<PAGE>
As filed with the Securities and Exchange Commission on August 31, 1998.
Registration No. 333-______
- --------------------------------------------------------------------------------
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM S-8
Registration Statement Under The Securities Act of 1933
BOSTON ACOUSTICS, INC.
(Exact name of registrant as specified in its charter)
Massachusetts 04-2662473
(State or other jurisdiction (I.R.S. Employer
of incorporation or organization) Identification No.)
300 Jubilee Drive
Peabody, Massachusetts 01960
(Address, including zip code, of principal executive offices)
1996 Stock Plan
1997 Stock Plan
(Full title of the plan)
Andrew G. Kotsatos
Chairman, Chief Executive Officer and Treasurer
Boston Acoustics, Inc.
300 Jubilee Drive
Peabody, Massachusetts 01960
(Name and address of agent for service)
(978) 538-5000
(Telephone number, including area code, of agent for service)
copies to:
Joseph D.S. Hinkley, Esq.
Peabody & Arnold LLP
50 Rowes Wharf
Boston, MA 02110
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
Proposed
Proposed maximum Amount
Title of Amount maximum aggregate of
securities to be offering price offering registration
to be registered registered per share price fee
- -----------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock, 738,000(1) $22.69(2) $16,745,220(2) $4,940(2)
par value $.01
per share (issuable upon
exercise of options)
- -----------------------------------------------------------------------------------------------------------
</TABLE>
(1) The 738,000 shares shown are shares issued or issuable upon the exercise of
options issued or issuable pursuant to the Company's 1996 Stock Plan and
1997 Stock Plan (collectively, the "Plans"). Pursuant to Rule 416(a) under
the Securities Act of 1933, as amended, there are also registered an
undetermined number of additional shares which may be issued if the
antidilution provisions of the Plans become operative.
(2) The total number of shares of Common Stock to be registered includes the
following: (i) under the 1996 Stock Plan 288,000 shares of the Company's
Common Stock issuable upon the exercise of options at exercise prices
ranging from $11.67 to $18.08; and (ii) under the 1997 Stock Plan 149,250
shares of the Company's Common Stock issuable upon the exercise of options
at exercise prices ranging from $17.33 to $19.89. An additional 300,750
shares are to be offered under the 1997 Stock Plan at prices not presently
determinable. Pursuant to Rule 457(c) and (h), the offering price for these
additional shares is estimated solely for the purpose of determining the
registration fee and is based on the $22.69 average of the high and low
sale prices of the Common Stock as reported by the Nasdaq National Market
on August 28, 1998.
<PAGE>
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
Item 3. Incorporation of Documents by Reference.
The following documents filed by Boston Acoustics, Inc. (the "Company")
with the Securities and Exchange Commission are incorporated in this
Registration Statement by reference:
(a) Annual Report on Form 10-K for the fiscal year ended March 28, 1998.
(b) Quarterly Report on Form 10-Q for fiscal quarter ended June 27, 1998.
(c) The description of the Company's Common Stock contained in the
Company's Registration Statement on Form 8-A, as amended.
All documents subsequently filed by the Company 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 which indicates that all securities offered have
been sold or which deregisters all securities then remaining unsold, shall be
deemed to be incorporated by reference herein and to be part hereof from the
date of filing of such documents.
Item 5. Interests of Named Experts and Counsel.
The legality of the shares of Common Stock of the Company offered hereby
(the "Shares") will be passed upon for the Company by Peabody & Arnold LLP, 50
Rowes Wharf, Boston, Massachusetts 02110. Joseph D.S. Hinkley, a partner in
Peabody & Arnold LLP, is the Clerk of the Company.
Item 6. Indemnification of Directors and Officers.
With respect to indemnification, Section 67 of Chapter 156B of the
Massachusetts General Laws provides:
"Indemnification of directors, officers, employees, and other agents
of a corporation, and persons who serve at its request as directors,
officers, employees or other agents of another organization, or who serve
at its request in any capacity with respect to any employee benefit plan,
may be provided by it to whatever extent shall be specified in or
authorized by (i) the articles of organization or (ii) a by-law adopted by
the stockholders or (iii) a vote adopted by the holders of a majority of
shares of stock entitled to vote on the election of directors. Except as
the articles of organization or by-laws otherwise require, indemnification
of any persons referred to in the preceding sentence who are not directors
of the corporation may be provided by it to the extent authorized by the
directors. Such indemnification may include payment by the corporation of
expenses incurred in defending a civil or criminal action or proceeding in
advance of the final disposition of such action or proceeding, upon receipt
of any undertaking by the person indemnified to repay such payment if he
shall be adjudicated to be not entitled to indemnification under this
section which undertaking may be accepted without reference to the
financial ability of such person to make repayment. Any such
indemnification may be provided although the person to be indemnified is no
longer an officer, director, employee or agent of the corporation or of
such other organization or no longer serves with respect to any such
employee benefit plan.
No indemnification shall be provided for any person with respect to
any matter as to which he shall have been adjudicated in any proceeding not
to have acted in good faith in the reasonable belief that his action was in
the best interest of the corporation or to the extent that such matter
relates to service with respect to any employee benefit plan, in the best
interests of the participants or beneficiaries of such employee benefit
plan.
The absence of any express provision for indemnification shall not
limit any right of indemnification existing independently of this section.
A corporation shall have power to purchase and maintain insurance on
behalf of any person who is or was a director, officer, employee, or other
agent of the corporation, or is or was serving at the request of the
corporation as a director, officer, employee or other agent of another
organization or with respect to any employee benefit plan, against any
liability incurred by him in any such capacity, or arising out of his
status as such, whether or not the corporation would have the power to
indemnify him against such liability.
Article 6A of the Company's Restated Articles of Organization provides as
follows:
Limitation of Liability of Directors. No director of this Corporation
shall be personally liable to the Corporation or its stockholders for
monetary damages for breach of fiduciary duty as a director notwithstanding
any provision of law imposing such liability; provided, however, that this
Article shall not eliminate or limit any liability of a director (i) for
any breach of the director's duty of loyalty to the Corporation or its
stockholders, (ii) for acts or omissions not in good faith or which involve
intentional misconduct or a knowing violation of law, (iii) under Section
61 or 62 of the Massachusetts Business Corporation Law, or (iv) with
respect to any transaction from which the director derived improper
personal benefit.
- 2 -
<PAGE>
The provisions of this Article shall not eliminate or limit the
liability of a director of this Corporation for any act or omission
occurring prior to the date on which this Article became effective. No
amendment or repeal of this Article shall adversely affect the rights and
protection afforded to a director of this Corporation under this Article
for acts or omissions occurring while this Article is in effect.
Item 8. Exhibits.
<TABLE>
<CAPTION>
Exhibit No. Exhibit
- ----------- -------
<S> <C>
++4.1. 1996 Stock Plan.
^4.2. 1997 Stock Plan.
*4.3. Form of Incentive Stock Option Agreement.
*4.4. Form of Non-Statutory Stock Option Agreement.
*5.1. Opinion of Peabody & Arnold LLP regarding legality.
*23.1. Consent of Arthur Andersen LLP.
*23.2. Consent of Peabody & Arnold LLP (included in its opinion filed as Exhibit 5.1).
*24.1. Power of Attorney (contained in signature page).
</TABLE>
- ------------------------------
*Filed herewith.
++Previously filed as an Exhibit to the Company's Annual Report on Form 10-K for
the fiscal year ended March 29, 1997.
^Previously filed as an Exhibit to the Company's Annual Report on Form 10-K for
the fiscal year ended March 28, 1998.
Item 9. Undertakings
(a) The undersigned Registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this Registration Statement:
(i) To include any prospectus required by section 10(a)(3) of
the Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events arising
after the effective date of this Registration Statement (or
the most recent post-effective amendment thereof) which,
individually or in the aggregate, represent a fundamental
change in the information set forth in this Registration
Statement;
(iii) To include any material information with respect to the
plan of distribution not previously disclosed in this
Registration Statement or any material change to such
information in this Registration Statement;
Provided, however, that paragraphs (a)(1)(i) and (a)(1)(ii) of the section
do not apply if this Registration Statement is on Form S-3, Form S-8 or
Form F-3, and the information required to be included in a post-effective
amendment by those paragraphs is contained in periodic reports filed with
or furnished to the Commission by the Registrant pursuant to section 13 or
section 15(d) of the Securities Exchange Act of 1934 that are incorporated
by reference in this Registration Statement.
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be
deemed to be a new registration statement relating to the securities
offered therein, and the offering of such securities at that time
shall be deemed to be the initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the
termination of the offering.
(b) The undersigned Registrant hereby undertakes that, for
purposes of determining any liability under the Securities Act of
1933, each filing of this Registrant's annual report pursuant to
section 13(a) or section 15(d) of the Securities Exchange Act of
1934 (and, where applicable, each filing of an employee benefit
plan's annual report pursuant to section 15(d) of the Securities
Exchange Act of 1934) that is incorporated by reference in this
Registration Statement shall be deemed to be a new registration
statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be
the initial bona fide offering thereof.
- 3 -
<PAGE>
(c) Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers
and controlling persons of the Registrant pursuant to the
foregoing provisions, or otherwise, the Registrant has been
advised that in the opinion of the Securities and Exchange
Commission such indemnification is against public policy as
expressed in the Act and is, therefore, unenforceable. In the
event that a claim for indemnification against such liabilities
(other than the payment by the Registrant of expenses incurred or
paid by a director, officer or controlling person of the
Registrant in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling
person in connection with the securities being registered, the
Registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of
appropriate jurisdiction the question whether such
indemnification by it is against public policy as expressed in
the Act and will be governed by the final adjudication of such
issue.
- 4 -
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-8 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Peabody, Commonwealth of Massachusetts on this 31st
day of August, 1998.
BOSTON ACOUSTICS, INC.
By: /s/ Andrew Kotsatos
-------------------
Andrew G. Kotsatos, Chairman,
Chief Executive Officer and Treasurer
- 5 -
<PAGE>
POWER OF ATTORNEY
The undersigned directors of Boston Acoustics, Inc. hereby severally
constitute and appoint Andrew G. Kotsatos our true and lawful attorney-in-fact
and agent with full power of substitution, to execute in our name and behalf in
the capacities indicated below any and all amendments to this Registration
Statement to be filed with the Securities and Exchange Commission and hereby
ratify and confirm all that such attorney-in-fact and agent shall lawfully do or
cause to be done by virtue thereof.
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed below by the following persons in the
capacities and on the dates indicated.
<TABLE>
<CAPTION>
Signature Title Date
- --------- ----- ----
<S> <C> <C>
/s/ Andrew Kotsatos Director, Chief Executive Officer and August 31, 1998
- ------------------- Treasurer ------------------
Andrew G. Kotsatos
/s/ Fred Faulkner Director, President and Chief Operating August 31, 1998
- ----------------- Officer ------------------
Fred E. Faulkner, Jr.
/s/ Debra Ricker-Rosato Vice President, Finance (Principal Financial August 31, 1998
- ----------------------- and Accounting Officer) ------------------
Debra A. Ricker-Rosato
/s/ George J. Markos Director August 31, 1998
- -------------------- ------------------
George J. Markos
/s/ Lisa Mooney Director August 31, 1998
- --------------- ------------------
Lisa M. Mooney
/s/ Gerald Walle Director August 31, 1998
- ---------------- ------------------
Gerald Walle
</TABLE>
<PAGE>
Exhibit 4.3
BOSTON ACOUSTICS, INC.
INCENTIVE STOCK OPTION AGREEMENT
1. Grant of Option. Boston Acoustics, Inc., a Massachusetts corporation,
whose principal place of business is at 300 Jubilee Drive, Peabody,
Massachusetts 01960 (the "Company") hereby grants to [Optionee], an individual
whose address is set forth below the optionee signature line (the "Optionee"),
an option, pursuant to the Company's 1997 Stock Plan (the "Plan"), to purchase
an aggregate of [#] shares of common stock, without par value, of the Company
("Common Stock") at a price of $[#] per share, purchasable as set forth in and
subject to the terms and conditions of this option and the Plan. Except where
the context otherwise requires, the term "Company" shall include the parent and
all present and future subsidiaries of the Company as defined in Sections 424(e)
and 424(f) of the Internal Revenue Code of 1986, as amended or replaced from
time to time (the "Code"). The Plan has been approved by the stockholders of the
Company. All rights and obligations of the parties pursuant to this Option
Agreement are conditional and subject to such approval.
2. Incentive Stock Option. This option is intended to qualify as an
incentive stock option ("Incentive Stock Option") within the meaning of Section
422 of the Code. Any provision of this Agreement or the Plan which conflicts
with the Code is null and void and any ambiguities shall be resolved so that
this option qualifies as an Incentive Stock Option.
3. Exercise of Option and Provisions for Termination.
(a) Vesting Schedule. Except as otherwise provided in this Agreement,
this option may be exercised as to twenty percent (20%) of the total number of
shares from and after one year from the date of grant, as to forty percent (40%)
of the total number of shares from and after two years from the date of grant,
and as to sixty percent (60%) of the total number of shares from and after three
years from the date of grant, as to eighty percent (80%) of the total number of
shares from and after four years from date of grant, and as to the whole number
of shares from and after five years from the date of grant and prior to the
tenth anniversary of the date of grant (hereinafter the "Expiration Date").
(b) Exercise Procedure. Subject to the conditions set forth in this
Agreement, this option shall be exercised by the Optionee's delivery of written
notice of exercise to the Company, specifying the number of shares to be
purchased and the purchase price to be paid therefor and accompanied by payment
in full in accordance with Section 4. Such exercise shall be effective upon
receipt by the Company of such written notice together with the required
payment. The Optionee may purchase less than the number of shares covered
hereby, provided that no partial exercise of this option may be for any
fractional share or for less than one whole share.
(c) Continuous Employment Required. Except as otherwise provided in
this Section 3, this option may not be exercised unless the Optionee, at the
time he or she exercises this option, is, and has been at all times since the
date of grant of this option, an employee of the Company. For all purposes of
this option, (i) "employment" shall be defined
<PAGE>
in accordance with the provisions of Section 1.421-7(h) of the Income Tax
Regulations or any successor regulations, and (ii) if this option shall be
assumed or a new option substituted therefor in a transaction to which Section
424(a) of the Code applies, employment by such assuming or substituting
corporation (hereinafter called the "Successor Corporation") shall be considered
for all purposes of this option to be employment by the Company.
(d) Exercise Period Upon Termination of Employment. If the Optionee
ceases to be employed by the Company for any reason, then, except as provided in
paragraphs (e) and (f) below, the right to exercise this option shall terminate
three months after such cessation (but in no event after the Expiration Date),
provided that this option shall be exercisable only to the extent that the
Optionee was entitled to exercise this option on the date of such cessation.
(e) Exercise Period Upon Death or Disability. If the Optionee dies or
becomes disabled (within the meaning of Section 22(e)(3) of the Code) prior to
the Expiration Date while he or she is an employee of the Company, or if the
Optionee dies within three months after the Optionee ceases to be an employee of
the Company (other than as the result of a discharge for "cause" as specified in
paragraph (f) below), this option shall be exercisable, within the period of one
year following the date of death or disability of the Optionee (but in no event
after the Expiration Date), by the Optionee or by the person to whom this option
is transferred by will or the laws of descent and distribution, provided that
this option shall be exercisable only to the extent that this option was
exercisable by the Optionee on the date of his or her death or disability.
Except as otherwise indicated by the context, the term "Optionee", as used in
this option, shall be deemed to include the estate of the Optionee or any person
who acquires the right to exercise this option by bequest or inheritance or
otherwise by reason of the death of the Optionee.
(f) Discharge for Cause. If the Optionee, prior to the Expiration
Date, ceases his or her employment with the Company because he or she is
discharged for "cause" (as defined below), the right to exercise this option
shall terminate immediately upon such cessation of employment. "Cause" shall
mean willful misconduct in connection with the Optionee's employment or willful
failure to perform his or her employment responsibilities in the best interests
of the Company (including, without limitation, breach by the Optionee of any
provision of any employment, nondisclosure, non-competition or other similar
agreement between the Optionee and the Company), as determined by the Company,
which determination shall be conclusive.
4. Payment of Purchase Price
(a) Method of Payment. Payment of the purchase price for shares
purchased upon exercise of this option shall be made (i) by delivery to the
Company of cash or a certified or bank check to the order of the Company in an
amount equal to the purchase price of such shares, (ii) subject to the consent
of the Company, by delivery to the Company of shares of Common Stock of the
Company then owned by the Optionee having a fair market value equal in amount to
the purchase price of such shares, (iii) by any other means which the Board of
Directors determines are consistent with the purpose of the Plan and with
<PAGE>
applicable laws and regulations (including, without limitation, the provisions
of Rule 16b-3 under the Securities Exchange Act of 1934 and Regulation T
promulgated by the Federal Reserve Board), or (iv) by any combination of such
methods of payment.
(b) Valuation of Shares or Other Non-Cash Consideration Tendered in
Payment of Purchase Price. For the purposes hereof, unless a recognized market
value is available, the fair market value of any share of the Company's Common
Stock or other non-cash consideration which may be delivered to the Company in
exercise of this option shall be determined in good faith by the Board of
Directors of the Company.
(c) Delivery of Shares Tendered in Payment of Purchase Price. If the
Optionee exercises this option by delivery of shares of Common Stock of the
Company, the certificate or certificates representing the shares of Common Stock
of the Company to be delivered shall be duly executed in blank by the Optionee
or shall be accompanied by a stock power duly executed in blank suitable for
purposes of transferring such shares to the Company. Fractional shares of Common
Stock of the Company will not be accepted in payment of the purchase price of
shares acquired upon exercise of this option.
(d) Restrictions on Use of Option Stock. Notwithstanding the
foregoing, no shares of Common Stock of the Company may be tendered in payment
of the purchase price of shares purchased upon exercise of this option if the
shares to be so tendered were acquired within twelve (12) months before the date
of such tender through the exercise of an option granted under the Plan or any
other stock option or restricted stock plan of the Company.
5. Delivery of Shares; Compliance With Securities Laws, Etc.
(a) General. The Company shall, upon payment of the option price for
the number of shares purchased and paid for, make prompt delivery of such shares
to the Optionee, provided that if any law or regulation requires the Company to
take any action with respect to such shares before the issuance thereof, then
the date of delivery of such shares shall be extended for the period necessary
to complete such action.
(b) Listing, Qualification, Etc. This option shall be subject to the
requirement that if, at any time, counsel to the Company shall determine that
the listing, registration or qualification of the shares subject hereto upon any
securities exchange or under any state or federal law, or the consent or
approval of any governmental or regulatory body, or that the disclosure of
non-public information or the satisfaction of any other condition is necessary
as a condition of, or in connection with, the issuance or purchase of shares
hereunder, this option may not be exercised, in whole or in part, unless such
listing, registration, qualification, consent or approval, disclosure or
satisfaction of such other condition shall have been effected or obtained on
terms acceptable to the Board of Directors. Nothing herein shall be deemed to
require the Company to apply for, effect or obtain such listing, registration,
qualification, or disclosure, or to satisfy such other condition.
6. Nontransferability of Option. This option is personal and no rights
granted hereunder may be transferred, assigned, pledged or hypothecated in any
way (whether by
<PAGE>
operation of law or otherwise) nor shall any such rights be subject to
execution, attachment or similar process except that this option may be
transferred (i) as provided in paragraph (e) of Section 3 above or (ii) pursuant
to a qualified domestic relations order as defined in Section 414(p) of the
Code. Upon any attempt to transfer, assign, pledge, hypothecate or otherwise
dispose of this option or of such rights contrary to the provisions hereof, or
upon the levy of any attachment or similar process upon this option or such
rights, this option and such rights shall, at the election of the Company,
become null and void.
7. No Special Employment Rights. Nothing contained in the Plan or this
option shall be construed or deemed by any person under any circumstances to
bind the Company to continue the employment of the Optionee for the period
within which this option may be exercised, or for any other period.
8. Rights as a Shareholder. The Optionee shall have no rights as a
shareholder with respect to any shares which may be purchased by exercise of
this option (including, without limitation, any rights to receive dividends or
non-cash distributions with respect to such shares) unless and until a
certificate representing such shares is duly issued and delivered to the
Optionee. No adjustment shall be made for dividends or other rights for which
the record date is prior to the date such stock certificate is issued.
9. Adjustment Provisions
(a) General. If, through, or as a result of, any merger,
consolidation, sale of all or substantially all of the assets of the Company,
reorganization, recapitalization, reclassification, stock dividend, stock split,
reverse stock split or other similar transaction, (i) the outstanding shares of
Common Stock are increased or decreased or are exchanged for a different number
or kind of shares or other securities of the Company, or (ii) additional shares
or new or different shares or other securities of the Company or other non-cash
assets are distributed with respect to such shares of Common Stock or other
securities, the Optionee shall, with respect to this option or any unexercised
portion hereof, be entitled to the rights and benefits, and be subject to the
limitations, set forth in Section 15(a) of the Plan.
(b) Board Authority to Make Adjustments. Any adjustments under this
Section 9 will be made by the Board of Directors, whose determination as to what
adjustments, if any, will be made and the extent thereof will be final, binding
and conclusive. No fractional shares will be issued pursuant to this option on
account of any such adjustments.
(c) Limits on Adjustments. No adjustment shall be made under this
Section 9 which would, within the meaning of any applicable provision of the
Code, constitute a modification, extension or renewal of this option or a grant
of additional benefits to the Optionee.
10. Mergers, Consolidation, Distributions, Liquidations Etc. In the event
of a consolidation or merger or sale of all or substantially all of the assets
of the Company in which outstanding shares of Common Stock are exchanged for
securities, cash or other
<PAGE>
property of any other corporation or business entity, or in the event of a
liquidation of the Company, prior to the Expiration Date or termination of this
option, the Optionee shall, with respect to this option or any unexercised
portion hereof, be entitled to the rights and benefits, and be subject to the
limitations, set forth in Section 16 of the Plan.
11. Withholding Taxes. The Company's obligation to deliver shares of Common
Stock upon the exercise of this option shall be subject to the Optionee's
satisfaction of all applicable federal, state and local income and employment
tax withholding requirements. If the Company, in its discretion, determines that
it must or should withhold or pay over tax with respect to the exercise of an
option or a Disqualifying Disposition (as defined in Section 12 below) of shares
of Common Stock acquired by the Optionee on exercise of this option, the
Optionee hereby agrees that, at the option of the Company, Optionee will pay to
the Company or the Company may withhold from the Optionee's wages the
appropriate amount of federal, state and local withholding taxes attributable to
such Disqualifying Disposition. If any portion of this option is treated as a
non-qualified option, the Optionee hereby agrees that, at the option of the
Company, Optionee will pay to the Company or the Company may withhold from the
Optionee's wages the appropriate amount of federal, state and local withholding
taxes attributable to the Optionee's exercise of such non-qualified option. At
the Company's discretion, the amount required to be withheld may be withheld in
cash from such wages, or (with respect to compensation income attributable to
the exercise of this option) in kind from the Common Stock otherwise deliverable
to the Optionee on exercise of this Option. The Optionee further agrees that, if
the Company does not withhold an amount from the Optionee's wages sufficient to
satisfy the Company's withholding obligation, the Optionee will reimburse the
Company on demand, in cash, for the amount under withheld.
12. Disqualifying Disposition. Although the parties intend that this option
shall qualify as an Incentive Stock Option, if this option is determined not to
be an Incentive Stock Option, the Optionee understands that the Company is not
responsible to compensate the Optionee or otherwise make up for the treatment of
this option as a non-qualified stock option. The Optionee should consult with
the Optionee's own tax advisors regarding the tax effects of this option and the
requirements necessary to obtain favorable treatment under the Code, including,
but not limited to, holding period requirements. The Optionee agrees to notify
the Company in writing immediately after the Optionee makes a Disqualifying
Disposition of any shares of Common Stock acquired pursuant to the exercise of
this option. A Disqualifying Disposition is any disposition (whether by sale,
exchange, gift, transfer, or otherwise) of such shares before the later of (a)
two years after the date the Optionee was granted this option or (b) one year
after the date the Optionee acquired shares by exercising this option. If the
Optionee dies before such shares are sold, these holding period requirements do
not apply and no Disqualifying Disposition would occur. The Optionee also agrees
to provide the Company with any information which it shall request concerning
any such disposition. The Optionee acknowledges that he or she will forfeit the
favorable income tax treatment otherwise available with respect to the exercise
of this Incentive Stock Option if he or she makes a Disqualifying Disposition of
the shares acquired on exercise of this option.
13. Investment Representations; Legends
<PAGE>
(a) Representations. The Optionee represents, warrants and covenants
that:
(i) Any shares purchased upon exercise of this option shall be
acquired for the Optionee's account for investment only and not with a view to,
or for sale in connection with, any distribution of the shares in violation of
the Securities Act of 1933 (the "Securities Act") or any rule or regulation
under the Securities Act.
(ii) The Optionee has had such opportunity as he or she has
deemed adequate to obtain from representatives of the Company such information
as is necessary to permit the Optionee to evaluate the merits and risks of his
or her investment in the Company.
(iii) The Optionee is able to bear the economic risk of holding
shares acquired pursuant to the exercise of this option for an indefinite
period.
(iv) The Optionee understands that (A) the shares acquired
pursuant to the exercise of this option will not be registered under the
Securities Act and are "restricted securities" within the meaning of Rule 144
under the Securities Act; (B) such shares cannot be sold, transferred or
otherwise disposed of unless they are subsequently registered under the
Securities Act or an exemption from registration is then available; (C) in any
event, an exemption from registration under Rule 144 or otherwise under the
Securities Act may not be available for at least two years and even then will
not be available unless a public market then exists for the Common Stock,
adequate information concerning the Company is then available to the public and
other terms and conditions of Rule 144 are complied with; and (D) there is now
no registration statement on file with the Securities and Exchange Commission
with respect to any stock of the Company and the Company has no obligation or
current intention to register any shares acquired pursuant to the exercise of
this option under the Securities Act.
(v) The Optionee agrees that if the Company offers any of its
Common Stock for sale pursuant to a registration statement under the Securities
Act, the Optionee will not, without the prior written consent of the Company,
offer, sell, contract to sell or otherwise dispose of, directly or indirectly,
any shares purchased upon exercise of this option for a period of 90 days after
the effective date of such registration statement.
By making payment upon exercise of this option, the Optionee shall be
deemed to have reaffirmed, as of the date of such payment, the representations
made in this Section 13.
(b) Legends on Stock Certificates. All stock certificates representing
shares of Common Stock issued to the Optionee upon exercise of this option shall
have affixed thereto legends substantially in the following forms, in addition
to any other legends required by applicable law:
<PAGE>
"The shares of stock represented by this certificate have not
been registered under the Securities Act of 1933 and may not be
transferred, sold or otherwise disposed of in the absence of an
effective registration statement with respect to the shares
evidenced by this certificate, filed and made effective under the
Securities Act of 1933, or an opinion of counsel satisfactory to
the Company to the effect that registration under such Act is not
required."
14. Interpretation of this Agreement. All decisions and interpretations
made by the Committee, as defined in Section 2 of the Plan, with regard to any
question arising under the Plan or this Agreement shall be binding and
conclusive on the Company and the Optionee and any other person entitled to
exercise this option as provided herein. In the event there is any inconsistency
between the provisions of this Agreement and of the Plan, the provisions of the
Plan shall govern, except as provided in section 2 above.
15. Miscellaneous
(a) Except as provided herein, this option may not be amended or
otherwise modified unless evidenced in writing and signed by the Company and the
Optionee.
(b) All notices under this option shall be mailed or delivered by hand
to the parties at their respective addresses set forth beneath their names below
or at such other address as may be designated in writing by either of the
parties to one another.
(c) This option shall be governed by and construed in accordance with
the laws of The Commonwealth of Massachusetts.
Date of Grant:
---------------------------
BOSTON ACOUSTICS, INC.
By:
-------------------------------------
<PAGE>
OPTIONEE'S ACCEPTANCE
The undersigned hereby accepts the foregoing option and agrees to the terms
and conditions thereof. The undersigned hereby acknowledges receipt of a copy of
the Company's 1997 Stock Plan.
OPTIONEE
--------------------------------
[Optionee]
Address: --------------------------------
--------------------------------
<PAGE>
Alternative Vesting Provisions - Section 3(a)
Vesting in equal installments over four years:
3. Exercise of Option and Provisions for Termination.
(a) Vesting Schedule. Except as otherwise provided in this Agreement,
this option may be exercised as to twenty-five percent (25%) of the total number
of shares from and after one year from the date of grant, as to fifty percent
(50%) of the total number of shares from and after two years from the date of
grant, and as to seventy-five percent (75%) of the total number of shares from
and after three years from the date of grant, and as to the whole number of
shares from and after four years from the date of grant and prior to the tenth
anniversary of the date of grant (hereinafter the "Expiration Date").
Vesting in equal installments over three years:
3. Exercise of Option and Provisions for Termination.
(a) Vesting Schedule. Except as otherwise provided in this Agreement,
this option may be exercised as to thirty-three percent (33%) of the total
number of shares from and after one year from the date of grant, as to sixty-six
percent (66%) of the total number of shares from and after two years from the
date of grant, and as to the whole number of shares from and after three years
from the date of grant and prior to the tenth anniversary of the date of grant
(hereinafter the "Expiration Date").
Vesting in equal installments over two years:
3. Exercise of Option and Provisions for Termination.
(a) Vesting Schedule. Except as otherwise provided in this Agreement,
this option may be exercised as to fifty percent (50%) of the total number of
shares from and after one year from the date of grant, and as to the whole
number of shares from and after two years from the date of grant and prior to
the tenth anniversary of the date of grant (hereinafter the "Expiration Date").
<PAGE>
Alternative Vesting Provisions - Section 10
Acceleration according to formula:
10. Merger, Consolidation, Asset Sale, Liquidation, etc.
Upon any merger, consolidation, sale of all (or substantially all) of the
assets of the Company, or other business combination involving the sale or
transfer of all (or substantially all) of the capital stock or assets of the
Company in which the Company is not the surviving entity, does not survive as an
operating going concern in substantially the same line of business (an
"Acquisition"), prior to the Expiration Date or termination of this option, the
Optionee shall, with respect to this option or any unexercised portion hereof,
be entitled to the rights and benefits, and be subject to the limitations, set
forth in Section 16 of the Plan.
<PAGE>
Exhibit 4.4
BOSTON ACOUSTICS, INC.
NON-STATUTORY STOCK OPTION AGREEMENT
1. Grant of Option. Boston Acoustics, Inc., a Massachusetts corporation,
whose principal place of business is at 300 Jubilee Drive, Peabody,
Massachusetts 01960 (the "Company") hereby grants to [Optionee], an individual
whose address is set forth below the optionee signature line (the "Optionee"),
an option, pursuant to the Company's 1997 Stock Plan (the "Plan"), to purchase
an aggregate of [#] shares of common stock, without par value, of the Company
("Common Stock") at a price of $[#] per share, purchasable as set forth in and
subject to the terms and conditions of this option and the Plan. Except where
the context otherwise requires, the term "Company" shall include the parent and
all present and future subsidiaries of the Company as defined in Sections 424(e)
and 424(f) of the Internal Revenue Code of 1986, as amended or replaced from
time to time (the "Code"). The Plan has been approved by the stockholders of the
Company. All rights and obligations of the parties pursuant to this Option
Agreement are conditional and subject to such approval.
2. Non-Statutory Stock Option. This option not is intended to qualify as an
incentive stock option within the meaning of Section 422 of the Code.
3. Exercise of Option and Provisions for Termination.
(a) Vesting Schedule. Except as otherwise provided in this Agreement,
this option may be exercised as to twenty percent (20%) of the total number of
shares from and after one year from the date of grant, as to forty percent (40%)
of the total number of shares from and after two years from the date of grant,
and as to sixty percent (60%) of the total number of shares from and after three
years from the date of grant, as to eighty percent (80%) of the total number of
shares from and after four years from date of grant, and as to the whole number
of shares from and after five years from the date of grant and prior to the
tenth anniversary of the date of grant (hereinafter the "Expiration Date").
(b) Exercise Procedure. Subject to the conditions set forth in this
Agreement, this option shall be exercised by the Optionee's delivery of written
notice of exercise to the Company, specifying the number of shares to be
purchased and the purchase price to be paid therefor and accompanied by payment
in full in accordance with Section 4. Such exercise shall be effective upon
receipt by the Company of such written notice together with the required
payment. The Optionee may purchase less than the number of shares covered
hereby, provided that no partial exercise of this option may be for any
fractional share or for less than one whole share.
(c) Continuous Relationship with Company Required. Except as otherwise
provided in this Section 3, this option may not be exercised unless the
Optionee, at the time he or she exercises this option, is, and has been at all
times since the date of grant of this option, an employee, officer or director
of, or consultant or advisor to, the Company (an "Eligible Optionee").
<PAGE>
(d) Exercise Period Upon Termination of Relationship with the Company.
If the Optionee ceases to be an Eligible Employee for any reason, then, except
as provided in paragraphs (e) and (f) below, the right to exercise this option
shall terminate [time period] after such cessation (but in no event after the
Expiration Date), provided that this option shall be exercisable only to the
extent that the Optionee was entitled to exercise this option on the date of
such cessation. Notwithstanding the foregoing, if the Optionee, prior to the
Expiration Date, materially violates any non-competition or confidentiality
provisions of any agreement between the Optionee and the Company, the right to
exercise this option shall terminate immediately upon such violation.
(e) Exercise Period Upon Death or Disability. If the Optionee dies or
becomes disabled (within the meaning of Section 22(e)(3) of the Code) prior to
the Expiration Date while he or she is an employee of the Company, or if the
Optionee dies within three months after the Optionee ceases to be an employee of
the Company (other than as the result of a discharge for "cause" as specified in
paragraph (f) below), this option shall be exercisable, within the period of
[time period] following the date of death or disability of the Optionee (but in
no event after the Expiration Date), by the Optionee or by the person to whom
this option is transferred by will or the laws of descent and distribution,
provided that this option shall be exercisable only to the extent that this
option was exercisable by the Optionee on the date of his or her death or
disability. Except as otherwise indicated by the context, the term "Optionee",
as used in this option, shall be deemed to include the estate of the Optionee or
any person who acquires the right to exercise this option by bequest or
inheritance or otherwise by reason of the death of the Optionee.
(f) Discharge for Cause. If the Optionee, prior to the Expiration
Date, ceases his or her employment with the Company because he or she is
discharged for "cause" (as defined below), the right to exercise this option
shall terminate immediately upon such cessation of employment. "Cause" shall
mean willful misconduct in connection with the Optionee's employment or willful
failure to perform his or her employment responsibilities in the best interests
of the Company (including, without limitation, breach by the Optionee of any
provision of any employment, nondisclosure, non-competition or other similar
agreement between the Optionee and the Company), as determined by the Company,
which determination shall be conclusive.
4. Payment of Purchase Price
(a) Method of Payment. Payment of the purchase price for shares
purchased upon exercise of this option shall be made (i) by delivery to the
Company of cash or a certified or bank check to the order of the Company in an
amount equal to the purchase price of such shares, (ii) subject to the consent
of the Company, by delivery to the Company of shares of Common Stock of the
Company then owned by the Optionee having a fair market value equal in amount to
the purchase price of such shares, (iii) by any other means which the Board of
Directors determines are consistent with the purpose of the Plan and with
applicable laws and regulations (including, without limitation, the provisions
of Rule 16b-3 under the Securities Exchange Act of 1934 and Regulation T
promulgated by the Federal Reserve Board), or (iv) by any combination of such
methods of payment.
<PAGE>
(b) Valuation of Shares or Other Non-Cash Consideration Tendered in
Payment of Purchase Price. For the purposes hereof, unless a recognized market
value is available, the fair market value of any share of the Company's Common
Stock or other non-cash consideration which may be delivered to the Company in
exercise of this option shall be determined in good faith by the Board of
Directors of the Company.
(c) Delivery of Shares Tendered in Payment of Purchase Price. If the
Optionee exercises this option by delivery of shares of Common Stock of the
Company, the certificate or certificates representing the shares of Common Stock
of the Company to be delivered shall be duly executed in blank by the Optionee
or shall be accompanied by a stock power duly executed in blank suitable for
purposes of transferring such shares to the Company. Fractional shares of Common
Stock of the Company will not be accepted in payment of the purchase price of
shares acquired upon exercise of this option.
(d) Restrictions on Use of Option Stock. Notwithstanding the
foregoing, no shares of Common Stock of the Company may be tendered in payment
of the purchase price of shares purchased upon exercise of this option if the
shares to be so tendered were acquired within twelve (12) months before the date
of such tender through the exercise of an option granted under the Plan or any
other stock option or restricted stock plan of the Company.
5. Delivery of Shares; Compliance With Securities Laws, Etc.
(a) General. The Company shall, upon payment of the option price for
the number of shares purchased and paid for, make prompt delivery of such shares
to the Optionee, provided that if any law or regulation requires the Company to
take any action with respect to such shares before the issuance thereof, then
the date of delivery of such shares shall be extended for the period necessary
to complete such action.
(b) Listing, Qualification, Etc. This option shall be subject to the
requirement that if, at any time, counsel to the Company shall determine that
the listing, registration or qualification of the shares subject hereto upon any
securities exchange or under any state or federal law, or the consent or
approval of any governmental or regulatory body, or that the disclosure of
non-public information or the satisfaction of any other condition is necessary
as a condition of, or in connection with, the issuance or purchase of shares
hereunder, this option may not be exercised, in whole or in part, unless such
listing, registration, qualification, consent or approval, disclosure or
satisfaction of such other condition shall have been effected or obtained on
terms acceptable to the Board of Directors. Nothing herein shall be deemed to
require the Company to apply for, effect or obtain such listing, registration,
qualification, or disclosure, or to satisfy such other condition.
6. Nontransferability of Option. This option is personal and no rights
granted hereunder may be transferred, assigned, pledged or hypothecated in any
way (whether by operation of law or otherwise) nor shall any such rights be
subject to execution, attachment or similar process except that this option may
be transferred (i) as provided in paragraph (e) of Section 3 above or (ii)
pursuant to a qualified domestic relations order as defined in Section 414(p) of
the Code. Upon any attempt to transfer, assign, pledge, hypothecate or otherwise
<PAGE>
dispose of this option or of such rights contrary to the provisions hereof, or
upon the levy of any attachment or similar process upon this option or such
rights, this option and such rights shall, at the election of the Company,
become null and void.
7. No Special Employment Rights. Nothing contained in the Plan or this
option shall be construed or deemed by any person under any circumstances to
bind the Company to continue the employment of the Optionee for the period
within which this option may be exercised, or for any other period.
8. Rights as a Shareholder. The Optionee shall have no rights as a
shareholder with respect to any shares which may be purchased by exercise of
this option (including, without limitation, any rights to receive dividends or
non-cash distributions with respect to such shares) unless and until a
certificate representing such shares is duly issued and delivered to the
Optionee. No adjustment shall be made for dividends or other rights for which
the record date is prior to the date such stock certificate is issued.
9. Adjustment Provisions
(a) General. If, through, or as a result of, any merger,
consolidation, sale of all or substantially all of the assets of the Company,
reorganization, recapitalization, reclassification, stock dividend, stock split,
reverse stock split or other similar transaction, (i) the outstanding shares of
Common Stock are increased or decreased or are exchanged for a different number
or kind of shares or other securities of the Company, or (ii) additional shares
or new or different shares or other securities of the Company or other non-cash
assets are distributed with respect to such shares of Common Stock or other
securities, the Optionee shall, with respect to this option or any unexercised
portion hereof, be entitled to the rights and benefits, and be subject to the
limitations, set forth in Section 15(a) of the Plan.
(b) Board Authority to Make Adjustments. Any adjustments under this
Section 9 will be made by the Board of Directors, whose determination as to what
adjustments, if any, will be made and the extent thereof will be final, binding
and conclusive. No fractional shares will be issued pursuant to this option on
account of any such adjustments.
10. Mergers, Consolidation, Distributions, Liquidations Etc. In the event
of a consolidation or merger or sale of all or substantially all of the assets
of the Company in which outstanding shares of Common Stock are exchanged for
securities, cash or other property of any other corporation or business entity,
or in the event of a liquidation of the Company, prior to the Expiration Date or
termination of this option, the Optionee shall, with respect to this option or
any unexercised portion hereof, be entitled to the rights and benefits, and be
subject to the limitations, set forth in Section 16 of the Plan.
[In the event of a merger or consolidation in which the Company is not the
surviving corporation, or in the event of the acquisition of more than 50% of
the Company's outstanding capital stock by a single person, entity or group of
persons or entities acting in
<PAGE>
concert, or in the event of the sale or transfer of all or substantially all of
the assets of the Company, or in the event that the Company ceases operations,
prior to the termination of this option or the Expiration Date, this option
shall become exercisable in full immediately prior to such event.
Notwithstanding any other provision of this Agreement, this option shall not be
subject to accelerated vesting if, but only to the extent that, such
acceleration would, taking into account any other consideration to be received
by the Optionee from the Company, cause the optionee to be in receipt of an
excess parachute payment as defined in 280G of the Code.]
11. Withholding Taxes. The Company's obligation to deliver shares of Common
Stock upon the exercise of this option shall be subject to the Optionee's
satisfaction of all applicable federal, state and local income and employment
tax withholding requirements.
12. Investment Representations; Legends
(a) Representations. The Optionee represents, warrants and covenants
that:
(i) Any shares purchased upon exercise of this option shall be
acquired for the Optionee's account for investment only and not with a view
to, or for sale in connection with, any distribution of the shares in
violation of the Securities Act of 1933 (the "Securities Act") or any rule
or regulation under the Securities Act.
(ii) The Optionee has had such opportunity as he or she has
deemed adequate to obtain from representatives of the Company such
information as is necessary to permit the Optionee to evaluate the merits
and risks of his or her investment in the Company.
(iii) The Optionee is able to bear the economic risk of holding
shares acquired pursuant to the exercise of this option for an indefinite
period.
(iv) The Optionee understands that (A) the shares acquired
pursuant to the exercise of this option will not be registered under the
Securities Act and are "restricted securities" within the meaning of Rule
144 under the Securities Act; (B) such shares cannot be sold, transferred
or otherwise disposed of unless they are subsequently registered under the
Securities Act or an exemption from registration is then available; (C) in
any event, an exemption from registration under Rule 144 or otherwise under
the Securities Act may not be available for at least two years and even
then will not be available unless a public market then exists for the
Common Stock, adequate information concerning the Company is then available
to the public and other terms and conditions of Rule 144 are complied with;
and (D) there is now no registration statement on file with the Securities
and Exchange Commission with respect to any stock of the Company and the
Company has no obligation or current intention to register any shares
acquired pursuant to the exercise of this option under the Securities Act.
<PAGE>
(v) The Optionee agrees that if the Company offers any of its
Common Stock for sale pursuant to a registration statement under the
Securities Act, the Optionee will not, without the prior written consent of
the Company, offer, sell, contract to sell or otherwise dispose of,
directly or indirectly, any shares purchased upon exercise of this option
for a period of 90 days after the effective date of such registration
statement.
By making payment upon exercise of this option, the Optionee shall be
deemed to have reaffirmed, as of the date of such payment, the representations
made in this Section 12.
(b) Legends on Stock Certificates. All stock certificates representing
shares of Common Stock issued to the Optionee upon exercise of this option shall
have affixed thereto legends substantially in the following forms, in addition
to any other legends required by applicable law:
"The shares of stock represented by this certificate have not
been registered under the Securities Act of 1933 and may not be
transferred, sold or otherwise disposed of in the absence of an
effective registration statement with respect to the shares
evidenced by this certificate, filed and made effective under the
Securities Act of 1933, or an opinion of counsel satisfactory to
the Company to the effect that registration under such Act is not
required."
13. Interpretation of this Agreement. All decisions and interpretations
made by the Committee, as defined in Section 2 of the Plan, with regard to any
question arising under the Plan or this Agreement shall be binding and
conclusive on the Company and the Optionee and any other person entitled to
exercise this option as provided herein. In the event there is any inconsistency
between the provisions of this Agreement and of the Plan, the provisions of the
Plan shall govern.
14. Miscellaneous
(a) Except as provided herein, this option may not be amended or
otherwise modified unless evidenced in writing and signed by the Company and the
Optionee.
(b) All notices under this option shall be mailed or delivered by hand
to the parties at their respective addresses set forth beneath their names below
or at such other address as may be designated in writing by either of the
parties to one another.
<PAGE>
(c) This option shall be governed by and construed in accordance with
the laws of The Commonwealth of Massachusetts.
Date of Grant:
----------------------
BOSTON ACOUSTICS, INC.
By:
--------------------------------------
<PAGE>
Exhibit 5.1
[letterhead]
(617) 951-2100
August 28, 1998
Boston Acoustics, Inc.
300 Jubilee Drive
Peabody, MA 01960
Re: Registration Statement on Form S-8 Relating to the 1996 Stock Plan and
the 1997 Stock Plan (collectively, the "Plans") of Boston Acoustics,
Inc. (the "Company")
Dear Sir or Madam:
Reference is made to the above-captioned Registration Statement on Form
S-8 (the "Registration Statement") filed by the Company on or about August 28,
1998 with the Securities and Exchange Commission under the Securities Act of
1933, as amended, relating to an aggregate of 738,000 shares of Common Stock,
$.01 par value per share, of the Company issuable pursuant to the Plans (the
"Shares").
We have examined, are familiar with, and have relied as to factual
matters solely upon, copies of the Plans, the Restated Articles of Organization
and the By-Laws of the Company, the minute books and stock records of the
Company and originals of such other documents, certificates and proceedings as
we have deemed necessary for the purpose of rendering this opinion.
Based on the foregoing, we are of the opinion that the Shares have been
duly authorized and, when issued and paid for in accordance with the terms of
the Plans, the terms of any option or purchase right granted thereunder and duly
authorized by the Company's Board of Directors or Compensation Committee and/or
any related agreements with the Company, will be validly issued, fully paid and
nonassessable.
<PAGE>
Boston Acoustics, Inc.
August 26, 1998
Page 2
We consent to the use of this opinion as an exhibit to the Registration
Statement, and further consent to the use of our name wherever appearing in the
Registration Statement and any amendments thereto.
Very truly yours,
/s/ Peabody & Arnold LLP
Peabody & Arnold LLP
<PAGE>
ARTHUR ANDERSEN LLP
Exhibit 23.1
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the use of our
reports (and to all references to our firm) included in or made a part of
this registration statement.
/s/ Arthur Andersen LLP
ARTHUR ANDERSEN LLP
Boston, Massachusetts
August 28, 1998
