets, acts of terrorism, or the response to any of the foregoing by the United States and other major countries.

We are a party to private litigation related to our historical stock option granting practices, in which an unfavorable outcome could have a material adverse effect on our financial results for a particular period or the trading price for our securities.

Several lawsuits have been filed against current and former directors and officers relating to our historical stock option granting practices. The Company is named as a nominal defendant in those lawsuits. These actions are in the preliminary stages, and their ultimate outcome could have a material adverse effect on our results of operations or cash flows for a particular period or the trading price for our securities. Litigation is time-consuming, expensive and disruptive to our normal business operations, and outcomes are difficult to predict. The defense of these lawsuits has resulted and will continue to result in significant legal expenditures and diversion of our management’s time and attention from business operations. In addition, we have entered into indemnification agreements with our current and former directors and officers, under which we are required to indemnify those persons against expenses, including attorneys’ fees, judgments, fines and settlements, payable by them in connection with this litigation, subject to applicable law. If we were required to pay any amounts to satisfy a judgment or in settlement of any of these claims, these amounts may not be covered by insurance.

For a further discussion on legal matters see “Legal Proceedings” in Part II, Item 1 of the Form 10-Q/A.

We may be unable to adequately protect our proprietary rights, which may impact our ability to compete effectively.

Our success depends in part on our proprietary technology. While we attempt to protect our proprietary technology through patents, copyrights and trade secret protection, we believe that our success also depends on increasing our technological expertise, continuing our development of new products and providing comprehensive support and service to our customers. However, we may be unable to protect our technology in all instances, or our competitors may develop similar or more competitive technology independently. We currently hold a number of United States and foreign patents and pending patent applications. However, other parties may challenge or attempt to invalidate or circumvent any patents the United States or foreign governments issue to us or these governments may fail to issue patents for pending applications. In addition, the rights granted or anticipated under any of these patents or pending patent applications may be narrower than we expect or, in fact provide no competitive advantages. Furthermore, effective patent, trademark, copyright, maskwork and trade secret protection may be unavailable, limited or not applied for in certain foreign countries. We may incur significant legal costs to protect our intellectual property.

We also seek to protect our proprietary technology, including technology that may not be patented or patentable, in part by confidentiality agreements and, if applicable, inventors’ rights agreements with our collaborators, advisors, employees and consultants. We cannot assure you that these agreements will always be undertaken or will not be breached or that we will have adequate remedies for any breach.

We have received, and may receive in the future, notices of claims of infringement and misappropriation of other parties’ proprietary rights. In the event of an adverse decision in a patent, trademark, copyright, maskwork or trade secret action, we could be required to withdraw the product or products found to be infringing from the market or redesign products offered for sale or under development. Whether or not these infringement claims are successfully asserted, we would likely incur significant costs and diversion of our resources with respect to the defense of these claims. In the event of an adverse outcome in any litigation, we may be required to pay substantial damages, including enhanced damages for willful infringement, and incur significant attorneys’ fees, as well as indemnify customers for damages they might suffer if the products they purchase from us infringe intellectual property rights of others. We could also be required to stop our manufacture, use, sale or importation of infringing products, expend significant resources to develop or acquire non-infringing technology, discontinue the use of some processes, or obtain licenses to intellectual property rights covering products and technology that we may, or have been found to, infringe or misappropriate such intellectual property rights.

Our products may contain defects that could affect our results of operations.

Our products may contain undetected errors or defects. Such problems may cause delays in product introductions and shipments, result in increased costs and diversion of development resources, cause us to incur increased charges due to obsolete or unusable inventory, require design modifications, or decrease market acceptance or customer satisfaction with these products, which could result in product returns. In addition, we may not find defects or failures in our products until after commencement of commercial shipments, which may result in loss or delay in market acceptance and could significantly harm our operating results. Our current or potential customers also might seek to recover from us any losses resulting from defects or failures in our products; further, such claims might be significantly higher than the revenues and profits we receive from our products involved as we are usually a component supplier with limited value content relative to the value of a complete system or sub-system. Liability claims could require us to spend significant time and money in litigation or to pay significant damages for which we may have insufficient insurance coverage. Any of these claims, whether or not successful, could seriously damage our reputation and business.

If we fail to attract and retain qualified personnel, our business may be harmed.

Our performance is substantially dependent on the performance of our executive officers and key employees. The loss of the services of key officers, technical personnel or other key employees could harm the business. Our success depends on our ability to identify, hire, train, develop and retain highly qualified technical and managerial personnel. Failure to attract and retain the necessary technical and managerial personnel could harm us.

We may not be able to compete successfully in markets within the semiconductor industry in the future.

We compete in the high performance segment of the linear market. Our competitors include among others, Analog Devices, Inc., Intersil, Maxim Integrated Products, Inc., National Semiconductor Corporation and Texas Instruments, Inc. Competition among manufacturers of linear integrated circuits is intense, and certain of our competitors may have significantly greater financial, technical, manufacturing and marketing resources than us. The principal elements of competition include product performance, functional value, quality and reliability, technical service and support, price, diversity of product line and delivery capabilities. We believe we compete favorably with respect to these factors, although we may be at a disadvantage in comparison to larger companies with broader product lines and greater technical service and support capabilities.

Environmental liabilities could force us to expend significant capital and incur substantial costs.

Federal, state and local regulations impose various environmental controls on the storage, use, discharge and disposal of certain chemicals and gases used in semiconductor processing. Our facilities have been designed to comply with these regulations, and we believe that our activities conform to present environmental regulations. Increasing public attention has, however, been focused on the environmental impact of electronics manufacturing operations. While we to date have not experienced any materially adverse business effects from environmental regulations, there can be no assurance that changes in such regulations will not require us to acquire costly remediation equipment or to incur substantial expenses to comply with such regulations. Any failure by us to control the storage, use or disposal of, or adequately restrict the discharge of hazardous substances could subject us to significant liabilities.

Our financial results may be adversely affected by increased tax rates and exposure to additional tax liabilities.

As a global company, our effective tax rate is highly dependent upon the geographic composition of worldwide earnings and tax regulations governing each region. We are subject to income taxes in both the United States and various foreign jurisdictions, and significant judgment is required to determine worldwide tax liabilities. Our effective tax rate as well as the actual tax ultimately payable could be adversely affected by changes in the split of earnings between countries with differing statutory tax rates, in the valuation of deferred tax assets, in tax laws or by material audit assessments, which could affect our profitability. In addition, the amount of income taxes we pay is subject to ongoing audits in various jurisdictions, and a material assessment by a governing tax authority could affect our profitability. Finally, jurisdictions could change their tax regulations to include profits that were previously exempt.

We are leveraged, and our debt obligations may affect our business, operating results and financial condition.

On November 1, 2010, we have debt outstanding of $845.1 million aggregate principal amount of our 3.00% Convertible Senior Notes due May 1, 2027 (the “2027A Notes” or the “Notes”). Debt service obligations arising from the Notes could adversely affect us in a number of ways, including by:

·	limiting our ability to obtain in the future, if needed, financing for working capital, capital expenditures, debt service requirements or other corporate purposes;

·	limiting our flexibility in implementing our business strategy and in planning for, or reacting to, changes in our business;

·	placing us at a competitive disadvantage relative to any of our competitors who have lower levels of debt;

·	decreasing our debt ratings and increasing our cost of borrowed funds;

·	making us more vulnerable to a downturn in our business or the economy generally;

·	subjecting us to the risk of being forced to refinance at higher interest rates these amounts when due; and

·	requiring us to use a substantial portion of our cash to pay principal and interest on our debt instead of contributing those funds to other purposes such as working capital, capital expenditures or other corporate purposes.

Our stock price may be volatile.

The trading price of our common stock may be subject to wide fluctuations. Our stock price may fluctuate in response to a number of events and factors, such as general United States and world economic and financial conditions, our own quarterly variations in operating results, announcements of technological innovations or new products by us or our competitors, changes in financial estimates and recommendations by securities analysts, the operating and stock price performance of other companies that investors may deem comparable to us, the hedging of our common stock and other derivative transactions by third parties, and new reports relating to trends in our markets or those of our customers. Additionally, lack of positive performance in our stock price may adversely affect our ability to retain key employees.

The stock market in general, and prices for companies in our industry in particular, has experienced extreme volatility that often has been unrelated to the operating performance of a particular company. These broad market and industry fluctuations may adversely affect the price of our common stock, regardless of our operating performance. As our Notes are convertible into shares of our common stock, volatility or depressed prices of our common stock could have a similar effect on the trading price of our Notes. In addition, to the extent we deliver common stock on conversion of the Notes, the ownership interests of our existing stockholders may be diluted. Sales in the public market of common stock issuable upon such conversion could adversely affect prevailing market prices of our common stock, as could the anticipated conversion of the Notes.

We may not have the ability to repurchase the Notes or to pay cash upon their conversion if and as required by the indentures governing the Notes.

Holders of the Notes have the right to require us to repurchase the Notes for cash on specified dates or upon the occurrence of a fundamental change.

The $845.1 million principal amount of our 2027A Notes can be redeemed by us at any time on or after May 1, 2014. We presently intend to repurchase the 2027A Notes on May 1, 2014, however, we may not have sufficient funds to repurchase the 2027A Notes in cash or have the ability to arrange necessary financing on acceptable terms. In addition, upon conversion of the 2027A Notes we will be required to make cash payments to the holders of the 2027A Notes equal to the lesser of the principal amount of the 2027A Notes being converted and the conversion value of those 2027A Notes. Such payments could be significant, and we may not have sufficient funds to make them at such time. Moreover, even if we do have sufficient funds to repurchase the 2027A Notes and make any additional required payments, doing so could reduce our working capital below levels that we believe are necessary or appropriate for the ongoing operation of our business. In such case, we might be forced to raise additional financing at the time of the repurchase or thereafter until cash generated from operations can restore working capital to the desired level.

Our failure to repurchase the Notes or convert the Notes into cash or a combination of cash and shares upon exercise of a holder’s conversion right in accordance with the provisions of the indentures would constitute a default under the applicable indenture. In addition, a default under either indenture could lead to a default under existing and future agreements governing our indebtedness. If, due to a default, the repayment of the related indebtedness were to be accelerated after any applicable notice or grace periods, we may not have sufficient funds to repay such indebtedness and the Notes.

A fundamental change may also constitute an event of default under, or result in the acceleration of the maturity of, our then-existing indebtedness. In addition, our ability to repurchase the Notes in cash or make any other required payments may be limited by law or the terms of other agreements relating to our indebtedness outstanding at the time.

The terms of the 2027A Notes and related provisions in the indentures subject noteholders to risks. Noteholders should be aware of the following risks, in addition to those described for holders of our common stock:

·	We are not restricted from taking actions or incurring additional debt (including secured debt) which may affect our ability to make payments under the Notes,

The Notes are not secured by any of our assets or those of our subsidiaries and are effectively subordinated to any secured debt we may incur. In any liquidation, dissolution, bankruptcy or other similar proceeding, holders of our secured debt may assert rights against any assets securing such debt in order to receive full payment of their debt before those assets may be used to pay the holders of the Notes. In such an event, we may not have sufficient assets remaining to pay amounts due on any or all of the Notes. In addition, none of our subsidiaries have guaranteed our obligations under, or have any obligation to pay any amounts due on, the Notes. As a result, the Notes are effectively subordinated to all liabilities of our subsidiaries, including trade payables,

The fundamental change provisions in the Notes and the indentures may not require us to offer to repurchase the Notes in the event of certain transactions. For example, any leveraged recapitalization, refinancing, restructuring, or acquisition initiated by us will generally not constitute a fundamental change requiring us to repurchase the Notes;

The liquidity of the trading market in the Notes, and the market price quoted for these Notes, may be adversely affected by, among other things, changes in, or other factors affecting, the market prices of our common stock, changes in the overall market for debt securities, and prevailing interest rates,

The conversion rates of the Notes may not adjust for certain events, such as a third-party tender or exchange offer or an issuance of our common stock for cash. In addition, adjustments in conversion rates may not adequately compensate noteholders for any lost value in the Notes as a result of a particular transaction,

The sale of the Notes and the shares of common stock issuable upon conversion of the Notes depends upon the continued maintenance of a registration statement filed with the SEC covering the resale of the Notes, or an exemption from the registration requirements of the Securities Act and any applicable state securities laws; and,

·	Noteholders are not entitled to any rights as holders of our common stock although, given that the Notes are convertible into shares of our common stock, they may be affected by any change relating to the common stock.

Our certificate of incorporation and by-laws include anti-takeover provisions that may enable our management to resist an unwelcome takeover attempt by a third party.

Our organizational documents and Delaware law contain provisions that might discourage, delay or prevent a change in control of our company or a change in our management. Our Board of Directors may also choose to adopt further anti-takeover measures without stockholder approval. The existence and adoption of these provisions could adversely affect the voting power of holders of common stock and limit the price that investors might be willing to pay in the future for shares of our common stock.

Item 2.

Unregistered Sales of Equity Securities and Use of Proceeds

c) Stock Repurchases

Period	Total Number of Shares Purchased	Average Price Paid per Share	Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs	Maximum Number of Shares that May Yet be purchased Under the Plans or Programs (1)
Month #1 (June 28, 2010 – July 25, 2010)	-			-
Month #2 (July 26, 2010 – August 22, 2010)	173,276	$31.88	173,276	18,294,447
Month #3 (August 23, 2010 – September 26, 2010)	-	-	-	-
Total	173,276	$31.88	173,276	18,294,447

On July 29, 2008 the Company’s Board of Directors authorized the Company to purchase up to 20.0 million shares of its outstanding common stock in the open market over a two-year time period. Following the expiration of this program, on October 12, 2010, the Company’s Board of Directors authorized the Company to purchase up to 10.0 million shares of its outstanding common stock in the open market over a two-year time period.

Item 3. Defaults Upon Senior Securities

N/A

Item 4. (Removed and Reserved)

Item 5. Other Information

N/A

Item 6.

Exhibits

Exhibit
Number		Description

31.1		Certification of Principal Executive Officer pursuant to Exchange Act Rules 13a-14(a) and 15d-14(a), as
		adopted pursuant to section 302 of the Sarbanes-Oxley Act of 2002

31.2		Certification of Principal Financial Officer and Principal Accounting Officer pursuant to Exchange Act
		Rules 13a-14(a) and 15d-14(a), as adopted pursuant to section 302 of the Sarbanes-Oxley Act of 2002

32.1		Certification of Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C. Section 1350 as
		adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

	LINEAR TECHNOLOGY CORPORATION

DATE: December 13, 2010	BY	/s/Paul Coghlan
		Paul Coghlan
		Vice President, Finance &
		Chief Financial Officer
		(Duly Authorized Officer and
		Principal Financial Officer)

LINEAR TECHNOLOGY CORP /CA/ - FORM 10-Q/A - December 10, 2010

Attached files

LINEAR TECHNOLOGY CORP /CA/ Reports