As filed with the Securities and Exchange Commission on June 24,1997
Registration No. 333-
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
______________________
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
______________________
ADVANCED TECHNOLOGY LABORATORIES, INC.
(Exact name of Registrant as specified in its charter)
Washington 91-1353386
(State or other jurisdiction of (I.R.S. Employer Identification
incorporation or organization) No.)
22100 Bothell Everett Highway
P.O. Box 3003
Bothell, WA 98041-3003
(Address of principal executive offices, including zip code)
AMENDED 1992 NONOFFICER EMPLOYEE STOCK OPTION PLAN
EMPLOYEE STOCK PURCHASE PLAN
(Full title of the plan)
W. BRINTON YORKS, Jr.
Vice President, General Counsel and Secretary
ADVANCED TECHNOLOGY LABORATORIES, INC.
22100 Bothell-Everett Highway
P.O. Box 3003
Bothell, WA 98041-3003
(425) 487-7000
(Name, address and telephone number, including area code, of
agent for service)
__________________
CALCULATION OF REGISTRATION FEE
Proposed Proposed
Title of Maximum Maximum
Securities Number to Offering Aggregate Amount of
to Be be Price Per Offering Registration
Registered Registered Share(1) Price(1) Fee
- ---------- ---------- -------- ---------- ------------
Common Stock,
par value
$.01 per Share 350,000(2) $41.375 $14,481,250 $4,388.26
(1) Estimated solely for the purpose of calculating the registration
fee pursuant to Rule 457(h). The price per share is estimated to
be $41.375 based on the average of the high and low prices for
the Common Stock in the over-the-counter market on June 23, 1997
as reported on the Nasdaq National Market.
(2) Of this number, 50,000 are being registered for issuance pursuant
to the Amended 1992 Nonofficer Employee Stock Option Plan and
300,000 are being registered for issuance pursuant to the
Employee Stock Purchase Plan. In addition to this number of
shares, an indeterminate number of additional shares which may be
necessary to adjust the number of shares reserved for issuance
pursuant to such plans as the result of any future stock split,
stock dividend or similar adjustment of the outstanding Common
Stock of the Registrant.
Page 1 of 29
Exhibit Index is on page 6
<PAGE>
REGISTRATION OF ADDITIONAL SECURITIES
Pursuant to General Instruction E, this registration
statement on Form S-8 is filed by Advanced Technology
Laboratories, Inc. (the "Registrant") to register additional
securities under the Plans described in Registration
Statement Nos. 33-54757 (including post-effective Amendment
No.1 thereto (the "Post-Effective Amendment")), 33-59914, 33-
61807 and 333-08881, to be issued pursuant to an amendment
and adoption of the Plans by the Registrant's Board of
Directors on February 26, 1997 and May 7, 1997, and by the
Registrant's Shareholders on May 7, 1997. Portions of
Registration Statement 33-54757, 33-59914, 33-61807 and 333-
08881 and the Post-Effective Amendment are incorporated
herein by reference.
PART II
INFORMATION REQUIRED IN REGISTRATION STATEMENT
Item 3. INCORPORATION OF CERTAIN DOCUMENTS BY
REFERENCE
The following documents are hereby incorporated by reference
in this Registration Statement:
(a) The Registrant's Annual Report on Form 10-K
for the year ended December 31, 1996 filed on March 28,
1997;
(b) All other reports filed by the Registrant
pursuant to Section 13(a) or 15(d) of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), since
the end of the fiscal year covered by the Annual Report
referred to in (a) above;
(c) The description of the Registrant's Common
Stock contained in the Current Report on Form 8-K filed on
January 11, 1996; and
(d) The description of the Registrant's Common
Stock contained in the Registration Statement on Form 10
(Registration No. 0-15160) filed with the Commission on
November 12, 1986 under Section 12(g) of the Exchange Act,
and any amendment or report filed for the purpose of
updating such description.
All documents filed by the Registrant pursuant to
Sections 13(a), 13(c), 14 and 15(d) of the Exchange Act
after the date hereof, and prior to the filing of a post-
effective amendment which indicates that the securities
offered hereby have been sold or which deregisters the
securities covered hereby then remaining unsold, shall also
be deemed to be incorporated by reference into this
Registration Statement and to be a part hereof commencing on
the respective dates on which such documents are filed.
Item 4. Not Applicable
Item 5. Not Applicable
Item 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Incorporated herein by reference to the Post-Effective
Amendment on Form S-8, filed with the Commission on August
11, 1995 under Registration Statement No. 33-54757.
Item 7. Not Applicable
2
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Item 8. EXHIBITS
Exhibit
Number Description
------- ------------------------------------------
5.1 Opinion of Bogle & Gates P.L.L.C.
10.1 Amended 1992 Nonofficer Employee Stock
Option Plan
10.2 Employee Stock Purchase Plan
23.1 Consent of KPMG Peat Marwick LLP
23.2 Consent of Bogle & Gates P.L.L.C. (included
in opinion filed as Exhibit 5.1)
24.1 Power of Attorney (see signature page)
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, as amended (the
"Securities Act");
(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. Notwithstanding the foregoing, any
increase or decrease in volume of securities offered (if the
total dollar value of securities offered would not exceed
that which was registered) and any deviation from the low or
high and of the estimated maximum offering range may be
reflected in the form of prospectus filed with the
Commission pursuant to Rule 424(b) if in the aggregate, the
changes in volume and price represent no more than a 20
percent change in the maximum aggregate offering price set
forth in the "Calculation of Registration Fee" table in the
effective registration statement;
(iii) To include any material information with
respect to the plan of distribution not previously disclosed
in 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)
- -------- -------
above do not apply if the registration statement is on Form
S-8 or Form S-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 Exchange Act that are incorporated by
reference in this Registration Statement.
Undertakings pursuant to Regulation S-K Rule 512(b) and
(h) are incorporated by reference to Registration Statement
Nos. 33-54757, 33-59914, 33-61807 and 333-08881 and the Post-
Effective Amendment.
3
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The Registrant. 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
Bothell, State of Washington, on this 24th day of
June, 1997.
ADVANCED TECHNOLOGY
LABORATORIES INC.
By /s/ Dennis C. Fill
-------------------------
Dennis C. Fill, Chairman
and Chief Executive Officer
The Plan. Solely with respect to the Registrant's
--------
Employee Stock Purchase Plan and pursuant to the
requirements of the Securities Act of 1933, the trustees (or
other persons who administer the employee benefit plan) have
duly caused this Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the
City of Bothell, State of Washington, on this 24th day of
June, 1997.
EMPLOYEE STOCK
PURCHASE PLAN
By /s/ Harvey N. Gillis
------------------------
Harvey N. Gillis, Senior
Vice President
and Chief Financial Officer
POWER OF ATTORNEY
Each person whose signature appears below constitutes
and appoints Dennis C. Fill and W. Brinton Yorks, Jr., and
each of them, his true and lawful attorneys-in-fact and
agents, with full power of substitution, for him and in his
name, place and stead, in any and all capacities, to sign
any amendments to the Registration Statements, and to file
the same, with exhibits thereto and other documents in
connection therewith, with the Securities and Exchange
Commission, hereby ratifying and confirming all that said
attorneys-in-fact, or their substitute or substitutes, may
do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of
1933, this Registration Statement has been signed by the
following persons in the capacities and on the date
indicated on June 24, 1997.
Signature Title
/s/ Dennis C. Fill Chairman of the Board, Chief
---------------------- Executive Officer
Dennis C. Fill
/s/ Harvey N. Gillis Senior Vice President, Chief
---------------------- Financial Officer (Principal
Harvey N. Gillis Financial Officer)
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/s/ Kirby L. Cramer Director
----------------------
Kirby L. Cramer
/s/ Harvey Feigenbaum Director
----------------------
Harvey Feigenbaum, M.D.
/s/ Eugene A. Larson Director
--------------------
Eugene A. Larson
/s/ Ernest Mario Director
--------------------
Ernest Mario, Ph.D.
/s/ John R. Miller Director
--------------------
John R. Miller
/s/ Phillip M. Nudelman Director
-----------------------
Phillip M. Nudelman, Ph.D.
/s/ Harry Woolf Director
--------------------
Harry Woolf, Ph.D.
/s/ Richard S. Totorica Vice President and Corporate
----------------------- Controller (Principal Accounting
Richard S. Totorica Officer)
5
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INDEX TO EXHIBITS
Sequentially
Exhibit Numbered
Number Description Page
------- -------------------------------------- --------
5.1 Opinion of Bogle & Gates P.L.L.C. 7
10.1 Amended 1992 Nonofficer Employee Stock 8 - 22
Option Plan
10.2 Employee Stock Purchase Plan 23 - 28
23.1 Consent of KPMG Peat Marwick LLP 29
23.2 Consent of Bogle & Gates P.L.L.C.(included
in opinion filed as Exhibit 5.1)
24.1 Power of Attorney (see signature page)
6
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Bogle & Gates P.L.L.C. Letterhead Exhibit 5.1
June 24, 1997
Advanced Technology Laboratories, Inc.
22100 Bothell Everett Highway
Bothell, WA 98041-3003
Gentlemen and Ladies:
We are acting as counsel to Advanced TechnologyLaboratories, Inc., a
Washington corporation (the "Company"), in connection with the filing of
a registration statement on Form S-8 (the "Registration Statement") under
the Securities Act of 1933, as amended, with the Securities and Exchange
Commission, relating to the proposed sale by the Company of an aggregate
of 350,000 shares of its common stock, par value $0.01 per share (the
"Common Stock"), issuable pursuant to the Company's Amended 1992 Nonofficer
Employee Stock Option Plan, and the Employee Stock Purchase
Plan.
In connection with the foregoing, we are of the opinion that the
Common Stock will, when sold, be legally issued, fully paid and nonassessable.
We hereby authorize and consent to the use of this opinion as Exhibit
5.1 to the Registration Statement.
Very truly yours,
Bogle & Gates P.L.L.C.
Exhibit 10.1
February 26, 1997
ADVANCED TECHNOLOGY LABORATORIES, INC.
1992 Nonofficer Employee Stock Option Plan
1. Definitions
The following terms have the corresponding meanings
for purposes of the Plan:
"Change of Control" means
(a) a "Board Change." For purposes of the Plan, a
Board Change shall have occurred if a majority of the seats
(other than vacant seats) on the Corporation's Board of
Directors (the "Board") were to be occupied by individuals
who were neither (i) nominated by a majority of the
Incumbent Directors nor (ii) appointed by directors so
nominated. An "Incumbent Director" is a member of the Board
who has been either (i) nominated by a majority of the
directors of the Corporation then in office or (ii)
appointed by directors so nominated, but excluding, for this
purpose, any such individual whose initial assumption of
office occurs as a result of either an actual or threatened
election contest (as such terms are used in Rule 14a-11 of
Regulation 14A promulgated under the Securities Exchange Act
of 1934, as amended (the "Exchange Act")) or other actual or
threatened solicitation of proxies or consents by or on
behalf of a Person other than the Board; or
(b) the acquisition by any individual, entity or group
(within the meaning of Section 13(d)(3) or 14(d)(2) of the
Exchange Act) (a "Person") of "Beneficial Ownership" (within
the meaning of Rule 13d-3 promulgated under the Exchange
Act) of (i) 20% or more of either (A) the then outstanding
shares of common stock (the "Outstanding Corporation Common
Stock") or (B) the combined voting power of the then
outstanding voting securities of the Corporation entitled to
vote generally in the election of directors (the
"Outstanding Corporation Voting Securities"), in the case of
either (A) or (B) of this clause (i), which acquisition is
not approved in advance by a majority of the Incumbent
Directors or (ii) 33% or more of either (A) the Outstanding
Corporation Common Stock or (B) the Outstanding Corporation
Voting Securities, in the case of either (A) or (B) of this
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clause (ii), which acquisition is approved in advance by a
majority of the Incumbent Directors; provided, however, that
the following acquisitions shall not constitute a Change of
Control: (x) any acquisition by the Corporation, (y) any
acquisition by any employee benefit plan (or related trust)
sponsored or maintained by the Corporation or any
corporation controlled by the Corporation, or (z) any
acquisition by any corporation pursuant to a reorganization,
merger or consolidation, if, following such reorganization,
merger or consolidation, the conditions described in clauses
(i), (ii) and (iii) of the following subsection (c) are
satisfied; or
(c) approval by the stockholders of the Corporation of
a reorganization, merger or consolidation, in each case,
unless, immediately following such reorganization, merger or
consolidation, (i) more than 60% of, respectively, the then
outstanding shares of common stock of the corporation
resulting from such reorganization, merger or consolidation
and the combined voting power of the then outstanding voting
securities of such corporation entitled to vote generally in
the election of directors is then beneficially owned,
directly or indirectly, by all or substantially all of the
individuals and entities who were the beneficial owners,
respectively, of the Outstanding Corporation Common Stock
and Outstanding Corporation Voting Securities immediately
prior to such reorganization, merger or consolidation in
substantially the same proportions as their ownership,
immediately prior to such reorganization, merger or
consolidation, of the Outstanding Corporation Common Stock
and Outstanding Corporation Voting Securities, as the case
may be, (ii) no Person (excluding the Corporation, any
employee benefit plan (or related trust) of the Corporation
or such corporation resulting from such reorganization,
merger or consolidation and any Person beneficially owning,
immediately prior to such reorganization, merger or
consolidation, directly or indirectly, 33% or more of the
Outstanding Corporation Common Stock or Outstanding
Corporation Voting Securities, as the case may be)
beneficially owns, directly or indirectly, 33% or more of,
respectively, the then outstanding shares of common stock of
the corporation resulting from such reorganization, merger
or consolidation or the combined voting power of the then
outstanding voting securities of such corporation entitled
to vote generally in the election of directors, and (iii)
at least a majority of the members of the board of directors
of the corporation resulting from such reorganization,
merger or consolidation were Incumbent Directors at the time
of the execution of the initial agreement providing for such
reorganization, merger or consolidation; or
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(d) approval by the stockholders of the Corporation of
(i) a complete liquidation or dissolution of the Corporation
or (ii) the sale or other disposition of all or
substantially all of the assets of the Corporation, other
than to a corporation, with respect to which immediately
following such sale or other disposition, (A) more than 60%
of, respectively, the then outstanding shares of common
stock of such corporation and the combined voting power of
the then outstanding voting securities of such corporation
entitled to vote generally in the election of directors is
then beneficially owned, directly or indirectly, by all or
substantially all of the individuals and entities who were
the beneficial owners, respectively, of the Outstanding
Corporation Common Stock and Outstanding Corporation Voting
Securities immediately prior to such sale or other
disposition in substantially the same proportion as their
ownership, immediately prior to such sale or other
disposition, of the Outstanding Corporation Common Stock and
Outstanding Corporation Voting Securities, as the case may
be, (B) no Person (excluding the Corporation and any
employee benefit plan (or related trust) of the Corporation
or such corporation and any Person beneficially owning,
immediately prior to such sale or other disposition,
directly or indirectly, 33% or more of the Outstanding
Corporation Common Stock or Outstanding Corporation Voting
Securities, as the case may be) beneficially owns, directly
or indirectly, 33% or more of, respectively, the then
outstanding shares of common stock of such corporation and
the combined voting power of the then outstanding voting
securities of such corporation entitled to vote generally in
the election of directors, and (C) at least a majority of
the members of the board of directors of such corporation
were approved by a majority of the Incumbent Directors at
the time of the execution of the initial agreement or action
of the Board providing for such sale or other disposition of
assets of the Corporation.
"Committee" means the Committee provided for in Section
4, which shall administer the Plan.
"Common Stock" means common stock, par value $0.01 per
share, of the Corporation.
"Corporation" means Advanced Technology Laboratories,
Inc., a Delaware corporation.
"Designated Beneficiary" means any person designated in
writing by a Participant as a legal recipient of payments
due under an award in the event of the Participant's death,
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or in the absence of such designation, the Participant's
estate. Such designation must be on file with the
Corporation in order to be effective but, unless the
Participant has made an irrevocable designation, may be
changed from time to time by the Participant.
"Fair Market Value" of the Common Stock as of any
trading day means the average (rounded to the next highest
cent in the case of fractions of a cent) of the high and low
sales prices of the Common Stock as reported on such trading
day by the NASDAQ National Market System. If no sales price
is reported for the Common Stock on such trading day, then
"Fair Market Value" shall mean the highest bid price
reported for the Common Stock on such trading day by the
National Quotation Bureau Incorporated or any similar
nationally recognized organization. The Committee, in its
sole discretion, shall make all determinations required by
this definition.
"Participant" means an employee who has received an
award under the Plan.
"Plan" means this Advanced Technology Laboratories,
Inc. 1992 Nonofficer Employee Stock Option Plan.
"Retirement" means the termination of the services of a
Participant because of early or normal retirement as defined
in the Westmark Retirement Plan.
"Withholding Tax" means any tax, including any federal,
state or local income tax or payroll tax, required by any
governmental entity to be withheld or otherwise deducted and
paid with respect to the transfer of shares of Common Stock
as a result of the exercise of an option.
2. Stock Subject to the Plan
There are reserved for issuance upon the exercise of
options under the Plan 370,000 shares of Common Stock. Such
shares may be authorized and unissued shares of Common Stock
or previously outstanding shares of Common Stock then held
in the Corporation's treasury. If any option granted under
the Plan shall expire or terminate for any reason
(including, without limitation, by reason of its surrender,
pursuant to the provisions of Section 6(f) or the third
paragraph of Section 6(b) or otherwise, or cancellation, in
whole or in part, pursuant to the provisions of Section 6(c)
or otherwise, or the substitution in place thereof of a new
option) without having been exercised in full, the shares
4
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subject thereto shall again be available for the purposes of
issuance under the Plan.
3. Administration
(a) The Plan shall be administered by the Committee.
Subject to the express provisions of the Plan, the Committee
shall have plenary authority, in its discretion, to
determine the individuals to whom, and the time or times at
which options shall be granted and the number of shares to
be covered by each such grant. In making such
determinations, the Committee may take into account the
nature of the services rendered by the respective
Participants, their present and potential contributions to
the Corporation's success and such other factors as the
Committee in its discretion may deem relevant. Subject to
the express provisions of the Plan, the Committee shall have
plenary authority to interpret the Plan, to prescribe, amend
and rescind rules and regulations relating to it, to
determine the terms and provisions of option agreements
(which need not be identical) and to make all other
determinations necessary or advisable for the administration
of the Plan. The Committee's determinations of the matters
referred to in this Section 3 shall be conclusive. It is
the intention of the Corporation that the Plan and the
administration hereof comply in all respects with Section
16(b) of the Exchange Act, and the rules and regulations
promulgated thereunder, and if any Plan provision is later
found not to be in compliance with Section 16(b), the
provision shall be deemed null and void, and in all events
the Plan shall be construed in favor of its meeting the
requirements of Rule 16b-3.
(b) The Committee may in its discretion delegate to a
committee appointed by the Board consisting of one or more
officers of the Corporation (the "Grant Committee") the
authority to grant, pursuant to this Plan, options for a
total number of shares of Common Stock determined by the
Committee, and under terms, conditions and criteria which
are approved by the Committee. Such authorization may
include the ability to determine the Participants to whom,
the number of shares in respect of which, and the time or
times at which, such options shall be granted. In the event
the Committee shall grant such authority to the Grant
Committee, the Grant Committee shall report to the
Committee in writing, at times determined by the Committee,
(i) the names of Participants who have received any such
grants, (ii) the number of shares covered by each option so
granted, (iii) the date upon which each such option was
granted and (iv) such other information as the committee may
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request. Any action of the Grant Committee pursuant to
authority granted by the Committee under this Section 3(b)
in accordance with the Committee resolution granting such
authority shall be deemed to be the action of the Committee.
4. The Committee
(a) The Board shall designate a Committee of members
of the Board which shall meet the requirements of Section
16(b) of the Exchange Act. Currently, the Committee shall
consist solely of two or more members of the Board who are
disinterested. If at any time an insufficient number of
disinterested directors is available to serve on such
Committee, interested directors may serve on the Committee;
however, during such time, no options shall be granted under
the Plan to any person if the granting of such options would
not meet the requirements of Section 16(b) of the Exchange
Act.
(b) For purposes of this Section 4, a "disinterested
director" is a person who meets the definition of
"disinterested person" as set forth in the rules and
regulations promulgated under Section 16(b) of the Exchange
Act. Currently, a disinterested director is a member of the
Board who is not (and, during the 12-month period preceding
his appointment as a member of the Committee has not been)
granted or awarded stock, stock appreciation rights or other
equity securities of the Corporation or any affiliated
corporation pursuant to the Plan or any other plan of the
Corporation or any affiliated corporation except for formula
plans (as such term is defined in Rule 16b-3(c)(2)(ii)
issued under the Exchange Act) or ongoing securities
acquisition plans (as described in Rule 16b-3(d)(2)(i)
issued under the Exchange Act). The Committee shall be
appointed by the Board, which may from time to time appoint
members of the Committee in substitution for members
previously appointed and may fill vacancies, however caused,
in the Committee. The Committee shall select one of its
members as its Chairman and shall hold its meetings at such
times and places as it may determine. A majority of its
members shall constitute a quorum. All determinations of
the Committee shall be made by not less than a majority of
its members. Any decision or determination reduced to
writing and signed by all the members shall be fully as
effective as if it had been made by a majority vote at a
meeting duly called and held. The Committee may appoint a
secretary, shall keep minutes of its meetings and shall make
such rules and regulations for the conduct of its business
as it shall deem advisable.
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5. Eligibility
The Committee may grant options only to employees of
the Corporation and of its present and future subsidiary
corporations ("subsidiaries") who, at the time of the grant,
are not officers or directors (within the meaning of Section
16 of the Exchange Act and the rules and regulations
promulgated thereunder) of the Corporation or any of its
present and future subsidiary corporations. Any person
eligible under the Plan may receive one or more grants of
options as the Committee shall from time to time determine,
and such determinations may be different as to different
Participants.
6. Option Grants
(a) The Committee is authorized under the Plan, in its
discretion, to issue only options which do not qualify as
"incentive stock options" as defined in Section 422 of the
United States Internal Revenue Code of 1986, as amended
("Nonqualified Stock Options") and the options shall be
designated as Nonqualified Stock Options in the applicable
option agreement. The purchase price of the Common Stock
under each option granted under the Plan shall be determined
by the Committee but shall be not less than the average Fair
Market Value of the Common Stock over any continuous period
of trading days beginning and ending no more than 30
business days before or after the date such option is
granted.
(b) The Committee shall be authorized in its
discretion to prescribe in the option grant the
installments, if any, in which an option granted under the
Plan shall become exercisable, provided that no option shall
be exercisable prior to the first anniversary of the date of
grant thereof except as provided in Section 6(c), (d), (g),
and (h) or except as the Committee otherwise determines. In
no case may an option be exercised as to less than 100
shares at any one time (or the remaining shares covered by
the option if less than 100) during the term of the option.
The Committee shall also be authorized to establish the
manner of the exercise of an option. The term of each
option shall be not more than 10 years from the date of
grant thereof. In general, upon exercise, the option price
is to be paid in full in cash; however, the Committee can
determine at any time prior to exercise that additional
forms of payment will be permitted. To the extent permitted
by the Committee and applicable laws and regulations
(including, but not limited to, federal tax and securities
laws and regulations and state corporate law), an option may
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be exercised (i) in Common Stock owned by the option holder
having a Fair Market Value on the date of exercise equal to
the aggregate option price, or in a combination of cash and
stock; provided, however, that payment in stock shall not be
made unless such stock shall have been owned by the option
holder for a period of at least three months prior thereto;
or (ii) by delivery of a properly executed exercise notice,
together with irrevocable instructions to a broker
designated by the Corporation, all in accordance with the
regulations of the Federal Reserve Board, to deliver
promptly to the Corporation the amount of sale or loan
proceeds to pay the exercise price and any Withholding Tax
obligations that may arise in connection with the exercise.
In lieu of requiring an option holder to pay cash or
stock and to receive in turn certificates for shares of
Common Stock upon the exercise of an option, if the option
agreement so provides, the Committee may elect to require
the option holder to surrender the option to the Corporation
for cancellation as to all or any portion of the number of
shares covered by the intended exercise and receive in
exchange for such surrender a payment, at the election of
the Committee, in cash, in shares of Common Stock or in a
combination of cash and shares of Common Stock, equivalent
to the appreciated value of the shares covered by the option
surrendered for cancellation. Such appreciated value shall
be the difference between the option price of such shares
(as adjusted pursuant to Section 15) and the Fair Market
Value of such shares, which shall for this purpose be
determined by the Committee taking into consideration all
relevant factors, but which shall not be less than the Fair
Market Value of such shares on the date on which the option
holder's notice of exercise is received by the Corporation.
Upon delivery to the Corporation of a notice of exercise of
option, the Committee may avail itself of its right to
require the option holder to surrender the option to the
Corporation for cancellation as to shares covered by such
intended exercise. The Committee's right of election shall
expire, if not exercised, at the close of business on the
fifth business day following the delivery to the Corporation
of such notice. Should the Committee not exercise such
right of election, the delivery of the aforesaid notice of
exercise shall constitute an exercise by the option holder
of the option to the extent therein set forth, and payment
for the shares covered by such exercise shall become due
immediately.
(c) In the event that a Participant's services for the
Corporation or one of its subsidiaries shall cease and the
termination of such individual's service is for cause, the
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option shall automatically terminate upon first notification
to the option holder of such termination of services, unless
the Committee determines otherwise, and such option shall
automatically terminate upon the date of such termination of
services for all shares which were not purchasable upon such
date. For purposes of this Section 6(c), "cause" is defined
as a determination by the Committee that the option holder
(i) has committed a felony, (ii) has engaged in an act or
acts of deliberate and intentional dishonesty resulting or
intended to result directly or indirectly in improper
material gain to or personal enrichment of the individual at
the Corporation's expense, or (iii) has willfully disobeyed
the Corporation's appropriate rules, instructions or orders,
and such willful disobedience has continued for a period of
10 days following notice thereof from the Corporation.
In the event of the termination of the services of the
holder of an option because of Retirement or disability, he
or she may (unless such option shall have been previously
terminated pursuant to the provisions of the preceding
paragraph or unless otherwise provided in the option grant)
exercise such option at any time prior to the expiration of
the option, (i) in the event of disability or normal
Retirement, to the extent of the number of shares covered by
such option, whether or not such shares had become
purchasable by him or her at the date of the termination of
his or her services and (ii) in the event of early
Retirement, to the extent of the number of shares covered by
such option at such time or times as such option becomes
purchasable by him or her in accordance with its terms.
In the event of the death of an individual to whom an
option has been granted under the Plan, while he or she is
performing services for the Corporation or a subsidiary, the
option theretofore granted to him or her (unless the option
shall have been previously terminated pursuant to the
provisions of this Section 6(c) or unless otherwise provided
in the option grant) may, subject to the limitations
described in Section 6(g), be exercised by his or her
Designated Beneficiary, by his or her legatee or legatees of
the option under his last will, or by his or her personal
representatives or distributees, at any time within a period
of one year after his or her death, but not after the
expiration of the option, to the extent of the remaining
shares covered by the option whether or not such shares had
become purchasable by such an individual at the date of
death. In the event of the death of an individual (i)
during the one-year period following termination of his or
her services or (ii) following termination of his or her
services by reason of Retirement or disability, then the
9
option (if not previously terminated pursuant to the
provisions of this Section 6(c)) may be exercised during the
remainder of such one-year period or during the remaining
term of the option, respectively, by his or her Designated
Beneficiary, by his or her legatee under his or her last
will, or by his or her personal representative or
distributee, but only to the extent of the number of shares
purchasable by such Participant pursuant to the provisions
of Section 6(d) at the date of termination of services.
In the event of the termination of the services of the
holder of an option, other than by reason of Retirement,
disability or death, he or she may (unless the option shall
have been previously terminated pursuant to the provisions
of this Section 6(c) or unless otherwise provided in the
option grant) exercise the option at any time within one
year after such termination but not after the expiration of
the option, to the extent of the number of shares covered by
the option which were purchasable by him or her at the date
of the termination of services, and such option shall
automatically terminate upon the date of such termination of
services for all shares which were not purchasable upon such
date.
(d) Notwithstanding the foregoing provisions, the
Committee may determine, in its sole discretion, in the case
of any termination of services, that the holder of an option
may exercise such option to the extent of some or all of the
remaining shares covered thereby whether or not such shares
had become purchasable by such an individual at the date of
the termination of his services and may exercise such option
at any time prior to the expiration of the original term of
the option. Options granted under the Plan shall not be
affected by any change of relationship with the Corporation
so long as the holder continues to be an employee of the
Corporation or of a subsidiary; however, a change in a
Participant's status from an employee to a nonemployee shall
result in the termination of an outstanding option held by
such Participant in accordance with Section 6(c). The
Committee, in its absolute discretion, may determine all
questions of whether particular leaves of absence constitute
a termination of service. Nothing in the Plan or in any
option granted pursuant to the Plan shall confer on any
individual any right to continue in the employ or other
service of the Corporation or any other person or interfere
in any way with the right of the Corporation or any other
person to terminate his or her employment or other services
at any time.
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<PAGE>
(e) The date of grant of an option pursuant to the
Plan shall be the date specified by the Committee, or the
Grant Committee acting pursuant to authority granted under
Section 3(b), at the time it grants such option, provided
that such date shall not be prior to the date of such action
by the Committee or the grant Committee, and that the price
shall be determined in accordance with Section 6(a) on such
date. The Committee or Grant Committee shall promptly
notify a grantee of an award and a written option grant
shall promptly be duly executed and delivered by or on
behalf of the Corporation.
(f) The Committee shall be authorized, in its absolute
discretion, to permit option holders to surrender
outstanding options in exchange for the grant of new options
or to require option holders to surrender outstanding
options as a condition precedent to the grant of new
options. The number of shares covered by the new options,
the option price (subject to the provisions of Section
6(a)), the option period and other terms and conditions of
the new options shall all be determined in accordance with
the Plan and may be different from the provisions of the
surrendered options.
(g) Notwithstanding any contrary waiting period,
installment period or other limitation or restriction in any
option agreement or in the Plan, in the event of a Change of
Control, each option outstanding under the Plan shall
thereupon become exercisable at any time during the
remaining term of the option, but not after the term of the
option, to the extent of the number of shares covered by the
option, whether or not such shares had become purchasable by
the Participant thereunder immediately prior to such Change
of Control.
(h) Anything in the Plan to the contrary
notwithstanding, during the 90 calendar days from and after
a Change of Control (x) an optionee (other than an optionee
who initiated a Change of Control in a capacity other than
as an officer or a Director of the Corporation) who is an
officer or a Director of the Corporation (within the meaning
of Section 16 of the Exchange Act and the rules and
regulations promulgated thereunder) with respect to an
option that was granted at least six months prior to the
date of exercise pursuant to this sentence and (y) any other
optionee who is not an officer or a Director with respect to
an option shall, unless the Committee shall determine
otherwise at the time of grant, have the right, in lieu of
the payment of the full purchase price of the shares of
Common Stock being purchased under the option and by giving
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<PAGE>
written notice to the Corporation, to elect (within such 90-
day period) to surrender all or part of the option to the
Corporation and to receive in cash an amount equal to the
amount by which the Fair Market Value of the Common Stock on
the date of exercise shall exceed the purchase price per
share under the option multiplied by the number of shares of
Common Stock granted under the stock option as to which the
right granted by this sentence shall have been exercised.
Such written notice shall specify the optionee's election to
purchase shares granted under the option or to receive the
cash payment referred to in the immediately preceding
sentence.
(i) Anything in this paragraph 6 to the contrary
notwithstanding, if a stock option of a recipient under an
ATL stock option plan expires, and the expired stock option
at the time of its expiration had value and was for the
purchase of shares of the same class as shares available for
grant under this Plan, and the recipient is eligible for
awards under this Plan as specified in paragraph 5 hereof,
and the Committee feels in its discretion that it is
appropriate or equitable to do so, the Committee may award
such recipient a new stock option under this Plan, for up to
the number of shares of the expired option, such new stock
option to vest immediately upon grant and to expire within a
period of time not greater than 90 day from the date of
grant.
7. Withholding Taxes
In connection with the transfer of shares of Common
Stock as a result of the exercise of an option the
Corporation (a) shall not issue a certificate for such
shares until it has received payment from the Participant of
any Withholding Tax in cash or by the retention by the
Corporation or acceptance by the Corporation upon delivery
thereof by the Participant of shares of Common Stock
sufficient in Fair Market Value to cover the amount of such
Withholding Tax and (b) shall have the right to retain or
sell without notice, or to demand surrender of, shares of
Common Stock in value sufficient to cover any Withholding
Tax. The Corporation shall have the right to withhold from
any cash amounts due from the Corporation to the Participant
pursuant to the Plan an amount equal to the Withholding Tax.
In either case, the Corporation shall make payment (or
reimburse itself for payment made) to the appropriate taxing
authority of an amount in cash equal to the amount of such
Withholding Tax, remitting any balance to the Participant.
For purposes of this Section 7, the value of shares of
Common Stock so retained or surrendered shall be equal to
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<PAGE>
the Fair Market Value of such shares on the date that the
amount of the Withholding Tax is to be determined (the "Tax
Date"), and the value of shares of Common Stock so sold
shall be the actual net sale price per share (after
deduction of commissions) received by the Corporation.
Notwithstanding the foregoing, the Participant may
elect, subject to approval by the Committee, to satisfy the
obligation to pay any Withholding Tax, in whole or in part,
by providing the Corporation with funds sufficient to enable
the Corporation to pay such Withholding Tax or by having the
Corporation retain or accept upon delivery thereof by the
Participant shares of Common Stock sufficient in Fair Market
Value to cover the amount of such Withholding Tax. Each
election by a Participant to have shares retained or to
deliver shares for this purpose shall be subject to the
following restrictions: (i) the election must be in writing
and made on or prior to the Tax Date and (ii) if the
Participant is subject to Section 16 of the Exchange Act, an
election to have shares retained to satisfy the Withholding
Tax must be an irrevocable election made at least six months
prior to the Tax Date or the withholding election must
become effective during the 10-business-day period beginning
on the third business day following the date on which the
Corporation releases for publication its annual or quarterly
summary statements of sales and earnings and ending on the
twelfth business day following the date of release thereof.
8. Transferability and Ownership Rights of Options
No option awarded under the Plan shall be transferable
otherwise than pursuant to the designation of a Designated
Beneficiary or by will, descent or distribution, and an
option may be exercised, during the lifetime of the holder
thereof, only by him or her. The holder of an option shall
have none of the rights of a stockholder until the shares
subject thereto shall have been registered in the name of
such holder on the transfer books of the Corporation.
9. Section 16(b) Compliance and Bifurcation of Plan
It is the intention of the Corporation that, if any of
the Corporation's equity securities are registered pursuant
to Section 12(b) or 12(g) of the Exchange Act, the Plan
shall comply in all respects with Rule 16b-3 under the
Exchange Act and, if any Plan provision is later found not
to be in compliance with such Section, the provision shall
be deemed null and void, and in all events the plan shall be
construed in favor of its meeting the requirements of Rule
16b-3. Notwithstanding anything in the Plan to the
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<PAGE>
contrary, the Board, in its absolute discretion, may
bifurcate the Plan so as to restrict, limit or condition the
use of any provision of the Plan to participants who are
officers and directors subject to Section 16 of the Exchange
Act without so restricting, limiting or conditioning the
Plan with respect to other participants.
10. Adjustments Upon Changes in Capitalization
Except as otherwise provided in Section 6(h) and
Section 6(i), in the event of any changes in the outstanding
stock of the Corporation by reason of stock dividends, stock
splits, recapitalizations, mergers, consolidations,
combinations or exchanges of shares, split-ups, split-offs,
spin-offs, liquidations or other similar changes in
capitalization, or any distribution to stockholders other
than cash dividends, the Committee shall make such
adjustments, if any, in light of the change or distribution
as the Committee in its sole discretion shall determine to
be appropriate, in the number and class of shares or rights
subject to options and the exercise prices of the options
covered thereby. In the event of any such change in the
outstanding Common Stock of the Corporation, the aggregate
number and class of shares available under the Plan and the
maximum number of shares as to which options may be granted
shall be appropriately adjusted by the Committee.
11. Amendment and Termination
Unless the Plan shall theretofore have been terminated
as hereinafter provided, the Plan shall terminate on, and no
awards of options shall be made after, October 31, 2002;
provided, however, that such termination shall have no
effect on awards of options made prior thereto. The Plan
may be terminated, modified or amended by the stockholders
of the Corporation. The Board of Directors of the
Corporation may also terminate the Plan, or modify or amend
the Plan in such respects as it shall deem advisable in
order to conform to any change in any law or regulation
applicable thereto, or in other respects. The amendment or
termination of the Plan shall not, without the consent of
the recipient of any award under the Plan, alter or impair
any rights or obligations under any award theretofore
granted under the Plan.
12. Effectiveness of the Plan
The Plan shall become effective on November 1, 1992.
The Committee may in its discretion authorize the granting
of options, the exercise of which shall be expressly subject
14
<PAGE>
to the conditions that (a) the shares of Common Stock
reserved for issuance under the Plan shall have been duly
listed, upon official notice of issuance, upon each stock
exchange in the United States upon which the Common Stock is
traded and (b) a registration statement under the Securities
Act of 1933, as amended, with respect to such shares shall
have become effective.
15
Exhibit 10.2
MAY 7, 1997
ADVANCED TECHNOLOGY LABORATORIES, INC.
Employee Stock Purchase Plan
1. Definitions
''Code'' means the Internal Revenue Code of 1986, as amended or
succeeded by later legislative enactments.
''Committee'' means the Committee provided for in Section 4,
which shall administer this ESPP.
''Common Stock'' means common stock, par value $0.01 per share,
of the Company.
''Company'' means Advanced Technology Laboratories, Inc., a
Washington corporation.
''Compensation'' means a Participant's base salary plus any
commissions paid.
''ESPP'' means this Advanced Technology Laboratories, Inc.
Employee Stock Purchase Plan.
''Fair Market Value'' of the Common Stock as of any day means
the closing price (rounded to the next highest cent in the case of
fractions of a cent) of the Common Stock as reported on such day
or, if such day is not a trading day of the Nasdaq Stock Market,
the immediately preceding trading day as reported by the Nasdaq
Stock Market. The Committee, in its sole discretion, shall make
all determinations required by this definition.
''Participant'' means an employee of ATL Ultrasound, Inc., a
wholly owned subsidiary of the Company, and its wholly owned
subsidiary, ATL International, Inc., without reference to any
other subsidiary or affiliate organization of either corporation,
who is regularly scheduled to work a minimum of 20 hours per week.
''Purchase Period'' means a six month period commencing on
January 1 or July 1.
2. Purpose
The purpose of this ESPP is to enable Participants to acquire a
larger personal proprietary interest in the Company, and to
encourage Participants to remain in the employ of the Company and
have a personal interest in the success of the Company. This ESPP
is intended to constitute an ''employee stock purchase plan'' as
defined in the Code, and shall be interpreted and administered to
further that intent.
This ESPP is intended to provide Common Stock for investment and
not for resale. The Company does not, however, intend to restrict
or influence the conduct of any Participant's affairs. A
Participant, therefore, may sell Common Stock that is purchased
under this ESPP at any time, subject to compliance with any
applicable federal or state tax and securities laws. THE EMPLOYEE
ASSUMES THE RISK OF ANY MARKET FLUCTUATIONS IN THE PRICE OF THE
SHARES.
3. Governmental Regulations
The Company's obligation to sell and deliver shares of Common
Stock under this ESPP is subject to the approval of any
governmental authority required in connection with the
authorization, issuance or sale of such shares, including the
Securities and Exchange Commission, the securities administrators
of the states in which Participants reside, and the Internal
Revenue Service.
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4. Administration
This ESPP shall be administered by the Compensation Committee of
the Board of Directors of the Company. The Compensation Committee
shall have plenary authority, in its discretion, to interpret the
ESPP, to prescribe, amend and rescind rules and regulations
relating to it, and to make all other determinations necessary or
advisable for the administration of the ESPP. The Committee's
determinations of the matters referred to in this Section 4 shall
be conclusive. It is the intention of the Company and the
Committee that this ESPP and the administration hereof comply in
all respects with Section 16(b) of the Securities Exchange Act of
1934 and Section 423(b) of the Code.
5. Stock Subject to the ESPP
There are reserved for issuance under this ESPP 300,000 shares
of Common Stock which may be purchased by Participants pursuant to
this ESPP, subject to adjustment as provided in Section 15.
6. Purchase Periods
This ESPP will be administered based on semi-annual Purchase
Periods commencing January 1 or July 1. The first Purchase Period
will begin on January 1, 1997 and end on June 30, 1997.
7. Payroll Deductions.
Any person who is properly enrolled as a Participant at the
beginning of a Purchase Period may elect, in accordance with
procedures prescribed by the Committee, to have the Company deduct
a specified integer number percentage of the Participant's
Compensation for the purchase of shares of Common Stock pursuant
to the ESPP.
The maximum rate of deduction that a Participant may elect for
any Purchase Period is 15%. An amount equal to the elected
percentage of the Participant's Compensation shall be deducted on
each regular pay day falling within the Purchase Period. All
amounts will be deducted from a Participant's Compensation on an
after-tax basis. No interest will be paid on payroll deductions
accumulated under this ESPP.
A Participant who is enrolled in this ESPP at the end of a
Purchase Period will, unless the Participant gives notice of his
or her intent to withdraw from the ESPP, automatically be enrolled
as a Participant in the subsequent Purchase Period.
8. Purchase of Common Stock
On the first business day following the end of a Purchase Period
(the ''Purchase Date''), a Participant's accumulated payroll
deductions will, subject to the limitations of Section 9 and the
termination provisions of Section 14, be applied toward the
purchase of shares of Common Stock at a purchase price equal to
the lesser of:
(a) 85% of the Fair Market Value for the Common Stock on the
first day of the Purchase Period; or
(b) 85% of the Fair Market Value for the Common Stock on the
Purchase Date,
in either event rounded to the nearest whole cent.
Shares of Common Stock may be purchased under the ESPP only with
a Participant's accumulated payroll deductions. Fractional shares
cannot be purchased. At the conclusion of each Purchase Period,
the Company shall automatically re-enroll each Participant in the
next Purchase Period, and any portion of a Participant's
accumulated payroll deductions not used for the purchase of Common
Stock at the end of a Purchase Period shall be applied to the
purchase of Common Stock in the next Purchase Period if the
Participant is participating in the ESPP during that Purchase
Period, or returned to the Participant.
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<PAGE>
9. Limitations on Share Purchases
During any Purchase Period the maximum number of shares of
Common Stock that may be purchased by a Participant may not exceed
1,000 shares. During any calendar year, the maximum value of the
Common Stock that may be purchased by a Participant under this
ESPP is $25,000, said value to be determined on the basis of the
Fair Market Value of the Common Stock on the first day of the
Purchase Period and in accordance with the requirements of Code
Section 423(b)(8). The foregoing limitation is intended to and
shall be interpreted in such a manner as will comply with Section
423(b)(8) of the Code. In addition, no Participant shall be
permitted to subscribe for any shares under this ESPP if such
Participant, immediately after such subscription, owns shares that
account for (including all shares that may be purchased under
outstanding subscriptions under the ESPP and any other outstanding
options to purchase shares of Common Stock) five percent or more
of the total combined voting power or value of all classes of
shares of the Company or its subsidiaries. For the foregoing
purposes the rules of Section 424(d) of the Code shall apply in
determining share ownership.
10. Withdrawal from the ESPP
At any time prior to the last three weeks of a Purchase Period,
a Participant may elect, in accordance with procedures prescribed
by the Committee, to withdraw from the ESPP. If a Participant
withdraws from the ESPP, all of the Participant's payroll
deductions for that Purchase Period will be promptly returned to
the Participant, and the Participant will not be eligible to
participate in the ESPP again before the next Purchase Period. If
a Participant withdraws effective for a Purchase Period that has
not yet commenced, the Participant may elect to participate in any
subsequent Purchase Period. If a Participant's payroll deductions
are interrupted by any legal process, the Participant will be
deemed to have elected to withdraw from the ESPP for the Purchase
Period in which the interruption occurs.
A Participant's participation and payroll deductions continue
during a leave of absence unless the Participant elects to stop
his or her payroll deductions. Such participation will end
automatically at the end of the current Purchase Period. A
Participant may re-enroll to participate in subsequent Purchase
Periods which commence following the employee's return from the
leave of absence.
11. Issuance of Common Stock to Custodial Accounts
The shares of Common Stock purchased by Participants will be
issued electronically by the Company's transfer agent to a
Participant's custodial account as soon as practicable after each
Purchase Date. Common Stock purchased under the ESPP will be
issued only in the name of the Participant (or, if his or her
authorization so designates, in the name of the Participant and
another person of legal age as joint tenants with rights of
survivorship). The custodial account of Participants shall be
maintained by a bank, broker-dealer or similar custodian that has
agreed to hold such shares for the accounts of the respective
Participants. Fees and expenses of the bank, broker-dealer or
similar custodian shall be paid by the Company or allocated among
the respective Participants in such manner as the Committee
determines. A Participant or his or her legal representative may
withdraw Common Stock from his or her custodial account at any
time; however any withdrawal within 2 years of the first day of
the Purchase Period and one year of the Purchase Date will be
treated by the Company as a disqualifying disposition under the
Code and be reported on the Participant's tax Form W-2.
12. Withholding Taxes
In connection with the purchase of shares of Common Stock under
this ESPP, the Company (a) shall not issue a certificate for such
shares until it has received payment from the Participant of any
required withholding tax in cash or by the retention or acceptance
upon delivery thereof by the Participant of shares of Common Stock
sufficient in Fair Market Value to cover the amount of such
withholding tax and (b) shall have the right to retain or sell
without notice, or to demand surrender of, shares of Common Stock
in value sufficient to cover any withholding tax. The Company
shall have the right to withhold from any payroll deductions made
by the Participant under this ESPP an amount equal to any required
withholding tax. In either case, the Company shall make payment
(or reimburse itself for payment made) to the appropriate taxing
authority of an amount in cash equal to the amount of such
withholding tax, remitting
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<PAGE>
any balance to the Participant. For purposes of this Section 12,
the value of shares of Common Stock so retained or surrendered
shall be equal to the Fair Market Value of such shares on the date
that the amount of the withholding tax is to be determined (the
''Tax Date''), and the value of shares of Common Stock so sold
shall be the actual net sale price per share (after deduction of
commissions) received by the Company.
Notwithstanding the foregoing, the Participant may elect,
subject to approval by the Committee, to satisfy the obligation to
pay any withholding tax, in whole or in part, by providing the
Company with funds sufficient to enable the Company to pay such
withholding tax or by having the Company retain or accept upon
delivery thereof by the Participant shares of Common Stock
sufficient in Fair Market Value to cover the amount of such
withholding tax. Each election by a Participant to have shares
retained or to deliver shares for this purpose must be in writing
and made on or prior to the Tax Date.
13. Transferability
A Participant's rights under this ESPP, including rights to
accumulated payroll deductions, may not be pledged, assigned,
encumbered or otherwise transferred for any reason other than by
will or the laws of descent and distribution. Any such attempt
will be treated as an election by the Participant to withdraw from
this ESPP.
14. Terminating Events
Upon (a) the dissolution or liquidation of the Company, (b) a
merger or other reorganization of the Company with one or more
corporations as a result of which the Company will not be a
surviving corporation, (c) the sale of all or substantially all of
the assets of the Company or a material division of the Company,
(d) a sale or other transfer, pursuant to a tender offer or
otherwise, of more than fifty percent (50%) of the then
outstanding shares of Common Stock of the Company, (e) an
acquisition by the Company resulting in an extraordinary expansion
of the Company's business or the addition of a material new line
of business, or (f) any exchange that is subject to this Section
14 in accordance with the provisions of Article 15 (any of such
events is herein referred to as a ''Terminating Event''), the
Committee may but shall not be required to:
(a) make provision for the continuation of the Participants'
rights under this ESPP on such terms and conditions as the
Committee determines to be appropriate and equitable, including
where applicable, but not limited to, an arrangement for the
substitution on an equitable basis, for each share of Common
Stock that could otherwise be purchased at the end of the
Purchase Period in progress at the time of the Terminating
Event, of any consideration payable with respect to each then
outstanding share of Common Stock in connection with the
Terminating Event; or
(b) terminate all rights of Participants under the ESPP for
such Payment Period and
(i) return to the Participants all of their payroll
deductions for such Payment Period; and
(ii) for each share of Common Stock, if any, that could
otherwise be purchased under the ESPP by a Participant at the
end of such Purchase Period (determined by assuming that
payroll deductions at the rate elected by the Participant
were continued to the end of the Purchase Period and used to
purchase shares based on the Fair Market Value of the Common
Stock on the first day of the Purchase Period) and with
respect to which (A) the purchase price at which such share
could be purchased (determined with reference only to the
Fair Market Value of the Common Stock on the first day of the
Purchase Period) is exceeded by (B) the Fair Market Value on
the date of the Terminating Event of a share of Common Stock,
as determined by the Committee, pay to the Participant an
amount equal to such excess.
The Committee shall make all determinations necessary or
advisable in connection with Terminating Events, and its
determinations shall, in the absence of fraud or patent mistake,
be conclusive and binding on all persons with any interest in the
ESPP.
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<PAGE>
15. Adjustments Upon Changes in Capitalization
In the event of any changes in the outstanding stock of the
Company by reason of stock dividends, stock splits,
recapitalizations, mergers, consolidations, combinations or
exchanges of shares, split-ups, split-offs, spin-offs,
liquidations or other similar changes in capitalization, or any
distribution to stockholders other than cash dividends, the
Committee shall make such adjustments, if any, in light of the
change or distribution as the Committee in its sole discretion
shall determine to be appropriate in the number and class of
shares and the purchase prices of the Common Stock which may be
purchased by Participants during the current Purchase Period. In
the event of any such change in the outstanding Common Stock of
the Company, the aggregate number and class of shares available
under this ESPP and the maximum number of shares which may be
purchased and their purchase price shall be appropriately adjusted
by the Committee.
Upon the happening of an event specified in this Section 15, the
class and aggregate number of shares available under this ESPP, as
set forth in Section 5 shall be appropriately adjusted to reflect
the event. Notwithstanding the foregoing, such adjustments shall
be made only to the extent that the Committee, based on advice of
counsel for the Company, determines that such adjustments will not
constitute a change requiring shareholder approval under 423(b)(2)
of the Code.
16. Termination of Employee's Rights
Subject to the provisions of the next paragraph, a Participant's
rights under this ESPP will terminate if he or she for any reason
(including death, disability or voluntary or involuntary
termination of employment) ceases to be an employee of the Company
or one of its subsidiaries. To the extent that the rights of a
Participant terminate in accordance with this Section 16, any of
the Participant's accrued payroll deductions will be promptly
returned to the Participant or his or her personal representative.
This ESPP does not, directly or indirectly, create any right for
the benefit of any employee or class of employees to
preferentially purchase any Common Stock under the ESPP, or create
in any employee or class of employees any right with respect to
continuation of employment by the Company, and it shall not be
deemed to interfere in any way with the Company's right to
terminate, or otherwise modify, an employee's employment at any
time.
17. Termination and Amendments to ESPP
This ESPP may be terminated at any time by the Committee but,
except as provided in Section 14, such termination shall not
affect the rights of Participants under the ESPP for the Purchase
Period in progress at the time of termination. This ESPP will
terminate in any case when all or substantially all of the
unissued shares of Common Stock reserved for the purposes of the
ESPP have been purchased. If at any time shares of Common Stock
reserved for the purpose of the ESPP remain available for purchase
but not in sufficient number to satisfy all then unfilled purchase
requirements, the available shares shall be apportioned among
Participants in proportion to the respective amounts of their
accumulated payroll deductions, and the ESPP shall terminate. Upon
such termination or any other termination of the ESPP, all payroll
deductions not used to purchase shares of Common Stock will be
refunded to the Participants entitled thereto.
This ESPP may be terminated, modified or amended by the
shareholders of the Company. The Board of Directors of the Company
may also terminate this ESPP, or modify or amend the ESPP in such
respects as it shall deem advisable in order to conform to any
change in any law or regulation applicable thereto, or in other
respects; however, to the extent required by applicable law or
regulation, shareholder approval will be required for any
amendment which will (a) increase the total number of shares which
may be issued under the ESPP, (b) change the class of persons
eligible to purchase Common Stock under the ESPP, (c) materially
increase the benefits accruing to Participants under the ESPP, or
(d) otherwise require shareholder approval under any applicable
law or regulation.
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18. Information to Participants
A Participant in this ESPP shall not have any rights as a
shareholder of the Company on account of shares of Common Stock
that may be purchased under the ESPP prior to the time such shares
are actually purchased by and issued to the Participant.
Notwithstanding the foregoing, the Company shall deliver to each
Participant under this ESPP who does not otherwise receive such
materials (a) a copy of the Company's annual financial statements,
together with management's discussion and analysis of financial
condition and results of operations for the fiscal year, and (b) a
copy of all reports, proxy statements and other communications
distributed to the Company's security holders generally.
19. Approval of Shareholders
This ESPP shall be effective January 1, 1997, subject to
approval by the holders of a majority of the shares of the Company
present or represented by proxy at the first annual meeting of the
shareholders of the Company held after the date on which the ESPP
is adopted by the Board of the Company. This ESPP shall also be
subject to approval by the shareholders of the Company in a manner
that complies with Section 423(b)(2) of the Code. If such
approvals do not occur prior to the end of the first Purchase
Period under the ESPP, this ESPP and all rights of Participants
under the ESPP shall terminate, and all payroll deductions of
Participants accumulated under the ESPP will be promptly returned
to the Participants.
Approved by Shareholders on May 7, 1997
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KPMG Peat Marwick Letterhead
Exhibit 23.1
CONSENT OF INDEPENDENT
CERTIFIED PUBLIC ACCOUNTANTS
------------------------------------------------
The Board of Directors
Advanced Technology Laboratories, Inc.:
We consent to the use of our reports incorporated herein by
reference in the registration statement.
KPMG Peat Marwick LLP
Seattle, Washington
June 24, 1997
