<PAGE>1
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14 (A) OF THE SECURITIES
EXCHANGE ACT OF 1934 (AMENDMENT NO. )
FILED BY THE REGISTRANT /X/ FILED BY A PARTY OTHER THAN THE REGISTRANT / /
- --------------------------------------------------------------------------------
Check the appropriate box:
/ / Preliminary Proxy Statement
/X/ Definitive Proxy Statement
/ / Definitive Additional Materials
/ / Soliciting Material Pursuant to sec.240.14a-11(c) or sec.240.14a-12
/ / Confidential, for Use of the Commission Only (as permitted by Rule
14a-6(e) (2))
Analogic Corporation
(Name of Registrant as Specified In Its Charter)
Analogic Corporation
(Name or Person (s) Filing Proxy Statement, if other than the Registrant)
PAYMENT OF FILING FEE (CHECK THE APPROPRIATE BOX):
/X/ No fee required.
/ / Fee computed on table below per Exchange Act Rules 14a-6(i) (1) and 0-11.
1) Title of each class of securities to which transaction applies:
2) Aggregate number of securities to which transactions applies:
3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which the
filing fee is calculated and state how it was determined):
4) Proposed maximum aggregate value of transaction:
5) Total fee paid:
/ / Fee paid previously with preliminary materials.
/ / Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a) (2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.
1) Amount Previously Paid:
2) Form, Schedule or Registration Statement No.:
3) Filing Party:
4) Date Filed:
- -------------------------------------------------------------------------------
<PAGE>2
Analogic Corporation
Notice of Annual Meeting of Stockholders of
Analogic Corporation to be Held January 22, 1999
The Annual Meeting of Stockholders of Analogic Corporation (the "Company") will
be held at the Company's headquarters located at 8 Centennial Drive, Peabody,
Massachusetts, (Centennial Industrial Park) on Friday, January 22, 1999 at
11:00 o'clock in the morning for the following purposes:
(1) To determine the number of Directors for the ensuing year and to
elect two (2) Class I directors for a three-year term, to hold office
until the 2002 Annual Meeting of Stockholders and until their
successors are elected and qualified.
(2) To consider and act upon the matter of adopting and approving
the Company's Key Employee Incentive Stock Option Plan, dated June
11, 1998, a copy of which is attached as Exhibit "A" to the proxy
statement.
(3) To act upon any and all matters incidental to any of the
foregoing and transact such other business as may legally come before
the Meeting or any adjourned session or sessions thereof.
The Board of Directors has fixed the close of business on November 25,
1998, as the record date for determining the stockholders having the right to
notice of and to vote at the meeting.
Julian Soshnick
Clerk
December 1, 1998
-----------------------------------------------
IF YOU ARE ENTITLED TO VOTE AT THE MEETING,
KINDLY EXECUTE AND MAIL THE ENCLOSED PROXY
-----------------------------------------------
<PAGE>3
Analogic Corporation
8 Centennial Drive
Peabody, Massachusetts 01960
PROXY STATEMENT
For the Annual Meeting of Stockholders
to be held on January 22, 1999
This proxy statement is furnished in connection with the solicitation by
and on behalf of the Board of Directors of Analogic Corporation (the "Company")
of proxies for use at the Annual Meeting of Stockholders of the Company to be
held on January 22, 1999 (the "Meeting"), and is being mailed, together with
the form of proxy solicited, to each stockholder of the Company on or about
December 1, 1998.
The enclosed proxy, if executed and returned, will be voted by the Proxy
Holders as directed on the proxy and, in the absence of such direction, to fix
the number of directors for the ensuing year at eight and for the election of
the nominees as directors, for the adoption of the Company's Key Employee
Incentive Stock Option Plan, dated June 11, 1998, and in accordance with their
best judgment if any other matter shall properly come before the Meeting.
Any stockholder giving a proxy in the accompanying form (the "Proxy")
retains the power to revoke it at any time prior to the exercise of the powers
conferred thereby. Such revocation may be effected by any means which are
sufficient to revoke a power of attorney, including giving written notice of
revocation to the Company at the above address or to its transfer agent, or the
execution and delivery to the Company or its transfer agent of a subsequent
proxy. Attendance of the stockholder at the Meeting in person, will not,
however, be deemed to revoke the Proxy unless the stockholder affirmatively
indicates his/her intention to vote the shares in person by so advising the
presiding officer or the clerk at the Meeting.
Stock and Stock Ownership
The holders of record of shares of Common Stock, $.05 par value, at the
close of business on November 25, 1998, may vote at the Meeting. On November
25, 1998, there were issued and outstanding 12,673,955 shares of Common Stock
of the Company (not including 1,188,922 shares held in treasury). Each share
of Common Stock is entitled to one vote on each of the matters listed in the
Notice of Meeting.
The following table sets forth information as to all persons (including
any "group", as that term is used in Section 13(d)(3) of the Exchange Act)
known by the Company to have owned beneficially 5% or more of its Common Stock
as of November 25, 1998, based upon information received from or on behalf of
the persons named. Unless otherwise noted, the beneficial owners listed have
sole voting and investment power with respect to the shares listed.
<PAGE>4
<TABLE>
<CAPTION>
Percent
Amount and Nature of of Class
Name and Address Beneficial Ownership (as of Nov. 25, 1998)
<S> <C> <C>
Bernard M. Gordon
Charitable 4,720,192 (1)(2) 37.2%
Remainder Unitrust
Bernard M. Gordon
Julian Soshnick
Gerald P. Bonder, Trustees
8 Centennial Drive
Peabody, MA 01960
T. Rowe Price 1,851,600 14.6%
100 East Pratt Street
Baltimore, MD 21202
Private Capital Management Inc. 908,795 7.2%
3003 Ninth Street
Naples, FL 33940
</TABLE>
(1) Exclusive of 6,000 shares owned by Mr. Gordon's wife, as to which he
disclaims any beneficial interest.
(2) Mr. Gordon serves as Trustee of the Bernard Gordon Charitable Remainder
Unitrust (the "Trust") along with Julian Soshnick and Gerald P. Bonder.
The three Trustees, acting by a majority, have full power to vote or
dispose of the shares held by the Trust. Upon the death of Mr. Gordon,
all of the assets of the Trust, in general, will be distributed to The
Gordon Foundation, a Section 501(c)(3) trust formed by Mr. Gordon with its
principal office located at 8 Centennial Drive, Peabody, Massachusetts.
<PAGE>5
PROPOSAL 1
ELECTION OF DIRECTORS
The Company's Restated Articles of Organization and By-Laws, as amended,
provide for the division of the Board of Directors into three classes, each
having a three-year term of office following the initial classification. The
term of one class expires each year. The terms of two directors, M. Ross Brown
and Edward F. Voboril, will expire at the Meeting. M. Ross Brown and Edward F.
Voboril have been nominated for election as the Class I directors, to hold
office until the 2002 Annual Meeting of Stockholders and until their respective
successors have been duly elected and qualified.
It is the intention of the persons named as Proxy Holders to fix the
number of directors for the ensuing year at eight and to vote for the election
of the nominees as Class I directors. In the event that any nominees should be
unable to serve, discretionary authority is reserved for the named Proxy
Holders to vote for a substitute, or to reduce the number of directors to be
elected, or both. Management has no reason to believe that the said nominees
will be unwilling or unable to serve if elected.
The following table sets forth certain information with respect to the
beneficial ownership of the Company's Common Stock by each director and nominee
for director of the Company and all directors, nominees for directors and
officers of the Company as a group. The table also sets forth certain
additional information with respect to each director and nominee for director
of the Company, including the year in which the term of office of each director
and nominee for director (if elected) expires.
<PAGE>6
<TABLE>
<CAPTION>
Nominee for Class I director is indicated by two asterisks.
Principal Occupation Director
Name Age Or Employment Since
<S> <C> <C> <C>
If Elected,
Term expires in 2002:
M. Ross Brown** 64 Vice President of the 1984
Company
Edward F. Voboril** (2)(3) 55 Chairman and CEO of 1990
Wilson Greatbatch Ltd.,
Clarence, NY
Term expires in 2001:
Bernard M. Gordon 71 Chairman of the Board 1969
and Chief Executive
Officer of the Company
John A. Tarello 67 Senior Vice President 1979
and Treasurer of the
Company
Gerald L. Wilson (2)(3) 59 Former Dean, School 1980
of Engineering and
Professor, Massachusetts
Institute of Technology
Term expires in 2000:
Bruce R. Rusch 55 President and Chief 1993
Operating Officer of
the Company
Bruce W. Steinhauer (2)(3) 63 President and Chief 1993
Executive Officer of the
Regional Medical Center
at Memphis
</TABLE>
<TABLE>
<CAPTION>
Amount and Nature of
Beneficial Ownership of
The Company's Common Stock
Name as of October 31, 1998
<S> <C>
If Elected,
Term expires in 2002:
M. Ross Brown** 7,500 * (5)(7)
Edward F. Voboril** (2)(3) 3,333 * (7)
Term expires in 2001:
Bernard M. Gordon 4,720,192 (4)(6)
John A. Tarello 30,000 *
Gerald L. Wilson (2)(3) 5,333 * (7)
Term expires in 2000:
Bruce R. Rusch 22,500 * (5)
Bruce W. Steinhauer (2)(3) 8,333 * (7)
Beneficial Ownership of Shares
by All Directors and Executive
Officers as a Group (8 persons) 4,828,441 (4)(5)(6)(7)
</TABLE>
* Represents less than 1% ownership
(1) The amounts shown are based upon information furnished by the individual
directors and officers. Unless otherwise noted the beneficial owners have
sole voting and investment power with respect to the shares listed.
(2) Member of Audit Committee.
(3) Member of Compensation Committee.
(4) Mr. Gordon serves as Trustee of the Bernard Gordon Charitable Remainder
Unitrust (the "Trust") along with Julian Soshnick and Gerald P. Bonder.
The three Trustees, acting by a majority, have full power to vote or
dispose of the shares held by the Trust. Upon the death of Mr. Gordon,
all the assets of the Trust, in general, will be distributed to the
Gordon Foundation, a Section 501(c)(3) trust formed by Mr. Gordon with its
principal office located at 8 Centennial Drive, Peabody, Massachusetts.
(5) These amounts include certain shares issued under the Company's Key
Employee Stock Bonus Plan which are subject to forfeiture under certain
circumstances (see the section of this proxy statement entitled Executive
Compensation).
(6) Exclusive of 6,000 shares owned by Mrs. Gordon, in which Mr. Gordon
disclaims all beneficial interest.
(7) These amounts include certain shares deemed beneficially owned under
Exchange Act Rule 13d-3(d)(1).
<PAGE>7
Bernard M. Gordon has been the Chairman of the Board of Directors of the
Company since 1969 and was President from 1980 to 1995.
Bruce R. Rusch was appointed a Vice President of the Company in January 1993
and President in January 1995. Mr. Rusch has been President of SKY COMPUTERS,
Inc. since 1987. SKY COMPUTERS, Inc. was acquired by Analogic effective April
1, 1992. Mr. Rusch is a director of Astea International, Inc.
John A. Tarello was the Company's Controller from May 1970 through July 1982,
a Vice President of the Company from 1971 to 1980, and has been Senior Vice
President since 1980, and Treasurer since 1985. He is also a director of Spire
Corporation.
Dr. Gerald L. Wilson is the former Dean of the School of Engineering at
Massachusetts Institute of Technology and the Vannevar Bush Professor of
Engineering at the Massachusetts Institute of Technology. Dr. Wilson has
served on MIT's faculty since 1965, and currently serves as a professor of
Electrical and Mechanical Engineering. He is a trustee of Commonwealth Energy
Systems and a director of ASECO Corporation.
Dr. Bruce W. Steinhauer became the President and Chief Executive Officer of
the Regional Medical Center at Memphis in 1998. Prior to this position, he was
the Chief Executive Officer of the Lahey-Hitchcock Clinic from 1992 - 1998.
M. Ross Brown joined the Company in August 1984 and is responsible for
managing its manufacturing operations. He was elected a Vice President in
October 1984.
Mr. Voboril was appointed Chairman of Wilson Greatbatch Ltd. of Clarence, New
York in 1998. He has been President and CEO since 1990.
By reason of Mr. Gordon's beneficial ownership of Common Stock set forth
above, he may be deemed to control the Company. In addition, in their capacity
as trustees of the Bernard M. Gordon Charitable Remainder Unitust, Mr. Gordon,
along with Mr. Soshnick and Mr. Bonder, may be deemed to control the Company.
The Board of Directors held four meetings during fiscal 1998.
The Company has an Audit Committee and a Compensation Committee. Mr. Voboril,
Dr. Wilson and Dr. Steinhauer serve on the Audit Committee. Mr. Voboril, Dr.
Wilson and Dr. Steinhauer serve on the Compensation Committee, with Bernard M.
Gordon serving as an ex officio member of the Compensation Committee. The
function of the Audit Committee is to confer with the Company's independent
auditors concerning the scope and results of their audit and any
recommendations they may have, and to consider such other matters relating to
auditing and accounting as the Committee may deem appropriate. During the 1998
fiscal year, the Committee met once with PricewaterhouseCoopers LLP. The
function of the Compensation Committee is to make recommendations to the Board
of Directors concerning officers' salaries and other compensation matters. The
Compensation Committee met once during the 1998 fiscal year to review and
approve salaries of the Company's officers for fiscal 1999. The Board does not
have a nominating committee.
EXECUTIVE OFFICERS
The Company has one executive officer who is not a Director.
Executive officers of the Company are elected annually by the Board of
Directors and hold office until their successors are chosen and qualified,
subject to early removal by the Board of Directors.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Mr. Bernard M. Gordon owns a 48% interest and Mr. Bernard L. Friedman, the
Company's former Vice Chairman of the Board (Mr. Friedman resigned on July 31,
1993), owns a 52% interest in a limited partnership (Audubon Realty, Ltd.),
which owns the Danvers, Massachusetts facilities leased by the Company for a
term to July 31, 2001. These facilities include a 50,000 square foot building
completed in 1978; a 40,000 square foot addition to that building, completed in
1982; and an 80,000 square foot building which the Company moved into during
1980. The fixed annual rent on the entire 170,000 square feet was increased
from $1,125,000 to $1,164,000 effective March 1, 1998, and shall be adjusted as
of March 1 every third year to reflect increases in the cost of living. A
total of 155,000 square feet of the facilities are sublet on a self-renewing
lease to Siemens Medical Electronics, Inc. for a term which as presently
extended will end on December 1, 2000, subject to an 18 month notice of
cancellation, on a triple-net basis.
<PAGE>8
Mr. Gordon and Mr. Friedman own a 48% and 52%, respective, interest in a
limited partnership (Audubon Realty, Ltd.) which owns the facility located at
360 Audubon Road, Wakefield, Massachusetts, which is leased by the Company for
a term to July 31, 2003. This facility has been utilized by the Company for
manufacturing and office space since May 1, 1981. The fixed annual rent for
this facility was increased from $315,000 to $333,000 effective May 1, 1996,
and shall be adjusted as of May 1 every third year to reflect increases in the
cost of living.
All of the foregoing rents are on a net lease basis, and accordingly the
Company pays, in addition to the above rental payments, all taxes, maintenance,
insurance, and other costs relating to the leased premises.
The terms of the several lease agreements, at the time they were executed,
were at least as favorable as those that could have been obtained from
unaffiliated third parties. Prior to execution of each such lease, two
independent appraisals were obtained in order to establish the fair market rate
for subject premises. A rent, in each case discounted below the fair market
rate established by the appraisals, was then agreed upon by the parties.
The leases each incorporated periodic rent escalation clauses, based upon the
CPI. At the present time, the rents that the Company is paying under the
several leases reflect fair rental value for the properties.
EXECUTIVE COMPENSATION
Summary Compensation Table
The following table sets forth certain compensation information for the Chief
Executive Officer and each of the next four most highly compensated executive
officers of the Company during the last fiscal year ("Named Officers") for
services rendered in all capacities for the last three fiscal years.
<TABLE>
<CAPTION>
ANNUAL COMPENSATION
Name and Total Annual
Principal Position Year Salary Bonuses Compensation
<S> <C> <C> <C> <C>
Bernard M. Gordon 1998 $339,400 $50,000 $389,400
Chairman (CEO) 1997 325,000 50,000 375,000
1996 325,000 25,000 350,000
Bruce R. Rusch 1998 $239,400 $50,000 $289,400
President (COO) 1997 225,000 50,000 275,000
1996 225,000 21,000 246,000
John A. Tarello 1998 $226,000 $50,000 $276,000
Senior Vice 1997 210,000 50,000 260,000
President and 1996 210,000 21,000 231,000
Treasurer
Ross Brown 1998 $193,700 $30,000 $223,700
Vice President 1997 185,000 30,000 215,000
1996 185,000 18,000 203,000
Julian Soshnick 1998 $193,700 $40,000 $233,700
Vice President 1997 185,000 40,000 225,000
and General 1996 185,000 18,000 203,000
Counsel
</TABLE>
<TABLE>
<CAPTION>
LONG-TERM
COMPENSATION AWARDS
Restricted
Stock Stock All other
Name and Awards Options Compensation
Principle Position Year (A)(B) (C)
<S> <C> <C> <C> <C>
Bernard M. Gordon 1998 --- --- $3,848
Chairman (CEO) 1997 --- --- 3,645
1996 --- --- 3,024
Bruce R. Rusch 1998 --- --- $3,646
President (COO) 1997 --- --- 3,442
1996 --- --- 2,855
John A. Tarello 1998 --- --- $3,892
Senior Vice 1997 --- --- 3,691
President and 1996 --- --- 3,062
Treasurer
Ross Brown 1998 --- --- $3,725
Vice President 1997 --- --- 3,521
1996 --- --- 2,921
Julian Soshnick 1998 --- --- $3,758
Vice President 1997 --- --- 3,555
and General 1996 --- --- 2,949
Counsel
</TABLE>
<PAGE>9
(A) Represents stock grants under the Company's Key Employee Stock Bonus Plan
dated March 14, 1983, as amended and restated on January 27, 1988, pursuant to
which Common Stock of the Company may be granted to key employees to encourage
them to exert their best efforts on behalf of the Company. Each recipient of
the Common Stock pursuant to the Bonus Plan is required to execute a
noncompetition agreement in a form satisfactory to the Company. The Bonus Plan
is administered by a committee appointed by the Board of Directors consisting
of the Chairman of the Board and three other Directors who are not eligible to
participate in the Bonus Plan. Generally, the Common Stock granted pursuant to
the Bonus Plan is not transferable for a period of three years from the date of
the grant and is subject to a risk of forfeiture in the event that the
recipient leaves the employ of the Company during this period for any reason.
Generally, during the subsequent four-year period, the transfer restrictions
will lapse with respect to 25% of the Common Stock for each year the recipient
remains in the employ of the Company. Failure to remain in the Company's
employ during all of the subsequent four-year period will result in a
forfeiture of shares as to which restrictions on disposition still exist. The
Common Stock granted pursuant to the Bonus Plan is held in escrow by the
Company until such restrictions on disposition lapse. However, while in
escrow, the recipient has the right to vote such shares of Common Stock and to
receive any cash dividends thereon. The Board of Directors, acting upon the
recommendation of the Stock Bonus Plan committee, may at the time of grant
designate a different schedule upon which the transfer restrictions lapse.
(B) As of July 31, 1998, the following table reflects aggregate stock bonus
awards, granted in 1993, for which transfer restrictions have not yet lapsed:
<TABLE>
<CAPTION>
Shares Market Value
<S> <C> <C>
Bruce R. Rusch 22,500 $916,875
M. Ross Brown 7,500 305,625
</TABLE>
(C) Represents amounts allocated to the Named officers pursuant to the
Company's profit sharing plan under which it may, but is not required to, make
contributions to a trust for the purpose of providing retirement benefits to
employees.
Stock Option Grants In Last Fiscal Year
There were no stock options awarded to named officers under the Company's Key
Employee Stock Option Plans during the last fiscal year.
Stock Option Exercises In Last Fiscal Year and Fiscal Year-End Option Values
The following table indicates (i) stock options exercised by the Named Officers
during the last fiscal year; (ii) the number of shares subject to exercisable
(vested) and unexercisable (unvested) stock options as of July 31, 1998; and
(iii) the fiscal year-end value of "in-the-money" unexercised options.
<TABLE>
<CAPTION>
Number of
Shares Acquired Value
Name On Exercise Realized (A)
<S> <C> <C>
Bernard M. Gordon ---- ----
Bruce R. Rusch ---- ----
John A. Tarello ---- ----
M. Ross Brown 2,500 $65,313
Julian Soshnick ---- ----
</TABLE>
<TABLE>
<CAPTION>
Number of Value of Unexercised
Unexercised Options In-The-Money Options
at Fiscal Year End at Fiscal Year End (A)(B)
Name Exercisable Unexercisable Exercisable Unexercisable
<S> <C> <C> <C> <C>
Bernard M. Gordon --- --- --- ---
Bruce R. Rusch --- --- --- ---
John A. Tarello --- --- --- ---
M. Ross Brown --- 2,500 --- $64,688
Julian Soshnick 5,000 --- $129,375 ---
</TABLE>
(A) The value realized or the unrealized value of in-the-money options at year-
end represents the aggregate difference between the market value on the date of
exercise or July 31, 1998, in the case of the unrealized values, and the
applicable exercise prices.
(B) "In-the-money" options are options whose exercise price was less than the
market price of Common Shares at July 31, 1998.
<PAGE>10
Compensation of Directors
Each director who is not an employee of the Company is entitled to an
annual fee of $10,000 plus a fee of $1,000 per meeting for each of the first
four meetings of the Board or any Board Committee attended by him, together
with reimbursement of travel expenses under certain circumstances.
In February 1988, the Board of Directors adopted and stockholders approved
at the January 1989 Annual Meeting of Stockholders, the 1988 Non-Qualified
Stock Option Plan for Non-Employee Directors (the "1988 Plan"). Pursuant to
the 1988 Plan, options to purchase 50,000 shares of common stock may be
granted only to directors of the Company or any subsidiary who are not
otherwise employees of the Company or any subsidiary. The exercise price of
options granted under the 1988 Plan is the fair market value of the Common
Stock on the date of grant. The 1988 Plan provides that each Non-Employee
director as of the date on which the Board of Directors adopted the 1988 Plan
shall be granted an option to acquire 5,000 shares. Each Non-Employee
director who is subsequently elected to the Board of Directors shall be
granted an option to acquire 5,000 shares after one year of service. In
June, 1996 the Board of Directors amended the 1988 plan to increase the
number of options that could be granted to each Non-Employee director to
10,000 shares.
In June 1996, the Board of Directors adopted and stockholders approved at
the January 1997 Annual Meeting of Stockholders, the 1997 Non-Qualified Stock
Option Plan for Non-Employee Directors (the "1997 Plan"). Pursuant to the 1997
Plan, options to purchase 50,000 shares of common stock may be granted only to
directors of the Company or any subsidiary who are not otherwise employees of
the Company or any subsidiary. The exercise price of options granted under the
1997 Plan is the fair market value of the Common Stock on the date of grant.
The 1997 Plan provides each new Non-Employee Director who is elected to the
Board shall be granted an option to acquire 5,000 shares, effective as of the
date he or she is first elected to the Board; provided, however, that upon such
first election, a new Non-Employee Director shall not receive a grant under
both this Plan and the 1988 Plan.
The Board of Directors shall determine under which Plans grants shall
be made. Every four (4) years from the date on which a Non-Employee Director
was last granted a Non-Employee Director option, whether under either Plan,
that Non-Employee Director shall be granted an option to acquire 5,000 shares,
effective as of the date of that fourth anniversary. No options were granted
under the 1997 Plan as of July 31, 1998.
Options granted under both Plans are exercisable for a nine-year period
commencing one year after the date of grant. During that exercise period,
subject to the occurrence of certain events, options may be exercised only to
the extent of (a) 33 1/3% of the number of shares covered by the option one or
more years after the date of grant, (b) 66 2/3% of the number of shares subject
to the option two or more years after the date of grant, and (c) 100% of the
number of shares subject to the option three or more years after the date of
grant. Both Plans are administered by members of the Company's Board of
Directors.
The following table sets forth options granted pursuant to the 1988 Plan
as of July 31, 1998:
<TABLE>
<CAPTION>
Date of Options Option Options Options Options
Grant Granted Price Exercised Exercisable Unexercisable
<S> <C> <C> <C> <C> <C> <C>
Dr. Wilson 2/01/88 5,000 $ 7.375 5,000 --- ---
Dr. Wilson 6/12/96 5,000 $27.750 --- 3,333 1,667
Mr. Voboril 6/12/91 5,000 $10.875 5,000 --- ---
Mr. Voboril 6/12/96 5,000 $27.750 --- 3,333 1,667
Dr. Steinhauer 10/08/93 5,000 $14.750 --- 5,000 ---
Dr. Steinhauer 6/12/96 5,000 $27.750 --- 3,333 1,667
</TABLE>
REPORT OF THE COMPENSATION COMMITTEE OF THE BOARD OF DIRECTORS ON EXECUTIVE
COMPENSATION
Analogic Corporation is engaged in the design, manufacture and marketing
of advanced precision data conversion and computer-based signal processing
instruments and equipment which are used to acquire, condition, translate,
compute, interpret, store, transmit, or display critical data in modern
industrial, scientific, medical, communications and other system
applications.
Analogic's technology-driven philosophy and strategic growth objectives
require an ability to recruit and retain competent executives with
substantial qualities in managerial breadth and technical depth. Such
retention requires provision of remuneration programs which motivate and
reward performance results directly related to enhancement of shareholder
value.
It is the charter of the Compensation Committee to develop, implement and
control executive remuneration practices which:
- Align management objectives with shareholder interests,
- Balance short-term (annual) business plans with longer-term strategic
goals,
- Link individual and Company performance to executive remuneration, and
- Provide for remunerative practices which are highly motivational to the
individual and competitive in the marketplace.
The Committee determines and approves all recommendations for salary
adjustment, cash incentive awards and/or stock incentive awards pertaining to
the Chief Executive Officer and other Senior Executives of the Company.
<PAGE>11
Annual Compensation
Executive salary ranges and annual incentive award targets are established
annually after reviewing comparative data from companies in similar
industries, with similar sales revenue. The Company's practice is to
compensate executives at a competitive level for its industry.
Each position is placed in a salary range appropriate to the scope of the
position, considering both external survey data and internal equity. Annual
salary increases and incentive awards are based on overall Company results
and achievement of individual objectives during the fiscal year. Measures of
Company performance include: sales growth, profit attainment, new product
introduction, manufacturing efficiency, product quality, employee morale and
employee turnover.
Individual performance factors are relevant to the area of responsibility
for each executive, and include division performance where appropriate.
The Committee reviewed competitive salary practices for corporate officers
and elected to make adjustments to officer base salaries effective January of
1998.
Longer-Term Incentives
Stock incentives, which include stock options and/or stock grants, were
provided through the following Plans which were previously approved by vote
of the shareholders:
- Key Employee Non-Qualified Stock Option Plan dated May 13, 1985.
- Key Employee Incentive Stock Option Plan dated March 14, 1993 and as
amended on January 28, 1987.
- Key Employee Stock Bonus Plan as restated January 27, 1988.
- Key Employee Incentive Stock Option Plan dated June 11, 1993.
The award of stock incentives to individual recipients considers the
contribution of the individual to longer-term results, his/her impact upon
divisional or corporate objectives, and level of position within the
organization.
The potential realization from these awards is directly related to the
continuing success of the Company as measured by increasing shareholder
value.
Compensation of the Chief Executive Officer
The compensation of the Chief Executive Officer, Mr. Bernard M. Gordon, is
determined by the Committee following evaluation of his individual
performance and the overall Company performance with considerable respect to
financial results. The key performance measure for this position is the
ability to provide the leadership and vision necessary to assure continuing
success. Other measures of quantitative and qualitative performance are
similar to those used for all Corporate Officers, as is the method of
evaluating competitive compensation practices.
Mr. Gordon's base salary was adjusted in January, 1998 to reflect
competitive renumeration practices of CEO's of comparable, high technology
companies. The amount of Mr. Gordon's incentive award was based on annual
financial results. Due to his position as founder of the Company, Mr. Gordon
personally identifies with the future of the organization and has declined to
participate in stock incentive arrangements. Overall, his compensation
continues to be conservative, particularly in light of his leadership
position in the electronics industry.
COMPENSATION COMMITTEE
Bruce W. Steinhauer
Edward F. Voboril
Gerald L. Wilson
<PAGE>12
COMPARISON OF FIVE-YEAR CUMULATIVE TOTAL RETURNS
The graph below compares the cumulative total shareholder return on the
Company's Common Shares with the cumulative total return on the Center for
Research in Security Prices of the University of Chicago ("CRSP") Total
Return Index for the NASDAQ Stock Market (U.S. Companies) and the CRSP Total
Return Index for all NASDAQ stocks within the Company's primary SIC Code.
The graph assumes $100 invested on July 31, 1993, in the Company's Common
Shares and $100 invested at that time in each of the NASDAQ indexes. The
comparison assumes that all dividends are reinvested.
[GRAPHIC]
The following legend represents data presented in graphical form.
<TABLE>
<CAPTION>
CRSP Total Returns
Index for: 7/31/93 7/31/94 7/31/95 7/31/96 7/31/97 7/31/98
<S> <C> <C> <C> <C> <C> <C>
ANALOGIC CORPORATION 100.0 105.8 126.2 190.9 246.6 276.9
Nasdaq Stock Market
(US Companies) 100.0 102.9 144.5 157.4 232.3 274.2
NASDAQ Stocks
(SIC 3800-3899 US
Companies) 100.0 94.3 149.2 146.1 192.3 173.1
Measuring instruments;
photo, med & optical
goods; timepieces
</TABLE>
Notes:
A. The lines represent monthly index levels derived from compounded daily
returns that include all dividends.
B. The indexes are reweighted daily, using the market capitalization on the
previous trading day.
C. If the monthly interval, based on the fiscal year-end, is not a trading
day, the preceding trading day is used.
D. The index level for all series was set to $100.0 on 7/31/93.
<PAGE>13
PROPOSAL 2
APPROVAL OF THE 1998 KEY EMPLOYEE
INCENTIVE STOCK OPTION PLAN
The Board of Directors has adopted, subject to the approval of the
stockholders, the Key Employee Incentive Stock Option Plan dated June 11, 1998
("the 1998 Plan"), a copy of which is attached as Exhibit A to this proxy
statement. The Board of Directors believes that the granting of such incentive
stock options helps the Company in its efforts to attract and retain highly
qualified employees and to encourage them to exert their best efforts on behalf
of the Company. Accordingly, the Board recommends that the stockholders vote
for approval of the 1998 Plan, and the proxies will be so voted unless a
stockholder specifies otherwise. The affirmative vote of a majority of the
shares voting on the matter (provided such majority is at least a majority of
the number of shares required to constitute a quorum) will be necessary to
approve the 1998 Plan.
The following is a summary description on the 1998 Plan. For information
concerning the participation by executive officers and directors of the Company
in all of the Company's stock option and benefit plans, see "Executive
Compensation" in this Proxy Statement.
Purpose
The purpose of the 1998 Plan is to further the growth and development of
Analogic Corporation and its wholly-owned subsidiaries by granting certain
officers, directors, and key employees, options to purchase shares of Common
Stock of the Company thereby encourage stock ownership in the Company and a
more direct stake in its continuing success.
Stock Available for Options
A total of up to 500,000 shares of Common Stock may be issued upon exercise
of options granted under the 1998 Plan. The shares of Common Stock to be
issued upon exercise of options may include treasury shares, authorized but
unissued shares and shares previously reserved for issuance upon exercise of
options which have expired or terminated. Shares subject to an option that
ceases to be exercisable for any reason are available for subsequent option
grants.
Administration
The 1998 Plan shall be administered by a Stock Plan Committee (the
"Committee") appointed by the Board of Directors of the Company. The Committee
shall consist of the Chairman of the Board and not less than two additional
directors, each of whom shall be ineligible to participate in the 1998 Plan.
The Committee may interpret the 1998 Plan and options granted pursuant to the
1998 Plan and may make, and amend, such regulations concerning the 1998 Plan as
it may deem appropriate.
Eligibility; Grant of Options
All officers, directors, and key employees of the Company and its wholly-
owned subsidiaries other than the Chairman of the Board shall be eligible to
participate in the Plan. No officer or director who is not also a key employee
shall be eligible to participate, nor shall any person owning 10% or more of
the Common Stock be eligible. Options may be granted within the limits of the
1998 Plan only in accordance with recommendations of the Committee and to the
extent that such recommendations are consistent with the provisions of Section
422 of the Internal Revenue Code and the 1998 Plan. Options for the purchase
of no more than 20,000 shares may be granted to any one individual,
cumulatively, under the Plan.
Option Prices
The price at which any shares of Common Stock may be purchased pursuant to
the exercise of an option (the "Exercise Price") granted under the 1998 Plan
shall be not less than the fair market value (the "Exercise Price") of the
share of Common Stock at the time the option is granted.
<PAGE>14
Exercise of Options
Generally, options granted under the 1998 Plan are exercisable during the
period commencing three years after the date of grant and ending eight years
from the date of grant (the "Option Period") with respect to the following
indicated percentage of the total number of shares of Common Stock subject to
an option at the expiration of the following indicated periods from the date of
grant of an option:
(1) during the fourth year from the date of each grant under the 1998 Plan
only to the extent of 25% of the total number of option shares granted to
the Participant under that grant;
(2) during the fifth year from the date of each grant under the 1998 Plan
only to the extent of 50% of the total number of option shares granted
to the Participant under that grant;
(3) during the sixth year from the date of each grant under the 1998 Plan
only to the extent of 75% of the total number of option shares granted
to the Participant under the Plan.
(4) during the seventh and subsequent years from the date of each grant under
the 1998 Plan, the Participant may exercise all unexercised options
granted under that grant.
The Committee may, however, at the time of grant of any option designate a
different schedule upon which such option shall become exercisable and may at
any time determine that one or more then outstanding options shall become
exercisable (in whole or in such part as may be specified in the Committee
vote) more quickly than otherwise applicable.
Rights in the Event of Termination of Employment or Death
If a Participant retires during the Exercise Period, his options shall be
exercisable only during the three months following his retirement, but in no
event after the expiration of the Exercise Period.
If a Participant dies during the Exercise Period, his options shall be
exercisable by the executors, administrators, legatees or distributees of his
estate only during the six months following the appointment of a fiduciary of
his or her estate, but in no event after the expiration of the Exercise Period.
If a Participant ceases to be an employee of the Company for any cause other
than retirement or death, his option shall terminate as of the date of the
cessation of his employment.
Transfer Restrictions
An option is exercisable only by the option holder during his or her
lifetime, and no option or right or interest in an option is assignable or
transferable by the holder except by will or the laws or descent and
distribution.
Conditions to Exercise of Options
The Committee may, in its discretion, require as conditions to the exercise
of options and the issuance of shares (a) that a registration statement under
the Securities Act of 1933, as amended, with respect to the shares to be issued
on the exercise of the options, containing such current information as is
required by the Rules and Regulations under said Act, shall have become, and
continue to be effective, or (b) that the Participant (i) shall have
represented both that he is acquiring the option and, at the time of exercising
the option, that he is acquiring the shares for his own account, for investment
or not with a view to or in connection with any distribution, (ii) shall have
agreed to restrictions on transfer, and (iii) shall have agreed to an
endorsement which makes appropriate reference to such representations and
restrictions both on the option and on the certificate representing the shares.
Amendment, Alteration or Termination of the 1998 Plan
The 1998 Plan will terminate on June 10, 2008 and no options may be granted
under the 1998 Plan after that date. The Board of Directors may alter,
terminate, discontinue, suspend or amend the 1998 Plan. Neither the Board of
Directors nor the Committee may, however, increase the maximum number of shares
in the aggregate that my be offered for sale under options, change the manner
of determining the offer price, or alter or impair any options previously
granted under the 1998 Plan. Termination of the 1998 Plan shall not impair or
alter the rights of the Participant to exercise options granted under the 1998
Plan.
<PAGE>15
Effect of Changes in Common Stock
If by reason or recapitalization, reclassification, stock split-up,
combination of shares, separation (including a spin-off) or dividend on the
stock of the Company payable in stock, the outstanding shares of stock of the
Company are increased or decreased or changed into or exchanged for a different
number of kind of shares or other securities of the Company, the Committee
shall conclusively determine the appropriate adjustment in the exercise prices
of outstanding options and in the number and kinds of shares as to which
outstanding options shall be exercisable.
If the Company is a party to any merger or consolidations, any purchase or
acquisition of property or stock, or any separation, reorganization or
liquidation, the Committee (or, if the Company is not the surviving
corporation, the Board of Directors of the surviving corporation) shall have
the power to make arrangements for the substitution of new options for, or the
assumption by another corporation of, any unexpired options then outstanding.
In the events of any of the foregoing transactions, the total number of
shares of stock in which options may be granted under this Plan shall be
appropriately adjusted by the Committee.
Federal Income Tax Consequences
The 1998 Plan is intended to qualify as an Incentive Stock Option Plan within
the meaning of Section 422 of the Internal Revenue Code. The following is a
summary of the federal income tax treatment of incentive stock options.
No taxable income will be recognized by the optionee upon the grant of an
incentive stock option. No taxable income will be recognized by the optionee
upon the exercise of an incentive stock option, and no corresponding expense
deduction will be available to the Company. Generally, if an optionee holds
shares acquired upon the exercise of incentive stock options until the late of
(i) two years from the grant of the option or (ii) one year from the date of
transfer of the purchased shares to him or her (the "Statutory Holding
Period"), any gain recognized by the optionee on a subsequent sale of such
shares will be treated as long-term capital gain. The gain recognized upon the
sale of the stock is the difference between the option price and the sale price
of the stock. The net federal income tax effect on the holder of incentive
stock options is to defer, until the stock is sold, taxation of any increase in
the stock's value from the time of grant to the time of exercise.
If the optionee sells the shares prior to the expiration of the Statutory
Holding Period, he or she will realize taxable income at ordinary income tax
rates in an amount equal to the lesser of (i) the value of the shares on the
date of exercise less the option price, or (ii) the amount realized on the date
of sale less the option price, and the Company will receive a corresponding
business expense deduction. However, special rules may apply to an officer-
optionee. The amount by which the proceeds of sale exceed the fair market
value of shares on the date of exercise will be treated as long-term capital
gain if the shares are held for more than one year prior to the sale and as
short-term capital gain if the shares are held for a shorter period. In the
case of a sale where a loss, if sustained, would have been recongnized, the
amount of the optionee's income, and the amount of the Company's corresponding
expense deduction, will not exceed the difference between sale price and the
adjusted basis of the shares.
For purposes of the `alternative minimum tax' applicable to individuals, in
the year of option exercise, an optionee must generally include in his or her
alternative minimum taxable income the difference between the exercise price
and the fair market value of the stock on the date of exercise. The
alternative minimum tax is imposed upon an individual's alternative minimum
taxable income, but only to the extent that such tax exceeds the taxpayer's
regular income tax liability for the taxable year.
If an optionee transfers `statutory option stock' (which includes stock
acquired through the exercise of an incentive stock option) to exercise stock
options prior to the expiration of the applicable holding periods, the optionee
will recognize ordinary income and the Company will receive a corresponding
business expense deduction in an amount equal to the lesser of (I) the fair
market value of the statutory option stock on the date it was acquired less its
exercise price, or (ii) the fair market value of such statutory option stock on
the date of the exchange less its adjusted basis.
<PAGE>16
PROPOSALS OF STOCKHOLDERS
A stockholder of the Company who intends to present a proposal for action at
the next Annual Meeting of Stockholders of the Company may seek to have his
proposal included in the Company's proxy material for the Meeting by notifying
the Company of such intention and furnishing the text of the proposal to the
Company. Such notice must also include the stockholder's address and statement
of the number of shares of Common Stock of the Company held of record or
beneficially by such stockholder and of the date or dates upon which such
shares were acquired, and must be accompanied by documentary support for a
claim of beneficial ownership. To have a proposal considered for inclusion in
the proxy material for the 2000 Annual Meeting of Stockholders, a stockholder
must give the aforesaid notice and submit his proposal no later than August 14,
1999. The notice and text should be sent to the attention of John A. Tarello,
Senior Vice President and Treasurer, Analogic Corporation, 8 Centennial Drive,
Peabody, MA 01960.
OTHER MATTERS
The Company knows of no business which will be presented for consideration at
the Meeting other than that set forth in this Proxy Statement. However, if any
such other business shall come before the Meeting, the persons named in the
Proxies or their substitutes shall vote the Proxies in respect of any such
business in accordance with their best judgment.
The cost of preparing, assembling, and mailing the proxy material will be
borne by the Company. The Company may solicit Proxies otherwise than by the
use of the mails, in that certain officers and regular employees of the
Company, without additional compensation, may use their personal efforts, by
telephone, correspondence or in person, to obtain Proxies. The Company will
also request persons, firms and corporations holding shares in their names, or
in the names of their nominees, which are beneficially owned by others, to send
proxy material to and obtain Proxies from such beneficial owners and will
reimburse such holders for their out-of-pocket expenses in so doing.
THE COMPANY WILL FURNISH TO ANY STOCKHOLDER UPON WRITTEN REQUEST, WITHOUT
CHARGE, A COPY OF THE COMPANY'S ANNUAL REPORT ON FROM 10-K, INCLUDING THE
FINANCIAL STATMENTS AND SCHEDULES THERETO, FILED WITH THE SECURITIES AND
EXCHANGE COMMISSION. A request for the Form 10-K should be addressed to John
A. Tarello, Senior Vice President and Treasurer, Analogic Corporation, 8
Centennial Drive, Peabody, Massachusetts 01960.
For the Board of Directors
December 1, 1998 Julian Soshnick
Clerk
IF YOU DO NOT EXPECT TO BE PRESENT AT THIS MEETING AND WISH YOUR STOCK TO BE
VOTED, YOU ARE REQUESTED TO SIGN, DATE AND MAIL PROMPTLY THE ENCLOSED PROXY,
WHICH IS BEING SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS. A RETURN
ENVELOPE, WHICH REQUIRES NO POSTAGE IF MAILED IN THE UNITED STATES OR CANADA,
IS ENCLOSED FOR THAT PURPOSE.
<PAGE>17
EXHIBIT A
ANALOGIC CORPORATION
KEY EMPLOYEE
INCENTIVE STOCK OPTION PLAN
DATED JUNE 11, 1998
1. Purpose
The purpose of this Plan (the "Plan") is to further the growth and
development of Analogic Corporation and any subsidiary corporations, as
hereinafter defined (referred to, unless the context otherwise requires, as the
"Company"), by granting to certain officers, directors, and key employees of
the Company and any subsidiary corporations, as an incentive and encouragement
to stock ownership, options to purchase shares of Common Stock of the Company
and thereby obtain a proprietary interest in the enterprise and a more direct
stake in its continuing welfare.
2. Administration
The Plan shall be administered by a Stock Plan Committee (the "Committee")
appointed by the Board of Directors of the Company. The Committee shall serve
at the pleasure of the Board and shall consist of the Chairman of the Board and
not less than two additional directors, each of whom is a disinterested person
as defined in 17 CFR 240.16b-3(c)(2). The Committee may, from time to time,
interpret the Plan and options granted pursuant thereto, and may make, and
amend, such regulations concerning the same as it may deem appropriate.
3. Grant of Options
The Committee may grant options within the limits of the Plan only in
accordance with the recommendations of the Committee with respect to the
identity of the employees to receive options, the times when they shall receive
them (subject to the limits hereinafter set forth), the number of shares to be
subject to each option, the dates upon which options granted may be exercised,
and other terms of the options to be granted (which terms need not be
identical) to the extent not inconsistent with the provisions of Section 422 of
the Internal Revenue Code (the "Code") and the Plan. Options for the purchase
of no more than 20,000 shares may be granted to any one Participant
cumulatively under the Plan.
Notwithstanding any provision hereof to the contrary, the aggregate fair
market value of stock with respect to which incentive stock options (determined
without regard to Section 422(d) of the Code) are exercisable for the first
time by any Participant during any calendar year shall not exceed $100,000.
For purposes of the preceding sentence, the fair market value of any stock
shall be determined as of the time the option with respect to such stock is
granted; and application of said $100,000 limitation shall be made taking
options into account in the order in which they were granted.
4. Shares Subject to the Plan
The shares to be optioned may be authorized and unissued shares of Common
Stock of the Company, of the par value of $.05 each, or treasury shares, as the
Committee may determine, not exceeding in the aggregate 500,000 shares of
Common Stock; provided however, that no options may be granted under the Plan
if the aggregate number of shares subject to (i) options then outstanding under
the Plan, (ii) other options granted by the Company and then outstanding, and
(iii) the options proposed to be granted under the Plan, would exceed an amount
equal to 10% of the then issued and outstanding shares of Common Stock of the
Company (excluding treasury shares). All shares subject to options that shall
have terminated for any reason (other than by surrender for cancellation upon
any exercise of all or part of such options) will be available for subsequent
optioning.
<PAGE>18
5. Participants
All officers, directors, and key employees of the Company and its wholly-
owned subsidiary corporations other than the Chairman of the Board and the Vice
Chairman of the Board shall be eligible to receive options and thereby become
Participants in the Plan. No officer or director who is not also a key
employee shall be eligible to participate, nor shall any person owning 10% or
more of the Common Stock be eligible. In granting options, the Committee may
include or exclude previous Participants in the Plan and/or in any of the
Company's other stock option plans.
6. Option Price
The price at which shares may from time to time be optioned shall be not
less than the fair market value at the time the option is granted. The fair
market value shall be determined in good faith by the Committee at each time
that such options are granted by it.
7. Option Period
Subject to Section 14, the period for exercising an option (the "Exercise
Period") shall be the period beginning three years and ending eight years from
the date the option is granted, except that:
(a) If an option shall have been granted in connection with the
termination of a previously granted option under the Plan, the
Exercise Period of such subsequently granted option shall be the
period beginning the day after the expiration of the option
period applicable to the said previously granted option and
ending eight years from the date such subsequently granted
option is granted.
(b) If a replacement option is granted to a previous Participant
under the Plan, unless otherwise determined by the Committee at
the time of grant, the Exercise Period shall commence three
years after the date of the grant being replaced under the Plan.
(c) If a Participant retires during the Exercise Period, such option
shall be exercisable by him only during the three months
following his retirement, but in no event after the expiration
of the Exercise Period.
(d) If a Participant dies during the Exercise Period, such option
shall be exercisable by the executors, administrators, legatees
or distributes of his estate only during the six months
following the appointment of a fiduciary of his or her estate,
but in no event after the expiration of the Exercise Period.
(e) If a Participant ceases to be an employee of the Company for any
cause other than retirement or death, such option shall
terminate as of the date of the cessation of his employment.
(f) The Committee may at the time of grant of any option designate a
different Exercise Period for such option.
8. Exercise of Option
Subject to Sections 7, 14 and 15, options granted under the Plan may be
exercised at any time and from time to time during the Exercise Period except
that each option granted under the Plan may be exercised:
during the fourth year from the date of that grant under the Plan
only to the extent of 25% of the total number of option shares
granted to the Participant under that grant;
during the fifth year from the date of that grant under the Plan only
to the extent of 50% of the total number of option shares granted to
the Participant under that grant;
<PAGE>19
during the sixth year from the date of that grant under the Plan only
to the extent of 75% of the total number of option shares granted to
the Participant under that grant; and
during the seventh and subsequent years from the date of that grant
under the Plan, the Participant may exercise all unexercised options
granted under that grant.
Notwithstanding the foregoing provisions of this Section 8, the Committee may
at the time of grant of any option designate a different schedule upon which
such option shall become exercisable and may at any time determine that one or
more then outstanding options shall become exercisable (in whole or in such
part as may be specified in the Committee vote) more quickly than such
option(s) would become exercisable under the schedule otherwise applicable
thereto.
The foregoing exercise schedule is subject always to the provisions
of Section 11 of the Plan and to the condition that any unexercised option
shall expire eight years from the date of grant of that option.
If one of the events referred to in Section 7(c) or 7(d) occurs, the
option shall be exercisable, subject to Section 15, under this Section during
the three months following retirement, or during the six month period following
the appointment of a fiduciary of the estate of a deceased employee, as the
case may be, only as to the number of shares, if any, as to which it was
exercisable immediately prior to said retirement or death.
9. Payment for Shares
Full payment for shares purchased, together with the amount of any tax or
excise due in respect of the sale and issue thereof, shall be made (i) in cash
(ii) by delivering shares of stock, or (iii) by any combination of cash and
such stock, as the Participant may determine at the time of the exercise of the
option in whole or in part. The Company will issue no certificates for shares
until full payment therefor has been made, and a Participant shall have none of
the rights of a stockholder until certificates for the shares purchased are
issued to him.
10. Nonassignability
Each option by its terms shall not be transferable otherwise than by will or
the laws of descent and distribution, and shall be exercisable, during a
Participant's lifetime, only by him.
11. Conditions to Exercise of Options
The Committee may, in its discretion, require as conditions to the exercise
of options and the issuance of shares thereunder (a) that a registration
statement under the Securities Act of 1933, as amended, with respect to the
shares to be issued on the exercise of the options, containing such current
information as is required by the Rules and Regulations under said Act, shall
have become, and continue to be, effective, or (b) that the Participant (i)
shall have represented, warranted and agreed, in form and substance
satisfactory to the Company, both that he is acquiring the option and, at the
time of exercising the option, that he is acquiring the shares for his own
account, for investment or not with a view to or in connection with any
distribution, (ii) shall have agreed to restrictions on transfer, in form and
substance satisfactory to the Company, and (iii) shall have agreed to an
endorsement which makes appropriate reference to such representations,
warranties, agreements and restrictions both on the option and on the
certificate representing the shares.
<PAGE>20
12. Conditions to Effectiveness of the Plan
The Plan was adopted by the Board of Directors on June 11, 1998. However,
any option granted shall not be exercisable unless and until the Plan shall
have been duly approved by the stockholders of the Company. No option shall be
granted or exercised if the grant of the option, or the exercise and the
issuance of shares pursuant thereto, would be contrary to law or the
regulations of any duly constituted authority having jurisdiction.
13. Alteration, Termination, Discontinuance, Suspension or Amendment
The Plan shall terminate on June 10, 2008 and no options shall be granted
under the Plan after such date. The Board may alter, terminate, discontinue,
suspend or amend the Plan. Neither the Board nor the Committee may, however,
increase the maximum number of shares in the aggregate that may be offered for
sale under options or change the manner of determining the option price or,
without the consent of the Participant, alter or impair any option previously
granted to him under the Plan, except as provided in Section 14. In no way
shall the termination of the Plan impair or alter the rights of the Participant
to exercise options granted under the Plan or alter the rights of the Committee
under Section 8 of the Plan. The Committee may issue new options in exchange
for outstanding options.
14. A. Effect of Changes in Common Stock
If by reason of recapitalization, reclassification, stock split-up,
combination of shares, separation (including a spin-off) or dividend on
the stock of the Company payable in stock, the outstanding shares of
stock of the Company are increased or decreased or changed into or
exchanged for a different number or kind of shares or other securities
of the Company, the Committee shall conclusively determine the
appropriate adjustment in the exercise prices of outstanding options
and in the number and kind of shares as to which outstanding options
shall be exercisable, and the total number of shares of stock of the
Company in which options may be granted under this Plan shall be
appropriately adjusted by the Committee.
B. Reorganization
If the Company is a party to any merger or consolidations, any purchase
or acquisition of property or stock, or any separation, reorganization
or liquidation, the Committee (or, if the Company is not the surviving
corporation, the Board of Directors of the surviving corporation) shall
have the power to make arrangements, which shall be binding upon the
holders of unexpired options, for the substitution of new options for,
or the assumption by another corporation of, any unexpired options then
outstanding hereunder, and the total number of shares of stock in which
options may be granted under this Plan shall be appropriately adjusted
by the Committee.
15. Securities Laws
With respect to persons subject to Section 16 of the Securities Exchange Act
of 1934 ("1934 Act"), transactions under this Plan are intended to comply with
all applicable conditions of Rule 16b-3 or its successors under the 1934 Act.
To the extent any provision of the Plan or action by the Committee or the Board
of Directors fails to so comply, it shall be deemed null and void, to the
extent permitted by law and deemed advisable by the Committee.
<PAGE>21
P R O X Y
ANALOGIC CORPORATION
Proxy for Annual Meeting of Stockholders to be held January 22, 1999
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned, having received the notice of the meeting and proxy statement
therefor, and revoking all prior proxies, hereby appoint(s) Bernard M. Gordon,
John A. Tarello, and Julian Soshnick, or any one of them attorney or attorneys
of the undersigned (with full power of substitution) to attend the Annual
Meeting of Stockholders of Analogic Corporation (the "Company") to be held at
the Company's headquarters located at Eight Centennial Drive, Peabody,
Massachusetts on January 22, 1999, at 11:00 a.m. and at any adjourned sessions
thereof, and there to vote and act with respect to all shares of the Company
which the undersigned shall be entitled to vote or act upon, with all the powers
the undersigned would possess if personally present. This proxy will be voted
as directed by the undersigned and if no direction is indicated, it will be
voted FOR the nominees as directors and FOR Proposal 2.
Election of two Directors. Nominees:
M. Ross Brown, Edward F. Voboril
SEE REVERSE SIDE:
If you wish to vote in accordance with the Board of Directors' recommendations,
please sign on the reverse side. You need not mark any boxes.
CONTINUED AND TO BE SIGNED ON THE REVERSE SIDE SEE REVERSE
SIDE
<PAGE>22
- -------------------------------------------------------------------------------
Reverse side of PROXY
- -------------------------------------------------------------------------------
THIS IS YOUR PROXY.
YOUR VOTE IS IMPORTANT.
Regardless of whether you plan to attend the Annual Meeting of Stockholders, you
can be sure your shares are represented at the Meeting by promptly returning
your proxy (attached below) in the enclosed envelope. Thank you for your
attention to this important matter.
- -------------------------------------------------------------------------------
DETACH HERE
/X/ Please mark
votes as in
this example.
This Proxy, when executed, will be voted in the manner directed herein. If no
direction is made, this Proxy will be voted FOR the election of Directors and
FOR Proposal 2.
The Board of Directors recommends a Vote FOR Proposals 1 and 2.
1. To fix the number of Directors
for the ensuing year at eight
and the election of Directors. / / FOR / / WITHHELD
2. To consider and act upon the
matter of adopting and approving
the Company's Key Employee
Incentive Stock Option Plan
dated June 11, 1998. / / FOR / / WITHHELD / / ABSTAIN
3. To act upon any and all matters incidental to any of the foregoing and
transact such other business as may legally come before the Meeting or any
adjourned session or sessions thereof.
MARK HERE FOR ADDRESS CHANGE
AND NOTE AT LEFT / /
Please sign exactly as name appears hereon. Joint owners should each sign.
When signing as attorney, executor, administrator, trustee or guardian, please
give full title as such.
Signature______________________ Date________ Signature_______________ Date______
