Registration No. ________
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
Fluke Corporation
(Exact Name of Registrant as Specified in Its Charter)
Washington
(State or Other Jurisdiction of Incorporation or Organization)
91-0606624
(I.R.S. Employer Identification No.)
6920 Seaway Boulevard, Everett, WA 98203
(Address of Principal Executive Offices) (Zip Code)
Fluke Corporation 1998 Stock Incentive Plan
(Full Title of the Plan)
Douglas G. McKnight, 6920 Seaway Boulevard, Everett, WA 98203
(Name and Address of Agent for Service)
(425) 356-5301
(Telephone Number, Including Area Code, of Agent for Service)
CALCULATION OF REGISTRATION FEE
Proposed Proposed
Title of Maximum Maximum
Securities Offering Aggregate
To Be Amount To Be Price Offering Amount of
Registered Registered Per Share(1) Price(1) Registration Fee
Common Stock 1,500,000(2) $23.25 $34,875,000 $10,288.12
$.25 Par Value
(1) Estimated solely for the purpose of calculating the registration fee
pursuant to Rule 457(c) and Rule 457(h) of the Securities Act of 1933, as
amended (the "Act"). The calculation of the registration fee of the shares is
based on a price of $23.25 per share, which was the average of the high and
low trading prices of the Common Stock on December 12, 1997 on the New York
Stock Exchange as reported in The Wall Street Journal.
(2) Together with an indeterminate number of shares of Common Stock which may
be necessary to adjust the number of shares reserved for issuance pursuant to
the Fluke Corporation 1998 Stock Incentive Plan as the result of any future
stock split, stock dividend or similar adjustment of the outstanding Common
Stock of the Registrant.
PART II
INFORMATION REQUIRED IN THE
REGISTRATION STATEMENT
Item 3. Incorporation of Documents by Reference.
The following documents filed with the Securities and Exchange Commission (File
No. 1-5590) are hereby incorporated by reference in this Registration
Statement: (a) the Registrant's Annual Report on Form 10-K for the year ended
April 25, 1997; (b) the Registrant's Quarterly Reports on Form 10-Q for the
periods ended July 25, 1997 and October 24, 1997 and the Registrant's current
report on Form 8-K dated September 12, 1997; and (c) the description of the
Registrants' Common Stock contained in the Company's registration statement on
Form 8-A filed on March 10, 1995, including any amendment or report filed for
the purpose of updating such description.
Also deemed to be incorporated herein by reference and to be a part hereof from
the date of filing are all documents filed by the Registrant pursuant to
Sections 13(a), 13(c), 14 and 15(d) of the Securities Exchange Act of 1934, as
amended, subsequent to the date of this Registration Statement and prior to the
filing of a post effective amendment which indicates that all securities
offered have been sold or deregisters all securities then remaining unsold.
Item 4. Description of Securities.
Not applicable.
Item 5. Interests of Named Experts and Counsel.
Not applicable.
Item 6. Indemnification of Directors and Officers.
The Washington Business Corporation Act permits a corporation to indemnify its
directors for reasonable expenses if a director is wholly successful in the
defense of any proceeding in which he or she has been made a party by reason
of the fact that he or she was or is a director and for judgments, penalties,
fines, settlements, or reasonable expenses incurred in a proceeding upon a
determination by the Board of Directors, a committee of the Board, independent
legal counsel, or the stockholders that the director acted in good faith and,
in the case of conduct in the director's official capacity with the
corporation, the director reasonably believed that his or her conduct was in
the corporation's best interests, or, in all other cases, the director
reasonably believed that his or her conduct was at least not opposed to the
corporation's best interests. The Washington Business Corporation Act permits
similar indemnification of officers. Washington law permits a corporation to
provide further indemnity to directors and officers, subject to certain
authorization requirements, except that indemnification is not permitted with
respect to intentional misconduct, a knowing violation of law, approval of an
unlawful distribution or loan, or a transaction involving the director's
receipt of an improper personal benefit.
Article XII of the Registrant's Articles of Incorporation authorizes the
Registrant's Board of Directors to take any action it deems appropriate to
indemnify the Registrant's directors to the fullest extent permitted by
Washington law. This provision is sufficiently broad that it might, under
certain circumstances, permit indemnification for liability arising under the
Act.
The Registrant's Bylaws provide a right to indemnification for all expense,
liability, and loss (including reasonable attorneys' fees, costs, judgments,
fines, ERISA excise taxes or penalties, and amounts paid in settlement) to
which a director is exposed by reason of the fact that he or she is or was
serving as a director or officer of the Registrant or, at the request of the
Registrant, as a director, officer, employee or agent of another corporation,
partnership, joint venture, trust or other enterprise, including an employee
benefit plan. Such a person cannot, however, be indemnified when (a) the
Registrant is legally unable to grant indemnity or (b) for expenses related to
a proceeding or claim that has been initiated without Board approval by the
person requesting indemnification. The Registrant's Bylaws also recognize the
Registrant's ability to advance expenses to an indemnitee, subject to a
requirement that the indemnitee undertake to repay the expenses if he or she
subsequently is found not to have met the standards required for
indemnification. The Board of Directors may also approve indemnification of
all employees (including officers), agents, and others serving the Registrant.
As permitted by the Washington Business Corporation Act, the Articles of
Incorporation of the Registrant provide that, to the fullest extent permitted
by law, directors shall not be personally liable to the Registrant or its
shareholders for monetary damages. At present, under the Washington Business
Corporation Act, liability would not be limited under circumstances involving
(a) acts of intentional misconduct or a knowing violation of law, (b) approval
of certain distributions or loans contrary to law, or (c) any transaction from
which the director will personally receive a benefit in money, property or
services to which the director is not legally entitled. Thus, a director of
the Registrant would not be liable for breaches of the duties of care or
loyalty or otherwise liable to the Registrant or its shareholders for
violations of state corporate law unless he or she violated the statutory
exceptions listed above. This provision is sufficiently broad that it might,
under certain circumstances, permit indemnification for liability arising
under the Act.
Item 7. Exemption from Registration Claimed.
Not applicable.
Item 8. Exhibits.
Exhibit No: Description
4.1 Fluke Corporation 1998 Stock Incentive Plan
4.2 Stockholders Rights Plan as amended and restated
April 25, 1997 (filed as Exhibit 4.1 to the
Registrant's Annual Report on Form 10-K for the
year ended April 25, 1997 and incorporated herein
by reference)
5.1 Opinion of Counsel
23.1 Consent of Ernst & Young LLP, Independent Auditors
23.2 Consent of Counsel (included in opinion filed as
Exhibit 5.1 hereto)
24.1 Power of Attorney (see signature page)
Item 9. Undertakings.
(a) Rule 415 Offering.
The undersigned Registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this registration statement:
(i) To include any prospectus required by Section 10(a)(3) of the
Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events arising
after the effective date of the registration statement (or the most
recent post-effective amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the information set forth
in the registration statement. Notwithstanding the foregoing, any
increase or decrease in volume of securities offered (if the total
dollar value of securities offered would not exceed that which is
registered) and any deviation from the low or high end of the estimated
maximum offering range may be reflected in the form of prospectus filed
with the Commission pursuant to Rule 424(b) if, in the aggregate, the
changes in volume and price represent no more than a 20 percent change
in the maximum aggregate offering price set forth in the "Calculation of
Registration Fee" table in the effective registration statement;
(iii) To include any material information with respect to the
plan of distribution not previously disclosed in the registration
statement or any material change to such information in the registration
statement;
provided, however, that paragraphs (a)(1)(i) and (a)(1)(ii) do not apply if
the registration statement is on Form S-3, Form S-8 or Form F-3, and the
information required to be included in a post-effective amendment by those
paragraphs is contained in periodic reports filed with or furnished to the
Commission by the registrant pursuant to Section 13 or Section 15(d) of the
Securities Exchange Act of 1934 that are incorporated by reference in the
registration statement.
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be deemed to
be a new registration statement relating to the securities offered therein,
and the offering of such securities at that time shall be deemed to be the
initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the termination
of the offering.
(b) Filings Incorporating Subsequent Exchange Act Documents by Reference.
The undersigned Registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of the
Registrant's annual report pursuant to Section 13(a) or Section 15(d) of the
Securities Exchange Act of 1934 (and, where applicable, each filing of an
employee benefit plan's annual report pursuant to Section 15(d) of the
Securities Exchange Act of 1934) that is incorporated by reference in the
registration statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such
securities at that time shall be deemed to be the initial bona fide offering
thereof.
(e) Incorporated Annual Reports and Quarterly Reports.
The undersigned Registrant hereby undertakes to deliver or cause to be
delivered with the prospectus, to each person to whom the prospectus is sent
or given, the latest annual report to security holders that is incorporated by
reference in the prospectus and furnished pursuant to and meeting the
requirements of Rule 14a-3 or Rule 14c-3 under the Securities Exchange Act of
1934; and, where interim financial information required to be presented by
Article 3 of Regulation S-X is not set forth in the prospectus, to deliver, or
cause to be delivered to each person to whom the prospectus is sent or given,
the latest quarterly report that is specifically incorporated by reference in
the prospectus to provide such interim financial information.
(h) Filing of Registration Statement on Form S-8.
Insofar as indemnification for liabilities arising under the Securities
Act of 1933 may be permitted to directors, officers and controlling persons of
the registrant pursuant to the foregoing provisions, or otherwise, the
registrant has been advised that in the opinion of the Securities and Exchange
Commission such indemnification is against public policy as expressed in the
Act and is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by the
registrant of expenses incurred or paid by a director, officer or controlling
person of the registrant in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling person in
connection with the securities being registered, the registrant will, unless
in the opinion of its counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question whether
such indemnification by it is against public policy as expressed in the Act
and will be governed by the final adjudication of such issue.
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
registrant certifies that it has reasonable grounds to believe that it meets
all of the requirements for filing on Form S-8 and has duly caused this
registration statement to be signed on its behalf by the undersigned,
thereunto duly authorized, in the City of Everett, State of Washington on this
18th day of December, 1997.
Fluke Corporation
By /s/ Douglas G. McKnight
Douglas G. McKnight
Vice President, General Counsel
and Corporate Secretary
POWER OF ATTORNEY
Each person whose signature appears below constitutes and appoints David
E. Katri, President and Chief Operating Officer, Elizabeth J. Huebner, Vice
President, Chief Financial Officer, and Douglas G. McKnight, Vice President,
General Counsel and Corporate Secretary, jointly and severally, as attorneys-
in-fact, each with full power of substitution, for such person and in any and
all capacities, to sign any amendments to this registration statement and to
file the same, with exhibits thereto and other documents in connection
therewith, with the Securities and Exchange Commission, hereby ratifying and
confirming all that each of said attorneys-in-fact, or their substitute or
substitutes, may do or cause to be done by virtue thereof.
Pursuant to the requirements of the Securities Act of 1933, this
registration statement has been signed by the following persons in the
capacities and on the date indicated.
Signature Title Date
/s/ William G. Parzybok, Jr. Chairman of the Board December 12, 1997
William G. Parzybok, Jr. Chief Executive Officer
/s/ David E. Katri President, Chief Operating December 12, 1997
David E. Katri Officer and Director
/s/ Elizabeth J. Huebner Vice President, Chief December 12, 1997
Elizabeth J. Huebner Financial Officer
/s/ Philip M. Condit Director December 12, 1997
Philip M. Condit
/s/ John D. Durbin Director December 12, 1997
John D. Durbin
/s/ David L. Fluke Director December 12, 1997
David L. Fluke
/s/ John M. Fluke, Jr. Director December 12, 1997
John M. Fluke, Jr.
/s/ Robert S. Miller, Jr. Director December 12, 1997
Robert S. Miller, Jr.
/s/ Sally G. Narodick Director December 12, 1997
Sally G. Narodick
/s/ William H. Neukom Director December 12, 1997
William H. Neukom
/s/ N. Stewart Rogers Director December 12, 1997
N. Stewart Rogers
/s/ James E. Warjone Director December 12, 1997
James E. Warjone
/s/ George M. Winn Director December 12, 1997
George M. Winn
INDEX TO EXHIBITS
Exhibit No: Description
4.1 Fluke Corporation 1998 Stock Incentive Plan
4.2 Stockholders Rights Plan as amended and restated
April 25, 1997 (filed as Exhibit 4.1 to the
Registrant's Annual Report on Form 10-K for the
year ended April 25, 1997 and incorporated herein
by reference)
5.1 Opinion of Counsel
23.1 Consent of Ernst & Young LLP, Independent Auditors
23.2 Consent of Counsel (included in opinion filed as
Exhibit 5.1 hereto)
24.1 Power of Attorney (see signature page)
Exhibit 4.1
FLUKE CORPORATION
1998 STOCK INCENTIVE PLAN
Article 1. Establishment and Purposes
1.1 Establishment of the Plan. Fluke Corporation (the "Company") hereby
establishes a plan to be known as the Fluke Corporation 1998 Stock Incentive
Plan (the "Plan") as set forth in this document. The Plan permits the grant
of Nonqualified Stock Options, Incentive Stock Options, Restricted Stock,
Stock Appreciation Rights, and Performance Awards. The Plan shall become
effective upon adoption by the Board of Directors and by approval of the
stockholders of the Company.
1.2 Purpose of the Plan. The purpose of the Plan is to promote the
success and enhance the value of the Company by linking the personal interests
of the Participants to those of the Company's stockholders, and by providing
Participants with an incentive for outstanding performance. The Plan further
strengthens the Company's ability to attract and retain officers, Directors,
employees, and other persons providing significant services to the Company and
its subsidiaries whose ability and special efforts will contribute materially
to the success of the Company.
Article 2. Definitions
2.1 Definitions. Unless otherwise required by the context, the following
terms when used in the Plan shall have the meanings set forth in this Section
2.1:
(a) "Board" means the Board of Directors of the Company.
(b) "Change of Control" of the Company, as used in this Plan,
means and shall be deemed to occur:
(i) upon the date the Company is informed by receiving a
report on Schedule 13D under the Securities Exchange Act of 1934
(the "Exchange Act") or similar report that any person (as such
term is used in Sections 13(d) and 14(d)(2) of the Exchange Act),
together with such person's Affiliates and Associates (as defined
in Rule 12b-2 of the Exchange Act), is or has become the
"beneficial owner" (as defined in Rule 13d-3 of the Exchange Act)
directly or indirectly, of securities of the Company representing
25% or more of the combined voting power of the Company's then
outstanding securities. A person shall not be deemed to
beneficially own securities acquired pursuant to the Employee
Stock Purchase Plan of the Company or other plans generally
applicable to employees, officers or Directors of the Company.
There will not be a Change of Control as the result of an
acquisition of securities by the Company, which by reducing the
number of shares outstanding, increases the proportionate number
of shares beneficially owned by any person to 25% or more of the
securities of the Company then outstanding. However, that if a
person becomes the beneficial owner of 25% or more of the
securities of the Company then outstanding by reason of share
purchases by the Company and shall, after such share purchases by
the Company, become the beneficial owner of any additional
securities of the Company, then a Change of Control will occur
unless such person disposes of such additional securities of the
Company within 10 days, or
(ii) upon the first purchase of the Company's Common Stock
pursuant to a tender or exchange offer (other than a tender or
exchange offer made by the Company) seeking to acquire securities
representing 25% or more of the combined voting power of the
Company's then outstanding securities, or
(iii) upon the first date on which Continuing Directors, as
defined in Article VI of the Company's Articles of Incorporation,
cease for any reason to constitute at least a majority of the
Board of Directors.
(c) "Code" means the Internal Revenue Code of 1986, as amended
from time to time, and the temporary or final regulations adopted
pursuant to the Code.
(d) "Committee" means the Compensation Committee of the Board of
Directors.
(e) "Common Stock" means the Common Stock of the Company, $.25 par
value.
(f) "Exchange Act" means the Securities Exchange Act of 1934, as
amended from time to time.
(g) "Fair Market Value" as applied to a specific date, means the
average between the highest and lowest quoted selling prices at which
the Company's Common Stock was sold on such date as reported in the New
York Stock Exchange Composite Transactions by The Wall Street Journal on
such date or such other report as the Committee may select, or if no
Company Common Stock was traded on such date, on the next preceding day
on which the Company Common Stock was so traded. Notwithstanding the
foregoing, upon the exercise, during the thirty (30) day period
following a Change of Control, of a tandem stock appreciation right
which is granted in connection with an option, Fair Market Value on the
date of exercise shall be deemed to be the greater of (i) the highest
price per share of the Company Common Stock as reported in the New York
Stock Exchange Composite Transactions by The Wall Street Journal or such
other report as the Committee may select during the sixty (60) day
period ending on the day preceding the date of exercise of the tandem
stock appreciation right, or (ii) if the Change of Control is one
described in Clause (ii) of Section 2.1(b) or a transaction described in
Section 5.2(b), the highest price per share paid for the Company's
Common Stock in connection with such Change of Control.
(h) "Incentive Stock Option" or "ISO" means an option to purchase
shares, granted under Article 6, which meets the requirements of an
Incentive Stock Option as defined in Section 422A of the Code, as in
effect at the time of grant of such option, or any statutory provision
that may hereafter replace such section.
(i) "Nonqualified Stock Option" or "NQSO" means an option to
purchase shares, granted under Article 6, which is not intended to be an
Incentive Stock Option.
(j) "Option Price" means the price per share of Common Stock at
which an option is exercisable.
(k) "Participant" means an individual who is selected by the
Committee to participate in the Plan pursuant to Article 4.
(l) "Performance Award" means an award granted under Article 10.
(m) "Permanent Disability" means when a Participant shall be found,
upon the basis of medical evidence satisfactory to the Committee, that
the Participant is prevented, whether due to physical or mental
condition, from engaging in further comparable employment by the Company
or any of its Subsidiaries and that such disability will be permanent
and continuous during the remainder of the Participant's life.
(n) "Restricted Stock" means a grant of shares granted under
Article 9.
(o) "Stock Appreciation Right" or "SAR" means an award of rights
granted under Article 8.
(p) "Subsidiary" means an entity that is designated by the
Committee as a subsidiary for purposes of this Plan and that is a
corporation (or other form of business association that is treated as a
corporation for tax purposes) of which shares (or other ownership
interests) having more than 50% of the voting power are owned or
controlled, directly or indirectly, by the Company so as to qualify as a
"subsidiary corporation" (within the meaning of Code Section 424(f)).
Article 3. Administration
3.1 The Committee. The Plan shall be administered by the Compensation
Committee of the Board. No Director shall serve as a member of the Committee
unless at the time of his appointment and service he shall be a "Non-Employee
Director," as defined in Rule 16b-3 of the General Rules and Regulations under
the Exchange Act, and shall be an "outside director" for purposes of Section
162 (m)(4) of the Code.
3.2 Authority of the Committee. The Committee shall have full authority
to construe and interpret the Plan, to establish, amend and rescind rules and
regulations relating to the Plan, to select persons eligible to participate in
the Plan, to grant NQSOs or ISOs, Restricted Stock, SARs and/or Performance
Awards thereunder, to administer the Plan, to make recommendations to the
Board, to take all such steps and make all such determinations in connection
with the Plan as it may deem necessary or advisable, which determination shall
be final and binding upon all Participants.
Article 4. Eligibility
4.1 Eligible Individuals. To be eligible for selection by the Committee
to participate in the Plan, an individual must be an officer, Director,
employee, or other person providing significant services to the Company, or of
any Subsidiary, as of the date on which the Committee grants to such
individual a NQSO, ISO, Restricted Stock, SAR, or Performance Award, and who
in the judgment of the Committee holds a position of responsibility and is
able to contribute substantially to the Company's continued success. Each
chosen individual is hereinafter referred to as a "Participant". A non-
employee Director may not be granted an ISO or a Performance Award pursuant to
this Plan.
Article 5. Shares Available and Certain Adjustments
5.1 Maximum Number of Shares. Subject to Section 5.2(a), the maximum
number of shares for which stock options, Restricted Stock grants, SARs and
Performance Awards denominated in shares may at any time be granted under the
Plan is 1,500,000 shares of Common Stock, from shares repurchased by the
Company or out of the authorized but unissued shares of the Company, or partly
out of each, as shall be determined by the Board of Directors. Upon the
expiration, cancellation or termination in whole or in part of (a) unexercised
NQSOs or ISOs, (b) Restricted Stock grants reverting to the Company, (c)
shares of Common Stock covered by a NQSO or ISO, or portion thereof, which are
surrendered upon exercise of a tandem SAR, (d) unexercised tandem SARs, and
(e) unearned Performance Awards denominated in shares, shares of Common Stock
which were subject thereto shall again be available under the Plan.
5.2 Certain Adjustments.
(a) In the event of any change in the Common Stock through
reorganization, recapitalization, reclassification, stock dividend of
ten percent or greater, stock split, amendment to the Articles of
Incorporation of the Company, or reverse stock split, the Board shall
make an appropriate and proportionate adjustment in the number of shares
of Common Stock subject to a NQSO, ISO, or Performance Award denominated
in shares without any change in the aggregate purchase price of the
shares subject to such NQSO, ISO, or Performance Award denominated in
shares but with corresponding adjustment to the exercise price per share
and in the number of shares covered by outstanding NQSOs, ISOs, SARs or
Performance Awards denominated in shares.
(b) Upon the effective date of a merger, consolidation or plan of
exchange (other than a merger, consolidation or plan of exchange
involving the Company in which the holders of voting securities of the
Company immediately prior to such transaction own at least 50% of the
voting power of the outstanding securities of the surviving corporation
or a parent of the surviving corporation after such transaction), or a
sale of all or substantially all the assets of the Company, or a
liquidation or dissolution of the Company, the Plan and any NQSO or ISO,
SAR, or Performance Award theretofore granted hereunder shall terminate,
unless provisions be made in writing in connection with such transaction
for the continuance of the Plan and for the assumption of options, SARs,
or Performance Awards theretofore granted, or the substitution for such
options, SARs, or Performance Awards with new options, SARs, or
Performance Awards covering the shares of a successor corporation, or a
parent, affiliate or subsidiary thereof, with appropriate adjustments as
to number and kind of shares and prices thereof, in which event the Plan
and the options, SARs, or Performance Awards granted under it, or the
new options, SARs, or Performance Awards substituted therefor, shall
continue in the manner and under the terms so provided.
(c) If provision is not made pursuant to the preceding Section
5.2(b) in connection with such a transaction for the continuance of the
Plan and for the assumption of options, SARs, or Performance Awards
denominated in shares, or the substitution for such options, SARs, or
Performance Awards denominated in shares of new options, SARs, or
Performance Awards denominated in shares covering the shares of a
successor employer corporation or a parent, affiliate or subsidiary
thereof, then each Participant under the Plan shall be entitled, prior
to the effective date of any such transaction, to purchase the full
number of shares under the option or Performance Award which the
Participant otherwise would have been entitled to purchase during the
remaining term of such option or Performance Award denominated in
shares, if applicable, and to exercise any SAR or Performance Award
denominated in shares, if applicable, for the full number of shares
under the SAR or Performance Award to which the Participant otherwise
would have been entitled to acquire upon such exercise during the
remaining term of such SAR or Performance Award denominated in shares,
if applicable, without regard to any limitation on exercise which may be
contained therein.
(d) Upon the occurrence of a Change of Control (unless the Board
shall consist of a majority of Continuing Directors, as defined in
Article VI of the Company's Articles of Incorporation, and the Board
shall determine otherwise by notice to Participants prior to or within
30 days after such Change of Control), all outstanding options, SARs, or
Performance Award, if applicable, shall become immediately exercisable
in full for the remainder of their terms, and the transferability
restrictions on all outstanding Restricted Stock grants or Performance
Award, if applicable, shall automatically lapse. All Performance Awards
shall be considered to be earned and payable in full and any deferral or
other restriction shall lapse. Any Performance Award or freestanding
SAR payable in cash shall be paid as promptly as is practicable.
Adjustments under this Section shall be made by the Board, whose
determination as to what adjustments shall be made, and the extent thereof,
shall be final, binding, and conclusive. No fractional share of Common Stock
shall be issued under the Plan or any such adjustment.
Article 6. Grant of Options
6.1 Committee Determination of Option Grant. Options may be granted in
such number and at such times during the term of this Plan as the Committee
shall determine, taking into account the duties of the respective individuals,
their present and potential contributions to the success of the Company, and
such other factors as the Committee shall deem relevant in accomplishing the
purposes of the Plan. The granting of an option shall take place when the
Committee by resolution, written consent or other appropriate action
determines to grant such an option to a particular Participant at a particular
price. Each option shall be evidenced by a written instrument delivered by or
on behalf of the Company containing provisions not inconsistent with the Plan
and such other or additional terms as the Committee may approve.
6.2 Type of Option. An option granted under the Plan may be either a
NQSO or an ISO, as designated by the Committee and as indicated in the option
agreement.
Article 7. Terms and Conditions of Options
7.1 Grant of an ISO. Each provision of the Plan and each ISO granted
hereunder shall be construed so that such option shall qualify as an ISO, and
any provision thereof that cannot be so construed shall be disregarded. ISOs,
in addition to complying with the other provisions of the Plan relating to
options generally, shall be subject to the following conditions:
(a) Only officers and other employees of the Company, or of any
Subsidiary are eligible to be granted ISOs.
(b) Except as provided in paragraph (c), the option price of the
ISOs shall be 100% of the Fair Market Value of the stock on the date of
grant.
(c) An officer or other employee must not, at the time an ISO is
granted, own stock representing more than ten percent of the voting
power of all classes of stock of the Company or of a Subsidiary. This
requirement is deemed waived if (i) the Option Price of the ISO to be
granted is at least 110% of the Fair Market Value of the stock subject
to the option, determined at the time the option is granted, and (ii)
the option is not exercisable more than five years from the date the
option is granted.
(d) The aggregate Fair Market Value (determined at the time of the
grant of the option) of the stock with respect to which ISOs are
exercisable for the first time by an officer or other employee during
any calendar year may not exceed $100,000.
(e) Any other terms and conditions will be added which the
Committee determines, upon advice of counsel, must be imposed for the
option to be an ISO.
(f) During a Participant's lifetime, the option may be exercisable
only by the Participant and options shall not be transferable, other
than by will or the laws of descent and distribution.
7.2 General Terms of Option Grants. Except as otherwise provided in
Section 7.1, all ISOs and NQSOs under the Plan shall be granted subject to the
following terms and conditions:
(a) The option price per share shall be determined by the Committee
at the time of grant. The option price may not be less than 100% of the
Fair Market Value of the shares covered by the option on the date the
option is granted. Options may not be repriced without stockholder
approval.
(b) Options shall be exercisable at such time and under such
conditions as set forth in the option grant however an option may not be
exercisable prior to six months following the date of grant, or
exercisable more than ten years after the date of grant.
(c) Shares of Common Stock covered by an option may be purchased at
one time or in such installments over the balance of the option period
as may be provided in the option grant. Any shares not purchased on the
applicable installment date may be purchased at one time or in such
installments over the balance of the option period as may be provided in
the option grant. Any shares not purchased on the applicable
installment date may be purchased thereafter at any time prior to the
final expiration of the option. To the extent that the right to
purchase shares has accrued thereunder, options may be exercised from
time to time by written notice to the Corporate Secretary of the Company
stating the number of shares with respect to which the option is being
exercised.
(d) The purchase price of shares of Common Stock covered by an
option and any related taxes to be withheld, if applicable, shall be
paid in full to the Company upon the exercise of the option either (i)
in cash or check, or (ii) by delivery at Fair Market Value, of Common
Stock already owned by the Participant, or any combination of cash and
Common Stock. The Fair Market Value of such Common Stock as delivered
shall be valued as of the day prior to delivery. A Participant shall
have none of the rights of a stockholder until the shares of Common
Stock are issued.
(e) The Committee shall determine, with respect to each option, the
nature and extent of the restrictions, if any, to be imposed on the
shares of Common Stock which may be purchased thereunder including, but
not limited to, restrictions on the transferability of such shares
acquired through the exercise of such options for such periods as the
Committee may determine and, further, that in the event a Participant's
employment by the Company, or a Subsidiary, terminates during the period
in which such shares are nontransferable, the Participant shall be
required to sell such shares back to the Company at such prices as the
Committee may specify in the option.
(f) During a Participant's lifetime, the option may be exercisable
only by the Participant and options shall not be transferable, other
than by will or the laws of descent and distribution. In the event of
death of a Participant, the option may be exercisable only by the
Participant's legal representative or beneficiaries, as provided in
Section 7.2(j). At the discretion of the Committee, however, an option
agreement may permit the transferability of an option by a Participant
solely to members of the Participant's immediate family or trusts or
partnerships for the benefit of such persons.
(g) Upon the termination of a Participant's service for any reason
other than retirement, Permanent Disability or death, any option held by
such Participant shall be exercisable only to the extent that it was
then exercisable (unless the Committee shall determine in a particular
case that specific limitations and restrictions of the option shall not
apply), and such option shall expire, unless it sooner expires under
Section 7.2(b) or its terms, three (3) months after termination of
service, unless extended by special action of the Committee. Leaves of
absence for such periods and purposes conforming to the personnel policy
of the Company, or of its Subsidiaries as applicable, shall not be
deemed terminations or interruptions of employment. In case of an ISO,
a leave of absence of no more than ninety (90) days (or, if longer,
where a Participant's right to reinstatement by the Company is
guaranteed by statute or by contract) approved in writing by the Board
of Directors shall not be deemed a termination of a Participant's
employment with or contract to provide services to the Company.
(h) Upon the termination of a Participant's service due to
retirement, any option held by such Participant shall become exercisable
in full (unless the Committee shall determine otherwise), and such
option shall expire, unless it sooner expires under Section 7.2(b) or
its terms, thirty six (36) months after such Participant's retirement
from the Company or any Subsidiary (three (3) months if the option is an
ISO).
(i) Upon the termination of a Participant's service due to
Permanent Disability, any option held by such Participant shall become
exercisable in full (unless the Committee shall determine otherwise),
and such option shall expire, unless it sooner expires under Section
7.2(b) or its terms, twelve (12) months after such termination of
service.
(j) Upon the death of a Participant, whether during a period of
service or during the three (3), twelve (12) or thirty six (36) month
period, as the case may be, referred to in Section 7.2(h) or 7.2(i), any
option held by such Participant shall become exercisable in full (unless
the Committee shall determine otherwise), and such option shall expire,
unless it sooner expires under Section 7.2(b) or its terms, twelve (12)
months after the date of death (three (3) months if the option is an
ISO).
Article 8. Stock Appreciation Rights
8.1 Grant of SARs. The Committee may grant freestanding SARs, tandem
SARs or any combination of these forms of SARs to any Participant at any time,
in such number, and under such terms and conditions as shall be determined by
the Committee. The grant price of freestanding SARs may not be less than 100%
of the Fair Market Value of the shares covered by the SAR on the date the SAR
is granted. In the case of a NQSO, tandem SARs may be granted either at the
time of the grant of such option or at any time thereafter during the term of
the option. In the case of an ISO, tandem SARs may be granted only at the time
of the grant of such option. Tandem SARs shall cover the same shares covered
by the options (or such lesser number of shares of Common Stock as the
Committee may determine) and shall, except as provided in Section 8.4 hereof,
be subject to the same terms and conditions as the related options including
without limitation Section 5.2 of this Plan, and such further terms and
conditions not inconsistent with the Plan as shall from time to time be
determined by the Committee. SARs may not be repriced without stockholder
approval.
8.2 Exercise of Freestanding SARs. Each freestanding SAR shall entitle
the holder of the SAR to receive from the Company an amount equal to the
excess of the Fair Market Value of one share of Common Stock on the date the
right is exercised over the grant price per share times the number of shares
covered by the SAR. Payment shall be made either in cash or in shares of
Common Stock valued at Fair Market Value as of the date the right is exercised
rounded up to next full share. Freestanding SARs may be exercised from time
to time upon actual receipt by the Company of written notice stating the
number of shares of Common Stock with respect to which the SAR is being
exercised. Such exercise shall be subject to the terms and conditions as
established for such SAR by the Committee.
8.3 Exercise of Tandem SARs. Each tandem SAR shall entitle the holder to
receive from the Company an amount equal to the excess of the Fair Market
Value of one share of Common Stock on the date the right is exercised over the
Option Price per share times the number of shares covered by the option, or
portion thereof, which is surrendered. The option which is surrendered must
be exercisable at the time of such surrender. Payment shall be made either in
cash or in shares of Common Stock valued at Fair Market Value as of the date
the right is exercised rounded up to next full share. Tandem SARs may be
exercised from time to time upon actual receipt by the Company of written
notice stating the number of shares of Common Stock with respect to which the
SAR is being exercised and the surrender of the related option.
8.4 Terms of the SAR.
(a) The right of a Participant to exercise a tandem SAR shall be
canceled if and to the extent the related option is exercised. To the
extent that a SAR is exercised, the related option shall be deemed to
have been surrendered, unexercised.
(b) A holder of SARs shall have none of the rights of a stockholder
until shares of Common Stock are issued, if any, pursuant to the
exercise of such rights.
(c) SARs may not be sold, transferred, pledged, assigned, levied
upon, or otherwise alienated or hypothecated, other than by will or by
application of the laws of descent and distribution. A Participant's
rights under the Plan shall be exercisable during the Participant's
lifetime only by the Participant or upon the Participant's death by the
Participant's beneficiary. At the discretion of the Committee, however,
a SAR Agreement may permit the transferability of a SAR by a Participant
solely to members of the Participant's immediate family or trusts or
partnerships for the benefit of such persons.
Article 9. Restricted Stock Grants
9.1 Grant of Restricted Stock. The Committee may make grants of
Restricted Stock in such number and at such times as the Committee shall
determine. The Committee may make Restricted Stock grants to any Participant.
The Restricted Stock grants shall take place when the Committee by
resolution, written consent or other appropriate action, establishes a
Restricted Stock grant date, the Participants who will receive such grants,
and the number of granted shares for each Participant.
9.2 Issuance of Restricted Stock. Stock certificates representing the
number of restricted shares granted to each Participant shall be issued as
soon as practical after the date of grant in the name of the Participant.
Such Participant will be entitled to all cash dividends paid on the shares and
will be able to vote such shares during the restricted period when the shares
are not vested, unless such rights are restricted by the terms and conditions
of the grant. The restricted shares will be retained in the safekeeping of
the Company and the shares will be physically delivered to the Participant
only upon their vesting and the removal of the transferability restriction.
Each Participant agrees to be bound by the terms and conditions of the grant
as determined by the Committee. Such shares shall bear a legend restricting
transferability in accordance with the terms of the grant. After the date of
grant, any stock splits or stock dividends paid on the shares would be subject
to the same transferability restrictions as the underlying shares upon which
they were paid. Shares subject to restrictions under the Plan may not be
sold, given, assigned, pledged, levied upon, nor may the shares or any
interest in the shares be transferred in any fashion. Any attempt to so
transfer the shares or any interest shall be void, and shall subject the
shares to return to the Company. At the discretion of the Committee, however,
a Restricted Stock agreement may permit the transferability of Restricted
Stock by a Participant solely to members of the Participant's immediate family
or trusts or partnerships for the benefit of such persons.
9.3 Lapse of Restrictions. Restrictions on the shares will lapse over a
period of time or in compliance with the conditions as established by the
Committee or pursuant to any waiver of conditions by the Committee. The
Committee shall establish a procedure for the removal of the legend from
certificates representing shares no longer subject to the restrictions.
9.4 Automatic Lapse of Restrictions. Restrictions shall automatically
lapse upon the retirement, death, or Permanent Disability of a Participant.
9.5 Termination. If a Participant's service with the Company or any of
its subsidiaries is terminated for any reason (other than retirement, death or
Permanent Disability), any shares still subject to the restrictions will be
canceled by the Company unless the Committee expressly waives the cancellation
provision for such Participant. If the Participant is a Director, shares
would be canceled if the Director voluntarily terminates as a Director prior
to expiration of such Director's elected term of office or if the Director was
removed from office for cause and by stockholder vote pursuant to the
Company's Articles of Incorporation. A leave of absence approved in writing
by the Committee shall not constitute a termination of service. Cash paid in
lieu of fractional shares and cash dividends paid upon shares granted under
this Plan shall not be subject to any transferability restrictions or
reversion to the Company.
Article 10. Performance Awards
10.1 Grant of Performance Awards. The Committee shall determine the
number, amount and timing of Performance Awards granted to each Participant.
The Committee may grant Performance Awards to Participants either alone or in
conjunction with other awards under the Plan. Such Performance Awards may
take the form determined by the Committee, including without limitation, cash,
Common Stock, performance units and performance shares, or any combination
thereof. The Committee may attach one or more restrictions to such
Performance Awards and all Performance Awards terms will be confirmed in a
Performance Award Agreement.
10.2 Performance Goals.
(a) The Committee shall establish performance goals which,
depending on the extent to which they are met, will determine the number
and/or value of Performance Awards that will be paid out to the
Participants. Performance goals are based on the attainment of one or
more of the following: specified levels of earnings per share from
continuing operations, operating income, revenues, return on operating
assets, return on equity, stockholder return(based upon appreciation in
stock price) and/or stockholder return (based upon appreciation in stock
price and dividend growth), achievement of cost control, working capital
turns, cash flow, net income, economic value added, stock price of the
Company, or attainment of specified levels of performance under one or
more of the measures described above relative to the performance of
other corporations. The performance goals are intended to qualify under
Section 162(m)(4)(c) of the Code and shall be set by the Committee
within the time period prescribed by Section 162(m) of the Code.
(b) The Committee shall have the authority at any time to make
adjustments to the performance goals for any outstanding Performance
Awards which the Committee deems necessary or desirable.
(c) Performance periods shall, in all cases, be a minimum of one
year.
10.3 Value of Performance Units/Shares.
(a) Each performance unit shall have an initial value that is
established by the Committee at the date of grant.
(B) Each performance share shall have an initial value equal to the
Fair Market Value of the Common Stock on the date of grant.
10.4 Earning and Payment of Performance Awards. After the applicable
performance period has ended, the holder of a Performance Award shall be
entitled to receive the payout earned by such Participant over the performance
period, to be determined as a function of the extent to which the
corresponding performance goals have been achieved. Payment of earned
Performance Awards shall be made in accordance with the terms and conditions
prescribed or authorized by the Committee.
10.5 Per Person Limitation on Amount of Award. The total amount of a
Performance Award during any measurement period may not exceed 200% of a
Participant's base salary during that same measurement period.
10.6 Nontransferability. Performance Awards may not be sold, transferred,
pledged, assigned, levied upon, or otherwise alienated or hypothecated, other
than by will or by application of the laws of descent and distribution. A
Participant's rights under the Plan shall be exercisable during the
Participant's lifetime only by the Participant or upon the Participant's death
by the Participant's beneficiary. At the discretion of the Committee,
however, an Award Agreement may permit the transferability of a Performance
Award by a Participant solely to members of the Participant's immediate family
or trusts or partnerships for the benefit of such persons.
10.7 Termination.
(a) Except to the extent otherwise provided in the applicable
Performance Award agreement, if any, upon a Participant's termination of
employment for any reason during the performance period or before any
applicable performance goals are satisfied, the right to the units
and/or shares covered by the Performance Award shall be forfeited by the
Participant.
(b) In the event that a Participant's employment is terminated
(other than for cause), or in the event a Participant retires, the
Committee shall have the discretion to waive, in whole or in part,
any or all remaining payment limitations with respect to any or all of
such Participant's Performance Awards.
Article 11. Regulatory Approvals and Listing
11.1 Investment Representation. The Committee shall have the right to
require that each Participant or other person who shall exercise an option,
receive a Restricted Stock grant, exercise a SAR or receive shares pursuant to
a Performance Award under the Plan, and each person into whose name shares of
Common Stock shall be issued pursuant to the exercise of an option, Restricted
Stock grant, SAR or Performance Award represent and agree that any and all
shares of Common Stock purchased pursuant to this Plan are being purchased for
investment and not with a view to the distribution or resale thereof and that
such shares will not be sold except in accordance with such restrictions or
limitations as may be set forth in the option, Restricted Stock grant, SAR, or
Performance Award. This Section 11.1 shall be inoperative during any period
of time when the Company has obtained all necessary or advisable approvals
from governmental agencies and has completed all necessary or advisable
registrations or other qualifications of shares of Common Stock as to which
options, Restricted Stock grants, SARs, or Performance Awards may from time to
time be granted as contemplated in Section 11.2 hereof.
11.2 Registration and Listing. No shares shall be issued and delivered
pursuant to this Plan unless and until, in the opinion of counsel for the
Company, any applicable registration requirements of the Securities Act of
1933, as amended, any applicable listing requirements of any national
securities exchange on which stock of the same class is then listed, and any
other requirements of law or of any regulatory bodies having jurisdiction over
such issuance and delivery, shall have been fully complied with.
Article 12. Term of the Plan
12.1 Term of the Plan. This Plan shall be void unless it is approved by
the stockholders of the Company within 12 months after the date the Plan is
adopted by the Board of Directors. Subject to such approval, options,
Restricted Stock grants, SARs and Performance Awards may be granted pursuant
to the Plan from time to time within the period commencing with and ending ten
(10) years after the earlier of the adoption of the Plan by the Board of
Directors or the approval of the Plan by the stockholders. Options, SARs and
Performance Awards granted under the Plan may extend beyond that date and the
terms and conditions of the Plan shall continue to apply to such grants and to
shares of Common Stock acquired upon exercise of such grants.
Article 13. General Provisions
13.1 Per Person Limitation on Number of Shares. The number of shares of
Common Stock with respect to which options, Restricted Stock grants, SARs, or
Performance Awards may be granted under the Plan to an individual Participant
in any three year period beginning with the adoption of the Plan by the Board
through the end of the term of the Plan shall not exceed 200,000 shares,
subject to adjustment as provided in Section 5.2.
13.2 Limitation on Number of Shares of Restricted Stock and Performance
Shares. The total number of shares of Common Stock with respect to which
restricted stock grants may be granted pursuant to Article 9 and performance
shares may be granted pursuant to Article 10 shall together not exceed 130,000
shares during the term of the Plan, subject to adjustment as provided in
Section 5.2.
13.3 No Right to Continued Employment. Nothing contained in the Plan, or
in any option, Restricted Stock grant, SAR or Performance Award granted
pursuant to the Plan, shall confer upon any employee any right with respect to
continuance of employment by the Company or a Subsidiary, nor interfere in any
way with the right of the Company or a Subsidiary to terminate the employment
of such employee at any time with or without cause.
13.4 Right to Withhold Taxes. Appropriate provision shall be made for all
taxes including any tax imposed by Code Section 4999, required to be withheld
in connection with options, Restricted Stock grants, SARs or Performance
Awards under the applicable laws or regulations of any governmental authority,
whether federal, state or local and whether domestic or foreign. The Company
may withhold such taxes or may require a Participant to pay such taxes in
connection with such grant or exercise.
Article 14. Amendment, Termination or Discontinuance of the Plan
14.1 Right to Amend. Subject to Section 14.2, the Committee may from time
to time make such amendments to the Plan as it may deem proper and in the best
interest of the Company without further approval of the Board of Directors or
stockholders of the Company, including, but not limited to, any amendment
necessary to ensure that the Company may obtain any regulatory approval
referred to in Section 11 hereof; provided, however, that no change in any
option, Restricted Stock grant, SAR or Performance Award theretofore granted
may be made without the consent of the Participant which would impair the
right of the Participant to acquire or retain Common Stock which he may have
acquired as a result of the Plan.
14.2 Amendments Requiring Stockholder Approval. The Committee may not
amend the Plan without the approval of the stockholders of the Company if such
amendment relates to (a) an increase in the maximum number of shares of the
Company subject to the Plan, except as permitted by Section 5.2, (b) an
extension of the period for the exercise of an option or a SAR beyond the
limit set forth in Section 7.2(b), (c) an extension to the term of the Plan,
(d) a reduction in the option price at which options may be granted under the
Plan, or (e) a change in the class of eligible Participants.
14.3 Termination of the Plan. The Board of Directors may at any time
suspend the operation of or terminate the Plan with respect to any shares of
the Company's Common Stock not at the time subject to option or grant.
Termination shall not affect any right to repurchase shares or the
forfeitability of shares issued under the Plan.
As amended on September 10, 1997
Exhibit 5.1
OPINION OF COUNSEL
I have acted as counsel for Fluke Corporation, a Washington corporation
(the "Company"), in connection with the preparation and filing of this
Registration Statement on Form S-8 (the "Registration Statement"), under the
Securities Act of 1933, as amended (the "Act"). The Registration Statement
covers 1,500,000 shares of Common Stock, $.25 par value, of the Company (the
"Shares"), all of which shares will be offered by the Company pursuant to the
Company's 1998 Stock Incentive Plan.
As Vice President, General Counsel for the Company, I am familiar with
the proceedings taken by the Company in connection with the adoption of the
Plan and with the offering of Shares pursuant to the Plan. I have reviewed the
corporation actions of the Company in connection with this matter and have
examined the documents, corporate records and other instruments deemed
necessary for the purpose of this opinion.
Based on the foregoing, it is my opinion that:
(i) The Company is a corporation duly incorporated and validly
existing under the laws of the State of Washington;
(ii) The Shares have been duly authorized; and
(iii) The Shares, when issued and sold and when payment therefore is
received by the Company in accordance with the Plan and in accordance
with resolutions adopted by the Board of Directors of the Company or the
Compensation Committee thereof, will be validly issued, fully paid and
nonassessable.
I hereby consent to the filing of this opinion as an exhibit to the
Registration Statement.
/s/ Douglas G. McKnight
Douglas G. McKnight
Exhibit 23.1
Consent of Ernst & Young LLP, Independent Auditors
We consent to the incorporation by reference in the Registration Statement
(Form S-8) pertaining to the registration of 1,500,000 shares of common stock
for the Fluke Corporation 1998 Stock Incentive Plan of our report dated May
28, 1997, with respect to the consolidated financial statements of the Fluke
Corporation incorporated by reference in its Annual Report (Form 10-K) for
the year ended April 25, 1997 and of our report dated July 21, 1997 with
respect to the related financial statement schedule included therein, filed
with the Securities and Exchange Commission.
Seattle, Washington /s/ Ernst & Young LLP
December 12, 1997
