<PAGE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
------------------------
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
------------------------
ADOBE SYSTEMS INCORPORATED
(Exact Name of Registrant as Specified in its Charter)
<TABLE>
<S> <C>
DELAWARE 77-0019522
(State of Other Jurisdiction (IRS Employer
of Incorporation) Identification No.)
</TABLE>
------------------------
345 PARK AVENUE
SAN JOSE, CALIFORNIA 95110
(408) 536-6000
(Address and telephone number of principal executive offices)
------------------------
ADOBE SYSTEMS INCORPORATED
AMENDED 1997 EMPLOYEE STOCK PURCHASE PLAN
(Full title of the plan)
COLLEEN M. POULIOT
SENIOR VICE PRESIDENT, GENERAL COUNSEL AND SECRETARY
ADOBE SYSTEMS INCORPORATED
345 PARK AVENUE
SAN JOSE, CALIFORNIA 95110
(408) 536-6000
(Name, address and telephone number, including area code, of agent for service)
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
PROPOSED MAXIMUM PROPOSED MAXIMUM
AMOUNT TO OFFERING PRICE AGGREGATE AMOUNT OF
TITLE OF SECURITIES TO BE REGISTERED BE REGISTERED PER SHARE(1) OFFERING PRICE(1) REGISTRATION FEE(1)
<S> <C> <C> <C> <C>
Common Stock (par value $0.0001)... 2,500,000 $68.8125 $146,225,000 $40,651
</TABLE>
(1) Estimated pursuant to Rule 457 solely for purposes of calculating the
registration fee. The purchase price per share at which the shares of the
Registrant's Common Stock are sold under the Amended 1997 Employee Stock
Purchase Plan will be equal to 85% of the lesser of the fair market value of
the Common Stock on (i) the first day of the offering, or (ii) the last day
of the purchase period. Accordingly, the price is based upon 85% of the
average of the high and low prices of Common Stock on June 14, 1999 as
reported on The Nasdaq National Market.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<PAGE>
PART II
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE.
The Registrant hereby incorporates by reference in this registration
statement:
(a) The contents of the Registration Statements on Form S-8 (No. 33-18986,
effective December 10, 1987; amended effective December 29, 1987; amended
effective December 23, 1988; No. 33-86482, effective November 18, 1994;
and No. 333-28207, effective May 30, 1997) previously filed with respect
to the Adobe Systems Incorporated Employee Stock Purchase Plan.
(b) The Registrant's latest annual report on Form 10-K, filed pursuant to
Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended
(the "Exchange Act") containing audited financial statements for the
Registrant's latest fiscal year ended November 27, 1998.
(c) All other reports filed pursuant to Section 13(a) or 15(d) of the
Exchange Act since the end of the fiscal year covered by the Registrant
document referred to in (b) above.
(d) The description of the Registrant's Common Stock contained in the
Registrant's Registration Statement on Form 8-A, filed pursuant to
Section 12 of the Exchange Act, including any amendments or reports filed
for the purpose of updating such description.
(e) The description of the Registrant's Preferred Stock Purchase Rights
contained in the Registrant's Registration Statement on Form 8-A, filed
pursuant to Section 12 of the Exchange Act, including any amendments or
reports filed for the purpose of updating such description.
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS
Section 145 of the Delaware General Corporation Law authorizes a court to
award, or a corporation's board of directors to grant, indemnification to
directors and officers in terms sufficiently broad to permit such
indemnification under certain circumstances for liabilities (including
reimbursement for expenses incurred) arising under the Securities Act of 1933.
The Registrant's Bylaws provide for indemnification of its directors, officers,
employees and other agents to the fullest extent not prohibited by the Delaware
General Corporation Law. The Registrant also maintains directors' and officers'
insurance against liabilities under the Securities Act of 1933 for its directors
and principal executive officers. In addition, each officer and director is a
party to a written agreement which states that the Registrant hereby agrees to
hold each of them harmless against any and all judgments, fines, settlements and
expenses related to claims against such person by reason of the fact that the
person is or was a director, officer, employee or other agent of the Registrant,
and otherwise to the fullest extent authorized or permitted by the Registrant's
Bylaws and under the non-exclusivity provisions of the Delaware Code.
ITEM 8. EXHIBITS
<TABLE>
<CAPTION>
INCORPORATED BY REFERENCE
EXHIBIT ------------------------------ FILED
NUMBER EXHIBIT DESCRIPTION FORM DATE NUMBER HEREWITH
- --------------------- ------------------- -------- -------- -------- --------
<C> <S> <C> <C> <C> <C>
4.1 The Registrant's (as successor in-interest to Adobe 10-Q 05/30/97 3.1
Systems (Delaware) Incorporated by virtue of a
reincorporation effective 5/30/97) Certificate of
Incorporation, as filed with the Secretary of State
of the State of Delaware on 5/9/97.
4.2 Amended and Restated Bylaws of Registrant as 8-K 09/03/98 3.2
currently in effect.
</TABLE>
1
<PAGE>
<TABLE>
<CAPTION>
INCORPORATED BY REFERENCE
EXHIBIT ------------------------------ FILED
NUMBER EXHIBIT DESCRIPTION FORM DATE NUMBER HEREWITH
- --------------------- ------------------- -------- -------- -------- --------
<C> <S> <C> <C> <C> <C>
4.3 Certificate of Designation of the Series A 10-K 05/30/97 2.1
Preferred Stock.
4.4 Amended 1997 Employee Stock Purchase Plan. X
4.5 Agreement and Plan of Merger effective 5/30/97 (by 10-Q 5/30/97 2.1
virtue of a reincorporation), by and between Adobe
Systems Incorporated, a California corporation, and
Adobe Systems (Delaware) Incorporated, a Delaware
corporation.
4.6 Third Amended and Restated Rights Agreement between 8-K 12/15/98 1
the Company and Harris Trust Company of California.
5 Opinion of counsel as to the legality of the X
securities being registered hereby.
23.1 Consent of counsel (included in Exhibit 5). X
23.2 Consent of KPMG LLP, Independent Auditors. X
24.1 Power of Attorney is contained on the signature X
page.
</TABLE>
2
<PAGE>
SIGNATURES:
Pursuant to the requirements of the Securities Act of 1933, as amended, the
Registrant certifies that it has reasonable grounds to believe that it meets all
of the requirements for filing on Form S-8 and has duly caused this registration
statement to be signed on its behalf by the undersigned thereunto duly
authorized, in the City of San Jose, State of California, on this 18th day of
June, 1999.
<TABLE>
<S> <C> <C>
ADOBE SYSTEMS INCORPORATED
(Registrant)
By: /s/ HAROLD L. COVERT
-----------------------------------------
Harold L. Covert
EXECUTIVE VICE PRESIDENT AND CHIEF
FINANCIAL OFFICER
</TABLE>
POWER OF ATTORNEY
The officers and directors of Adobe Systems Incorporated whose signatures
appear below hereby constitute and appoint John E. Warnock and Harold L. Covert,
and each of them, their true and lawful attorneys and agents, with full power of
substitution, each with power to act alone, to sign and execute on behalf of the
undersigned any amendment or amendments to this registration statement on
Form S-8 (including post-effective amendments), and each of the undersigned does
hereby ratify and confirm all that each of said attorney and agent, or their or
his substitutes, shall do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended, this
registration statement has been signed below on June 18, 1999 by the following
persons in the capacities indicated:
<TABLE>
<CAPTION>
SIGNATURE TITLE
--------- -----
<C> <S> <C>
/s/ JOHN E. WARNOCK Chairman of the Board and Chief
--------------------------------- Executive Officer (Principal
John E. Warnock Executive Officer)
/s/ CHARLES M. GESCHKE
--------------------------------- Chairman of the Board and President
Charles M. Geschke
/s/ HAROLD L. COVERT Executive Vice President and Chief
--------------------------------- Financial Officer (Principal
Harold L. Covert Financial and Accounting Officer)
/s/ CAROL MILLS BALDWIN
--------------------------------- Director
Carol Mills Baldwin
/s/ ROBERT SEDGEWICK
--------------------------------- Director
Robert Sedgewick
/s/ DELBERT W. YOCAM
--------------------------------- Director
Delbert W. Yocam
</TABLE>
3
<PAGE>
EXHIBIT INDEX
<TABLE>
<CAPTION>
EXHIBIT
NUMBER EXHIBIT DESCRIPTION
- --------------------- -------------------
<C> <S>
4.1 The Registrant's (as successor in-interest to Adobe Systems
(Delaware) Incorporated by virtue of a reincorporation
effective 5/30/97) Certificate of Incorporation, as filed
with the Secretary of State of the State of Delaware on
5/9/97.
4.2 Amended and Restated Bylaws of Registrant as currently in
effect.
4.3 Certificate of Designation of the Series A Preferred Stock.
4.4 Amended 1997 Employee Stock Purchase Plan.
4.5 Agreement and Plan of Merger effective 5/30/97 (by virtue of
a reincorporation), by and between Adobe Systems
Incorporated, a California corporation, and Adobe Systems
(Delaware) Incorporated, a Delaware corporation.
4.6 Third Amended and Restated Rights Agreement between the
Company and Harris Trust Company of California.
5 Opinion of counsel as to the legality of the securities
being registered hereby.
23.1 Consent of counsel (included in Exhibit 5).
23.2 Consent of KPMG LLP, Independent Auditors.
24.1 Power of Attorney is contained on the signature page.
</TABLE>
<PAGE>
ADOBE SYSTEMS INCORPORATED
1997 EMPLOYEE STOCK PURCHASE PLAN
(as amended by the Board through September 23, 1998)
1. PURPOSE AND TERM OF PLAN.
1.1 PURPOSE. The purpose of the Adobe Systems Incorporated
1997 Employee Stock Purchase Plan, as amended (the "Plan"), is to provide
Eligible Employees of the Participating Company Group with an opportunity to
acquire a proprietary interest in the Company through the purchase of Stock.
The Company intends that the Plan qualify as an "employee stock purchase
plan" under Section 423 of the Code (including any amendments or replacements
of such section), and the Plan shall be so construed.
1.2 TERM OF PLAN. The Plan shall continue in effect until
the earlier of its termination by the Board or the date on which all of the
shares of Stock available for issuance under the Plan have been issued.
1.3 ESTABLISHMENT. The Adobe Systems Incorporated Employee
Stock Purchase Plan was initially established on December 7, 1987, was
amended and restated effective January 1, 1989, and was amended and restated
in its entirety as the Plan effective April 9, 1997, the initial date of
stockholder approval of the Plan. The Plan is hereby amended and restated
effective September 23, 1998, except that the amendment in Section 4.1 to
increase the maximum aggregate number of Shares that may be issued under the
Plan shall be effective as of the date on which it is approved by the
stockholders of the Company.
2. DEFINITIONS AND CONSTRUCTION.
2.1 DEFINITIONS. Any term not expressly defined in the Plan
but defined for purposes of Section 423 of the Code shall have the same
definition herein. Whenever used herein, the following terms shall have
their respective meanings set forth below:
(a) "BOARD" means the Board of Directors of the
Company. If one or more Committees have been appointed by the Board to
administer the Plan, "Board" also means such Committee(s).
(b) "CODE" means the Internal Revenue Code of 1986,
as amended, and any applicable regulations promulgated thereunder.
(c) "COMMITTEE" means a committee of the Board duly
appointed to administer the Plan and having such powers as shall be specified
by the Board. Unless the powers of the Committee have been specifically
limited, the Committee shall have all of the powers of the Board granted
herein, including, without limitation, the power to amend or terminate the
Plan at any time, subject to the terms of the Plan and any applicable
limitations imposed by law.
<PAGE>
(d) "COMPANY" means Adobe Systems Incorporated, a
Delaware corporation, or any successor corporation thereto.
(e) "COMPENSATION" means, with respect to any
Offering Period, base wages or salary, overtime, bonuses, commissions, shift
differentials, payments for paid time off, payments in lieu of notice, and
compensation deferred under any program or plan, including, without
limitation, pursuant to Section 401(k) or Section 125 of the Code.
Compensation shall be limited to amounts actually payable in cash or deferred
during the Offering Period. Compensation shall not include moving
allowances, payments pursuant to a severance agreement, termination pay,
relocation payments, sign-on bonuses, any amounts directly or indirectly paid
pursuant to the Plan or any other stock purchase or stock option plan, or any
other compensation not included above.
(f) "ELIGIBLE EMPLOYEE" means an Employee who meets
the requirements set forth in Section 5 for eligibility to participate in the
Plan.
(g) "EMPLOYEE" means a person treated as an employee
of a Participating Company for purposes of Section 423 of the Code. A
Participant shall be deemed to have ceased to be an Employee either upon an
actual termination of employment or upon the corporation employing the
Participant ceasing to be a Participating Company. For purposes of the Plan,
an individual shall not be deemed to have ceased to be an Employee while such
individual is on a bona fide leave of absence approved by the Company of
ninety (90) days or less. In the event an individual's leave of absence
exceeds ninety (90) days, the individual shall be deemed to have ceased to be
an Employee on the ninety-first (91st) day of such leave unless the
individual's right to reemployment with the Participating Company Group is
guaranteed either by statute or by contract. The Company shall determine in
good faith and in the exercise of its discretion whether an individual has
become or has ceased to be an Employee and the effective date of such
individual's employment or termination of employment, as the case may be.
All such determinations by the Company shall be, for purposes of an
individual's participation in or other rights under the Plan as of the time
of the Company's determination, final, binding and conclusive,
notwithstanding that the Company or any governmental agency subsequently
makes a contrary determination.
(h) "FAIR MARKET VALUE" means, as of any date, if
there is then a public market for the Stock, the closing sale price of a
share of Stock (or the mean of the closing bid and asked prices if the Stock
is so quoted instead) as quoted on the Nasdaq National Market, the Nasdaq
Small-Cap Market or such other national or regional securities exchange or
market system constituting the primary market for the Stock, as reported in
THE WALL STREET JOURNAL or such other source as the Company deems reliable.
If the relevant date does not fall on a day on which the Stock has traded on
such securities exchange or market system, the date on which the Fair Market
Value shall be established shall be the last day on which the Stock was so
traded prior to the relevant date, or such other appropriate day as shall be
determined by the Board, in its sole discretion. If there is then no public
market for the Stock, the Fair Market Value on any
<PAGE>
relevant date shall be as determined by the Board without regard to any
restriction other than a restriction which, by its terms, will never lapse.
(i) "OFFERING" means an offering of Stock as provided
in Section 6.
(j) "OFFERING DATE" means, for any Offering Period,
the first day of such Offering Period.
(k) "OFFERING PERIOD" means a period established in
accordance with Section 6.1.
(l) "PARENT CORPORATION" means any present or future
"parent corporation" of the Company, as defined in Section 424(e) of the Code.
(m) "PARTICIPANT" means an Eligible Employee who has
become a participant in an Offering Period in accordance with Section 7 and
remains a participant in accordance with the Plan.
(n) "PARTICIPATING COMPANY" means the Company or any
Parent Corporation or Subsidiary Corporation designated by the Board as a
corporation the Employees of which may, if Eligible Employees, participate in
the Plan. The Board shall have the sole and absolute discretion to determine
from time to time which Parent Corporations or Subsidiary Corporations shall
be Participating Companies.
(o) "PARTICIPATING COMPANY GROUP" means, at any point
in time, the Company and all other corporations collectively which are then
Participating Companies.
(p) "PURCHASE DATE" means, for any Purchase Period,
the last day of such period.
(q) "PURCHASE PERIOD" means a period established in
accordance with Section 6.2.
(r) "PURCHASE PRICE" means the price at which a share
of Stock may be purchased under the Plan, as determined in accordance with
Section 9.
(s) "PURCHASE RIGHT" means an option granted to a
Participant pursuant to the Plan to purchase such shares of Stock as provided
in Section 8, which the Participant may or may not exercise during the
Offering Period in which such option is outstanding. Such option arises from
the right of a Participant to withdraw any accumulated payroll deductions of
the Participant not previously applied to the purchase of Stock under the
Plan and to terminate participation in the Plan at any time during an
Offering Period.
(t) "STOCK" means the common stock of the Company, as
adjusted from time to time in accordance with Section 4.2.
<PAGE>
(u) "SUBSCRIPTION AGREEMENT" means a written
agreement in such form as specified by the Company, stating an Employee's
election to participate in the Plan and authorizing payroll deductions under
the Plan from the Employee's Compensation.
(v) "SUBSCRIPTION DATE" means the last business day
prior to the Offering Date of an Offering Period or such earlier date as the
Company shall establish.
(w) "SUBSIDIARY CORPORATION" means any present or
future "subsidiary corporation" of the Company, as defined in Section 424(f)
of the Code.
2.2 CONSTRUCTION. Captions and titles contained herein are
for convenience only and shall not affect the meaning or interpretation of
any provision of the Plan. Except when otherwise indicated by the context,
the singular shall include the plural and the plural shall include the
singular. Use of the term "or" is not intended to be exclusive, unless the
context clearly requires otherwise.
3. ADMINISTRATION.
3.1 ADMINISTRATION BY THE BOARD. The Plan shall be
administered by the Board, including any duly appointed Committee of the
Board. All questions of interpretation of the Plan, of any form of agreement
or other document employed by the Company in the administration of the Plan,
or of any Purchase Right shall be determined by the Board and shall be final
and binding upon all persons having an interest in the Plan or the Purchase
Right. Subject to the provisions of the Plan, the Board shall determine all
of the relevant terms and conditions of Purchase Rights granted pursuant to
the Plan; provided, however, that all Participants granted Purchase Rights
pursuant to the Plan shall have the same rights and privileges within the
meaning of Section 423(b)(5) of the Code. All expenses incurred in
connection with the administration of the Plan shall be paid by the Company.
3.2 AUTHORITY OF OFFICERS. Any officer of the Company shall
have the authority to act on behalf of the Company with respect to any
matter, right, obligation, determination or election that is the
responsibility of or that is allocated to the Company herein, provided that
the officer has apparent authority with respect to such matter, right,
obligation, determination or election.
3.3 POLICIES AND PROCEDURES ESTABLISHED BY THE COMPANY. The
Company may, from time to time, consistent with the Plan and the requirements
of Section 423 of the Code, establish, change or terminate such rules,
guidelines, policies, procedures, limitations, or adjustments as deemed
advisable by the Company, in its sole discretion, for the proper
administration of the Plan, including, without limitation, (a) a minimum
payroll deduction amount required for participation in an Offering, (b) a
limitation on the frequency or number of changes permitted in the rate of
payroll deduction during an Offering, (c) an exchange ratio applicable to
amounts withheld in a currency other than United States dollars, (d) a
payroll deduction greater than or less than the amount designated by a
Participant in order to adjust for
<PAGE>
the Company's delay or mistake in processing a Subscription Agreement or in
otherwise effecting a Participant's election under the Plan or as advisable
to comply with the requirements of Section 423 of the Code, and (e)
determination of the date and manner by which the Fair Market Value of a
share of Stock is determined for purposes of administration of the Plan.
4. SHARES SUBJECT TO PLAN.
4.1 MAXIMUM NUMBER OF SHARES ISSUABLE. Subject to
adjustment as provided in Section 4.2, and effective upon approval by the
stockholders of the Company, the maximum aggregate number of shares of Stock
that may be issued under the Plan shall be nine million five hundred thousand
(9,500,000) and shall consist of authorized but unissued or reacquired shares
of Stock, or any combination thereof; provided that until such approval by
the stockholders of the Company, the maximum aggregate number of Shares that
may be issued under the Plan shall be seven million (7,000,000). If an
outstanding Purchase Right for any reason expires or is terminated or
canceled, the shares of Stock allocable to the unexercised portion of such
Purchase Right shall again be available for issuance under the Plan.
4.2 ADJUSTMENTS FOR CHANGES IN CAPITAL STRUCTURE. In the
event of any stock dividend, stock split, reverse stock split,
recapitalization, combination, reclassification or similar change in the
capital structure of the Company, or in the event of any merger (including a
merger effected for the purpose of changing the Company's domicile), sale of
assets or other reorganization in which the Company is a party, appropriate
adjustments shall be made in the number and class of shares subject to the
Plan and each Purchase Right and in the Purchase Price. If a majority of the
shares which are of the same class as the shares that are subject to
outstanding Purchase Rights are exchanged for, converted into, or otherwise
become (whether or not pursuant to an Ownership Change Event) shares of
another corporation (the "NEW SHARES"), the Board may unilaterally amend the
outstanding Purchase Rights to provide that such Purchase Rights are
exercisable for New Shares. In the event of any such amendment, the number
of shares subject to, and the Purchase Price of, the outstanding Purchase
Rights shall be adjusted in a fair and equitable manner, as determined by the
Board, in its sole discretion. Notwithstanding the foregoing, any fractional
share resulting from an adjustment pursuant to this Section 4.2 shall be
rounded down to the nearest whole number, and in no event may the Purchase
Price be decreased to an amount less than the par value, if any, of the stock
subject to the Purchase Right. The adjustments determined by the Board
pursuant to this Section 4.2 shall be final, binding and conclusive.
5. ELIGIBILITY.
5.1 EMPLOYEES ELIGIBLE TO PARTICIPATE. Each Employee of a
Participating Company is eligible to participate in the Plan and shall be
deemed an Eligible Employee, except the following:
(a) Any Employee who is customarily employed by the
Participating Company Group for less than twenty (20) hours per week; or
<PAGE>
(b) Any Employee who is customarily employed by the
Participating Company Group for not more than five (5) months in any calendar
year.
5.2 EXCLUSION OF CERTAIN STOCKHOLDERS. Notwithstanding any
provision of the Plan to the contrary, no Employee shall be granted a
Purchase Right under the Plan if, immediately after such grant, such Employee
would own or hold options to purchase stock of the Company or of any Parent
Corporation or Subsidiary Corporation possessing five percent (5%) or more of
the total combined voting power or value of all classes of stock of such
corporation, as determined in accordance with Section 423(b)(3) of the Code.
For purposes of this Section 5.2, the attribution rules of Section 424(d) of
the Code shall apply in determining the stock ownership of such Employee.
6. OFFERINGS.
6.1 OFFERING PERIODS. Effective for Offerings beginning on and
after September 23, 1998, except as otherwise set forth below, the Plan shall be
implemented by Offerings of approximately twelve (12) months duration or such
other duration as the Board shall determine. Offering Periods shall commence on
or about January 1 and July 1 of each year and end on or about the next December
31 and June 30, respectively, occurring thereafter. The initial Offering Period
commenced on July 1, 1997. Notwithstanding the foregoing, the Board may
establish a different duration for one or more future Offering Periods or
different commencing or ending dates for such Offering Periods; provided,
however, that no Offering Period may have a duration exceeding twenty-seven (27)
months. If the first or last day of an Offering Period is not a day on which
the national securities exchanges or Nasdaq Stock Market are open for trading,
the Company shall specify the trading day that will be deemed the first or last
day, as the case may be, of the Offering Period.
6.2 PURCHASE PERIODS. Effective for Offerings beginning on
and after September 23, 1998, each Offering Period shall consist of two (2)
consecutive Purchase Periods of approximately six (6) months duration, or
such other number or duration as the Board shall determine. A Purchase
Period commencing on or about January 1 shall end on or about the next June
30. A Purchase Period commencing on or about July 1 shall end on or about
the next December 31. Notwithstanding the foregoing, the Board may establish
a different duration for one or more future Purchase Periods or different
commencing or ending dates for such Purchase Periods. If the first or last
day of a Purchase Period is not a day on which the national securities
exchanges or Nasdaq Stock Market are open for trading, the Company shall
specify the trading day that will be deemed the first or last day, as the
case may be, of the Purchase Period.
7. PARTICIPATION IN THE PLAN.
7.1 INITIAL PARTICIPATION. An Eligible Employee may become
a Participant in an Offering Period by delivering a properly completed
Subscription Agreement to the office designated by the Company not later than
the close of business for such office on the Subscription Date established by
the Company for such Offering Period. An Eligible Employee who does not
deliver a properly completed Subscription Agreement to the Company's
designated
<PAGE>
office on or before the Subscription Date for an Offering Period shall not
participate in the Plan for that Offering Period or for any subsequent
Offering Period unless such Eligible Employee subsequently delivers a
properly completed Subscription Agreement to the appropriate office of the
Company on or before the Subscription Date for such subsequent Offering
Period. An Employee who becomes an Eligible Employee on or after the
Offering Date of an Offering Period shall not be eligible to participate in
such Offering Period but may participate in any subsequent Offering Period
provided such Employee is still an Eligible Employee as of the Offering Date
of such subsequent Offering Period.
7.2 CONTINUED PARTICIPATION. A Participant shall
automatically participate in the next Offering Period commencing immediately
after the final Purchase Date of each Offering Period in which the
Participant participates provided that such Participant remains an Eligible
Employee on the Offering Date of the new Offering Period and has not either
(a) withdrawn from the Plan pursuant to Section 12.1 or (b) terminated
employment as provided in Section 13. A Participant who may automatically
participate in a subsequent Offering Period, as provided in this Section 7.2,
is not required to deliver any additional Subscription Agreement for the
subsequent Offering Period in order to continue participation in the Plan.
However, a Participant may deliver a new Subscription Agreement for a
subsequent Offering Period in accordance with the procedures set forth in
Section 7.1 if the Participant desires to change any of the elections
contained in the Participant's then effective Subscription Agreement.
Eligible Employees may not participate simultaneously in more than one
Offering.
8. RIGHT TO PURCHASE SHARES.
8.1 GRANT OF PURCHASE RIGHT. Except as set forth below, on
the Offering Date of each Offering Period, each Participant in such Offering
Period shall be granted automatically a Purchase Right consisting of an
option to purchase two thousand five hundred (2,500) shares of Stock. No
Purchase Right shall be granted on an Offering Date to any person who is not,
on such Offering Date, an Eligible Employee.
8.2 PRO RATA ADJUSTMENT OF PURCHASE RIGHT. Notwithstanding
the provisions of Section 8.1, if the Board establishes an Offering Period of
less than eleven and one-half (11 1/2) months or more than twelve and one-half
(12 1/2) months in duration, the number of whole shares of Stock subject to a
Purchase Right shall be determined by multiplying 208.33 shares by the number
of months (rounded to the nearest whole month) in the Offering Period and
disregarding any resulting fractional share.
8.3 CALENDAR YEAR PURCHASE LIMITATION. Notwithstanding any
provision of the Plan to the contrary, no Purchase Right shall entitle a
Participant to purchase shares of Stock under the Plan at a rate which, when
aggregated with such Participant's rights to purchase shares under all other
employee stock purchase plans of a Participating Company intended to meet the
requirements of Section 423 of the Code, exceeds Twenty-Five Thousand Dollars
($25,000) in Fair Market Value (or such other limit, if any, as may be
imposed by the Code) for each calendar year in which such Purchase Right has
been outstanding at any time. For purposes of the preceding sentence, the
Fair Market Value of shares purchased during a given Offering Period
<PAGE>
shall be determined as of the Offering Date for such Offering Period. The
limitation described in this Section 8.3 shall be applied in conformance with
applicable regulations under Section 423(b)(8) of the Code.
9. PURCHASE PRICE. The Purchase Price at which each share of
Stock may be acquired in an Offering Period upon the exercise of all or any
portion of a Purchase Right shall be established by the Board; provided,
however, that the Purchase Price shall not be less than eighty-five percent
(85%) of the lesser of (a) the Fair Market Value of a share of Stock on the
Offering Date of the Offering Period or (b) the Fair Market Value of a share
of Stock on the Purchase Date. Unless otherwise provided by the Board prior
to the commencement of an Offering Period, the Purchase Price for that
Offering Period shall be eighty-five percent (85%) of the lesser of (a) the
Fair Market Value of a share of Stock on the Offering Date of the Offering
Period, or (b) the Fair Market Value of a share of Stock on the Purchase Date.
10. ACCUMULATION OF PURCHASE PRICE THROUGH PAYROLL DEDUCTION.
Shares of Stock acquired pursuant to the exercise of all or any portion of a
Purchase Right may be paid for only by means of payroll deductions from the
Participant's Compensation accumulated during the Offering Period for which
such Purchase Right was granted, subject to the following:
10.1 AMOUNT OF PAYROLL DEDUCTIONS. Except as otherwise
provided herein, the amount to be deducted under the Plan from a
Participant's Compensation on each payday during an Offering Period shall be
determined by the Participant's Subscription Agreement. The Subscription
Agreement shall set forth the percentage of the Participant's Compensation to
be deducted on each payday during an Offering Period in whole percentages of
not less than one percent (1%) (except as a result of an election pursuant to
Section 10.3 to stop payroll deductions made effective following the first
payday during an Offering) or more than fifteen percent (15%).
Notwithstanding the foregoing, the Board may change the limits on payroll
deductions effective as of any future Offering Date.
10.2 COMMENCEMENT OF PAYROLL DEDUCTIONS. Payroll deductions
shall commence on the first payday following the Offering Date and shall
continue to the end of the Offering Period unless sooner altered or
terminated as provided herein.
10.3 ELECTION TO CHANGE OR STOP PAYROLL DEDUCTIONS. During
an Offering Period, a Participant may elect to increase or decrease the rate
of or to stop deductions from his or her Compensation by delivering to the
Company's designated office an amended Subscription Agreement authorizing
such change on or before the "Change Notice Date." The "CHANGE NOTICE DATE"
shall be a date prior to the beginning of the first pay period for which such
election is to be effective as established by the Company from time to time
and announced to the Participants. A Participant who elects to decrease the
rate of his or her payroll deductions to zero percent (0%) shall nevertheless
remain a Participant in the current Offering Period unless such Participant
withdraws from the Plan as provided in Section 12.1.
10.4 PARTICIPANT ACCOUNTS. Individual bookkeeping accounts
shall be maintained for each Participant. All payroll deductions from a
Participant's Compensation shall
<PAGE>
be credited to such Participant's Plan account and shall be deposited with
the general funds of the Company. All payroll deductions received or held by
the Company may be used by the Company for any corporate purpose.
10.5 NO INTEREST PAID. Interest shall not be paid on sums
deducted from a Participant's Compensation pursuant to the Plan.
11. PURCHASE OF SHARES.
11.1 EXERCISE OF PURCHASE RIGHT. On each Purchase Date of an
Offering Period, each Participant who has not withdrawn from the Plan and
whose participation in the Offering has not terminated before such Purchase
Date shall automatically acquire pursuant to the exercise of the
Participant's Purchase Right the number of whole shares of Stock determined
by dividing (a) the total amount of the Participant's payroll deductions
accumulated in the Participant's Plan account during the Offering Period and
not previously applied toward the purchase of Stock by (b) the Purchase
Price. However, in no event shall the number of shares purchased by the
Participant during an Offering Period exceed the number of shares subject to
the Participant's Purchase Right. No shares of Stock shall be purchased on a
Purchase Date on behalf of a Participant whose participation in the Offering
or the Plan has terminated before such Purchase Date.
11.2 PRO RATA ALLOCATION OF SHARES. In the event that the
number of shares of Stock which might be purchased by all Participants in the
Plan on a Purchase Date exceeds the number of shares of Stock available in
the Plan as provided in Section 4.1, the Company shall make a pro rata
allocation of the remaining shares in as uniform a manner as shall be
practicable and as the Company shall determine to be equitable. Any
fractional share resulting from such pro rata allocation to any Participant
shall be disregarded.
11.3 DELIVERY OF CERTIFICATES. As soon as practicable after
each Purchase Date, the Company shall arrange the delivery to each
Participant, as appropriate, of a certificate representing the shares
acquired by the Participant on such Purchase Date; provided that the Company
may deliver such shares to a broker that holds such shares in street name for
the benefit of the Participant. Shares to be delivered to a Participant
under the Plan shall be registered in the name of the Participant, or, if
requested by the Participant, in the name of the Participant and his or her
spouse, or, if applicable, in the names of the heirs of the Participant.
11.4 RETURN OF CASH BALANCE. Any cash balance remaining in a
Participant's Plan account following any Purchase Date shall be refunded to
the Participant as soon as practicable after such Purchase Date. However, if
the cash to be returned to a Participant pursuant to the preceding sentence
is an amount less than the amount that would have been necessary to purchase
an additional whole share of Stock on such Purchase Date, the Company may
retain such amount in the Participant's Plan account to be applied toward the
purchase of shares of Stock in the subsequent Purchase Period or Offering
Period, as the case may be.
<PAGE>
11.5 TAX WITHHOLDING. At the time a Participant's Purchase
Right is exercised, in whole or in part, or at the time a Participant
disposes of some or all of the shares of Stock he or she acquires under the
Plan, the Participant shall make adequate provision for the foreign, federal,
state and local tax withholding obligations of the Participating Company
Group, if any, which arise upon exercise of the Purchase Right or upon such
disposition of shares, respectively. The Participating Company Group may,
but shall not be obligated to, withhold from the Participant's compensation
the amount necessary to meet such withholding obligations.
11.6 EXPIRATION OF PURCHASE RIGHT. Any portion of a
Participant's Purchase Right remaining unexercised after the end of the
Offering Period to which the Purchase Right relates shall expire immediately
upon the end of the Offering Period.
11.7 REPORTS TO PARTICIPANTS. Each Participant who has
exercised all or part of his or her Purchase Right shall receive, as soon as
practicable after the Purchase Date, a report of such Participant's Plan
account setting forth the total payroll deductions accumulated prior to such
exercise, the number of shares of Stock purchased, the Purchase Price for
such shares, the date of purchase and the cash balance, if any, remaining
immediately after such purchase that is to be refunded or retained in the
Participant's Plan account pursuant to Section 11.4. The report required by
this Section may be delivered in such form and by such means, including by
electronic transmission, as the Company may determine.
12. WITHDRAWAL FROM OFFERING OR PLAN.
12.1 VOLUNTARY WITHDRAWAL FROM THE PLAN. A Participant may
withdraw from the Plan by signing and delivering to the Company's designated
office a written notice of withdrawal on a form provided by the Company for
such purpose. Such withdrawal may be elected at any time prior to the end of
an Offering Period; provided, however, if a Participant withdraws from the
Plan after the Purchase Date of a Purchase Period, the withdrawal shall not
affect shares of Stock acquired by the Participant on such Purchase Date. A
Participant who voluntarily withdraws from the Plan is prohibited from
resuming participation in the Plan in the same Offering from which he or she
withdrew, but may participate in any subsequent Offering by again satisfying
the requirements of Sections 5 and 7.1. The Company may impose, from time to
time, a requirement that the notice of withdrawal from the Plan be on file
with the Company's designated office for a reasonable period prior to the
effectiveness of the Participant's withdrawal.
12.2 AUTOMATIC WITHDRAWAL FROM AN OFFERING. If the Fair
Market Value of a share of Stock on a Purchase Date other than the final
Purchase Date of an Offering is less than the Fair Market Value of a share of
Stock on the Offering Date of the Offering, then every Participant
automatically shall be (a) withdrawn from such Offering at the close of such
Purchase Date and after the acquisition of shares of Stock for the Purchase
Period and (b) enrolled in the Offering commencing on the first business day
subsequent to such Purchase Date.
12.3 RETURN OF PAYROLL DEDUCTIONS. Upon a Participant's
voluntary withdrawal from the Plan pursuant to Sections 12.1 or automatic
withdrawal from an Offering pursuant to
<PAGE>
Section 12.2, the Participant's accumulated payroll deductions which have not
been applied toward the purchase of shares of Stock (except, in the case of an
automatic withdrawal pursuant to Section 12.2, for an amount necessary to
purchase an additional whole share as provided in Section 11.4) shall be
returned as soon as practicable after the withdrawal, without the payment of
any interest, to the Participant, and the Participant's interest in the Plan
or the Offering, as applicable, shall terminate. Such accumulated payroll
deductions may not be applied to any other Offering under the Plan.
13. TERMINATION OF EMPLOYMENT OR ELIGIBILITY. Upon a Participant's
ceasing, prior to a Purchase Date, to be an Employee of the Participating
Company Group for any reason, including retirement, disability or death, or
the failure of a Participant to remain an Eligible Employee, the
Participant's participation in the Plan shall terminate immediately. In such
event, the payroll deductions credited to the Participant's Plan account
since the last Purchase Date shall, as soon as practicable, be returned to
the Participant or, in the case of the Participant's death, to the
Participant's legal representative, and all of the Participant's rights under
the Plan shall terminate. Interest shall not be paid on sums returned
pursuant to this Section 13. A Participant whose participation has been so
terminated may again become eligible to participate in the Plan by again
satisfying the requirements of Sections 5 and 7.1.
14. TRANSFER OF CONTROL.
14.1 DEFINITIONS.
(a) An "OWNERSHIP CHANGE EVENT" shall be deemed to
have occurred if any of the following occurs with respect to the Company: (i)
the direct or indirect sale or exchange in a single or series of related
transactions by the stockholders of the Company of more than fifty percent
(50%) of the voting stock of the Company; (ii) a merger or consolidation in
which the Company is a party; (iii) the sale, exchange, or transfer of all or
substantially all of the assets of the Company; or (iv) a liquidation or
dissolution of the Company.
(b) A "TRANSFER OF CONTROL" shall mean an Ownership
Change Event or a series of related Ownership Change Events (collectively,
the "TRANSACTION") wherein the stockholders of the Company immediately before
the Transaction do not retain immediately after the Transaction, in
substantially the same proportions as their ownership of shares of the
Company's voting stock immediately before the Transaction, direct or indirect
beneficial ownership of more than fifty percent (50%) of the total combined
voting power of the outstanding voting stock of the Company or the
corporation or corporations to which the assets of the Company were
transferred (the "TRANSFEREE CORPORATION(s)"), as the case may be. For
purposes of the preceding sentence, indirect beneficial ownership shall
include, without limitation, an interest resulting from ownership of the
voting stock of one or more corporations which, as a result of the
Transaction, own the Company or the Transferee Corporation(s), as the case
may be, either directly or through one or more subsidiary corporations. The
Board shall have the right to determine whether multiple sales or exchanges
of the voting stock of the Company or multiple Ownership Change Events are
related, and its determination shall be final, binding and conclusive.
<PAGE>
14.2 EFFECT OF TRANSFER OF CONTROL ON PURCHASE RIGHTS. In
the event of a Transfer of Control, the surviving, continuing, successor, or
purchasing corporation or parent corporation thereof, as the case may be (the
"ACQUIRING CORPORATION"), shall assume the Company's rights and obligations
under the Plan. If the Acquiring Corporation elects not to assume the
Company's rights and obligations under outstanding Purchase Rights, the
Purchase Date of the then current Purchase Period shall be accelerated to a
date before the date of the Transfer of Control specified by the Board, but
the number of shares of Stock subject to outstanding Purchase Rights shall
not be adjusted. All Purchase Rights which are neither assumed by the
Acquiring Corporation in connection with the Transfer of Control nor
exercised as of the date of the Transfer of Control shall terminate and cease
to be outstanding effective as of the date of the Transfer of Control.
15. NONTRANSFERABILITY OF PURCHASE RIGHTS. A Purchase Right may
not be transferred in any manner otherwise than by will or the laws of
descent and distribution and shall be exercisable during the lifetime of the
Participant only by the Participant.
16. RESTRICTION ON ISSUANCE OF SHARES. The issuance of shares
under the Plan shall be subject to compliance with all applicable
requirements of foreign, federal or state law with respect to such
securities. A Purchase Right may not be exercised if the issuance of shares
upon such exercise would constitute a violation of any applicable foreign,
federal or state securities laws or other law or regulations or the
requirements of any securities exchange or market system upon which the Stock
may then be listed. In addition, no Purchase Right may be exercised unless
(a) a registration statement under the Securities Act of 1933, as amended,
shall at the time of exercise of the Purchase Right be in effect with respect
to the shares issuable upon exercise of the Purchase Right, or (b) in the
opinion of legal counsel to the Company, the shares issuable upon exercise of
the Purchase Right may be issued in accordance with the terms of an
applicable exemption from the registration requirements of said Act. The
inability of the Company to obtain from any regulatory body having
jurisdiction the authority, if any, deemed by the Company's legal counsel to
be necessary to the lawful issuance and sale of any shares under the Plan
shall relieve the Company of any liability in respect of the failure to issue
or sell such shares as to which such requisite authority shall not have been
obtained. As a condition to the exercise of a Purchase Right, the Company
may require the Participant to satisfy any qualifications that may be
necessary or appropriate, to evidence compliance with any applicable law or
regulation, and to make any representation or warranty with respect thereto
as may be requested by the Company.
17. RIGHTS AS A STOCKHOLDER AND EMPLOYEE. A Participant shall have
no rights as a stockholder by virtue of the Participant's participation in
the Plan until the date of the issuance of a certificate for the shares
purchased pursuant to the exercise of the Participant's Purchase Right (as
evidenced by the appropriate entry on the books of the Company or of a duly
authorized transfer agent of the Company). No adjustment shall be made for
dividends, distributions or other rights for which the record date is prior
to the date such certificate is issued, except as provided in Section 4.2.
Nothing herein shall confer upon a Participant any right to continue in
<PAGE>
the employ of the Participating Company Group or interfere in any way with
any right of the Participating Company Group to terminate the Participant's
employment at any time.
18. LEGENDS. The Company may at any time place legends or other
identifying symbols referencing any applicable foreign, federal or state
securities law restrictions or any provision convenient in the administration
of the Plan on some or all of the certificates representing shares of Stock
issued under the Plan. The Participant shall, at the request of the Company,
promptly present to the Company any and all certificates representing shares
acquired pursuant to a Purchase Right in the possession of the Participant in
order to carry out the provisions of this Section. Unless otherwise
specified by the Company, legends placed on such certificates may include but
shall not be limited to the following:
"THE SHARES EVIDENCED BY THIS CERTIFICATE WERE ISSUED BY THE
CORPORATION TO THE REGISTERED HOLDER UPON THE PURCHASE OF SHARES UNDER AN
EMPLOYEE STOCK PURCHASE PLAN AS DEFINED IN SECTION 423 OF THE INTERNAL
REVENUE CODE OF 1986, AS AMENDED. THE TRANSFER AGENT FOR THE SHARES
EVIDENCED HEREBY SHALL NOTIFY THE CORPORATION IMMEDIATELY OF ANY TRANSFER OF
THE SHARES BY THE REGISTERED HOLDER HEREOF. THE REGISTERED HOLDER SHALL HOLD
ALL SHARES PURCHASED UNDER THE PLAN IN THE REGISTERED HOLDER'S NAME (AND NOT
IN THE NAME OF ANY NOMINEE)."
19. NOTIFICATION OF SALE OF SHARES. The Company may require the
Participant to give the Company prompt notice of any disposition of shares
acquired by exercise of a Purchase Right within two years from the date of
granting such Purchase Right or one year from the date of exercise of such
Purchase Right. The Company may require that until such time as a
Participant disposes of shares acquired upon exercise of a Purchase Right,
the Participant shall hold all such shares in the Participant's name (or, if
elected by the Participant, in the name of the Participant and his or her
spouse but not in the name of any nominee) until the lapse of the time
periods with respect to such Purchase Right referred to in the preceding
sentence. The Company may direct that the certificates evidencing shares
acquired by exercise of a Purchase Right refer to such requirement to give
prompt notice of disposition.
20. NOTICES. All notices or other communications by a Participant
to the Company under or in connection with the Plan shall be deemed to have
been duly given when received in the form specified by the Company at the
location, or by the person, designated by the Company for the receipt thereof.
21. INDEMNIFICATION. In addition to such other rights of
indemnification as they may have as members of the Board or officers or
employees of the Participating Company Group, members of the Board and any
officers or employees of the Participating Company Group to whom authority to
act for the Board or the Company is delegated shall be indemnified by the
Company against all reasonable expenses, including attorneys' fees, actually
and necessarily incurred in connection with the defense of any action, suit
or proceeding, or in connection with any appeal therein, to which they or any
of them may be a party by reason of any action taken or
<PAGE>
failure to act under or in connection with the Plan, or any right granted
hereunder, and against all amounts paid by them in settlement thereof
(provided such settlement is approved by independent legal counsel selected
by the Company) or paid by them in satisfaction of a judgment in any such
action, suit or proceeding, except in relation to matters as to which it
shall be adjudged in such action, suit or proceeding that such person is
liable for gross negligence, bad faith or intentional misconduct in duties;
provided, however, that within sixty (60) days after the institution of such
action, suit or proceeding, such person shall offer to the Company, in
writing, the opportunity at its own expense to handle and defend the same.
22. AMENDMENT OR TERMINATION OF THE PLAN. The Board may at any
time amend or terminate the Plan, except that (a) such termination shall not
affect Purchase Rights previously granted under the Plan, except as permitted
under the Plan, and (b) no amendment may adversely affect a Purchase Right
previously granted under the Plan (except to the extent permitted by the Plan
or as may be necessary to qualify the Plan as an employee stock purchase plan
pursuant to Section 423 of the Code or to obtain qualification or
registration of the shares of Stock under applicable foreign, federal or
state securities laws). In addition, an amendment to the Plan must be
approved by the stockholders of the Company within twelve (12) months of the
adoption of such amendment if such amendment would authorize the sale of more
shares than are authorized for issuance under the Plan or would change the
definition of the corporations that may be designated by the Board as
Participating Companies.
23. CONTINUATION OF PLAN TERMS AS TO OUTSTANDING PURCHASE RIGHTS.
Any other provision of the Plan to the contrary notwithstanding, the terms of
the Plan prior to amendment (other than the maximum aggregate number of
shares of Stock issuable thereunder) shall remain in effect and apply to all
Purchase Rights granted pursuant to the Plan prior to amendment.
IN WITNESS WHEREOF, the undersigned Secretary of the Company certifies
that the foregoing Adobe Systems Incorporated 1997 Employee Stock Purchase
Plan, as amended, was duly adopted by the Board of Directors of the Company
on September 23, 1998.
/s/ Colleen M. Pouliot
----------------------
Secretary
<PAGE>
EXHIBIT 5
June 18, 1999
Securities and Exchange Commission
450 Fifth Street, NW
Washington, DC 20549
RE: ADOBE SYSTEMS INCORPORATED AMENDED 1997 EMPLOYEE STOCK PURCHASE PLAN--
REGISTRATION STATEMENT ON FORM S-8
Gentlemen and Ladies:
As legal counsel for Adobe Systems Incorporated, a Delaware corporation (the
"Company"), I am rendering this opinion in connection with the Registration
Statement on Form S-8 to be filed with the Securities and Exchange Commission on
or about June 21, 1999 (the "Registration Statement") in connection with the
registration under the Securities Act of 1933, as amended, of up to 2,500,000
shares of the Company's Common Stock, par value $0.0001, authorized for issuance
pursuant to the Adobe Systems Incorporated Amended 1997 Employee Stock Purchase
Plan (the "Plan").
I have examined all instruments, documents and records which I deemed relevant
and necessary for the basis of my opinion hereinafter expressed. In such
examination, I have assumed the genuineness of all signatures and the
authenticity of all documents submitted to me as originals and the conformity to
the originals of all documents submitted to me as copies.
I am admitted to practice only in the State of California and I express no
opinion concerning any law other than the law of the State of California and the
federal law of the United States. As to matters of Delaware corporation law, I
have based my opinion solely upon my examination of such laws and the rules and
regulations of the authorities administering such laws, all as reported in
standard, unofficial compilations. I have not obtained opinions of counsel
licensed to practice in jurisdictions other than the State of California.
Based on such examination, I am of the opinion that the 2,500,000 shares which
may be issued pursuant to the Plan are duly authorized shares of the Company's
Common Stock, and, when issued in accordance with the provision of the Plan,
will be validly issued, fully paid and non-assessable.
I hereby consent to the filing of this opinion as an exhibit to the Registration
Statement referred to above and the use of my name wherever it appears in said
Registration Statement.
Respectfully submitted,
/s/ Cheryl K. House
Cheryl K. House
Corporate Securities Counsel
Adobe Systems Incorporated
<PAGE>
EXHIBIT 23.2
CONSENT OF INDEPENDENT AUDITORS
The Board of Directors
Adobe Systems Incorporated:
We consent to incorporation herein by reference of our report dated
December 14, 1998, relating to the consolidated balance sheets of Adobe Systems
Incorporated and subsidiaries as of November 27, 1998 and November 28, 1997, and
the related consolidated statements of income, stockholders' equity, and cash
flows for each of the years in the three-year period ended November 27, 1998,
and the related schedule, which report appears in the November 27, 1998, annual
report on Form 10-K of Adobe Systems Incorporated.
/s/ KPMG LLP
Mountain View, California
June 18, 1999
