<PAGE> 1
As filed with the Securities and Exchange Commission on September 19, 1996
REGISTRATION STATEMENT NO. 333-
================================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
------------------------------------
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
------------------------------------
BROOKTROUT TECHNOLOGY, INC.
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
MASSACHUSETTS 04-2184792
(STATE OF ORGANIZATION) (I.R.S. EMPLOYER IDENTIFICATION NO.)
410 FIRST AVENUE
NEEDHAM, MASSACHUSETTS 02194
(617) 449-4100
(ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING AREA CODE, OF
REGISTRANT'S PRINCIPAL EXECUTIVE OFFICES)
BROOKTROUT TECHNOLOGY, INC.
1992 STOCK INCENTIVE PLAN
(FULL TITLE OF THE PLAN)
------------------------------------
ERIC R. GILER
PRESIDENT
BROOKTROUT TECHNOLOGY, INC.
410 FIRST AVENUE
NEEDHAM, MASSACHUSETTS 02194
(617) 449-4100
(NAME, ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING AREA CODE,
OF AGENT FOR SERVICE)
------------------------------------
With copy to:
THOMAS P. STORER, P.C.
GOODWIN, PROCTER & HOAR LLP
EXCHANGE PLACE
BOSTON, MASSACHUSETTS 02109-2881
(617) 570-1000
------------------------------------
<TABLE>
CALCULATION OF REGISTRATION FEE
===================================================================================================================================
<CAPTION>
Title of Securities Being Amounts to be Proposed Maximum Proposed Maximum Amount of
Registered Registered(1) Offering Price Per Share Aggregate Offering Price Registration Fee
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock, par value $.01 975,000 shares $30.50(2) $29,737,500 $10,254.31
per share
===================================================================================================================================
<FN>
(1) This Registration Statement also relates to such indeterminate number of additional shares of the Registrant's Common
Stock, par value $.01 per share, as may be required pursuant to the 1992 Stock Incentive Plan in the event of a stock
dividend, reverse stock split, split-up, recapitalization, forfeiture of stock under the Plan or other similar event.
(2) This estimate is made pursuant to Rule 457(c) and (h) under the Securities Act of 1933 solely for the purposes of
determining the amount of the registration fee. The registration fee is based upon the average of the high and low prices
for the Registrant's Common Stock, par value $.01 per share, as reported on the Nasdaq National Market on September 12,
1996.
===================================================================================================================================
</TABLE>
<PAGE> 2
This registration statement relates to 975,000 shares of the common
stock, par value $.01 per share, of Brooktrout Technology, Inc. (the
"Registrant") representing those additional shares under the Brooktrout
Technology, Inc. 1992 Stock Incentive Plan (the "1992 Plan") which may be issued
pursuant to an amendment to the 1992 Plan adopted by the Board of Directors of
the Registrant on March 14, 1996 and approved by the stockholders of the
Registrant on May 29, 1996, which increased the size of the 1992 Plan from
1,350,000 shares to 2,325,000 shares (all share amounts have been adjusted to
reflect two three-for-two stock splits effected through 50% stock dividends paid
by the Company on February 27, 1996 and June 20, 1996). Pursuant to Instruction
E to Form S-8 regarding the registration of additional securities of the same
class under an employee benefit plan for which a registration statement filed on
Form S-8 is effective, all items have been omitted from this registration
statement other than the facing page; statements that the contents of the
earlier registration statements pertaining to the 1992 Plan, identified by file
number, and certain other filings are incorporated by reference; required
opinions and consents, the signature page; and information required in this
registration statement that was not in the earlier registration statements.
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
Item 3. Incorporation of Certain Documents by Reference.
-----------------------------------------------
The Registrant hereby incorporates by reference the following documents
which have previously been filed with the Securities and Exchange Commission
(the "Commission"):
(a) the Registrant's Registration Statement on Form S-8 dated
December 10, 1992 as filed with the Commission on December 17,
1992, File No. 33-55900, pursuant to Section 12(g) of the
Securities Exchange Act of 1934;
(b) the Registrant's Registration Statement on Form S-8 dated October
14, 1994 as filed with the Commission on October 17, 1994, File
No. 33-85264, pursuant to Section 12(g) of the Securities
Exchange Act of 1934;
(c) the Registrant's Prospectus dated August 6, 1996 as filed with
the Commission on August 8, 1996 pursuant to Rule 424(b) under
the Securities Act of 1933;
(d) all other reports filed with the Commission by the Registrant
pursuant to Section 13(a) or 15(d) of the Securities Exchange Act
of 1934 since December 31, 1995; and
(e) the description of the Registrant's common stock, par value $.01
per share, contained in the Registrant's Registration Statement
on Form 8-A, as amended, filed with Commission pursuant to
Section 12 of the Securities Exchange Act of 1934.
In addition, all documents subsequently filed with the Commission by the
Registrant pursuant to Sections 13(a), 13(c), 14 and 15(d) of the Securities
Exchange Act of 1934 prior to the filing of a post-effective amendment hereto
that indicates that all securities offered hereunder have been sold or which
deregisters all securities then remaining unsold, shall be deemed to be
incorporated by reference in this Registration Statement and to be a part hereof
from the date of filing of such documents. Any statement contained in a document
incorporated by reference herein shall be deemed to be modified or superseded
for purposes hereof to the extent that a statement contained herein or in any
subsequently filed document which also is incorporated by reference herein
modifies or supersedes such statement. Any statement so modified or superseded
shall not be deemed, except as so modified or superseded, to constitute a part
of this Registration Statement.
2
<PAGE> 3
Item 8. Exhibits.
--------
The following is a complete list of exhibits filed or incorporated by
reference as part of this Registration Statement.
Exhibit
- -------
5.1 Opinion of Goodwin, Procter & Hoar LLP as to the legality of the
securities being registered.
10.1 Brooktrout Technology, Inc. 1992 Stock Incentive Plan.
23.1 Consent of Goodwin, Procter & Hoar LLP (included in Exhibit 5.1).
23.2 Consent of Deloitte & Touche LLP.
24.1 Powers of Attorney (included on signature pages to this
Registration Statement).
3
<PAGE> 4
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, Brooktrout
Technology, Inc. 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 Needham, Massachusetts on September 19, 1996.
BROOKTROUT TECHNOLOGY, INC.
By: /S/ ERIC R. GILER
-----------------------------------
Eric R. Giler
President
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that each individual whose signature
appears below constitutes and appoints each of Eric R. Giler, David W. Duehren
and Robert C. Leahy, acting singly, such person's true and lawful
attorney-in-fact and agent, with full power of substitution and resubstitution,
for such person and in such person's name, place and stead, in any and all
capacities, to sign any and all amendments (including post-effective amendments)
to this Registration Statement, and to file the same, with all exhibits thereto,
and all documents in connection therewith, with the Securities and Exchange
Commission, granting unto each said attorney-in-fact and agent full power and
authority to do and perform each and every act and thing requisite and necessary
to be done in and about the premises, as fully to all intents and purposes as
such person might or could do in person, hereby ratifying and confirming all
that any said attorney-in-fact and agent, or any substitute or substitutes of
any of them, may lawfully do or cause to be done by virtue hereof.
<TABLE>
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 dates indicated.
<CAPTION>
SIGNATURE TITLE DATE
--------- ----- ----
<S> <C> <C>
/S/ ERIC R. GILER President, Chief Executive Officer and September 19, 1996
- ---------------------------------------- Director (Principal Executive Officer)
Eric R. Giler
/S/ DAVID W. DUEHREN Vice President of Research and September 19, 1996
- ---------------------------------------- Development, Clerk and Director
David W. Duehren
/S/ ROBERT C. LEAHY Vice President of Finance and Operations, September 19, 1996
- ---------------------------------------- and Treasurer (Principal Financial and
Robert C. Leahy Accounting Officer)
/S/ PATRICK T. HYNES Vice President of Advanced Product September 19, 1996
- ---------------------------------------- Engineering and Director
Patrick T. Hynes
/S/ ROBERT G. BARRETT Director September 19, 1996
- ----------------------------------------
Robert G. Barrett
/S/ DAVID L. CHAPMAN Director September 19, 1996
- ----------------------------------------
David L. Chapman
/S/ W. BROOKE TUNSTALL Director September 19, 1996
- ----------------------------------------
W. Brooke Tunstall
</TABLE>
4
<PAGE> 5
<TABLE>
EXHIBIT INDEX
<CAPTION>
Exhibit No. Description Page No.*
- ----------- ----------- ---------
<S> <C> <C>
5.1 Opinion of Goodwin, Procter & Hoar LLP as to the legality of the 6
securities being registered
10.1 Brooktrout Technology, Inc. 1992 Stock Incentive Plan 7
23.1 Consent of Goodwin, Procter & Hoar LLP (included in Exhibit 5.1) -
23.2 Consent of Deloitte & Touche LLP 21
24.1 Powers of Attorney (included on signature pages to this Registration -
Statement)
<FN>
- -----------------
* Refers to sequentially numbered copy.
</TABLE>
5
<PAGE> 1
EXHIBIT 5.1
September 19, 1996
Brooktrout Technology, Inc.
410 First Avenue
Needham, Massachusetts 02192
Re: Brooktrout Technology, Inc. 1992 Stock Incentive Plan
-----------------------------------------------------
Ladies and Gentlemen:
This opinion is delivered in our capacity as counsel to Brooktrout
Technology, Inc. (the "Company") in connection with the preparation and filing
with the Securities and Exchange Commission under the Securities Act of 1933 of
a Registration Statement on Form S-8 (the "Registration Statement") relating to
975,000 shares of the Company's common stock, par value $.01 per share (the
"Registered Shares"), which may be issued pursuant to the Brooktrout Technology,
Inc. 1992 Stock Incentive Plan (the "Plan").
As counsel for the Company, we have examined a copy of the Plan, the
Registration Statement, and the Company's Restated Articles of Organization and
Amended and Restated By-laws, each as presently in effect, and such records,
certificates and other documents of the Company as we have deemed necessary or
appropriate for the purposes of this opinion.
We are attorneys admitted to practice in the Commonwealth of
Massachusetts and certain other jurisdictions. We express no opinion concerning
the laws of any jurisdictions other than the laws of the United States of
America and the Commonwealth of Massachusetts, and also express no opinion with
respect to the blue sky or securities laws of any state, including
Massachusetts.
Based on the foregoing, we are of the opinion that, when the Registered
Shares are sold and paid for pursuant to the terms of the Plan, the Registered
Shares will be duly authorized, legally issued, fully paid and non-assessable
under the Business Corporation Law of the Commonwealth of Massachusetts.
The foregoing assumes that all requisite steps will be taken to comply
with the requirements of the Securities Act of 1933 and applicable requirements
of state laws regulating the offer and sale of securities.
We hereby consent to being named as counsel to the Company in the
Registration Statement and to the inclusion of this opinion as an exhibit to the
Registration Statement.
Very truly yours,
/S/ GOODWIN, PROCTER & HOAR LLP
GOODWIN, PROCTER & HOAR LLP
6
<PAGE> 1
EXHIBIT 10.1
BROOKTROUT TECHNOLOGY, INC.
1992 STOCK INCENTIVE PLAN
SECTION 1. General Purpose of the Plan; Definitions.
----------------------------------------
The name of the plan is the Brooktrout Technology, Inc. 1992 Stock
Incentive Plan (the "Plan"). The purpose of the Plan is to encourage and enable
the officers, employees and Directors of Brooktrout Technology, Inc. (the
"Company") and its Subsidiaries upon whose judgment, initiative and efforts the
Company largely depends for the successful conduct of its business to acquire a
proprietary interest in the Company. It is anticipated that providing such
persons with a direct stake in the Company's welfare will assure a closer
identification of their interests with those of the Company, thereby stimulating
their efforts on the Company's behalf and strengthening their desire to remain
with the Company.
The following terms shall be defined as set forth below:
"Act" means the Securities Exchange Act of 1934, as amended.
"Award" or "Awards", except where referring to a particular
category of grant under the Plan, shall include Incentive Stock
Options, Non-Qualified Stock Options, Restricted Stock Awards,
Unrestricted Stock Awards and Performance Share Awards.
"Board" means the Board of Directors of the Company.
"Cause" means and shall be limited to a vote of the Board of
Directors resolving that the participant should be dismissed as a
result of (i) any material breach by the participant of any agreement
to which the participant and the Company are parties, (ii) any act
(other than retirement) or omission to act by the participant which may
have a material and adverse effect on the business of the Company or
any Subsidiary or on the participant's ability to perform services for
the Company or any Subsidiary, including, without limitation, the
commission of any crime (other than ordinary traffic violations), or
(iii) any material misconduct or neglect of duties by the participant
in connection with the business or affairs of the Company or any
Subsidiary.
"Code" means the Internal Revenue Code of 1986, as amended,
and any successor Code, and related rules, regulations and
interpretations.
"Committee" means any Committee of the Board referred to in
Section 2.
"Disability" means disability as set forth in Section 22(e)(3)
of the Code.
"Disinterested Person" means a Non-Employee Director who
qualifies as such under
7
<PAGE> 2
Rule 16b-3(c)(2)(i) promulgated under the Act, or any successor
definition under the Act.
"Effective Date" means the date on which the Plan is approved
by stockholders as set forth in Section 14.
"Eligible Director" means any Director referred to in Section
5(c)(i).
"ERISA" means the Employee Retirement Income Security Act of
1974, as amended, and the related rules, regulations and
interpretations.
"Fair Market Value" on any given date means the last reported
sale price at which Stock is traded on such date or, if no Stock is
traded on such date, the most recent date on which Stock was traded, as
reflected on the NASDAQ National Market System or, if applicable, any
other national stock exchange on which the Stock is traded.
"Incentive Stock Option" means any Stock Option designated and
qualified as an "incentive stock option" as defined in Section 422 of
the Code.
"Non-Employee Director" means a member of the Board who is not
also an employee of the Company or any Subsidiary.
"Non-Qualified Stock Option" means any Stock Option that is
not an Incentive Stock Option.
"Option" or "Stock Option" means any option to purchase shares
of Stock granted pursuant to Section 5.
"Performance Share Award" means Awards granted pursuant to
Section 8.
"Restricted Stock Award" mean Awards granted pursuant to
Section 6.
"Stock" means the Common Stock, $.01 par value per share, of
the Company, subject to adjustments pursuant to Section 3.
"Subsidiary" means any corporation or other entity (other than
the Company) in any unbroken chain of corporations or other entities,
beginning with the Company if each of the corporations or entities
(other than the last corporation or entity in the unbroken chain) owns
stock or other interests possessing 50% or more of the total combined
voting power of all classes of stock or other interests in one of the
other corporations or entities in the chain.
"Unrestricted Stock Award" means Awards granted pursuant to
Section 7.
SECTION 2. Administration of Plan; Committee Authority to Select
Participants and Determine
---------
8
<PAGE> 3
Awards.
------
(a) COMMITTEE. The Plan shall be administered by all of the
Non-Employee Director members of the Compensation Committee of the Board, or any
other committee of not less than two Non-Employee Directors performing similar
functions, as appointed by the Board from time to time (the "Committee"). Each
member of the Committee shall be a Disinterested Person.
(b) POWERS OF COMMITTEE. The Committee shall have the power
and authority to grant Awards consistent with the terms of the Plan, including
the power and authority:
(i) to select the officers and other employees of
the Company and its Subsidiaries to whom Awards may from time to time
be granted;
(ii) to determine the time or times of grant, and
the extent, if any, of Incentive Stock Options, Non-Qualified Stock
Options, Restricted Stock, Unrestricted Stock and Performance Shares,
or any combination of the foregoing, granted to any one or more
participants;
(iii) to determine the number of shares to be covered
by any Award;
(iv) to determine and modify the terms and
conditions, including restrictions, not inconsistent with the terms of
the Plan, of any Award, which terms and conditions may differ among
individual Awards and participants, and to approve the form of written
instruments evidencing the Awards;
(v) to accelerate the exercisability or vesting of
all or any portion of any Option;
(vi) subject to the provisions of Section 5(a)(ii),
to extend the period in which Stock Options may be exercised;
(vii) to determine whether, to what extent, and under
what circumstances Stock and other amounts payable with respect to an
Award shall be deferred either automatically or at the election of the
participant and whether and to what extent the Company shall pay or
credit amounts equal to interest (at rates determined by the Committee)
or dividends or deemed dividends on such deferrals; and
(viii) to adopt, alter and repeal such rules,
guidelines and practices for administration of the Plan and for its own
acts and proceedings as it shall deem advisable; to interpret the terms
and provisions of the Plan and any Award (including related written
instruments); to make all determinations it deems advisable for the
administration of the Plan; to decide all disputes arising in
connection with the Plan; and to otherwise supervise the administration
of the Plan.
All decisions and interpretations of the Committee shall be binding on
all persons, including
9
<PAGE> 4
the Company and Plan participants.
SECTION 3. Shares Issuable under the Plan; Mergers; Substitution.
-----------------------------------------------------
(a) SHARES ISSUABLE. The maximum number of shares of Stock
reserved and available for issuance under the Plan shall be two million three
hundred twenty-five thousand (2,325,000). For purposes of this limitation, the
shares of Stock underlying any Awards which are forfeited, canceled, reacquired
by the Company, satisfied without the issuance of Stock or otherwise terminated
(other than by exercise) shall be added back to the shares of Stock available
for issuance under the Plan so long as the participants to whom such Awards had
been previously granted received no benefits of ownership of the underlying
shares of Stock to which the Award related. Subject to such overall limitation,
shares may be issued up to such maximum number pursuant to any type or types of
Award, including Incentive Stock Options. Shares issued under the Plan may be
authorized but unissued shares or shares reacquired by the Company.
(b) STOCK DIVIDENDS, MERGERS, ETC. In the event of a stock
dividend, stock split or similar change in capitalization affecting the Stock,
the Committee shall make appropriate adjustments in (i) the number and kind of
shares of stock or securities on which Awards may thereafter be granted, (ii)
the number and kind of shares remaining subject to outstanding Awards, and (iii)
the option or purchase price in respect of such shares. In the event of any
merger, consolidation, dissolution or liquidation of the Company, the Committee
in its sole discretion may, as to any outstanding Awards, make such substitution
or adjustment in the aggregate number of shares reserved for issuance under the
Plan and in the number and purchase price (if any) of shares subject to such
Awards as it may determine and as may be permitted by the terms of such
transaction, or accelerate, amend or terminate such Awards upon such terms and
conditions as it shall provide (which, in the case of the termination of the
vested portion of any Award, shall require payment or other consideration which
the Committee deems equitable in the circumstances).
(c) SUBSTITUTE AWARDS. The Committee may grant Awards under
the Plan in substitution for stock and stock-based awards held by employees of
another corporation who concurrently become employees of the Company or a
Subsidiary as the result of a merger or consolidation of the employing
corporation with the Company or a Subsidiary or the acquisition by the Company
or a Subsidiary of property or stock of the employing corporation. The Committee
may direct that the substitute awards be granted on such terms and conditions as
the Committee considers appropriate in the circumstances.
SECTION 4. Eligibility.
-----------
Participants in the Plan will be such full or part-time officers and
other employees of the Company and its Subsidiaries who are responsible for or
contribute to the management, growth or profitability of the Company and its
Subsidiaries and who are selected from time to time by the Committee, in its
sole discretion. Non-Employee Directors are also eligible to participate in the
Plan but only to the extent provided in Section 5(c) and Section 7 below.
10
<PAGE> 5
SECTION 5. Stock Options.
-------------
Any Stock Option granted under the Plan shall be in such form as the
Committee may from time to time approve.
Stock Options granted under the Plan may be either Incentive Stock
Options or Non-Qualified Stock Options. To the extent that any option does not
qualify as an Incentive Stock Option, it shall constitute a Non-Qualified Stock
Option.
No Incentive Stock Option shall be granted under the Plan after August
17, 2002.
(a) STOCK OPTIONS GRANTED TO EMPLOYEES. The Committee in
its discretion may grant Stock Options to employees of the Company or any
Subsidiary. Stock Options granted to employees pursuant to this Section 5(a)
shall be subject to the following terms and conditions and shall contain such
additional terms and conditions, not inconsistent with the terms of the Plan, as
the Committee shall deem desirable:
(i) EXERCISE PRICE. The exercise price per share
for the Stock covered by a Stock Option granted pursuant to this
Section 5(a) shall be determined by the Committee at the time of grant
but shall be, in the case of Incentive Stock Options, not less than
100% of Fair Market Value on the date of grant and, in the case of
Non-Qualified Stock Options, not less than 85% of Fair Market Value on
the date of grant. If an employee owns or is deemed to own (by reason
of the attribution rules applicable under Section 424(d) of the Code)
more than 10% of the combined voting power of all classes of stock of
the Company or any Subsidiary or parent corporation and an Incentive
Stock Option is granted to such employee, the option price shall be not
less than 110% of Fair Market Value on the grant date.
(ii) OPTION TERM. The term of each Stock Option
shall be fixed by the Committee, but no Incentive Stock Option shall be
exercisable more than ten years after the date the option is granted.
If an employee owns or is deemed to own (by reason of the attribution
rules of Section 424(d) of the Code) more than 10% of the combined
voting power of all classes of stock of the Company or any Subsidiary
or parent corporation and an Incentive Stock Option is granted to such
employee, the term of such option shall be no more than five years from
the date of grant.
(iii) EXERCISABILITY; RIGHTS OF A STOCKHOLDER. Stock
Options shall become vested and exercisable at such time or times,
whether or not in installments, as shall be determined by the Committee
at or after the grant date. The Committee may at any time accelerate
the exercisability of all or any portion of any Stock Option. An
optionee shall have the rights of a stockholder only as to shares
acquired upon the exercise of a Stock Option and not as to unexercised
Stock Options.
(iv) METHOD OF EXERCISE. Stock Options may be
exercised in whole or in part, by giving written notice of exercise to
the Company, specifying the number of shares to
11
<PAGE> 6
be purchased. Payment of the purchase price may be made by one or more
of the following methods:
(A) In cash, by certified or bank check or by
other instrument acceptable to the Committee;
(B) In the form of shares of Stock that are not
then subject to restrictions under any Company plan, if
permitted by the Committee in its discretion. Such surrendered
shares shall be valued at Fair Market Value on the exercise
date; or
(C) By the optionee delivering to the Company a
properly executed exercise notice together with irrevocable
instructions to a broker to promptly deliver to the Company
cash or a check payable and acceptable to the Company to pay
the purchase price; provided that in the event the optionee
chooses to pay the purchase price as so provided, the optionee
and the broker shall comply with such procedures and enter
into such agreements of indemnity and other agreements as the
Committee shall prescribe as a condition of such payment
procedure. Payment instruments will be received subject to
collection.
The delivery of certificates representing shares of Stock to be purchased
pursuant to the exercise of a Stock Option shall be contingent upon receipt from
the Optionee (or a purchaser acting in his stead in accordance with the
provisions of the Stock Option) by the Company of the full purchase price for
such shares and the fulfillment of any other requirements contained in the Stock
Option or applicable provisions of law.
(v) NON-TRANSFERABILITY OF OPTIONS. No Stock Option
shall be transferable by the optionee otherwise than by will or by the
laws of descent and distribution and all Stock Options shall be
exercisable, during the optionee's lifetime, only by the optionee.
(vi) TERMINATION BY DEATH. If any optionee's
employment by the Company and its Subsidiaries terminates by reason of
death, the Stock Option may thereafter be exercised, to the extent
exercisable at the date of death, by the legal representative or
legatee of the optionee, for a period of 180 days (or such longer
period as the Committee shall specify at any time) from the date of
death, or until the expiration of the stated term of the Option, if
earlier.
(vii) Termination by Reason of Disability.
-----------------------------------
(A) Any Stock Option held by an optionee whose
employment by the Company and its Subsidiaries has terminated
by reason of Disability may thereafter be exercised, to the
extent it was exercisable at the time of such termination, for
a period of twelve months (or such longer period as the
Committee shall specify at any time) from the date of such
termination of employment, or until the expiration of the
stated term of the Option, if earlier.
12
<PAGE> 7
(B) The Committee shall have sole authority and
discretion to determine whether a participant's employment has
been terminated by reason of Disability.
(C) Except as otherwise provided by the
Committee at the time of grant, the death of an optionee
during a period provided in this Section 5(a)(vii) for the
exercise of a Non-Qualified Stock Option, shall extend such
period for 180 days from the date of death, subject to
termination on the expiration of the stated term of the
Option, if earlier.
(viii) TERMINATION FOR CAUSE. If any optionee's
employment by the Company and its Subsidiaries has been terminated for
Cause, any Stock Option held by such optionee shall immediately
terminate and be of no further force and effect; provided, however,
that the Committee may, in its sole discretion, provide that such stock
option can be exercised for a period of up to 30 days from the date of
termination of employment or until the expiration of the stated term of
the Option, if earlier.
(ix) OTHER TERMINATION. Unless otherwise determined
by the Committee, if an optionee's employment by the Company and its
Subsidiaries terminates for any reason other than death, Disability, or
for Cause, any Stock Option held by such optionee may thereafter be
exercised, to the extent it was exercisable on the date of termination
of employment, for three months (or such longer period as the Committee
shall specify at any time) from the date of termination of employment
or until the expiration of the stated term of the Option, if earlier.
(x) ANNUAL LIMIT ON INCENTIVE STOCK OPTIONS. To the
extent required for "incentive stock option" treatment under Section
422 of the Code, the aggregate Fair Market Value (determined as of the
time of grant) of the Stock with respect to which Incentive Stock
Options granted under this Plan and any other plan of the Company or
its Subsidiaries become exercisable for the first time by an optionee
during any calendar year shall not exceed $100,000.
(xi) FORM OF SETTLEMENT. Shares of Stock issued upon
exercise of a Stock Option shall be free of all restrictions under the
Plan, except as otherwise provided in this Plan.
(b) RELOAD OPTIONS. At the discretion of the Committee,
Options granted under this Section 5(a) may include a so-called "reload" feature
pursuant to which an optionee exercising an option by the delivery of a number
of shares of Stock in accordance with Section 5(a)(iv)(B) hereof would
automatically be granted an additional Option (with an exercise price equal to
the Fair Market Value of the Stock on the date the additional Option is granted
and with the same expiration date as the original Option being exercised, and
with such other terms as the Committee may provide) to purchase that number of
shares of Stock equal to the number delivered to exercise the original Option.
13
<PAGE> 8
(c) Stock Options Granted to Non-Employee Directors.
-----------------------------------------------
(i) GRANT OF OPTIONS. Each Non-Employee Director
who is not a stockholder, or an affiliate of a stockholder, with
beneficial ownership of 10% or more of the Company's outstanding Stock
(an "Eligible Director") shall be eligible to receive a grant of
options ("Non-Employee Director Options") under this Section 5(b). Such
options shall be granted effective upon (A) the date of adoption of
this Plan; (B) the date of first election of any Eligible Director as a
Director of the Company; and (C) the date of re-election of any
Eligible Director (including an Eligible Director who did not receive a
grant of Non-Employee Director Options in his or her prior term as a
result of not being an Eligible Director at such time), provided that
this clause (c) shall not apply in the case of an Eligible Director who
received a grant of an Extended Option (as hereinafter defined) in his
or her prior term. Each Non-Employee Director Option granted hereunder
shall be a Non-Qualified Stock Option to purchase a number of shares of
Stock equal to the product of (x) the number of months (rounded down to
the nearest whole number) remaining in the term to which the recipient
Eligible Director is elected or re-elected, multiplied by (y) 208 1/3
shares (appropriately adjusted to reflect any stock split, stock
dividend or similar transaction), such product being rounded down to
the nearest whole number; provided that for purposes of grants
effective upon adoption of this Plan the period referred to in clause
(x) shall be measured from April 1, 1992; and provided further that in
the case of any Eligible Director whose remaining term is 12 months or
less upon such grant, the period referred to in clause (x) shall be
increased by 36 months (an "Extended Option"). Each Non-Employee
Director Option shall vest at a rate of 208 1/3 shares per month,
adjusted appropriately to eliminate fractional shares, so as to be
exercisable as to 100% of the shares covered thereby from and after the
expiration of such Eligible Director's term as a Director, or the next
succeeding 3-year term in the case of an Extended Option, assuming
continuance of service as a Director.
(ii) EXERCISE PRICE. The exercise price per share
for the Stock covered by a Stock Option granted pursuant to this
Section 5(c) shall be equal to the Fair Market Value of the Stock on
the date the Stock Option is granted; provided, however, that the
exercise price per share for the Stock covered by the initial grant of
Non-Qualified Stock Options under clause A of Section 5(c)(i) above
shall be not less than the fair market value of the Stock, which
exercise price shall be determined by the Board of Directors.
(iii) Exercise; Termination; Non-Transferability.
------------------------------------------
(A) No Option granted under this Section 5(c)
may be exercised before the first anniversary of the date upon
which it was granted; provided, however, that any Option so
granted shall become exercisable upon the termination of
service of the Eligible Director because of Disability or
death. No Option issued under this Section 5(c) shall be
exercisable after the expiration of ten years from the date
upon which such Option is granted.
(B) The rights of an Eligible Director in an
Option granted under Section 5(c) shall terminate three months
after such Director ceases to be a Director
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of the Company or the specified expiration date, if earlier,
and such Non-Employee Director Option shall be exercisable
through such date as to the shares vested through the date
such Eligible Director ceased to be a Director of the Company;
provided, however, that if the Eligible Director ceases to be
a Director for Cause, the rights shall terminate immediately
on the date on which he ceases to be a Director.
(C) No Stock Option granted under this Section
5(c) shall be transferable by the optionee otherwise than by
will or by the laws of descent and distribution, and such
Options shall be exercisable, during the optionee's lifetime
only by the optionee. Any Option granted to an Eligible
Director and outstanding on the date of his death may be
exercised by the legal representative or legatee of the
optionee for a period of 180 days from the date of death or
until the expiration of the stated term of the option, if
earlier.
(D) Options granted under this Section 5(c) may
be exercised only by written notice to the Company specifying
the number of shares to be purchased. Payment of the full
purchase price of the shares to be purchased may be made by
one or more of the methods specified in Section 5(a)(iv). An
optionee shall have the rights of a stockholder only as to
shares acquired upon the exercise of a Stock Option and not as
to unexercised Stock Options.
(iv) LIMITED TO ELIGIBLE DIRECTORS. The provisions
of this Section 5(c) shall apply only to Options granted or to be
granted to Eligible Directors, and shall not be deemed to modify,
limit or otherwise apply to any other provision of this Plan or to any
Option issued under this Plan to a participant who is not an Eligible
Director of the Company. To the extent inconsistent with the
provisions of any other Section of this Plan, the provisions of this
Section 5(c) shall govern the rights and obligations of the Company
and Eligible Directors respecting Options granted or to be granted to
Eligible Directors. The provisions of this Section 5(c) that affect
the price, date of exercisability, option period or amount of shares
under an option shall not be amended more than once in any six-month
period, other than to comport with changes in the Code or ERISA.
SECTION 6. Restricted Stock Awards.
-----------------------
(a) NATURE OF RESTRICTED STOCK AWARD. The Committee may
grant Restricted Stock Awards to any employees of the Company or any Subsidiary.
A Restricted Stock Award is an Award entitling the recipient to acquire, at no
cost or for a purchase price determined by the Committee, shares of Stock
subject to such restrictions and conditions as the Committee may determine at
the time of grant ("Restricted Stock"). Conditions may be based on continuing
employment and/or achievement of pre-established performance goals and
objectives. In addition, a Restricted Stock Award may be granted to an employee
by the Committee in lieu of a cash bonus due to such employee pursuant to any
other plan of the Company.
(b) ACCEPTANCE OF AWARD. A participant who is granted a
Restricted Stock Award
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<PAGE> 10
shall have no rights with respect to such Award unless the participant shall
have accepted the Award within 60 days (or such shorter date as the Committee
may specify) following the award date by making payment to the Company, if
required, by certified or bank check or other instrument or form of payment
acceptable to the Committee in an amount equal to the specified purchase price,
if any, of the shares covered by the Award and by executing and delivering to
the Company a written instrument that sets forth the terms and conditions of the
Restricted Stock in such form as the Committee shall determine.
(c) RIGHTS AS A STOCKHOLDER. Upon complying with Section 6(b)
above, a participant shall have all the rights of a stockholder with respect to
the Restricted Stock including voting and dividend rights, subject to
non-transferability restrictions and Company repurchase or forfeiture rights
described in this Section 6 and subject to such other conditions contained in
the written instrument evidencing the Restricted Stock Award. Unless the
Committee shall otherwise determine, certificates evidencing shares of
Restricted Stock shall remain in the possession of the Company until such shares
are vested as provided in Section 6(e) below.
(d) RESTRICTIONS. Shares of Restricted Stock may not be sold,
assigned, transferred, pledged or otherwise encumbered or disposed of except as
specifically provided herein. In the event of termination of employment by the
Company and its Subsidiaries for any reason (including death, Disability, and
for Cause), the Company shall have the right, at the discretion of the
Committee, to repurchase shares of Restricted Stock with respect to which
conditions have not lapsed at their purchase price, or to require forfeiture of
such shares to the Company if acquired at no cost, from the participant or the
participant's legal representative. The Company must exercise such right of
repurchase or forfeiture not later than the 90th day following such termination
of employment (unless otherwise specified in the written instrument evidencing
the Restricted Stock Award).
(e) VESTING OF RESTRICTED STOCK. The Committee at the time of
grant shall specify the date or dates and/or the attainment of pre-established
performance goals, objectives and other conditions on which the
non-transferability of the Restricted Stock and the Company's right of
repurchase or forfeiture shall lapse. Subsequent to such date or dates and/or
the attainment of such pre-established performance goals, objectives and other
conditions, the shares on which all restrictions have lapsed shall no longer be
Restricted Stock and shall be deemed "vested."
(f) WAIVER, DEFERRAL AND REINVESTMENT OF DIVIDENDS. The
written instrument evidencing the Restricted Stock Award may require or permit
the immediate payment, waiver, deferral or investment of dividends paid on the
Restricted Stock.
SECTION 7. Unrestricted Stock Awards.
-------------------------
(a) GRANT OR SALE OF UNRESTRICTED STOCK. The Committee may, in
its sole discretion, grant (or sell at a purchase price determined by the
Committee) to any employees of the Company or any Subsidiary shares of Stock
free of any restrictions under the Plan ("Unrestricted Stock"). Shares of
Unrestricted Stock may be granted or sold as described in the preceding sentence
in respect of past services or other valid consideration, or in lieu of any cash
compensation due to such employee.
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<PAGE> 11
(b) ELECTIONS TO RECEIVE UNRESTRICTED STOCK IN LIEU OF
COMPENSATION. Upon the request of an employee and with the consent of the
Committee, each employee may, pursuant to an irrevocable written election
delivered to the Company no later than the date or dates specified by the
Committee, receive a portion of the cash compensation otherwise due to him in
Unrestricted Stock (valued at Fair Market Value on the date or dates the cash
compensation would otherwise be paid). Such Unrestricted Stock may be paid to
the employee at the same time as the cash compensation would otherwise be paid,
or at a later time, as specified by the employee in the written election.
(c) ELECTIONS TO RECEIVE UNRESTRICTED STOCK IN LIEU OF
DIRECTORS' FEES. Each NonEmployee Director may, pursuant to an irrevocable
written election delivered to the Company no later than six months prior to the
date the directors' fees would otherwise be paid, receive all or a portion of
such fees in Unrestricted Stock (valued at Fair Market Value on the date or
dates the directors' fees would otherwise be paid). Such Unrestricted Stock may
be paid to the Non-Employee Director at the same time the directors' fees would
otherwise have been paid, or at a later time, as specified by the Non-Employee
Director in the written election.
(d) RESTRICTIONS ON TRANSFERS. The right to receive
Unrestricted Stock may not be sold, assigned, transferred, pledged or otherwise
encumbered, other than by will or the laws of descent and distribution.
SECTION 8. Performance Share Awards.
------------------------
(a) NATURE OF PERFORMANCE SHARES. A Performance Share Award is
an award entitling the recipient to acquire shares of Stock upon the attainment
of specified performance goals. The Committee may make Performance Share Awards
independently of or in connection with the granting of any other Award under the
Plan. Performance Share Awards may be granted under the Plan to any employees of
the Company or any Subsidiary, including those who qualify for awards under
other performance plans of the Company. The Committee in its sole discretion
shall determine whether and to whom Performance Share Awards shall be made, the
performance goals applicable under each such Award, the periods during which
performance is to be measured, and all other limitations and conditions
applicable to the awarded Performance Shares; provided, however, that the
Committee may rely on the performance goals and other standards applicable to
other performance unit plans of the Company in setting the standards for
Performance Share Awards under the Plan.
(b) RESTRICTIONS ON TRANSFER. Performance Share Awards and
all rights with respect to such Awards may not be sold, assigned, transferred,
pledged or otherwise encumbered.
(c) RIGHTS AS A STOCKHOLDER. A participant receiving a
Performance Share Award shall have the rights of a stockholder only as to shares
actually received by the participant under the Plan and not with respect to
shares subject to the Award but not actually received by the participant. A
participant shall be entitled to receive a stock certificate evidencing the
acquisition of shares of Stock under a Performance Share Award only upon
satisfaction of all conditions specified in the written instrument evidencing
the Performance Share Award (or in a performance plan adopted by the Committee).
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<PAGE> 12
(d) TERMINATION. Except as may otherwise be provided by the
Committee at any time prior to termination of employment, a participant's rights
in all Performance Share Awards shall automatically terminate upon the
participant's termination of employment by the Company and its Subsidiaries for
any reason (including death, Disability and for Cause).
(e) ACCELERATION, WAIVER, ETC. At any time prior to the
participant's termination of employment by the Company and its Subsidiaries, the
Committee may in its sole discretion accelerate, waive or, subject to Section
11, amend any or all of the goals, restrictions or conditions imposed under any
Performance Share Award.
SECTION 9. Tax Withholding.
---------------
(a) PAYMENT BY PARTICIPANT. Each participant shall, no later
than the date as of which the value of an Award or of any Stock or other amounts
received thereunder first becomes includable in the gross income of the
participant for Federal income tax purposes, pay to the Company, or make
arrangements satisfactory to the Committee regarding payment of any Federal,
state, or local taxes of any kind required by law to be withheld with respect to
such income. The Company and its Subsidiaries shall, to the extent permitted by
law, have the right to deduct any such taxes from any payment of any kind
otherwise due to the participant.
(b) PAYMENT IN SHARES. A participant may elect to have such
tax withholding obligation satisfied, in whole or in part, by (i) authorizing
the Company to withhold from shares of Stock to be issued pursuant to any Award
a number of shares with an aggregate Fair Market Value (as of the date the
withholding is effected) that would satisfy the withholding amount due, or (ii)
transferring to the Company shares of Stock owned by the participant with an
aggregate Fair Market Value (as of the date the withholding is effected) that
would satisfy the withholding amount due. With respect to any participant who is
subject to Section 16 of the Act, the following additional restrictions shall
apply:
(A) the election to satisfy tax withholding
obligations relating to an Award in the manner permitted by
this Section 9(b) shall be made either (1) during the period
beginning on the third business day following the date of
release of quarterly or annual summary statements of sales and
earnings of the Company and ending on the twelfth business day
following such date, or (2) at least six months prior to the
date as of which the receipt of such an Award first becomes a
taxable event for Federal income tax purposes;
(B) such election shall be irrevocable;
(C) such election shall be subject to the
consent or disapproval of the Committee; and
(D) the Stock withheld to satisfy tax
withholding, if granted at the discretion of the Committee,
must pertain to an Award which has been held by the
18
<PAGE> 13
participant for at least six months from the date of grant
of the Award.
SECTION 10. Transfer, Leave of Absence, Etc.
-------------------------------
For purposes of the Plan, the following events shall not be deemed a
termination of employment:
(a) a transfer to the employment of the Company from a
Subsidiary or from the Company to a Subsidiary, or from one Subsidiary to
another; or
(b) an approved leave of absence for military service or
sickness, or for any other purpose approved by the Company, if the employee's
right to re-employment is guaranteed either by a statute or by contract or under
the policy pursuant to which the leave of absence was granted or if the
Committee otherwise so provides in writing.
SECTION 11. Amendments and Termination.
--------------------------
The Board may at any time amend or discontinue the Plan and the
Committee may at any time amend or cancel any outstanding Award (or provide
substitute Awards at the same or reduced exercise or purchase price or with no
exercise or purchase price, but such price, if any, must satisfy the
requirements which would apply to the substitute or amended Award if it were
then initially granted under this Plan) for the purpose of satisfying changes in
law or for any other lawful purpose, but no such action shall adversely affect
rights under any outstanding Award without the holder's consent.
SECTION 12. Status of Plan.
--------------
With respect to the portion of any Award which has not been exercised
and any payments in cash, Stock or other consideration not received by a
participant, a participant shall have no rights greater than those of a general
creditor of the Company unless the Committee shall otherwise expressly determine
in connection with any Award or Awards. In its sole discretion, the Committee
may authorize the creation of trusts or other arrangements to meet the Company's
obligations to deliver Stock or make payments with respect to Awards hereunder,
provided that the existence of such trusts or other arrangements is consistent
with the provision of the foregoing sentence.
SECTION 13. General Provisions.
------------------
(a) NO DISTRIBUTION; COMPLIANCE WITH LEGAL REQUIREMENTS. The
Committee may require each person acquiring shares pursuant to an Award to
represent to and agree with the Company in writing that such person is acquiring
the shares without a view to distribution thereof.
No shares of Stock shall be issued pursuant to an Award until all
applicable securities law and
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<PAGE> 14
other legal and stock exchange requirements have been satisfied. The Committee
may require the placing of such stop-orders and restrictive legends on
certificates for Stock and Awards as it deems appropriate.
(b) DELIVERY OF STOCK CERTIFICATES. Delivery of stock
certificates to participants under this Plan shall be deemed effected for all
purposes when the Company or a stock transfer agent of the Company shall have
delivered such certificates in the United States mail, addressed to the
participant, at the participant's last known address on file with the Company.
(c) OTHER COMPENSATION ARRANGEMENTS; NO EMPLOYMENT RIGHTS.
Nothing contained in this Plan shall prevent the Board from adopting other or
additional compensation arrangements, including trusts, subject to stockholder
approval if such approval is required; and such arrangements may be either
generally applicable or applicable only in specific cases. The adoption of the
Plan and the grant of Awards do not confer upon any employee any right to
continued employment with the Company or any Subsidiary.
SECTION 14. Effective Date of Plan.
----------------------
The Plan shall become effective upon approval by the holders of a
majority of the shares of capital stock of the Company present or represented
and entitled to vote at a meeting of stockholders. Subject to such approval by
the stockholders, and to the requirement that no Stock may be issued hereunder
prior to such approval, Stock Options and other Awards may be granted hereunder
on and after adoption of the Plan by the Board.
SECTION 15. Governing Law.
-------------
This Plan shall be governed by Massachusetts law except to the extent
such law is preempted by federal law.
20
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EXHIBIT 23.2
CONSENT OF INDEPENDENT AUDITORS
We consent to the incorporation by reference in this Registration
Statement of Brooktrout Technology, Inc. on Form S-8 of our report dated June
20, 1996 on the supplemental consolidated financial statements of Brooktrout
Technology, Inc. as of December 31, 1995 and 1994 and for each of the three
years in the period ended December 31, 1995 (which includes explanatory
paragraphs relating to the restatement of the consolidated financial statements
for a pooling-of-interests and a change in accounting for income taxes)
appearing in Registration Statement No. 333-06885 on Form S-3.
DELOITTE & TOUCHE LLP
Boston, Massachusetts
September 18, 1996
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