<PAGE>
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of
the Securities Exchange Act of 1934
(Amendment No. )
Filed by the Registrant /X/
Filed by a Party other than the Registrant / /
Check the appropriate box:
/X/ Preliminary Proxy Statement
/ / Confidential, for Use of the Commission Only (as permitted by Rule
14a-6(e)(2))
/ / Definitive Proxy Statement
/ / Definitive Additional Materials
/ / Soliciting Material Pursuant to Section240.14a-11(c) or
Section240.14a-12
VISX, INCORPORATED
- --------------------------------------------------------------------------------
(Name of Registrant as Specified in Its Charter)
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
/X/ $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), 14a-6(i)(2) or
Item 22(a)(2) of Schedule 14A
/ / $500 per each party to the controversy pursuant to Exchange Act Rule
14a-6(i)(3)
/ / Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
1) Title of each class of securities to which the transaction applies:
------------------------------------------------------------------------
2) Aggregate number of securities to which transaction applies:
------------------------------------------------------------------------
3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which the
filing fee is calculated and state how it was determined):
------------------------------------------------------------------------
4) Proposed maximum aggregate value of transaction:
------------------------------------------------------------------------
5) Total fee paid:
------------------------------------------------------------------------
/ / Fee paid previously with preliminary materials.
/ / Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.
1) Amount Previously Paid:
------------------------------------------------------------------------
2) Form, Schedule or Registration Statement No.:
------------------------------------------------------------------------
3) Filing Party:
------------------------------------------------------------------------
4) Date Filed:
------------------------------------------------------------------------
<PAGE>
PRELIMINARY PROXY
[LOGO]
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD MAY 17, 1996
To the Stockholders:
The Annual Meeting of Stockholders of VISX, Incorporated (the "Company")
will be held on Friday, May 17, 1996 at 9:00 a.m., local time, at the Company's
principal executive offices located at 3400 Central Expressway, Santa Clara,
California 95051 for the following purposes:
1. To elect five directors to serve until the next Annual Meeting and until
their successors have been elected and qualified;
2. To ratify the adoption of amended and restated Bylaws of the Company;
3. To ratify the adoption of the 1995 Directors' Option Plan;
4. To ratify the adoption of the 1995 Stock Plan;
5. To approve an amendment to the Company's Restated Certificate of
Incorporation to increase the authorized number of shares of Common
Stock;
6. To approve an amendment to the Company's Restated Certificate of
Incorporation to authorize a class of Preferred Stock;
7. To adopt a form of Indemnification Agreement;
8. To ratify the appointment of Arthur Andersen LLP as the Company's
independent public accountants for the year ending December 31, 1996; and
9. To act upon such other matters as may properly come before the meeting
or any adjournment or postponement thereof.
The foregoing items of business are more fully described in the Proxy
Statement accompanying this Notice. Only stockholders of record at the close of
business on April 1, 1996 are entitled to notice of, and to vote at, the meeting
and at any postponement or adjournment thereof. A list of stockholders entitled
to vote at the Annual Meeting will be available for inspection at the offices of
the Company.
For The Board Of Directors
Katrina J. Church
SECRETARY
Santa Clara, California
April 2, 1996
YOUR VOTE IS IMPORTANT
IT IS IMPORTANT THAT ALL STOCKHOLDERS BE REPRESENTED AT THE ANNUAL MEETING.
THEREFORE, IN ORDER TO ASSURE YOUR REPRESENTATION WHETHER OR NOT YOU PLAN TO
ATTEND THE MEETING, PLEASE COMPLETE, DATE, SIGN, AND RETURN THE ENCLOSED PROXY
PROMPTLY IN THE ACCOMPANYING REPLY ENVELOPE. NO POSTAGE IS NECESSARY IF MAILED
IN THE UNITED STATES. YOU MAY REVOKE YOUR PROXY AT ANY TIME PRIOR TO THE ANNUAL
MEETING. IF YOU ATTEND THE ANNUAL MEETING AND WISH TO CHANGE YOUR PROXY VOTE,
YOU MAY DO SO AUTOMATICALLY BY VOTING IN PERSON AT THE ANNUAL MEETING.
<PAGE>
PRELIMINARY PROXY
VISX, INCORPORATED
----------------
PROXY STATEMENT
1996 ANNUAL MEETING OF STOCKHOLDERS
---------------------
INFORMATION CONCERNING VOTING AND PROXY SOLICITATION
GENERAL
These proxy materials are furnished in connection with the solicitation of
proxies on behalf of the Board of Directors of VISX, Incorporated (the
"Company") for the Annual Meeting of Stockholders to be held on May 17, 1996 at
9:00 a.m., local time, and at any adjournment or postponement of the Annual
Meeting. The Annual Meeting will be held at the Company's principal executive
offices located at 3400 Central Expressway, Santa Clara, California. The
telephone number at the meeting location is (408) 733-2020. This Proxy
Statement, Notice of Annual Meeting and the accompanying proxy card will be
mailed to stockholders on or about April 2, 1996.
PURPOSE OF MEETING
The specific proposals to be considered and acted upon at the Annual Meeting
are summarized in the accompanying Notice of Annual Meeting of Stockholders.
Each proposal is described in more detail in this Proxy Statement.
VOTING AND SOLICITATION
The Company's Common Stock is the only class of security entitled to vote at
the Annual Meeting. Only stockholders of record at the close of business on
April 1, 1996 will be entitled to vote on all matters to come before the
meeting. Each outstanding share of Common Stock entitles its holder to cast one
vote for each matter to be voted upon. On April 1, 1996, there were
approximately shares of Common Stock outstanding and entitled to vote at
the Annual Meeting.
Votes cast by proxy or in person at the Annual Meeting will be tabulated by
the Inspector of Elections (the "Inspector") with the assistance of the
Company's Transfer Agent. The Inspector will also determine whether or not a
quorum is present. The presence at the Annual Meeting, in person or by proxy, of
the holders of a majority of the shares of Common Stock outstanding on April 1,
1996 will constitute a quorum. All proxies representing shares that are entitled
to vote at the meeting will be counted toward establishing a quorum, regardless
of whether such proxies contain abstentions or broker non-votes.
Whether or not you are able to attend the Annual Meeting, you are urged to
complete and return the enclosed proxy. All valid proxies received prior to the
meeting will be voted. If you specify a choice with respect to any item by
marking the appropriate box on the proxy, the shares will be voted in accordance
with that specification. If no specification is made, the shares will be voted
FOR Proposals 1, 2, 3, 4, 5, 6, 7, and 8, and, in the proxy holders' discretion,
as to other matters that may properly come before the Annual Meeting. If a
broker indicates on the enclosed proxy or its substitute that the broker does
not have discretionary authority as to certain shares to vote on a particular
matter ("Broker Non-Votes"), those shares will not be considered as present with
respect to that matter.
The Company will bear the entire cost of solicitation, including the
preparation, assembly, printing and mailing of this Proxy Statement, the proxy
card and any additional soliciting material furnished to stockholders. The
Company may retain the services of Morrow and Company, Inc. or
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other proxy solicitors to solicit proxies, for which the Company estimates that
it would pay fees not to exceed an aggregate of $10,000. In addition, the
Company expects to reimburse brokerage firms and other persons representing
beneficial owners of shares for their expense in forwarding solicitation
material to such beneficial owners. The original solicitation of proxies by mail
may be supplemented by solicitation by telephone, telegram, facsimile, or
personal communication by directors, officers, regular employees or agents of
the Company. No additional compensation will be paid to these individuals for
any such services.
REVOCABILITY OF PROXIES
You may revoke or change your proxy at any time before the Annual Meeting.
To do this, send a written notice of revocation or another signed proxy with a
later date to the Secretary of the Company, Katrina J. Church, at the Company's
principal executive offices, before the beginning of the Annual Meeting. You may
also revoke your proxy by attending the Annual Meeting and voting in person.
Attendance at the Annual Meeting will not, in itself, constitute revocation of a
previously granted proxy.
STOCKHOLDER PROPOSALS FOR 1997 ANNUAL MEETING.
Stockholder proposals that are intended to be presented at the Company's
annual meeting of stockholders to be held in 1997 must be received by the
Company no later than December 13, 1996 in order to be included in the proxy
statement and related proxy materials.
PROPOSAL NO. 1
ELECTION OF DIRECTORS
NOMINEES
A board of five directors is to be elected at the Annual Meeting. Unless
otherwise instructed, the proxy holders will vote the proxies received for the
Company's five nominees named below, all of whom are currently directors of the
Company, except for Mr. Galiardo. In the event that any nominee of the Company
is unable or declines to serve as a director at the time of the Annual Meeting,
the proxies will be voted for any substitute nominee designated by the current
Board of Directors to fill the vacancy. It is not expected that any nominee
listed below will be unable or will decline to serve as a director. In the event
that additional persons are nominated for election as directors, the proxy
holder intends to vote all proxies received in such a manner as will ensure the
election of as many of the nominees listed below as possible, and, in such
event, the specific nominees to be voted for will be determined by the proxy
holders. In any event, the proxy holders cannot vote for more than five persons.
The term of office of each person elected as a director will continue until the
next Annual Meeting of Stockholders or until his or her successor has been
elected and qualified.
The names of the nominees, and certain information about them, are set forth
below:
ELIZABETH H. DAVILA DIRECTOR SINCE 1995
Ms. Davila, 51, has been Executive Vice President and Chief Operating Officer of
the Company since May 1995, and a Director since December 1995. From 1977 to
1994, Ms. Davila held senior management positions with Syntex Corporation which
included Vice President of Quality and Reengineering, Vice President and
Director of the Drug Development Optimization Program, Vice President of
Marketing and Sales for the Syva Company Diagnostics Division and Vice President
of Marketing and Sales of the Syntex Ophthalmics Division.
2
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GLENDON E. FRENCH DIRECTOR SINCE 1995
Mr. French, 61, has been a Director of the Company since May 1995. He served as
Chairman and Chief Executive Officer of Imagyn Medical, Inc. ("Imagyn") from
February 1992 until his retirement as Chief Executive Officer in December 1994.
He continued to serve as Chairman of Imagyn until April 1995. From 1989 until he
joined Imagyn in February 1992, Mr. French was Chairman, Chief Executive Officer
and a director of Applied Immune Sciences, Inc. From 1982 to 1988, Mr. French
was President of the Health and Education Services Sector of ARA Services, Inc.,
and from 1972 to 1982, he was President of American Critical Care (formerly a
division of American Hospital Supply Corp., now known as Dupont Critical Care).
JOHN W. GALIARDO DIRECTOR NOMINEE
Mr. Galiardo, 62, is Vice Chairman of the Board of Directors and General Counsel
of Becton Dickinson and Company. Mr. Galiardo joined Becton Dickinson in 1977
and is responsible for the Law and Patent Departments, Medical Affairs,
Corporate Regulatory and Quality Affairs, the Environment and Safety
Departments, and Public Affairs. Prior to joining Becton Dickinson, Mr. Galiardo
was Assistant General Counsel of E. R. Squibb & Sons, and before that he was
associated with the law firm Dewey, Ballantine, Bushby, Palmer & Wood in New
York City. Mr. Galiardo is a member of the Board of Directors of the Health
Industry Manufacturers Association, and serves on the Board of Trustees of the
Healthcare Leadership Council. He also serves as a member of the Board of
Directors of the New Jersey Manufacturers Insurance Company and New Jersey
Re-Insurance Company.
MARK B. LOGAN DIRECTOR SINCE 1994
Mr. Logan, 57, has served as Chairman of the Board, President, and Chief
Executive Officer of the Company since November 1994. From January 1992 to July
1994, Mr. Logan was Chairman of the Board, President and Chief Executive Officer
of Insmed Pharmaceuticals, Inc., a development-stage biopharmaceutical company,
and has served on its board of directors since its founding in 1988. Prior to
1992, Mr. Logan was a Principal Associate with McManis Associates, Inc. a
Washington D.C. based research and management firm, specializing in the health
care field. From 1981 to 1985, Mr. Logan was employed by Bausch & Lomb, Inc. as
President, Health Care and Consumer Group, and was a member of Bausch & Lomb's
board of directors. From 1975 to 1981, he was employed by Becton Dickinson &
Company, where he held the position of Consumer Group President, and was
responsible for that Company's worldwide diabetes syringe business.
RICHARD B. SAYFORD DIRECTOR SINCE 1995
Mr. Sayford, 65, has been a Director of the Company since May 1995. He has been
President of Strategic Enterprises, Inc., a private business consulting firm
specializing in providing services to high technology and venture firms, since
1979. He is a founding investor of MCI Communications Co., and has served as a
member of the Board of Directors of MCI since 1980. He is also a director of
Laser Technologies, Inc. He is former President of Amdahl International, Ltd.
and Corporate Vice President of Amdahl Corporation.
VOTE REQUIRED AND BOARD OF DIRECTORS RECOMMENDATION
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" THE NOMINEES LISTED HEREIN.
The five nominees receiving the highest number of affirmative votes of the
shares present or represented and entitled to be voted for them shall be elected
as directors. Votes withheld from any director will be counted for purposes of
determining the presence or absence of a quorum for the transaction of business
at the meeting, but have no other legal effect upon election of directors under
Delaware law.
3
<PAGE>
FURTHER INFORMATION CONCERNING
THE BOARD OF DIRECTORS
BOARD COMMITTEES AND MEETINGS
The Board of Directors of the Company held seven meetings and five
telephonic meetings during 1995. All current directors attended 100% of the
total meetings of the Board and the Board committees of which they were members
during 1995. The Board of Directors has standing Audit, Compensation, and
Nominating Committees.
AUDIT COMMITTEE. In 1995, the Audit Committee was comprised of former
Directors Karen Brenner (through May 1995) and Robert Samuels (through December
1995), and current Directors French and Sayford. Mr. French was appointed to the
Audit Committee in May 1995; Mr. Sayford in December 1995. The Audit Committee
oversees engagement of the Company's independent auditors, reviews the
arrangements for and scope of the audit by the Company's independent auditors,
and reviews and evaluates the Company's accounting practices and its systems of
internal accounting controls. The Audit Committee held three meetings during
1995.
COMPENSATION COMMITTEE. In 1995, the Compensation Committee was comprised
of former Directors Brenner (through May 1995) and Samuels (through December
1995), and current Directors Sayford and French. Mr. Sayford was appointed to
the Compensation Committee in May 1995; Mr. French in December 1995. The
Compensation Committee sets the compensation of the Company's executive
officers, including salary and bonuses, and administers the Company's stock
option plans. The Compensation Committee held five meetings and took action by
written consent four times during 1995.
NOMINATING COMMITTEE. In February 1995, the Board formed a separate
Nominating Committee, comprised of Director Logan and former Directors Brenner
and Samuels. In May 1995, current Directors French and Sayford were appointed to
replace Ms. Brenner and Dr. Samuels on the Nominating Committee. The functions
of the Nominating Committee are to solicit recommendations for candidates for
the Board of Directors; develop and review background information for
candidates; and make recommendations to the Board regarding such candidates. The
Committee considers stockholder recommendations for Director nominees.
Recommendations may be sent to the Company's principal executive offices
(Attention: Secretary).
DIRECTOR COMPENSATION
In the first part of 1995, non-employee directors were paid an annual
retainer of $10,000, and a fee of $500 for each Committee meeting that the
director attended. Effective upon election at the 1995 Annual Meeting, the fees
were increased as follows: non-employee directors will be paid an annual
retainer of $15,000, a fee of $1,000 for each Board meeting the director attends
($250 for attendance by telephone), and $500 for each Committee meeting that the
director attends ($750 for the chairperson of the Committee). In addition,
directors are reimbursed for out-of-pocket travel expenses associated with their
attendance at Board meetings. Non-employee directors also receive automatic
annual grants of options to purchase 2,000 shares of the Company's Common Stock.
Beginning with the 1995 Annual Meeting, non-employee directors also receive a
one-time grant of options to purchase 15,000 shares of the Company's Common
Stock upon initial election to the Board of Directors.
COMPLIANCE WITH SECTION 16(A) OF THE EXCHANGE ACT
Section 16(a) of the Securities Exchange Act of 1934 requires the Company's
executive officers and directors and persons who own more than ten percent of
the Company's Common Stock (collectively, "Reporting Persons") to file reports
of ownership and changes in ownership of the Company's Common Stock with the
Securities and Exchange Commission. Reporting Persons are required by SEC
regulations to furnish the Company with copies of all Section 16(a) forms that
they file. Based solely on a review of the copies of reporting forms furnished
to the Company or written representations from certain Reporting Persons that no
annual forms were required, the Company believes that during 1995 all filing
requirements were complied with.
4
<PAGE>
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
The Company's Compensation Committee currently consists of Directors French
and Sayford. During 1995, the Company's Compensation Committee members were:
Karen Brenner (through May 1995), Robert B. Samuels (through December 1995),
Richard B. Sayford (from May 1995), and Glendon E. French (from December 1995),
all of whom were non-employee directors. No executive officer of the Company
served on the compensation committee of another entity or on any other committee
of the board of directors of another entity performing similar functions during
1995.
EXECUTIVE COMPENSATION
REPORT OF THE COMPENSATION COMMITTEE ON EXECUTIVE COMPENSATION
COMPENSATION COMMITTEE. The Compensation Committee of the Board of
Directors is composed entirely of outside directors. The Committee is
responsible for setting and administering the policies and programs that govern
both annual compensation and stock ownership programs for the executive officers
of the Company.
COMPENSATION PHILOSOPHY. The goals of the Company's compensation program
are to provide a strong and direct link between the Company's performance and
executive pay. The Company aligns management compensation with business
objectives and stockholder interests by setting performance measures and
objectives, and tying those objectives to a cash bonus plan and the use of
stock-based incentives. To that end, the Company positions its executive base
salary levels in the middle of the range of survey data. The survey data
includes both the Company's direct competitors and companies with whom the
Company competes for executive talent.
Other key elements of the Company's compensation philosophy include
establishing compensation programs that provide competitive pay systems to help
the Company attract, retain and motivate its executive management. Pay is
sufficiently variable that above-average performance results in above-average
total compensation, and below-average performance for the Company or the
individual results in below-average total compensation. The focus is on
achievement of a pre-set business plan for Company-wide goals and individual
performance.
COMPLIANCE WITH INTERNAL REVENUE CODE SECTION 162(M). The Company is
subject to Section 162(m) of the Internal Revenue Code adopted in 1993, which
limits the deductibility of certain compensation payments to its executive
officers. The Company does not have a policy requiring the Committee to qualify
all compensation for deductibility under this provision. The Committee's current
view is that any non-deductible amounts will be immaterial to the Company's
financial or tax position, and that the Company derives substantial benefits
from the flexibility provided by the current system, in which the selection and
quantification of performance targets are modified from year to year to reflect
changing conditions. However, the Committee considers the net cost to the
Company in making all compensation decisions and will continue to evaluate the
impact of this provision on its compensation programs.
1995 EXECUTIVE COMPENSATION PROGRAM. In 1995, the Company's executive
compensation program integrated the following components: base salary; bonuses
paid under the Company's Incentive Compensation Plan, and stock option grants.
The Committee reviews each component of executive compensation annually. As an
executive's level of responsibility increases, a greater portion of that
individual's potential total compensation is based on performance incentives and
less on salary and employee benefits, causing potentially greater variability in
the individual's absolute compensation level from year to year.
Base Salary. The Committee establishes annual base salary levels for
executives based on competitive data, level of experience, position and
responsibility, the prior year's corporate performance and individual
recommendations of executive management.
Incentive Compensation Plan. In March 1995, the Committee approved a
performance-based executive compensation plan (The Incentive Compensation
Plan). The Committee awarded
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bonuses for 1995 using the criteria as set forth in that plan. The total
pool of monies available for bonuses was set based on the Committee's
assessment of 1995 performance. After reviewing the Company's 1995
performance and the executives' individual performance, the Committee
approved grants of bonuses for the executive officers. All Named Officers
were awarded cash bonuses in 1996 based on 1995 performance.
Stock Awards. The Committee approved option awards for all of the Named
Officers except Mr. Logan in 1995.
1995 CHIEF EXECUTIVE OFFICER COMPENSATION. Mr. Logan, in his capacity as
the Chairman of the Board, Chief Executive Officer and President, participates
in the same compensation programs as the other Named Officers. The Committee has
targeted Mr. Logan's total compensation, including compensation derived from the
Incentive Compensation Plan and the stock option plan, at a level it believes is
competitive with the average amount paid by the Company's competitors and
companies with whom the Company competes for executive talent. Mr. Logan was
hired in November, 1994 at a base salary of $275,000, and his base salary
remained at $275,000 throughout 1995. Mr. Logan's Incentive Compensation Plan
award was based on the outstanding achievements of the Company during 1995 and
Mr. Logan's contributions to those achievements.
Submitted by the 1996
Compensation Committee of the
Company's
Board of Directors:
Glendon E. French
Richard B. Sayford
6
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COMPENSATION OF NAMED EXECUTIVES
SUMMARY COMPENSATION TABLE. The following table summarizes the total
compensation earned or paid to the Chief Executive Officer and the four other
most highly compensated executive officers having total cash compensation for
1995 in excess of $100,000 (collectively, the "Named Officers") for services
rendered to the Company during each of the last three fiscal years.
<TABLE>
<CAPTION>
LONG-TERM
COMPENSATION
ANNUAL COMPENSATION AWARDS
--------------------------------------- ------------------
OTHER ANNUAL NUMBER OF SHARES
NAME AND PRINCIPAL POSITION YEAR SALARY BONUS COMPENSATION UNDERLYING OPTIONS
- -------------------------------------------- --------- ----------- ----------- ------------- ------------------
<S> <C> <C> <C> <C> <C>
MARK B. LOGAN (1)........................... 1995 $ 275,000 $ 275,000 -- --
Chief Executive Officer, 1994 41,250 -- $ 75,000(2) 300,000
President and 1993 N/A N/A N/A N/A
Chairman of the Board
ELIZABETH H. DAVILA (3)..................... 1995 126,000 90,000 -- 100,000
Executive Vice President and 1994 N/A N/A N/A N/A
Chief Operating Officer 1993 N/A N/A N/A N/A
TERRANCE N. CLAPHAM......................... 1995 144,904 35,000 -- 10,000
Vice President, Research 1994 139,711 22,000 -- 11,500
and Development 1993 124,847 33,000 -- 20,000
W. MICHAEL WILSON........................... 1995 116,473 30,000 17,500
Vice President, Operations 1994 109,711 20,000 -- 6,900
1993 94,844 35,000 -- --
JORDAN D. HALLER (4)........................ 1995 72,115 34,000 97,500(5) 90,000
Vice President, Regulatory and 1994 N/A N/A N/A N/A
Clinical Affairs 1993 N/A N/A N/A N/A
</TABLE>
- ------------------------
(1) Mr. Logan joined the Company in November 1994.
(2) Consists of expenses paid in connection with Mr. Logan's relocation to
California.
(3) Ms. Davila joined the Company in April 1995.
(4) Dr. Haller joined the Company in June 1995. Prior to that time, he was a
consultant to the Company.
(5) Consists of consulting fees paid in the first half of 1995.
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OPTION GRANTS IN LAST FISCAL YEAR. The table below provides details
regarding stock options granted to the Named Officers in 1995, and the potential
realizable value of those options. The values do not take into account risk
factors such as non-transferability and limits on exercisability. In assessing
these values it should be kept in mind that no matter what theoretical value is
placed on a stock option on the date of grant, its ultimate value will depend on
the market value of the Company's stock at a future date. In the past the
Company has used the Black-Scholes valuation model as an indicator of the grant
date present value of option grants. The Company intends to use the 5% and 10%
rates called for in the SEC regulations. For ease of comparison with last year's
table, the information is provided below using both methods.
<TABLE>
<CAPTION>
POTENTIAL REALIZABLE
VALUE AT ASSUMED
NUMBER OF ANNUAL RATES OF STOCK
SHARES PERCENT OF TOTAL PRICE APPRECIATION
UNDERLYING OPTIONS GRANTED EXERCISE GRANT DATE FOR OPTION TERM (3)
OPTIONS TO EMPLOYEES IN PRICE PER EXPIRATION PRESENT ---------------------
NAME GRANTED (1) FISCAL YEAR SHARE DATE VALUE (2) 5% ($) 10% ($)
- ---------------------------------------- ----------- ----------------- --------- ----------- ---------- --------- ----------
<S> <C> <C> <C> <C> <C> <C> <C>
Mark B. Logan........................... -0- N/A N/A N/A N/A N/A N/A
Elizabeth H. Davila..................... 100,000 17% $ 13.25 05/03/05 $3,124,000 $ 833,285 $2,111,709
Terrance N. Clapham..................... 10,000 2 $ 11.8125 01/24/05 320,200 74,288 188,261
W. Michael Wilson....................... 10,000 2 $ 11.8125 01/24/05 320,200 74,288 188,261
7,500 1 $ 19.875 09/06/05 209,250 93,745 237,567
Jordan D. Haller........................ 90,000 14 $ 13.25 06/08/05 2,811,600 749,957 1,900,538
</TABLE>
- ------------------------------
(1) Options have a ten-year term and vest 25% on the first anniversary of the
grant date, and ratably thereafter at the rate of 1/48th of the total grant
per month for three years. The exercisability of the options is
automatically accelerated in the event of certain business combinations, a
liquidation or dissolution, or upon a change in control of the Company.
(2) Calculated using the Black-Scholes option pricing model. Assumes that
options have a ten-year term. Also assumes stock price volatility of 30%, a
current dividend yield of 0%, and an expected interest rate of 4.96% (based
on the average short-term Treasury Bill rate as of December 29, 1995). In
future proxy statements, the Company does not intend to use an alternative
formula for a grant date valuation, as the Company does not believe that
any formula will determine with reasonable accuracy a present value based
on future unknown or volatile factors.
(3) The dollar amounts under these columns are the result of calculations at
the 5% and 10% rates set by the SEC and therefore are not intended to
forecast possible future appreciation, if any, of the Company's stock
price.
AGGREGATE OPTION EXERCISES IN LAST FISCAL YEAR AND FISCAL YEAR-END
VALUES. The following table provides information with respect to option
exercises in 1995 by the Named Officers and the value of such officers'
unexercised options as of December 31, 1995. The values for "in-the-money"
options represent the positive spread between the exercise price of any such
existing stock options and the year-end price of Common Stock.
<TABLE>
<CAPTION>
NUMBER OF SHARES VALUE OF UNEXERCISED
UNDERLYING UNEXERCISED IN-THE-MONEY OPTIONS
SHARES OPTIONS AT FISCAL YEAR-END AT FISCAL YEAR-END (2)
ACQUIRED ON VALUE -------------------------- --------------------------
NAME EXERCISE REALIZED (1) EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
- ------------------------------- ------------- ----------- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
Mark B. Logan.................. -- -- 81,249 218,751 $2,173,411 $ 5,851,589
Elizabeth H. Davila............ -- -- -- 100,000 -- 2,575,000
Terrance N. Clapham............ -- -- 98,718 22,782 3,191,985 588,640
W. Michael Wilson.............. 9,009 $ 68,047 11,064 23,336 290,605 554,959
Jordan D. Haller............... -- -- 60,000 30,000 1,545,000 772,500
</TABLE>
- ------------------------------
(1) Market value of underlying shares at the exercise date minus the exercise
price.
(2) Value of unexercised options is based on the price of the last reported
sale of the Company's Common Stock on the Nasdaq National Market of $39.00
per share on December 29, 1995 (the last trading day for fiscal 1995),
minus the exercise price.
8
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EMPLOYMENT ARRANGEMENTS
In November 1990, the Company entered into an employment agreement with Mr.
Clapham. The agreement contains provisions for the assignment to the Company of
any patent rights and other proprietary knowledge developed by him relating to
the Company's products at any time during his employment or one year thereafter.
In addition, he has agreed not to compete with the business of the Company
during the term of his employment agreement and for one year thereafter. The
agreement renews automatically for additional successive twelve-month periods
and may be terminated by either party upon twelve months notice. The Company may
terminate the agreement for cause, as defined in the agreements, at any time.
Compensation and benefits continue for the remaining term of the agreement under
certain prescribed circumstances, such as an involuntary termination or a
voluntary resignation after a significant reduction in duties or
responsibilities, a reduction in level of compensation or benefits or a change
in the geographic location of Mr. Clapham's principal office. The employment
agreement provides for an annual salary review by the Compensation Committee of
the Board of Directors and for a cash bonus pursuant to the program approved by
the Board. For 1995, the Compensation Committee approved a salary increase for
Mr. Clapham (to $150,000 per year). The bonus program provides for cash payments
of 20-50% of base salary, subject to accomplishment of performance objectives
set by the Compensation Committee.
Pursuant to an employment arrangement with the Company, Mr. Logan shall be
entitled to 18 months of salary as a severance payment in the event of any
change in control transaction (defined as a business combination transaction in
which stockholders of the Company prior to such transaction own immediately
after such transaction less than 50% of the outstanding voting securities of the
surviving entity) which results in an actual or constructive termination of his
employment.
9
<PAGE>
PERFORMANCE GRAPH
The SEC requires that the Company include in this proxy statement a
line-graph presentation comparing cumulative, five-year stockholder returns on
an indexed basis with a broad equity market index and either a nationally
recognized industry standard or an index of peer companies selected by the
Company. The following graph assumes that $100 was invested on December 29, 1990
(the last trading day of that year) in each of the Company's Common Stock and
each of the comparative markets, and that all dividends were reinvested. The
stock price performance shown on the graph is not necessarily indicative of
future price performance.
The following graph compares the performance of the Company's Common Stock
with the performance of the Standard & Poor's Biotechnical and Medical Products
Group Index, and the Nasdaq National Market (U.S. Composite) Index.
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------
TOTAL RETURN ANALYSIS 12/31/90 12/31/91 12/31/92 12/31/93 12/30/94 12/29/95
- -----------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
VISX $ 100.00 $ 366.67 $ 269.44 $ 344.44 $ 227.78 $ 866.67
- -----------------------------------------------------------------------------------------------------
S&P MEDICAL PRODUCTS $ 100.00 $ 163.08 $ 139.69 $ 106.59 $ 126.11 $ 212.60
- -----------------------------------------------------------------------------------------------------
NASDAQ COMPOSITE (US) $ 100.00 $ 160.84 $ 187.19 $ 214.88 $ 210.05 $ 296.81
- -----------------------------------------------------------------------------------------------------
</TABLE>
10
<PAGE>
PRINCIPAL STOCKHOLDERS
The following table sets forth certain information known to the Company
regarding the beneficial ownership of the Company's Common Stock as of March 22,
1996 by (1) each person known to the Company to own more than 5% of the issued
and outstanding Common Stock, (2) each of the Company's directors, (3) each of
the Named Officers, and (4) all directors, nominees and executive officers as a
group. Except as otherwise indicated, each person has sole voting and investment
power with respect to all shares shown as beneficially owned, subject to
community property laws where applicable.
<TABLE>
<CAPTION>
APPROXIMATE
COMMON STOCK PERCENT
BENEFICIALLY BENEFICIALLY
BENEFICIAL OWNER OWNED OWNED
- ------------------------------------------------------------------------------------ -------------- -------------
<S> <C> <C>
Twentieth Century Companies, Inc. .................................................. 975,000 (1) 6.43%
Main Street
P.O. Box 418210
Kansas City, Missouri 64141-9210
Terrance N. Clapham................................................................. 313,981 (2) 2.05%
Mark B. Logan....................................................................... 113,889 (3) +
Jordan D. Haller.................................................................... 79,000 (4) +
Elizabeth H. Davila................................................................. 25,895 (5) +
W. Michael Wilson................................................................... 20,619 (6) +
Richard B. Sayford.................................................................. 2,200 (7) +
Glendon E. French................................................................... 2,000 (8) +
John W. Galiardo.................................................................... 0 N/A
All directors, nominees, and executive officers as a group (11 persons)............. 603,375 (9) 3.88%
</TABLE>
- ------------------------
+ Represents less than 1% of the Company's outstanding Common Stock
(1) As reported on Schedule 13G filed with the Securities and Exchange
Commission ("SEC") on or about February 9, 1996. Twentieth Century
Companies, Investor Research Corporation and James E. Stowers, Jr. share
beneficial ownership of these shares and have sole voting power and sole
dispositive power as to all of the shares.
(2) Includes options to purchase 105,331 shares that will be exercisable on or
before May 31, 1996.
(3) Includes options to purchase 112,499 shares that will be exercisable on or
before May 31, 1996.
(4) Includes options to purchase 60,000 shares that will be exercisable on or
before May 31, 1996.
(5) Includes options to purchase 25,000 shares that will be exercisable on or
before May 31, 1996.
(6) Includes options to purchase 16,156 shares that will be exercisable on or
before May 31, 1996.
(7) Includes options to purchase 2,000 shares that will be exercisable on or
before May 31, 1996.
(8) Includes options to purchase 2,000 shares that will be exercisable on or
before May 31, 1996.
(9) Includes options to purchase an aggregate of 368,392 shares held by
non-employee directors and the executive officers that will be exercisable
on or before May 31, 1996.
11
<PAGE>
PROPOSAL NO. 2
ADOPTION OF BYLAWS
Following the Company's last annual meeting of stockholders in May 1995, the
members of the Company's Board of Directors, including the new directors elected
at such annual meeting, undertook a review of the Company's bylaws and other
corporate governance policies. The Company's Bylaws as previously in effect
imposed burdensome operational requirements that were beyond those required by
Delaware law. In particular, the Bylaws provided a five-day notice requirement
for board meetings. Following this review, the Board of Directors approved
amended and restated Bylaws (the "Restated Bylaws").
The Restated Bylaws incorporate several changes permitted by Delaware law
that the Board of Directors believes will streamline corporate governance. These
include shortening the notice period for meetings of the Board of Directors from
five days to two days. In addition, the Restated Bylaws provide for an advance
notice requirement for stockholder nominees and business proposed to be brought
by stockholders before any stockholders meeting. The Restated Bylaws also
eliminate the right of stockholders to call special meetings of stockholders.
The advance notice requirement and the elimination of the right of stockholders
to call a special meeting of stockholders could have the effect of delaying,
deferring or preventing a change in control of the Company.
The foregoing represents a summary of certain provisions of the Restated
Bylaws and does not represent a complete description of the Restated Bylaws.
Stockholders should review the complete Restated Bylaws attached hereto as
EXHIBIT A.
VOTE REQUIRED AND BOARD OF DIRECTORS RECOMMENDATION
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" PROPOSAL NUMBER 2. The
affirmative vote of holders of a majority of the shares of Common Stock
represented at the meeting is necessary to approve the adoption of the Amended
and Restated Bylaws.
PROPOSAL NO. 3
APPROVAL OF ADOPTION OF 1995 DIRECTOR OPTION PLAN
In June 1995, the Board of Directors approved, and recommended that the
Company's stockholders approve, a new 1995 Director Option Plan (the "Director
Plan"). The Director Plan provides for automatic stock option grants to Outside
Directors (defined as members of the Board of Directors who are not employees)
of the Company. Prior to the adoption of the Director Plan, the 1993 Flexible
Stock Incentive Plan (the "1993 Plan") provided automatic stock option grants to
Outside Directors. The Board of Directors approved the adoption of the Director
Plan to replace similar provisions in the 1993 Plan because it believes that
administering stock options and option grants to Outside Directors under a
separate plan will improve the efficiency of granting and administering stock
options to the Outside Directors of the Company. Once the Director Plan is
adopted, automatic stock options will be granted only under the Director Plan,
and similar provisions under the 1993 Plan shall terminate.
The essential features of the Director Plan and certain information
regarding the Director Plan and its purpose are set forth below. This
description is qualified in its entirety by the terms of the 1995 Option Plan,
which is attached to this Proxy Statement as EXHIBIT B and is incorporated in
this Proxy Statement by this reference.
STATUS OF SHARES. Initially, 250,000 shares will be authorized and
available for future grants under the Director Plan.
ELIGIBILITY; ADMINISTRATION. Under the Director Plan, Outside Directors are
granted automatic "non-statutory stock options" not intended to qualify within
the meaning of Section 422 of the Internal Revenue Code of 1986, as amended (the
"Code"). Upon first becoming a director, each new Outside Director will receive
an automatic grant of an option to purchase up to 15,000 shares of
12
<PAGE>
Common Stock ("First Option"), and each continuing Outside Director will receive
(provided that such Outside Director has been a director for at least six months
prior to such grant), upon re-election to the Board each year, an automatic
grant of an option to purchase up to 2,000 shares of Common Stock ("Subsequent
Option"), at an exercise price equal to 100% of the fair market value on the
date of grant. The Director Plan is designed to work automatically and not to
require administration. However, where administration is necessary, it will be
provided by the Board of Directors of the Company. Any individual who is not a
"disinterested" person under Rule 16b-3 shall have no discretion concerning
decisions regarding the Director Plan. The interpretation and construction of
any provision of the Director Plan by the Board of Directors shall be final and
conclusive. Members of the Board of Directors do not receive any additional
compensation for their services in connection with the administration of the
Director Plan.
EXERCISE PRICE; MARKET VALUE. The exercise price of stock options granted
under the Director Plan must be at least equal to the last reported closing sale
price (or the closing bid, if no sales were reported) of the Company's Common
Stock on the date of grant. Payment of the exercise price may be made in cash,
promissory notes, shares of Common Stock or certain other consideration. On
March 6, 1995, the closing price of the Company's Common Stock as reported on
the Nasdaq National Market System was $33.375.
EXERCISABILITY. Options granted under the Director Plan will be exercisable
25% on the first anniversary of the date of grant and ratably thereafter over
thirty-six months. All options under the Director Plan have a term of ten years
from the date of grant. Options are exercisable only while the Outside Director
remains a director of the Company and for three months thereafter.
AMENDMENT AND TERMINATION. The Board of Directors may terminate the
Director Plan or amend the Director Plan from time to time without approval of
the stockholders. However, to the extent necessary and desirable to comply with
Rule 16b-3 under the Exchange Act (or any other applicable law or regulation),
the Company shall obtain approval of the stockholders with respect to plan
amendments in the manner required by such law or regulation. No amendment may
impair any options previously granted under the Director Plan without the
consent of the optionee. The Director Plan will terminate in June 2000, unless
earlier terminated by the Board of Directors.
TAX INFORMATION REGARDING STOCK OPTIONS. An optionee under the Director
Plan will not recognize any taxable income upon the grant of the option. Upon
exercise of an option, however, the optionee will recognize ordinary income for
tax purposes measured by the excess of the then fair market value of the shares
over the exercise price. Upon resale of the shares by the optionee, any
difference between the sales price and the fair market value at the time of
exercise, to the extent not recognized as ordinary income as described above,
will be treated as capital gain or loss. The Company will be allowed a deduction
for federal income tax purposes equal to the amount of ordinary income
recognized by the optionee.
VOTE REQUIRED AND BOARD OF DIRECTORS RECOMMENDATION
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" PROPOSAL NUMBER 3. The
affirmative vote of holders of a majority of the shares of Common Stock
represented at the meeting is necessary to approve the adoption of the Director
Plan.
PROPOSAL NO. 4
ADOPTION OF 1995 STOCK PLAN
As of the date of this Proxy Statement, there remain available to grant
under all of the Company's option plans options to purchase zero (0) shares of
the Company's Common Stock. In December 1995, the Board of Directors approved,
and recommended that the Company's stockholders approve, a new 1995 Stock Plan
(the "1995 Plan"). To enable the Company to continue to grant stock options to
new employees upon hiring, the Board of Directors adopted in February 1996 a
Supplemental Stock Option Plan (the "Supplemental Plan"), which allows for
grants of non-qualified stock options to non-officer
13
<PAGE>
and non-director employees of the Company. With those exceptions, the
Supplemental Plan is identical in its terms to the 1995 Plan. If stockholder
approval of the 1995 Plan is received at the annual meeting, the Supplemental
Plan will be terminated.
A description of the principal terms of the 1995 Plan and its purpose are
set forth below. This description is qualified in its entirety by the terms of
the 1995 Plan, which is attached to this Proxy Statement as EXHIBIT C and is
incorporated in this Proxy Statement by this reference.
STATUS OF SHARES. Initially, 1,517,346 shares (representing 10% of the
shares issued and outstanding on the date the Board Adopted the 1995 Plan) will
be authorized and available for future grants under the 1995 Plan. Each year
thereafter, on the first day of each new fiscal year, the number of shares
available shall be increased by a number of shares equal to 3% of the number of
shares of Common Stock outstanding on the last preceding business day. The
maximum number of shares reserved and available for issuance pursuant to
Incentive Stock Options is 10% of the Shares issued and outstanding on the date
the Board adopted the plan. Upon adoption by the stockholders of the 1995 Plan,
the Supplemental Plan will be terminated, and the number of shares available to
grant under the 1995 Plan will be reduced by the number of stock options granted
pursuant to the Supplemental Plan.
ELIGIBILITY; ADMINISTRATION. The 1995 Plan provides for the grant of
incentive stock options and non-qualified stock options (collectively,
"options"), and the award of rights to purchase Common Stock, to employees
(including officers and directors) and consultants of the Company, except that
only employees can receive incentive stock options. The 1995 Plan will be
administered by the Compensation Committee of the Board of Directors, which
consists of two non-employee directors (currently, Directors French and
Sayford). Members of the Committee serve for such time as the Board determines,
are subject to removal by the Board at any time, and, with the exception of
Automatic Options granted under the 1993 Flexible Stock Incentive Plan (or the
1995 Director Plan, if adopted), are not eligible to receive stock options. The
Committee would have the authority to interpret the 1995 Plan and, subject to
its terms, to determine the recipients of awards and the times at which awards
will be granted, the terms of the awards (which need not be identical),
including exercise prices (except for incentive stock options), number of shares
subject to awards and terms of exercise and whether an award will be an
incentive option, a non-qualified option, a restricted stock purchase or bonus.
For an option to qualify as an incentive option, generally the optionee must
remain an employee at all times commencing with the grant of the option and
ending with the exercise of the option. Independent contractors and directors
who are not also employees may not be granted incentive options. Incentive stock
options may not be granted at an exercise price less than the fair market value
of the underlying stock on the date of grant.
EXERCISE PRICE; MARKET VALUE. The exercise price of stock options granted
under the 1995 Plan must be at least equal to the last reported closing sale
price (or the closing bid, if no sales were reported) of the Company's Common
Stock on the date of grant. Payment of the exercise price may be made in cash,
promissory notes, shares of Common Stock or certain other consideration. On
March 6, 1996, the closing price of the Company's Common Stock as reported on
the Nasdaq National Market System was $33.375.
EXERCISABILITY. As a general rule, options granted under the 1995 Plan will
be exercisable 25% on the first anniversary of the date of grant and ratably
thereafter over thirty-six months. The Company has in the past granted
performance-based options to certain employees and consultants, and the 1995
Plan is designed with the flexibility to grant options with vesting based on
performance criteria, if the Compensation Committee so elects. All options under
the 1995 Plan have a term of ten years from the date of grant. The option must,
however, be exercised no more than three months after the optionee ceases to be
so employed, with certain exceptions in the case of permanent disability, leaves
of absence, and death of the optionee.
AMENDMENT AND TERMINATION. The Board of Directors may terminate the 1995
Plan or amend the 1995 Plan from time to time without approval of the
stockholders. However, to the extent
14
<PAGE>
necessary and desirable to comply with Rule 16b-3 under the Exchange Act (or any
other applicable law or regulation), the Company shall obtain approval of the
stockholders with respect to plan amendments in the manner required by such law
or regulation. No amendment may impair any options previously granted under the
1995 Plan without the consent of the optionee. The 1995 Plan will terminate in
December 2000, unless earlier terminated by the Board of Directors. Any options
outstanding at the time of termination of the 1995 Plan will remain in force in
accordance with the provisions of the agreements evidencing such grants.
TAX INFORMATION REGARDING STOCK OPTIONS. The 1995 Option Plan allows for
the grant of non-qualified as well as incentive stock options. Historically, the
Company has granted only non-qualified stock options. It is the intention of
management to recommend the grant of incentive stock options to employees upon
the adoption by the stockholders of the 1995 Plan.
NON-QUALIFIED STOCK OPTIONS. An optionee under the 1995 Plan will not
recognize any taxable income upon the grant of the option. Upon exercise of an
option, however, the optionee will recognize ordinary income for tax purposes
measured by the excess of the then fair market value of the shares over the
exercise price. Upon resale of the shares by the optionee, any difference
between the sales price and the fair market value at the time of exercise, to
the extent not recognized as ordinary income as described above, will be treated
as capital gain or loss. The Company will be allowed a deduction for federal
income tax purposes equal to the amount of ordinary income recognized by the
optionee.
INCENTIVE STOCK OPTIONS. An incentive option is an option intended to
satisfy the requirements applicable to incentive stock options under Section 422
of the Code. If an option is treated as an incentive option, the optionee
generally recognizes no taxable income as the result of the grant or exercise of
the option unless the optionee is subject to the alternative minimum tax
("AMT"). The Company generally will not be allowed a deduction for federal
income tax purposes in connection with the grant or exercise of an incentive
option, regardless of the applicability of the AMT to the optionee. The Company
will be entitled to a deduction, however, to the extent that the optionee
recognizes ordinary income upon a disqualifying disposition. Upon a sale of the
shares more than two years after the grant of an incentive option and one year
after the shares are transferred to the optionee, whichever is later, gain or
loss will be characterized for federal income tax purposes as long-term capital
gain or loss, equal to the difference between the sale price and the exercise
price. If shares are disposed of prior to completion of either of these holding
periods, the optionee will have made a "disqualifying disposition" of the shares
and will recognize ordinary income at the time of disposition. The Company
generally will be entitled to a deduction for the year in which the
disqualifying disposition occurs in the amount of the ordinary income realized
by the optionee upon such disqualifying disposition.
VOTE REQUIRED AND BOARD OF DIRECTORS RECOMMENDATION
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" PROPOSAL NUMBER 4. The
affirmative vote of holders of a majority of the shares of Common Stock
represented at the meeting is necessary to approve the adoption of the 1995
Plan.
PROPOSAL NO. 5
AMENDMENT OF CERTIFICATE TO
INCREASE AUTHORIZED COMMON STOCK
PROPOSED AMENDMENT
In February 1996, the Board of Directors approved an amendment to the
Certificate of Incorporation, to increase the authorized stock of the Company
from 30,000,000 shares, $0.01 par value, to 90,000,000 shares, $0.01 par value,
subject to stockholder approval. If both Proposals 5 and 6 are adopted, the
Amended and Restated Certificate of Incorporation will read as set forth in
Exhibit D to this Proxy Statement.
15
<PAGE>
PURPOSE AND EFFECT OF AMENDMENT
STATUS OF SHARES. The Company is currently authorized to issue 30,000,000
shares of $0.01 par value Common Stock. At December 31, 1995, 15,173,855 shares
of Common Stock were outstanding and 1,844,310 shares were reserved for issuance
pursuant to the exercise of stock options, and 431,659 shares were available for
grant pursuant to the Employee Stock Purchase Plan, leaving only 12,550,176
shares of Common Stock available for future issuance. The number of shares
remaining available is not considered adequate for the Company's future possible
requirements.
REASONS FOR AMENDMENT. The proposed increase in the authorized Common Stock
will provide the Company with greater flexibility to issue Common Stock for
corporate purposes. Although the Company has no firm plans to use the additional
authorized shares of Common Stock, the Board of Directors believes that it is
prudent to increase the number of authorized shares of Common Stock to the
proposed level in order to provide a reserve of shares available for issuance in
connection with possible future actions. Among the purposes for which such
additional authorized stock could be issued are to raise additional capital, to
fund stock splits or stock dividends, to be used as consideration in
acquisitions, and to fund stock option and other employee benefit plans.
Currently, management of the Company has no plans, agreements or arrangements
for the issuance of shares of Common Stock, except pursuant to employee benefit
plans. Having such additional authorized Common Stock available for issuance in
the future, however, would allow the Board of Directors to issue shares of
Common Stock without the delay and expense associated with seeking stockholder
approval. Elimination of such delays and expense occasioned by the need to
obtain stockholder approval will better enable the Company to (among other
things) engage in financing transactions and pursue acquisition opportunities
that may arise as well as take advantage of changing market and financial
conditions on a more competitive basis as determined by the Board of Directors.
The additional Common Stock to be authorized by adoption of the Amendment
would have rights identical to the currently outstanding Common Stock of the
Company. Adoption of the proposed Amendment and subsequent issuance of the
Common Stock would not affect the rights of the holders of currently outstanding
Common Stock of the Company, except for effects incidental to increasing the
number of shares of the Company's Common Stock outstanding. If the Amendment is
adopted, it will become effective upon filing of the Amended and Restated
Certificate of Incorporation with the Delaware Secretary of State.
POSSIBLE EFFECTS OF THE AMENDMENT. If the proposed Amendment is approved,
the Board of Directors may cause the issuance of additional shares of Common
Stock without further vote of stockholders of the Company (except as provided
under Delaware corporate law or under the rules of any national securities
exchange on which shares of the Company's Common Stock are then listed). Current
holders of Common Stock have no preemptive or similar rights, which means that
current stockholders do not have a prior right to purchase any new issue of
capital stock of the Company in order to maintain their proportionate ownership
of such stock. The effects of the authorization of additional shares of Common
Stock may also include dilution of the voting power of currently outstanding
shares.
Furthermore, the Board of Directors could use authorized but unissued shares
to create impediments to a takeover or a transfer of control of the Company.
Accordingly, the increase in the number of authorized shares of Common Stock may
deter a future takeover attempt which holders of Common Stock may deem to be in
their best interest or in which holders of Common Stock may be offered a premium
for their shares over the market price.
The Board of Directors is not currently aware of any attempt to take over or
acquire the Company. While it may be deemed to have potential anti-takeover
effects, the proposed Amendment to increase the authorized Common Stock is not
prompted by any specific effort or takeover threat currently perceived by
management. Moreover, management does not currently intend to propose additional
anti-takeover measures in the near future.
16
<PAGE>
VOTE REQUIRED AND BOARD OF DIRECTORS RECOMMENDATION
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" PROPOSAL NUMBER 5. The
affirmative vote by a majority of the shares of Common Stock of the Company
entitled to vote at the Annual Meeting will be required to amend the
Certificate. Proxies solicited by the Board of Directors will be so voted unless
stockholders specify otherwise on their proxy cards. Votes that are cast against
the proposal will be counted for purposes of determining the presence or absence
of a quorum and the total number of votes cast with respect to the proposal.
Abstentions will have the same effect as a vote against the proposal. Broker
non-votes will be counted for purposes of determining the presence or absence of
a quorum for the transaction of business, but will not be counted for purposes
of determining the number of votes cast with respect to the proposal.
PROPOSAL NO. 6
AMENDMENT OF CERTIFICATE TO
AUTHORIZE PREFERRED STOCK
PROPOSED AMENDMENT
In February 1996, the Board of Directors approved an amendment to the
Certificate of Incorporation to add a provision allowing for the issuance of
Preferred Stock, subject to stockholder approval. If both Proposals 5 and 6 are
adopted, the Amended and Restated Certificate of Incorporation will read as set
forth in Exhibit D to this Proxy Statement.
PURPOSE AND EFFECT OF AMENDMENT
Currently, the Company is authorized to issue only Common Stock. The purpose
of the proposed amendment to authorize a class of 5,000,000 shares of
undesignated Preferred Stock is to give the Board of Directors the flexibility
and authority to provide for the issuance of Preferred Stock without delay and
without the need for further action by the stockholders, except in connection
with transactions for which Delaware law requires stockholder approval. It is
not possible to state the precise effect of the authorization of the Preferred
Stock upon the rights of the Company's stockholders until the Board of Directors
determines the respective preferences, limitations and relative rights of the
holders of one or more series of the Preferred Stock, including dividend rights,
conversion rights, voting rights, redemption rights, and liquidation
preferences. The amendment will give the Board of Directors broad discretion to
set the terms of any shares of Preferred Stock that are issued. The Company may
issue one or more series of stock with such voting powers, designations,
preferences, and other rights as set forth in the Certificate of Incorporation
or in resolutions authorizing the issuance of such stock adopted by the Board of
Directors pursuant to express authority vested in it by provisions of the
Company's Certificate of Incorporation.
Preferred Stock authorized by the amendment would be available for issuance
from time to time for any proper corporate purpose, including but not limited to
issuance in public or private transactions in connection with future financings,
acquisitions, or stock distributions. At this time, the Company has no plans to
issue any shares of Preferred Stock. However, because the need to raise
additional capital or the opportunity to effect an acquisition can arise when it
would be inconvenient to hold a stockholders' meeting or when there would not be
time for such a meeting, the Company believes that prudent business planning
suggests the 5,000,000 shares of Preferred Stock be authorized at this time.
The amendment may be viewed as having the overall effect of delaying or
preventing an unsolicited attempt by another person or entity to acquire control
of the Company. Issuances of authorized preferred shares can be implemented, and
have been implemented by some companies in the past, with voting or conversion
privileges intended to make acquisition of the company more difficult or more
costly. Such an issuance could discourage or limit the stockholders'
participation in certain types of transactions that might be proposed (such as a
tender offer), whether or not management or a
17
<PAGE>
majority of the stockholders favored such transactions, and could enhance the
ability of officers and directors to retain their positions. The Company is not
aware of any current proposals by any party to acquire control of the Company.
VOTE REQUIRED AND BOARD OF DIRECTORS RECOMMENDATION
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" PROPOSAL NUMBER 6. The
affirmative vote by a majority of the shares of Common Stock of the Company
entitled to vote at the Annual Meeting will be required to amend the
Certificate. Proxies solicited by the Board of Directors will be so voted unless
stockholders specify otherwise on their proxy cards. Votes that are cast against
the proposal will be counted for purposes of determining the presence or absence
of a quorum and the total number of votes cast with respect to the proposal.
Abstentions will have the same effect as a vote against the proposal. Broker
non-votes will be counted for purposes of determining the presence or absence of
a quorum for the transaction of business, but will not be counted for purposes
of determining the number of votes cast with respect to the proposal.
PROPOSAL NO. 7
ADOPTION OF FORM OF DIRECTOR AND EXECUTIVE OFFICER
INDEMNIFICATION AGREEMENT
As indicated under Proposal 2 above, following the Company's last annual
meeting of stockholders in May 1995, the members of the Company's Board of
Directors, including the new directors elected at such annual meeting, undertook
a review of the Company's corporate governance policies. This review included an
assessment of the Company's policies with respect to indemnification of
directors and executive officers. Although the Company's Bylaws and Certificate
of Incorporation currently provide for indemnification of directors and
executive officers to the maximum extent permitted by Delaware law, the Board of
Directors believed it desirable to set forth in a more precise manner the
procedures that will be followed for indemnification of directors and executive
officers. Since two litigation matters in connection with which current and
former directors were being indemnified were pending during May 1995 (both of
which matters have since been resolved), it was deemed advisable to document
these procedures more clearly.
Accordingly, in December 1995, the Board of Directors approved a form of
Indemnification Agreement which, subject to receipt of stockholder approval,
will be entered into with each director and executive officer of the Company.
This form of agreement, like the Company's Certificate of Incorporation and
Bylaws, provides for indemnification to the maximum extent permitted under
Delaware law. In addition, the agreement contains provisions regarding certain
matters that typically arise when indemnification is sought, such as the
circumstances under which expenses advances may be made, and establishes
procedures for seeking and obtaining indemnification and the selection of legal
counsel.
The Board of Directors believes that the provisions of the indemnification
agreements are necessary to attract qualified individuals to serve as directors
and executive officers of the Company.
The foregoing represents a summary of certain provisions of the form of
Indemnification Agreement and does not represent a complete description thereof.
Stockholders should review the complete form of Indemnification Agreement
attached hereto as EXHIBIT E.
VOTE REQUIRED AND BOARD OF DIRECTORS RECOMMENDATION
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" PROPOSAL NUMBER 7. The
affirmative vote of holders of a majority of the shares of Common Stock
represented at the meeting is necessary to approve the adoption of the form of
Indemnification Agreement. Votes that are cast against the proposal will be
counted for purposes of determining the presence or absence of a quorum and the
total number of votes cast with respect to the proposal. Abstentions will have
the same effect
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as a vote against the proposal. Broker non-votes will be counted for purposes of
determining the presence or absence of a quorum for the transaction of business,
but will not be counted for purposes of determining the number of votes cast
with respect to the proposal.
PROPOSAL NO. 8
RATIFICATION OF APPOINTMENT OF INDEPENDENT PUBLIC ACCOUNTANTS
The Company is asking the stockholders to ratify the appointment of Arthur
Andersen LLP as the Company's independent public accountants for the year ending
December 31, 1996. Representatives of Arthur Andersen LLP are expected to attend
the Annual Meeting and will have the opportunity to make a statement if they
desire to do so and to answer appropriate questions.
VOTE REQUIRED AND BOARD OF DIRECTORS' RECOMMENDATION
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" PROPOSAL NUMBER 8.
Ratification of the appointment of Arthur Andersen LLP as the Company's
independent public accountants for the year ending December 31, 1996 will
require the affirmative vote of a majority of the shares of Common Stock
represented in person or by proxy and entitled to vote at the Annual Meeting. If
stockholders do not ratify the appointment of Arthur Andersen LLP, the Audit
Committee and the Board of Directors will reconsider the appointment.
OTHER MATTERS
The Board knows of no other matters to be presented for stockholder action
at the Annual Meeting. However, if other matters do properly come before the
Annual Meeting or any adjournment or postponement thereof, the Board intends
that the persons named in the proxies will vote upon such matters in accordance
with their best judgment.
* * * *
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PRELIMINARY PROXY
EXHIBIT A
BYLAWS
OF
VISX, INCORPORATED
ARTICLE I
CORPORATE OFFICES
I.1 REGISTERED OFFICE
The registered office of the corporation shall be in the City of Dover,
County of Kent, State of Delaware. The name of the registered agent of the
corporation at such location is The Corporation Trust Company.
I.2 OTHER OFFICES
The board of directors may at any time establish other offices at any place
or places where the corporation is qualified to do business.
ARTICLE II
MEETINGS OF STOCKHOLDERS
II.1 PLACE OF MEETINGS
Meetings of stockholders shall be held at any place, within or outside the
State of Delaware, designated by the board of directors. In the absence of any
such designation, stockholders' meetings shall be held at the registered office
of the corporation.
II.2 ANNUAL MEETING
The annual meeting of stockholders shall be held each year on a date and at
a time designated by the board of directors. In the absence of such designation,
the annual meeting of stockholders shall be held on the third Friday of May in
each year at 9:00 a.m. However, if such day falls on a legal holiday, then the
meeting shall be held at the same time and place on the next succeeding full
business day. At the meeting, directors shall be elected and any other proper
business may be transacted.
II.3 SPECIAL MEETING
A special meeting of the stockholders may be called at any time by the board
of directors, or by the chairman of the board, or by the president. No other
person or persons are permitted to call a special meeting.
If a special meeting is called by the chairman of the board or the
president, then the request shall be in writing, specifying the time of such
meeting and the general nature of the business proposed to be transacted, and
shall be delivered personally or sent by registered mail or by telegraphic or
other facsimile transmission to the chairman of the board, the president, or the
secretary of the corporation. The officer receiving the request shall cause
notice to be promptly given to the stockholders entitled to vote, in accordance
with the provisions of Sections 2.4 and 2.6 of these bylaws, that a meeting will
be held at the time requested by the person or persons calling the meeting, so
long as that time is not less than thirty-five (35) nor more than sixty (60)
days after the receipt of the request. If the notice is not given within twenty
(20) days after receipt of the request, then the person or persons requesting
the
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meeting may give the notice. Nothing contained in this paragraph of this Section
2.3 shall be construed as limiting, fixing or affecting the time when a meeting
of stockholders called by action of the board of directors may be held.
II.4 NOTICE OF STOCKHOLDERS' MEETINGS
All notices of meetings with stockholders shall be in writing and shall be
sent or otherwise given in accordance with Section 2.6 of these bylaws not less
than ten (10) nor more than sixty (60) days before the date of the meeting to
each stockholder entitled to vote at such meeting. The notice shall specify the
place, date, and hour of the meeting, and, in the case of a special meeting, the
purpose or purposes for which the meeting is called.
II.5 ADVANCE NOTICE OF STOCKHOLDER NOMINEES AND STOCKHOLDER BUSINESS
Subject to the rights of holders of any class or series of stock having a
preference over the Common Stock as to dividends or upon liquidation,
(i) nominations for the election of directors, and
(ii) business proposed to be brought before any stockholder meeting
may be made by the board of directors or proxy committee appointed by the board
of directors or by any stockholder entitled to vote in the election of directors
generally if such nomination or business proposed is otherwise proper business
before such meeting. However, any such stockholder may nominate one or more
persons for election as directors at a meeting or propose business to be brought
before a meeting, or both, but only if such stockholder has given timely notice
in proper written form of such stockholder's intent to make such nomination or
nominations or to propose such business. To be timely, such stockholder's notice
must be delivered to or mailed and received at the principal executive offices
of the corporation not less than one hundred twenty (120) calendar days in
advance of the date specified in the corporation's proxy statement released to
stockholders in connection with the previous year's annual meeting of
stockholders; provided, however, that in the event that no annual meeting was
held in the previous year or the date of the annual meeting has been changed by
more than thirty (30) days from the date contemplated at the time of the
previous year's proxy statement, notice by the stockholder to be timely must be
so received a reasonable time before the solicitation is made. To be in proper
form, a stockholder's notice to the secretary shall set forth:
(i) the name and address of the stockholder who intends to make the
nominations or propose the business and, as the case may be, of the person
or persons to be nominated or of the business to be proposed;
(ii) a representation that the stockholder is a holder of record of
stock of the corporation entitled to vote at such meeting and, if
applicable, intends to appear in person or by proxy at the meeting to
nominate the person or persons specified in the notice;
(iii) if applicable, a description of all arrangements or understandings
between the stockholder and each nominee and any other person or persons
(naming such person or persons) pursuant to which the nomination or
nominations are to be made by the stockholder;
(iv) such other information regarding each nominee or each matter of
business to be proposed by such stockholder as would be required to be
included in a proxy statement filed pursuant to the proxy rules of the
Securities and Exchange Commission had the nominee been nominated, or
intended to be nominated, or the matter been proposed, or intended to be
proposed by the board of directors; and
(v) if applicable, the consent of each nominee to serve as director of
the corporation if so elected.
The chairman of the meeting shall refuse to acknowledge the nomination of
any person or the proposal of any business not made in compliance with the
foregoing procedure.
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II.6 MANNER OF GIVING NOTICE; AFFIDAVIT OF NOTICE
Written notice of any meeting of stockholders, if mailed, is given when
deposited in the United States mail, postage prepaid, directed to the
stockholder at his address as it appears on the records of the corporation. An
affidavit of the secretary or an assistant secretary or of the transfer agent of
the corporation that the notice has been given shall, in the absence of fraud,
be prima facie evidence of the facts stated therein.
II.7 QUORUM
The holders of a majority of the stock issued and outstanding and entitled
to vote thereat, present in person or represented by proxy, shall constitute a
quorum at all meetings of the stockholders for the transaction of business
except as otherwise provided by statute or by the certificate of incorporation.
If, however, such quorum is not present or represented at any meeting of the
stockholders, then the stockholders entitled to vote thereat, present in person
or represented by proxy, shall have power to adjourn the meeting from time to
time, without notice other than announcement at the meeting, until a quorum is
present or represented. At such adjourned meeting at which a quorum is present
or represented, any business may be transacted that might have been transacted
at the meeting as originally noticed.
II.8 ADJOURNED MEETING; NOTICE
When a meeting is adjourned to another time or place, unless these bylaws
otherwise require, notice need not be given of the adjourned meeting if the time
and place thereof are announced at the meeting at which the adjournment is
taken. At the adjourned meeting the corporation may transact any business that
might have been transacted at the original meeting. If the adjournment is for
more than thirty (30) days, or if after the adjournment a new record date is
fixed for the adjourned meeting, a notice of the adjourned meeting shall be
given to each stockholder of record entitled to vote at the meeting.
II.9 VOTING
The stockholders entitled to vote at any meeting of stockholders shall be
determined in accordance with the provisions of Section 2.11 of these bylaws,
subject to the provisions of Sections 217 and 218 of the General Corporation Law
of Delaware (relating to voting rights of fiduciaries, pledgors and joint owners
of stock and to voting trusts and other voting agreements).
Except as may otherwise be provided in the certificate of incorporation or
these bylaws, each stockholder shall be entitled to one vote for each share of
capital stock held by such stockholder and stockholders shall not be entitled to
cumulate their votes in the election of directors or with respect to any matter
submitted to a vote of stockholders.
II.10 WAIVER OF NOTICE
Whenever notice is required to be given under any provision of the General
Corporation Law of Delaware or of the certificate of incorporation or these
bylaws, a written waiver thereof, signed by the person entitled to notice,
whether before or after the time stated therein, shall be deemed equivalent to
notice. Attendance of a person at a meeting shall constitute a waiver of notice
of such meeting, except when the person attends a meeting for the express
purpose of objecting, at the beginning of the meeting, to the transaction of any
business because the meeting is not lawfully called or convened. Neither the
business to be transacted at, nor the purpose of, any regular or special meeting
of the stockholders need be specified in any written waiver of notice unless so
required by the certificate of incorporation or these bylaws.
II.11 STOCKHOLDER ACTION BY WRITTEN CONSENT WITHOUT A MEETING
Unless otherwise provided in the certificate of incorporation, any action
required by this chapter to be taken at any annual or special meeting of
stockholders of a corporation, or any action that may be taken at any annual or
special meeting of such stockholders, may be taken without a meeting, without
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prior notice, and without a vote if a consent in writing, setting forth the
action so taken, is signed by the holders of outstanding stock having not less
than the minimum number of votes that would be necessary to authorize or take
such action at a meeting at which all shares entitled to vote thereon were
present and voted.
Prompt notice of the taking of the corporate action without a meeting by
less than unanimous written consent shall be given to those stockholders who
have not consented in writing. If the action which is consented to is such as
would have required the filing of a certificate under any section of the General
Corporation Law of Delaware if such action had been voted on by stockholders at
a meeting thereof, then the certificate filed under such section shall state, in
lieu of any statement required by such section concerning any vote of
stockholders, that written notice and written consent have been given as
provided in Section 228 of the General Corporation Law of Delaware.
II.12 RECORD DATE FOR STOCKHOLDER NOTICE; VOTING; GIVING CONSENTS
In order that the corporation may determine the stockholders entitled to
notice of or to vote at any meeting of stockholders or any adjournment thereof,
or entitled to express consent to corporate action in writing without a meeting,
or entitled to receive payment of any dividend or other distribution or
allotment of any rights, or entitled to exercise any rights in respect of any
change, conversion or exchange of stock or for the purpose of any other lawful
action, the board of directors may fix, in advance, a record date, which shall
not be more than sixty (60) nor less than ten (10) days before the date of such
meeting, nor more than sixty (60) days prior to any other action.
If the board of directors does not so fix a record date:
(i) The record date for determining stockholders entitled to notice of
or to vote at a meeting of stockholders shall be at the close of business on
the day next preceding the day on which notice is given, or, if notice is
waived, at the close of business on the day next preceding the day on which
the meeting is held.
(ii) The record date for determining stockholders entitled to express
consent to corporate action in writing without a meeting, when no prior
action by the board of directors is necessary, shall be the day on which the
first written consent is expressed.
(iii) The record date for determining stockholders for any other purpose
shall be at the close of business on the day on which the board of directors
adopts the resolution relating thereto.
A determination of stockholders of record entitled to notice of or to vote
at a meeting of stockholders shall apply to any adjournment of the meeting;
provided, however, that the board of directors may fix a new record date for the
adjourned meeting.
II.13 PROXIES
Each stockholder entitled to vote at a meeting of stockholders or to express
consent or dissent to corporate action in writing without a meeting may
authorize another person or persons to act for him by a written proxy, signed by
the stockholder and filed with the secretary of the corporation, but no such
proxy shall be voted or acted upon after three (3) years from its date, unless
the proxy provides for a longer period. A proxy shall be deemed signed if the
stockholder's name is placed on the proxy (whether by manual signature,
typewriting, telegraphic transmission or otherwise) by the stockholder or the
stockholder's attorney-in-fact. The revocability of a proxy that states on its
face that it is irrevocable shall be governed by the provisions of Section
212(c) of the General Corporation Law of Delaware.
II.14 LIST OF STOCKHOLDERS ENTITLED TO VOTE
The officer who has charge of the stock ledger of a corporation shall
prepare and make, at least ten (10) days before every meeting of stockholders, a
complete list of the stockholders entitled to vote at the meeting, arranged in
alphabetical order, and showing the address of each stockholder and the
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number of shares registered in the name of each stockholder. Such list shall be
open to the examination of any stockholder, for any purpose germane to the
meeting, during ordinary business hours, for a period of at least ten (10) days
prior to the meeting, either at a place within the city where the meeting is to
be held, which place shall be specified in the notice of the meeting, or, if not
so specified, at the place where the meeting is to be held. The list shall also
be produced and kept at the time and place of the meeting during the whole time
thereof, and may be inspected by any stockholder who is present.
ARTICLE III
DIRECTORS
III.1 POWERS
Subject to the provisions of the General Corporation Law of Delaware and any
limitations in the certificate of incorporation or these bylaws relating to
action required to be approved by the stockholders or by the outstanding shares,
the business and affairs of the corporation shall be managed and all corporate
powers shall be exercised by or under the direction of the board of directors.
III.2 NUMBER OF DIRECTORS
The number of directors of this corporation shall be five (5), until changed
by an amendment to this bylaw adopted as provided herein. The number of
directors may be changed by an amendment to this bylaw, duly adopted by the
board of directors or by the stockholders, or by a duly adopted amendment to the
certificate of incorporation. No reduction of the authorized number of directors
shall have the effect of removing any director before that director's term of
office expires.
III.3 ELECTION, QUALIFICATION AND TERM OF OFFICE OF DIRECTORS
Except as provided in Section 3.4 of these bylaws, directors shall be
elected at each annual meeting of stockholders to hold office until the next
annual meeting. Directors need not be stockholders unless so required by the
certificate of incorporation or these bylaws, wherein other qualifications for
directors may be prescribed. Each director, including a director elected to fill
a vacancy, shall hold office until his successor is elected and qualified or
until his earlier resignation or removal. Elections of directors need not be by
written ballot.
III.4 RESIGNATION AND VACANCIES
Any director may resign at any time upon written notice to the corporation.
When one or more directors so resigns and the resignation is effective at a
future date, a majority of the directors then in office, including those who
have so resigned, shall have power to fill such vacancy or vacancies, the vote
thereon to take effect when such resignation or resignations shall become
effective, and each director so chosen shall hold office as provided in this
section in the filling of other vacancies.
Unless otherwise provided in the certificate of incorporation or these
bylaws:
(i) Vacancies and newly created directorships resulting from any
increase in the authorized number of directors elected by all of the
stockholders having the right to vote as a single class may be filled by a
majority of the directors then in office, although less than a quorum, or by
a sole remaining director.
(ii) Whenever the holders of any class or classes of stock or series
thereof are entitled to elect one or more directors by the provisions of the
certificate of incorporation, vacancies and newly created directorships of
such class or classes or series may be filled by a majority of the directors
elected by such class or classes or series thereof then in office, or by a
sole remaining director so elected.
If at any time, by reason of death or resignation or other cause, the
corporation should have no directors in office, then any officer or any
stockholder or an executor, administrator, trustee or guardian of a stockholder,
or other fiduciary entrusted with like responsibility for the person or estate
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of a stockholder, may call a special meeting of stockholders in accordance with
the provisions of the certificate of incorporation or these bylaws, or may apply
to the Court of Chancery for a decree summarily ordering an election as provided
in Section 211 of the General Corporation Law of Delaware.
If, at the time of filling any vacancy or any newly created directorship,
the directors then in office constitute less than a majority of the whole board
(as constituted immediately prior to any such increase), then the Court of
Chancery may, upon application of any stockholder or stockholders holding at
least ten (10) percent of the total number of the shares at the time outstanding
having the right to vote for such directors, summarily order an election to be
held to fill any such vacancies or newly created directorships, or to replace
the directors chosen by the directors then in office as aforesaid, which
election shall be governed by the provisions of Section 211 of the General
Corporation Law of Delaware as far as applicable.
III.5 PLACE OF MEETINGS; MEETINGS BY TELEPHONE
The board of directors of the corporation may hold meetings, both regular
and special, either within or outside the State of Delaware.
Unless otherwise restricted by the certificate of incorporation or these
bylaws, members of the board of directors, or any committee designated by the
board of directors, may participate in a meeting of the board of directors, or
any committee, by means of conference telephone or similar communications
equipment by means of which all persons participating in the meeting can hear
each other, and such participation in a meeting shall constitute presence in
person at the meeting.
III.6 FIRST MEETINGS
The first meeting of each newly elected board of directors shall be held at
such time and place as shall be specified in a notice given as hereinafter
provided for special meetings of the board of directors, or as shall be
specified in a written waiver signed by all of the directors.
III.7 REGULAR MEETINGS
Regular meetings of the board of directors may be held without notice at
such time and at such place as shall from time to time be determined by the
board.
III.8 SPECIAL MEETINGS; NOTICE
Special meetings of the board of directors for any purpose or purposes may
be called at any time by the chairman of the board, the president, any vice
president, the secretary or any two directors.
Notice of the time and place of special meetings shall be delivered
personally or by telephone to each director or sent by first-class mail,
overnight delivery service, telecopy or telegram, charges prepaid, addressed to
each director at that director's address as it is shown on the records of the
corporation. If the notice is mailed, it shall be deposited in the United States
mail at least four (4) days before the time of the holding of the meeting. If
the notice is delivered personally or by overnight courier, telephone, telecopy
or telegram, it shall be delivered personally or by overnight courier, telephone
or telecopier or to the telegraph company at least forty-eight (48) hours before
the time of the holding of the meeting. Any oral notice given personally or by
overnight courier, telecopier or telephone may be communicated either to the
director or to a person at the office of the director who the person giving the
notice has reason to believe will promptly communicate it to the director. The
notice need not specify the purpose or the place of the meeting, if the meeting
is to be held at the principal executive office of the corporation.
III.9 QUORUM
At all meetings of the board of directors, a majority of the authorized
number of directors shall constitute a quorum for the transaction of business
and the act of a majority of the directors present at any meeting at which there
is a quorum shall be the act of the board of directors, except as may be
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otherwise specifically provided by statute or by the certificate of
incorporation. If a quorum is not present at any meeting of the board of
directors, then the directors present thereat may adjourn the meeting from time
to time, without notice other than announcement at the meeting, until a quorum
is present.
III.10 WAIVER OF NOTICE
Whenever notice is required to be given under any provision of the General
Corporation Law of Delaware or of the certificate of incorporation or these
bylaws, a written waiver thereof, signed by the person entitled to notice,
whether before or after the time stated therein, shall be deemed equivalent to
notice. Attendance of a person at a meeting shall constitute a waiver of notice
of such meeting, except when the person attends a meeting for the express
purpose of objecting, at the beginning of the meeting, to the transaction of any
business because the meeting is not lawfully called or convened. Neither the
business to be transacted at, nor the purpose of, any regular or special meeting
of the directors, or members of a committee of directors, need be specified in
any written waiver of notice unless so required by the certificate of
incorporation or these bylaws.
III.11 ADJOURNED MEETING; NOTICE
If a quorum is not present at any meeting of the board of directors, then
the directors present thereat may adjourn the meeting from time to time, without
notice other than announcement at the meeting, until a quorum is present.
III.12 BOARD ACTION BY WRITTEN CONSENT WITHOUT A MEETING
Unless otherwise restricted by the certificate of incorporation or these
bylaws, any action required or permitted to be taken at any meeting of the board
of directors, or of any committee thereof, may be taken without a meeting if all
members of the board or committee, as the case may be, consent thereto in
writing and the writing or writings are filed with the minutes of proceedings of
the board or committee.
III.13 FEES AND COMPENSATION OF DIRECTORS
Unless otherwise restricted by the certificate of incorporation or these
bylaws, the board of directors shall have the authority to fix the compensation
of directors.
III.14 APPROVAL OF LOANS TO OFFICERS
The corporation may lend money to, or guarantee any obligation of, or
otherwise assist any officer or other employee of the corporation or of its
subsidiary, including any officer or employee who is a director of the
corporation or its subsidiary, whenever, in the judgment of the directors, such
loan, guaranty or assistance may reasonably be expected to benefit the
corporation. The loan, guaranty or other assistance may be with or without
interest and may be unsecured, or secured in such manner as the board of
directors shall approve, including, without limitation, a pledge of shares of
stock of the corporation. Nothing in this section contained shall be deemed to
deny, limit or restrict the powers of guaranty or warranty of the corporation at
common law or under any statute.
III.15 REMOVAL OF DIRECTORS
Unless otherwise restricted by statute, by the certificate of incorporation
or by these bylaws, any director or the entire board of directors may be
removed, with or without cause, by the holders of a majority of the shares then
entitled to vote at an election of directors.
No reduction of the authorized number of directors shall have the effect of
removing any director prior to the expiration of such director's term of office.
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ARTICLE IV
COMMITTEES
IV.1 COMMITTEES OF DIRECTORS
The board of directors may, by resolution passed by a majority of the whole
board, designate one or more committees, with each committee to consist of one
or more of the directors of the corporation. The board may designate one or more
directors as alternate members of any committee, who may replace any absent or
disqualified member at any meeting of the committee. In the absence or
disqualification of a member of a committee, the member or members thereof
present at any meeting and not disqualified from voting, whether or not he or
they constitute a quorum, may unanimously appoint another member of the board of
directors to act at the meeting in the place of any such absent or disqualified
member. Any such committee, to the extent provided in the resolution of the
board of directors or in the bylaws of the corporation, shall have and may
exercise all the powers and authority of the board of directors in the
management of the business and affairs of the corporation, and may authorize the
seal of the corporation to be affixed to all papers that may require it; but no
such committee shall have the power or authority to (i) amend the certificate of
incorporation (except that a committee may, to the extent authorized in the
resolution or resolutions providing for the issuance of shares of stock adopted
by the board of directors as provided in Section 151(a) of the General
Corporation Law of Delaware, fix any of the preferences or rights of such shares
relating to dividends, redemption, dissolution, any distribution of assets of
the corporation or the conversion into, or the exchange of such shares for,
shares of any other class or classes or any other series of the same or any
other class or classes of stock of the corporation), (ii) adopt an agreement of
merger or consolidation under Sections 251 or 252 of the General Corporation Law
of Delaware, (iii) recommend to the stockholders the sale, lease or exchange of
all or substantially all of the corporation's property and assets, (iv)
recommend to the stockholders a dissolution of the corporation or a revocation
of a dissolution, or (v) amend the bylaws of the corporation; and, unless the
board resolution establishing the committee, the bylaws or the certificate of
incorporation expressly so provide, no such committee shall have the power or
authority to declare a dividend, to authorize the issuance of stock, or to adopt
a certificate of ownership and merger pursuant to Section 253 of the General
Corporation Law of Delaware.
IV.2 COMMITTEE MINUTES
Each committee shall keep regular minutes of its meetings and report the
same to the board of directors when required.
IV.3 MEETINGS AND ACTION OF COMMITTEES
Meetings and actions of committees shall be governed by, and held and taken
in accordance with, the provisions of Article III of these bylaws, Section 3.5
(place of meetings and meetings by telephone), Section 3.7 (regular meetings),
Section 3.8 (special meetings and notice), Section 3.9 (quorum), Section 3.10
(waiver of notice), Section 3.11 (adjournment and notice of adjournment), and
Section 3.12 (action without a meeting), with such changes in the context of
those bylaws as are necessary to substitute the committee and its members for
the board of directors and its members; provided, however, that the time of
regular meetings of committees may also be called by resolution of the board of
directors and that notice of special meetings of committees shall also be given
to all alternate members, who shall have the right to attend all meetings of the
committee. The board of directors may adopt rules for the government of any
committee not inconsistent with the provisions of these bylaws.
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ARTICLE V
OFFICERS
V.1 OFFICERS
The officers of the corporation shall be a president, one or more vice
presidents, a secretary, and a chief financial officer. The corporation may also
have, at the discretion of the board of directors, a chairman of the board, one
or more assistant vice presidents, assistant secretaries, a treasurer and one or
more assistant treasurers, and any such other officers as may be appointed in
accordance with the provisions of Section 5.3 of these bylaws. Any number of
offices may be held by the same person.
V.2 ELECTION OF OFFICERS
The officers of the corporation, except such officers as may be appointed in
accordance with the provisions of Sections 5.3 or 5.5 of these bylaws, shall be
chosen by the board of directors, subject to the rights, if any, of an officer
under any contract of employment.
V.3 SUBORDINATE OFFICERS
The board of directors may appoint, or empower the president to appoint,
such other officers and agents as the business of the corporation may require,
each of whom shall hold office for such period, have such authority, and perform
such duties as are provided in these bylaws or as the board of directors may
from time to time determine.
V.4 REMOVAL AND RESIGNATION OF OFFICERS
Subject to the rights, if any, of an officer under any contract of
employment, any officer may be removed, either with or without cause, by an
affirmative vote of the majority of the board of directors at any regular or
special meeting of the board or, except in the case of an officer chosen by the
board of directors, by any officer upon whom such power of removal may be
conferred by the board of directors.
Any officer may resign at any time by giving written notice to the
corporation. Any resignation shall take effect at the date of the receipt of
that notice or at any later time specified in that notice; and, unless otherwise
specified in that notice, the acceptance of the resignation shall not be
necessary to make it effective. Any resignation is without prejudice to the
rights, if any, of the corporation under any contract to which the officer is a
party.
V.5 VACANCIES IN OFFICES
Any vacancy occurring in any office of the corporation shall be filled by
the board of directors.
V.6 CHAIRMAN OF THE BOARD
The chairman of the board, if such an officer be elected, shall, if present,
preside at meetings of the board of directors and exercise and perform such
other powers and duties as may from time to time be assigned to him by the board
of directors or as may be prescribed by these bylaws. If there is no president,
then the chairman of the board shall also be the chief executive officer of the
corporation and shall have the powers and duties prescribed in Section 5.7 of
these bylaws.
V.7 PRESIDENT
Subject to such supervisory powers, if any, as may be given by the board of
directors to the chairman of the board, if there be such an officer, the
president shall be the chief executive officer of the corporation and shall,
subject to the control of the board of directors, have general supervision,
direction, and control of the business and the officers of the corporation. He
shall preside at all meetings of the shareholders and, in the absence or
nonexistence of a chairman of the board, at all meetings of the board of
directors. He shall have the general powers and duties of management usually
vested in the office of president of a corporation and shall have such other
powers and duties as may be prescribed by the board of directors or these
bylaws.
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V.8 VICE PRESIDENT
In the absence or disability of the president, the vice presidents, if any,
in order of their rank as fixed by the board of directors or, if not ranked, a
vice president designated by the board of directors, shall perform all the
duties of the president and when so acting shall have all the powers of, and be
subject to all the restrictions upon, the president. The vice presidents shall
have such other powers and perform such other duties as from time to time may be
prescribed for them respectively by the board of directors, these bylaws, the
president or the chairman of the board.
V.9 SECRETARY
The secretary shall keep or cause to be kept, at the principal executive
office of the corporation or such other place as the board of directors may
direct, a book of minutes of all meetings and actions of directors, committees
of directors, and shareholders. The minutes shall show the time and place of
each meeting, whether regular or special (and, if special, how authorized and
the notice given), the names of those present at directors' meetings or
committee meetings, the number of shares present or represented at shareholders'
meetings, and the proceedings thereof.
The secretary shall keep, or cause to be kept, at the principal executive
office of the corporation or at the office of the corporation's transfer agent
or registrar, as determined by resolution of the board of directors, a share
register, or a duplicate share register, showing the names of all shareholders
and their addresses, the number and classes of shares held by each, the number
and date of certificates evidencing such shares, and the number and date of
cancellation of every certificate surrendered for cancellation.
The secretary shall give, or cause to be given, notice of all meetings of
the shareholders and of the board of directors required to be given by law or by
these bylaws. He shall keep the seal of the corporation, if one be adopted, in
safe custody and shall have such other powers and perform such other duties as
may be prescribed by the board of directors or by these bylaws.
V.10 CHIEF FINANCIAL OFFICER
The chief financial officer shall keep and maintain, or cause to be kept and
maintained, adequate and correct books and records of accounts of the properties
and business transactions of the corporation, including accounts of its assets,
liabilities, receipts, disbursements, gains, losses, capital, retained earnings,
and shares. The books of account shall at all reasonable times be open to
inspection by any director.
The chief financial officer shall deposit all money and other valuables in
the name and to the credit of the corporation with such depositaries as may be
designated by the board of directors. He shall disburse the funds of the
corporation as may be ordered by the board of directors, shall render to the
president and directors, whenever they request it, an account of all of his
transactions as chief financial officer and of the financial condition of the
corporation, and shall have such other powers and perform such other duties as
may be prescribed by the board of directors or these bylaws.
V.11 ASSISTANT SECRETARY
The assistant secretary, or, if there is more than one, the assistant
secretaries in the order determined by the stockholders or board of directors
(or if there be no such determination, then in the order of their election)
shall, in the absence of the secretary or in the event of his or her inability
or refusal to act, perform the duties and exercise the powers of the secretary
and shall perform such other duties and have such other powers as the board of
directors or the stockholders may from time to time prescribe.
V.12 ADMINISTRATIVE OFFICERS
In addition to the Corporate Officers of the corporation as provided in
Section 5.1 of these bylaws and such subordinate Corporate Officers as may be
appointed in accordance with Section 5.3 of these bylaws, there may also be such
Administrative Officers of the corporation as may be designated and
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appointed from time to time by the president of the corporation. Administrative
Officers shall perform such duties and have such powers as from time to time may
be determined by the president or the board of directors in order to assist the
Corporate Officers in the furtherance of their duties. In the performance of
such duties and the exercise of such powers, however, such Administrative
Officers shall have limited authority to act on behalf of the corporation as the
board of directors shall establish, including but not limited to limitations on
the dollar amount and on the scope of agreements or commitments that may be made
by such Administrative Officers on behalf of the corporation, which limitations
may not be exceeded by such individuals or altered by the president without
further approval by the board of directors.
V.13 AUTHORITY AND DUTIES OF OFFICERS
In addition to the foregoing authority and duties, all officers of the
corporation shall respectively have such authority and perform such duties in
the management of the business of the corporation as may be designated from time
to time by the board of directors or the stockholders.
ARTICLE VI
INDEMNITY
VI.1 INDEMNIFICATION OF DIRECTORS AND OFFICERS
The corporation shall, to the maximum extent and in the manner permitted by
the General Corporation Law of Delaware, indemnify each of its directors and
officers against expenses (including attorneys' fees), judgments, fines,
settlements, and other amounts actually and reasonably incurred in connection
with any proceeding, arising by reason of the fact that such person is or was an
agent of the corporation. For purposes of this Section 6.1, a "director" or
"officer" of the corporation includes any person (i) who is or was a director or
officer of the corporation, (ii) who is or was serving at the request of the
corporation as a director or officer of another corporation, partnership, joint
venture, trust or other enterprise, or (iii) who was a director or officer of a
corporation which was a predecessor corporation of the corporation or of another
enterprise at the request of such predecessor corporation.
VI.2 INDEMNIFICATION OF OTHERS
The corporation shall have the power, to the extent and in the manner
permitted by the General Corporation Law of Delaware, to indemnify each of its
employees and agents (other than directors and officers) against expenses
(including attorneys' fees), judgments, fines, settlements, and other amounts
actually and reasonably incurred in connection with any proceeding, arising by
reason of the fact that such person is or was an agent of the corporation. For
purposes of this Section 6.2, an "employee" or "agent" of the corporation (other
than a director or officer) includes any person (i) who is or was an employee or
agent of the corporation, (ii) who is or was serving at the request of the
corporation as an employee or agent of another corporation, partnership, joint
venture, trust or other enterprise, or (iii) who was an employee or agent of a
corporation which was a predecessor corporation of the corporation or of another
enterprise at the request of such predecessor corporation.
VI.3 INSURANCE
The corporation may purchase and maintain insurance on behalf of any person
who is or was a director, officer, employee or agent of the corporation, or is
or was serving at the request of the corporation as a director, officer,
employee or agent of another corporation, partnership, joint venture, trust or
other enterprise against any liability asserted against him and 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 under
the provisions of the General Corporation Law of Delaware.
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ARTICLE VII
RECORDS AND REPORTS
VII.1 MAINTENANCE AND INSPECTION OF RECORDS
The corporation shall, either at its principal executive office or at such
place or places as designated by the board of directors, keep a record of its
shareholders listing their names and addresses and the number and class of
shares held by each shareholder, a copy of these bylaws as amended to date,
accounting books, and other records.
Any stockholder of record, in person or by attorney or other agent, shall,
upon written demand under oath stating the purpose thereof, have the right
during the usual hours for business to inspect for any proper purpose the
corporation's stock ledger, a list of its stockholders, and its other books and
records and to make copies or extracts therefrom. A proper purpose shall mean a
purpose reasonably related to such person's interest as a stockholder. In every
instance where an attorney or other agent is the person who seeks the right to
inspection, the demand under oath shall be accompanied by a power of attorney or
such other writing that authorizes the attorney or other agent to so act on
behalf of the stockholder. The demand under oath shall be directed to the
corporation at its registered office in Delaware or at its principal place of
business.
The officer who has charge of the stock ledger of a corporation shall
prepare and make, at least ten (10) days before every meeting of stockholders, a
complete list of the stockholders entitled to vote at the meeting, arranged in
alphabetical order, and showing the address of each stockholder and the number
of shares registered in the name of each stockholder. Such list shall be open to
the examination of any stockholder, for any purpose germane to the meeting,
during ordinary business hours, for a period of at least ten (10) days prior to
the meeting, either at a place within the city where the meeting is to be held,
which place shall be specified in the notice of the meeting, or, if not so
specified, at the place where the meeting is to be held. The list shall also be
produced and kept at the time and place of the meeting during the whole time
thereof, and may be inspected by any stockholder who is present.
VII.2 INSPECTION BY DIRECTORS
Any director shall have the right to examine the corporation's stock ledger,
a list of its stockholders, and its other books and records for a purpose
reasonably related to his position as a director. The Court of Chancery is
hereby vested with the exclusive jurisdiction to determine whether a director is
entitled to the inspection sought. The Court may summarily order the corporation
to permit the director to inspect any and all books and records, the stock
ledger, and the stock list and to make copies or extracts therefrom. The Court
may, in its discretion, prescribe any limitations or conditions with reference
to the inspection, or award such other and further relief as the Court may deem
just and proper.
VII.3 REPRESENTATION OF SHARES OF OTHER CORPORATIONS
The chairman of the board, the president, any vice president, the treasurer,
the secretary or assistant secretary of this corporation, or any other person
authorized by the board of directors or the president or a vice president, is
authorized to vote, represent, and exercise on behalf of this corporation all
rights incident to any and all shares of any other corporation or corporations
standing in the name of this corporation. The authority granted herein may be
exercised either by such person directly or by any other person authorized to do
so by proxy or power of attorney duly executed by such person having the
authority.
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ARTICLE VIII
GENERAL MATTERS
VIII.1 CHECKS
From time to time, the board of directors shall determine by resolution
which person or persons may sign or endorse all checks, drafts, other orders for
payment of money, notes or other evidences of indebtedness that are issued in
the name of or payable to the corporation, and only the persons so authorized
shall sign or endorse those instruments.
VIII.2 EXECUTION OF CORPORATE CONTRACTS AND INSTRUMENTS
The board of directors, except as otherwise provided in these bylaws, may
authorize any officer or officers, or agent or agents, to enter into any
contract or execute any instrument in the name of and on behalf of the
corporation; such authority may be general or confined to specific instances.
Unless so authorized or ratified by the board of directors or within the agency
power of an officer, no officer, agent or employee shall have any power or
authority to bind the corporation by any contract or engagement or to pledge its
credit or to render it liable for any purpose or for any amount.
VIII.3 STOCK CERTIFICATES; PARTLY PAID SHARES
The shares of a corporation shall be represented by certificates, provided
that the board of directors of the corporation may provide by resolution or
resolutions that some or all of any or all classes or series of its stock shall
be uncertificated shares. Any such resolution shall not apply to shares
represented by a certificate until such certificate is surrendered to the
corporation. Notwithstanding the adoption of such a resolution by the board of
directors, every holder of stock represented by certificates and upon request
every holder of uncertificated shares shall be entitled to have a certificate
signed by, or in the name of the corporation by the chairman or vice-chairman of
the board of directors, or the president or vice-president, and by the treasurer
or an assistant treasurer, or the secretary or an assistant secretary of such
corporation representing the number of shares registered in certificate form.
Any or all of the signatures on the certificate may be a facsimile. In case any
officer, transfer agent or registrar who has signed or whose facsimile signature
has been placed upon a certificate has ceased to be such officer, transfer agent
or registrar before such certificate is issued, it may be issued by the
corporation with the same effect as if he were such officer, transfer agent or
registrar at the date of issue.
The corporation may issue the whole or any part of its shares as partly paid
and subject to call for the remainder of the consideration to be paid therefor.
Upon the face or back of each stock certificate issued to represent any such
partly paid shares, upon the books and records of the corporation in the case of
uncertificated partly paid shares, the total amount of the consideration to be
paid therefor and the amount paid thereon shall be stated. Upon the declaration
of any dividend on fully paid shares, the corporation shall declare a dividend
upon partly paid shares of the same class, but only upon the basis of the
percentage of the consideration actually paid thereon.
VIII.4 SPECIAL DESIGNATION ON CERTIFICATES
If the corporation is authorized to issue more than one class of stock or
more than one series of any class, then the powers, the designations, the
preferences, and the relative, participating, optional or other special rights
of each class of stock or series thereof and the qualifications, limitations or
restrictions of such preferences and/or rights shall be set forth in full or
summarized on the face or back of the certificate that the corporation shall
issue to represent such class or series of stock; provided, however, that,
except as otherwise provided in Section 202 of the General Corporation Law of
Delaware, in lieu of the foregoing requirements there may be set forth on the
face or back of the certificate that the corporation shall issue to represent
such class or series of stock a statement that the corporation will furnish
without charge to each stockholder who so requests the powers, the
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designations, the preferences, and the relative, participating, optional or
other special rights of each class of stock or series thereof and the
qualifications, limitations or restrictions of such preferences and/or rights.
VIII.5 LOST CERTIFICATES
Except as provided in this Section 8.5, no new certificates for shares shall
be issued to replace a previously issued certificate unless the latter is
surrendered to the corporation and cancelled at the same time. The corporation
may issue a new certificate of stock or uncertificated shares in the place of
any certificate theretofore issued by it, alleged to have been lost, stolen or
destroyed, and the corporation may require the owner of the lost, stolen or
destroyed certificate, or his legal representative, to give the corporation a
bond sufficient to indemnify it against any claim that may be made against it on
account of the alleged loss, theft or destruction of any such certificate or the
issuance of such new certificate or uncertificated shares.
VIII.6 CONSTRUCTION; DEFINITIONS
Unless the context requires otherwise, the general provisions, rules of
construction, and definitions in the Delaware General Corporation Law shall
govern the construction of these bylaws. Without limiting the generality of this
provision, the singular number includes the plural, the plural number includes
the singular, and the term "person" includes both a corporation and a natural
person.
VIII.7 DIVIDENDS
The directors of the corporation, subject to any restrictions contained in
the certificate of incorporation, may declare and pay dividends upon the shares
of its capital stock pursuant to the General Corporation Law of Delaware.
Dividends may be paid in cash, in property, or in shares of the corporation's
capital stock.
The directors of the corporation may set apart out of any of the funds of
the corporation available for dividends a reserve or reserves for any proper
purpose and may abolish any such reserve. Such purposes shall include but not be
limited to equalizing dividends, repairing or maintaining any property of the
corporation, and meeting contingencies.
VIII.8 FISCAL YEAR
The fiscal year of the corporation shall be fixed by resolution of the board
of directors and may be changed by the board of directors.
VIII.9 SEAL
The corporation may have a seal, which may be altered at pleasure. The seal
may be used by causing it or a facsimile thereof to be impressed or affixed or
in any other manner reproduced.
VIII.10 TRANSFER OF STOCK
Upon surrender to the corporation or the transfer agent of the corporation
of a certificate for shares duly endorsed or accompanied by proper evidence of
succession, assignation or authority to transfer, it shall be the duty of the
corporation to issue a new certificate to the person entitled thereto, cancel
the old certificate, and record the transaction in its books.
VIII.11 STOCK TRANSFER AGREEMENTS
The corporation shall have power to enter into and perform any agreement
with any number of shareholders of any one or more classes of stock of the
corporation to restrict the transfer of shares of stock of the corporation of
any one or more classes owned by such stockholders in any manner not prohibited
by the General Corporation Law of Delaware.
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VIII.12 REGISTERED STOCKHOLDERS
The corporation shall be entitled to recognize the exclusive right of a
person registered on its books as the owner of shares to receive dividends and
to vote as such owner, shall be entitled to hold liable for calls and
assessments the person registered on its books as the owner of shares, and shall
not be bound to recognize any equitable or other claim to or interest in such
share or shares on the part of another person, whether or not it shall have
express or other notice thereof, except as otherwise provided by the laws of
Delaware.
ARTICLE IX
AMENDMENTS
The original or other bylaws of the corporation may be adopted, amended or
repealed by the stockholders entitled to vote; provided, however, that the
corporation may, in its certificate of incorporation, confer the power to adopt,
amend or repeal bylaws upon the directors. The fact that such power has been so
conferred upon the directors shall not divest the stockholders of the power, nor
limit their power to adopt, amend or repeal bylaws.
ARTICLE X
DISSOLUTION
If it should be deemed advisable in the judgment of the board of directors
of the corporation that the corporation should be dissolved, the board, after
the adoption of a resolution to that effect by a majority of the whole board at
any meeting called for that purpose, shall cause notice to be mailed to each
stockholder entitled to vote thereon of the adoption of the resolution and of a
meeting of stockholders to take action upon the resolution.
At the meeting a vote shall be taken for and against the proposed
dissolution. If a majority of the outstanding stock of the corporation entitled
to vote thereon votes for the proposed dissolution, then a certificate stating
that the dissolution has been authorized in accordance with the provisions of
Section 275 of the General Corporation Law of Delaware and setting forth the
names and residences of the directors and officers shall be executed,
acknowledged, and filed and shall become effective in accordance with Section
103 of the General Corporation Law of Delaware. Upon such certificate's becoming
effective in accordance with Section 103 of the General Corporation Law of
Delaware, the corporation shall be dissolved.
Whenever all the stockholders entitled to vote on a dissolution consent in
writing, either in person or by duly authorized attorney, to a dissolution, no
meeting of directors or stockholders shall be necessary. The consent shall be
filed and shall become effective in accordance with Section 103 of the General
Corporation Law of Delaware. Upon such consent's becoming effective in
accordance with Section 103 of the General Corporation Law of Delaware, the
corporation shall be dissolved. If the consent is signed by an attorney, then
the original power of attorney or a photocopy thereof shall be attached to and
filed with the consent. The consent filed with the Secretary of State shall have
attached to it the affidavit of the secretary or some other officer of the
corporation stating that the consent has been signed by or on behalf of all the
stockholders entitled to vote on a dissolution; in addition, there shall be
attached to the consent a certification by the secretary or some other officer
of the corporation setting forth the names and residences of the directors and
officers of the corporation.
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ARTICLE XI
CUSTODIAN
XI.1 APPOINTMENT OF A CUSTODIAN IN CERTAIN CASES
The Court of Chancery, upon application of any stockholder, may appoint one
or more persons to be custodians and, if the corporation is insolvent, to be
receivers, of and for the corporation when:
(i) at any meeting held for the election of directors the stockholders
are so divided that they have failed to elect successors to directors whose
terms have expired or would have expired upon qualification of their
successors; or
(ii) the business of the corporation is suffering or is threatened with
irreparable injury because the directors are so divided respecting the
management of the affairs of the corporation that the required vote for
action by the board of directors cannot be obtained and the stockholders are
unable to terminate this division; or
(iii) the corporation has abandoned its business and has failed within a
reasonable time to take steps to dissolve, liquidate or distribute its
assets.
XI.2 DUTIES OF CUSTODIAN
The custodian shall have all the powers and title of a receiver appointed
under Section 291 of the General Corporation Law of Delaware, but the authority
of the custodian shall be to continue the business of the corporation and not to
liquidate its affairs and distribute its assets, except when the Court of
Chancery otherwise orders and except in cases arising under Sections 226(a)(3)
or 352(a)(2) of the General Corporation Law of Delaware.
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CERTIFICATE OF ADOPTION OF BYLAWS
OF
VISX, INCORPORATED
CERTIFICATE BY SECRETARY OF ADOPTION BY DIRECTORS' VOTE
The undersigned hereby certifies that she is the duly elected, qualified,
and acting Secretary of VISX, Incorporated and that the foregoing Bylaws,
comprising 22 pages, were submitted to the board of directors at a meeting held
on December 13, 1995, and recorded in the minutes thereof.
IN WITNESS WHEREOF, the undersigned has hereunto set her hand and affixed
the corporate seal this 13th day of December, 1995.
--------------------------------------
Katrina J. Church, SECRETARY
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PRELIMINARY PROXY
EXHIBIT B
VISX, INCORPORATED
1995 DIRECTOR OPTION PLAN
1. PURPOSES OF THE PLAN. The purposes of this 1995 Director Option Plan
are to attract and retain the best available personnel for service as Outside
Directors (as defined herein) of the Company, to provide additional incentive to
the Outside Directors of the Company to serve as Directors, and to encourage
their continued service on the Board.
All options granted hereunder shall be nonstatutory stock options.
2. DEFINITIONS. As used herein, the following definitions shall apply:
(a) "BOARD" means the Board of Directors of the Company.
(b) "CODE" means the Internal Revenue Code of 1986, as amended.
(c) "COMMON STOCK" means the Common Stock of the Company.
(d) "COMPANY" means VISX, Incorporated, a Delaware corporation.
(e) "CONTINUOUS STATUS AS A DIRECTOR" means the absence of any
interruption or termination of service as a Director.
(f) "DIRECTOR" means a member of the Board.
(g) "EMPLOYEE" means any person, including officers and Directors,
employed by the Company or any Parent or Subsidiary of the Company. The
payment of a Director's fee by the Company shall not be sufficient in and of
itself to constitute "employment" by the Company.
(h) "EXCHANGE ACT" means the Securities Exchange Act of 1934, as
amended.
(i) "FAIR MARKET VALUE" means, as of any date, the value of Common Stock
determined as follows:
(i) If the Common Stock is listed on any established stock exchange
or a national market system, including without limitation the Nasdaq
National Market of the National Association of Securities Dealers, Inc.
Automated Quotation ("NASDAQ") System, the Fair Market Value of a Share
of Common Stock shall be the closing sales price for such stock (or the
closing bid, if no sales were reported) as quoted on such system or
exchange (or the exchange with the greatest volume of trading in Common
Stock) on the day of determination, as reported in THE WALL STREET
JOURNAL or such other source as the Board deems reliable;
(ii) If the Common Stock is quoted on the NASDAQ System (but not on
the National Market thereof) or regularly quoted by a recognized
securities dealer but selling prices are not reported, the Fair Market
Value of a Share of Common Stock shall be the mean between the high bid
and low asked prices for the Common Stock on the day of determination, as
reported in THE WALL STREET JOURNAL or such other source as the Board
deems reliable, or;
(iii) In the absence of an established market for the Common Stock,
the Fair Market Value thereof shall be determined in good faith by the
Board.
(j) "NEW OUTSIDE DIRECTOR" means an Outside Director who first becomes a
Director at or after the Company's 1995 annual meeting of stockholders
(which meeting took place on May 26, 1995).
(k) "OPTION" means a stock option granted pursuant to the Plan.
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(l) "OPTIONED STOCK" means the Common Stock subject to an Option.
(m) "OPTIONEE" means an Outside Director who receives an Option.
(n) "OUTSIDE DIRECTOR" means a Director who is not an Employee.
(o) "PARENT" means a "parent corporation", whether now or hereafter
existing, as defined in Section 424(e) of the Code.
(p) "PLAN" means this VISX, Incorporated 1995 Director Option Plan.
(q) "SHARE" means a share of the Common Stock, as adjusted in accordance
with Section 10 of the Plan.
(r) "SUBSIDIARY" means a "subsidiary corporation", whether now or
hereafter existing, as defined in Section 424(f) of the Internal Revenue
Code of 1986.
3. STOCK SUBJECT TO THE PLAN. Subject to the provisions of Section 10 of
the Plan, the maximum aggregate number of Shares which may be optioned and sold
under the Plan is Two Hundred Fifty Thousand (250,000) Shares (the "Pool") of
Common Stock. The Shares may be authorized but unissued, or reacquired Common
Stock.
If an Option should expire or become unexercisable for any reason without
having been exercised in full, the unpurchased Shares which were subject thereto
shall, unless the Plan shall have been terminated, become available for future
grant under the Plan; provided, however, that Shares that have actually been
issued under the Plan shall not be returned to the Plan and shall not become
available for future distribution under the Plan.
4. ADMINISTRATION AND GRANTS OF OPTIONS UNDER THE PLAN.
(a) PROCEDURE FOR GRANTS. The provisions set forth in this Section 4(a)
shall not be amended more than once every six months, other than to comport with
changes in the Code, the Employee Retirement Income Security Act of 1974, as
amended, or the rules thereunder. All grants of Options to Outside Directors
under this Plan shall be automatic and nondiscretionary and shall be made
strictly in accordance with the following provisions:
(i) No person shall have any discretion to select which Outside
Directors shall be granted Options or to determine the number of Shares to
be covered by Options granted to Outside Directors.
(ii) Each New Outside Director shall be automatically granted an Option
to purchase Fifteen Thousand (15,000) Shares (a "First Option") on the later
of (i) the date on which such person first becomes a Director, whether
through election by the stockholders of the Company or appointment by the
Board to fill a vacancy or (ii) the date this Plan is adopted by the Board;
provided, however, that an Employee Director who ceases to be an Employee
but who remains a Director shall not receive a First Option. Notwithstanding
the foregoing, each First Option granted to a New Outside Director on the
date this Plan is adopted by the Board shall be for 15,000 Shares less the
number of shares subject to any option granted to such New Outside Director
under any other director option grant program of the Company during the
calendar year in which this Plan is adopted by the Board.
(iii) Each Outside Director shall be automatically granted an Option to
purchase Two Thousand (2,000) Shares (a "Subsequent Option") on the date
such Outside Director is reelected to the Board commencing with the
Company's 1996 annual meeting of stockholders, if on such date he shall have
served on the Board for at least six (6) months.
(iv) Notwithstanding the provisions of subsections (ii) and (iii) hereof,
any exercise of an Option made before the Company has obtained stockholder
approval of the Plan in accordance with Section 16 hereof shall be
conditioned upon obtaining such stockholder approval of the Plan in
accordance with Section 16 hereof.
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(v) The terms of a First Option granted hereunder shall be as follows:
(A) the term of the First Option shall be ten (10) years.
(B) the First Option shall be exercisable only while the Outside
Director remains a Director of the Company, except as set forth in
Section 8 hereof.
(C) the exercise price per Share shall be 100% of the fair market
value per Share on the date of grant of the First Option. In the event
that the date of grant of the First Option is not a trading day, the
exercise price per Share shall be the Fair Market Value on the next
trading day immediately following the date of grant of the First Option.
(D) the First Option shall become exercisable as to 12/48 of the
Shares subject to the First Option at the end of 12 full months following
the date of grant and as to 1/48 of the Shares subject to the First
Option at the end of each full month thereafter, subject to continued
service as an Outside Director.
(vi) The terms of a Subsequent Option granted hereunder shall be as
follows:
(A) the term of the Subsequent Option shall be ten (10) years.
(B) the Subsequent Option shall be exercisable only while the Outside
Director remains a Director of the Company, except as set forth in
Section 8 hereof.
(C) the exercise price per Share shall be 100% of the fair market
value per Share on the date of grant of the Subsequent Option. In the
event that the date of grant of the First Option is not a trading day,
the exercise price per Share shall be the Fair Market Value on the next
trading day immediately following the date of grant of the First Option.
(D) the Subsequent Option shall become exercisable as to 12/48 of the
Shares subject to the Subsequent Option at the end of 12 full months
following the date of grant and as to 1/48 of the Shares subject to the
Subsequent Option at the end of each full month thereafter, subject to
continued service as an Outside Director.
(vii) In the event that any Option granted under the Plan would cause the
number of Shares subject to outstanding Options plus the number of Shares
previously purchased under Options to exceed the Pool, then the remaining
Shares available for Option grant shall be granted under Options to the
Outside Directors on a pro rata basis. No further grants shall be made until
such time, if any, as additional Shares become available for grant under the
Plan through action of the stockholders to increase the number of Shares
which may be issued under the Plan or through cancellation or expiration of
Options previously granted hereunder.
5. ELIGIBILITY. Options may be granted only to Outside Directors. All
Options shall be automatically granted in accordance with the terms set forth in
Section 4 hereof. An Outside Director who has been granted an Option may, if he
is otherwise eligible, be granted an additional Option or Options in accordance
with such provisions.
The Plan shall not confer upon any Optionee any right with respect to
continuation of service as a Director or nomination to serve as a Director, nor
shall it interfere in any way with any rights which the Director or the Company
may have to terminate his or her directorship at any time.
6. TERM OF PLAN. The Plan shall become effective upon the earlier to occur
of its adoption by the Board or its approval by the stockholders of the Company
as described in Section 16 of the Plan. It shall continue in effect for a term
of five (5) years unless sooner terminated under Section 11 of the Plan.
7. FORM OF CONSIDERATION. The consideration to be paid for the Shares to
be issued upon exercise of an Option, including the method of payment, shall
consist of (i) cash, (ii) check, (iii) other shares which (x) in the case of
Shares acquired upon exercise of an Option, have been owned by the Optionee for
more than six (6) months on the date of surrender, and (y) have a Fair Market
Value on
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the date of surrender equal to the aggregate exercise price of the Shares as to
which said Option shall be exercised, (iv) delivery of a properly executed
exercise notice together with such other documentation as the Company and the
broker, if applicable, shall require to effect an exercise of the Option and
delivery to the Company of the sale or loan proceeds required to pay the
exercise price, or (v) any combination of the foregoing methods of payment.
8. EXERCISE OF OPTION.
(a) PROCEDURE FOR EXERCISE; RIGHTS AS A STOCKHOLDER. Any Option granted
hereunder shall be exercisable at such times as are set forth in Section 4
hereof; provided, however, that no Options shall be exercisable until
stockholder approval of the Plan in accordance with Section 16 hereof has been
obtained.
An Option may not be exercised for a fraction of a Share.
An Option shall be deemed to be exercised when written notice of such
exercise has been given to the Company in accordance with the terms of the
Option by the person entitled to exercise the Option and full payment for the
Shares with respect to which the Option is exercised has been received by the
Company. Full payment may consist of any consideration and method of payment
allowable under Section 7 of the Plan. Until the issuance (as evidenced by the
appropriate entry on the books of the Company or of a duly authorized transfer
agent of the Company) of the stock certificate evidencing such Shares, no right
to vote or receive dividends or any other rights as a stockholder shall exist
with respect to the Optioned Stock, notwithstanding the exercise of the Option.
A share certificate for the number of Shares so acquired shall be issued to the
Optionee as soon as practicable after exercise of the Option. No adjustment
shall be made for a dividend or other right for which the record date is prior
to the date the stock certificate is issued, except as provided in Section 10 of
the Plan.
Exercise of an Option in any manner shall result in a decrease in the number
of Shares which thereafter may be available, both for purposes of the Plan and
for sale under the Option, by the number of Shares as to which the Option is
exercised.
(b) RULE 16B-3. Options granted to Outside Directors must comply with the
applicable provisions of Rule 16b-3 promulgated under the Exchange Act or any
successor thereto and shall contain such additional conditions or restrictions
as may be required thereunder to qualify Plan transactions, and other
transactions by Outside Directors that otherwise could be matched with Plan
transactions, for the maximum exemption from Section 16 of the Exchange Act.
(c) TERMINATION OF CONTINUOUS STATUS AS A DIRECTOR. In the event an
Optionee's Continuous Status as a Director terminates (other than upon the
Optionee's death or total and permanent disability (as defined in Section
22(e)(3) of the Code)), the Optionee may exercise his or her Option, but only
within three (3) months from the date of such termination, and only to the
extent that the Optionee was entitled to exercise it on the date of such
termination (but in no event later than the expiration of its ten (10) year
term). To the extent that the Optionee was not entitled to exercise an Option on
the date of such termination, and to the extent that the Optionee does not
exercise such Option (to the extent otherwise so entitled) within the time
specified herein, the Option shall terminate.
(d) DISABILITY OF OPTIONEE. In the event Optionee's Continuous Status as a
Director terminates as a result of total and permanent disability (as defined in
Section 22(e)(3) of the Code), the Optionee may exercise his or her Option, but
only within twelve (12) months from the date of such termination, and only to
the extent that the Optionee was entitled to exercise it on the date of such
termination (but in no event later than the expiration of its ten (10) year
term). To the extent that the Optionee was not entitled to exercise an Option on
the date of termination, or if he or she does not exercise such Option (to the
extent otherwise so entitled) within the time specified herein, the Option shall
terminate.
(e) DEATH OF OPTIONEE. In the event of an Optionee's death, the Optionee's
estate or a person who acquired the right to exercise the Option by bequest or
inheritance may exercise the Option, but
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only within twelve (12) months following the date of death, and only to the
extent that the Optionee was entitled to exercise it on the date of death (but
in no event later than the expiration of its ten (10) year term). To the extent
that the Optionee was not entitled to exercise an Option on the date of death,
and to the extent that the Optionee's estate or a person who acquired the right
to exercise such Option does not exercise such Option (to the extent otherwise
so entitled) within the time specified herein, the Option shall terminate.
9. NON-TRANSFERABILITY OF OPTIONS. The Option may not be sold, pledged,
assigned, hypothecated, transferred, or disposed of in any manner other than by
will or by the laws of descent or distribution and may be exercised, during the
lifetime of the Optionee, only by the Optionee.
10. ADJUSTMENTS UPON CHANGES IN CAPITALIZATION, DISSOLUTION, MERGER, ASSET
SALE OR CHANGE OF CONTROL.
(A) CHANGES IN CAPITALIZATION. Subject to any required action by the
stockholders of the Company, the number of Shares covered by each outstanding
Option, the number of Shares which have been authorized for issuance under the
Plan but as to which no Options have yet been granted or which have been
returned to the Plan upon cancellation or expiration of an Option, as well as
the price per Share covered by each such outstanding Option, and the number of
Shares issuable pursuant to the automatic grant provisions of Section 4 hereof
shall be proportionately adjusted for any increase or decrease in the number of
issued Shares resulting from a stock split, reverse stock split, stock dividend,
combination or reclassification of the Common Stock, or any other increase or
decrease in the number of issued Shares effected without receipt of
consideration by the Company; provided, however, that conversion of any
convertible securities of the Company shall not be deemed to have been "effected
without receipt of consideration." Except as expressly provided herein, no
issuance by the Company of shares of stock of any class, or securities
convertible into shares of stock of any class, shall affect, and no adjustment
by reason thereof shall be made with respect to, the number or price of Shares
subject to an Option.
(b) DISSOLUTION OR LIQUIDATION. In the event of the proposed dissolution
or liquidation of the Company, to the extent that an Option has not been
previously exercised, it will terminate immediately prior to the consummation of
such proposed action.
(c) MERGER OR ASSET SALE. In the event of a merger of the Company with or
into another corporation, or the sale of substantially all of the assets of the
Company, each outstanding Option shall be assumed or an equivalent option shall
be substituted by the successor corporation or a Parent or Subsidiary of the
successor corporation. In the event that the successor corporation does not
agree to assume the Option or to substitute an equivalent option, each
outstanding Option shall become fully vested and exercisable, including as to
Shares as to which it would not otherwise be exercisable. If an Option becomes
fully vested and exercisable in the event of a merger or sale of assets, the
Board shall notify the Optionee that the Option shall be fully exercisable for a
period of thirty (30) days from the date of such notice, and the Option shall
terminate upon the expiration of such period. For the purposes of this
paragraph, the Option shall be considered assumed if, following the merger or
sale of assets, the option or right confers the right to purchase, for each
Share of Optioned Stock subject to the Option immediately prior to the merger or
sale of assets, the consideration (whether stock, cash, or other securities or
property) received in the merger or sale of assets by holders of Common Stock
for each Share held on the effective date of the transaction (and if holders
were offered a choice of consideration, the type of consideration chosen by the
holders of a majority of the outstanding Shares).
11. AMENDMENT AND TERMINATION OF THE PLAN.
(a) AMENDMENT AND TERMINATION. Except as set forth in Section 4, the Board
may at any time amend, alter, suspend, or discontinue the Plan, but no
amendment, alteration, suspension, or discontinuation shall be made which would
impair the rights of any Optionee under any grant theretofore made, without his
or her consent. In addition, to the extent necessary and desirable to comply
with
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Rule 16b-3 under the Exchange Act (or any other applicable law or regulation),
the Company shall obtain stockholder approval of any Plan amendment in such a
manner and to such a degree as required.
(b) EFFECT OF AMENDMENT OR TERMINATION. Any such amendment or termination
of the Plan shall not affect Options already granted and such Options shall
remain in full force and effect as if this Plan had not been amended or
terminated.
12. TIME OF GRANTING OPTIONS. The date of grant of an Option shall, for
all purposes, be the date determined in accordance with Section 4 hereof.
13. CONDITIONS UPON ISSUANCE OF SHARES. Shares shall not be issued
pursuant to the exercise of an Option unless the exercise of such Option and the
issuance and delivery of such Shares pursuant thereto shall comply with all
relevant provisions of law, including, without limitation, the Securities Act of
1933, as amended, the Exchange Act, the rules and regulations promulgated
thereunder, state securities laws, and the requirements of any stock exchange
upon which the Shares may then be listed, and shall be further subject to the
approval of counsel for the Company with respect to such compliance.
As a condition to the exercise of an Option, the Company may require the
person exercising such Option to represent and warrant at the time of any such
exercise that the Shares are being purchased only for investment and without any
present intention to sell or distribute such Shares, if, in the opinion of
counsel for the Company, such a representation is required by any of the
aforementioned relevant provisions of law.
Inability of the Company to obtain authority from any regulatory body having
jurisdiction, which authority is deemed by the Company's counsel to be necessary
to the lawful issuance and sale of any Shares hereunder, shall relieve the
Company of any liability in respect of the failure to issue or sell such Shares
as to which such requisite authority shall not have been obtained.
14. RESERVATION OF SHARES. The Company, during the term of this Plan, will
at all times reserve and keep available such number of Shares as shall be
sufficient to satisfy the requirements of the Plan.
15. OPTION AGREEMENT. Options shall be evidenced by written option
agreements in such form as the Board shall approve.
16. STOCKHOLDER APPROVAL. Continuance of the Plan shall be subject to
approval by the stockholders of the Company at or prior to the first annual
meeting of stockholders held subsequent to the granting of an Option hereunder.
Such stockholder approval shall be obtained in the degree and manner required
under applicable state and federal law.
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PRELIMINARY PROXY
EXHIBIT C
VISX INCORPORATED
1995 STOCK PLAN
1. PURPOSES OF THE PLAN. The purposes of this Stock Plan are:
- to attract and retain the best available personnel for positions of
substantial responsibility,
- to provide additional incentive to Employees and Consultants, and
- to promote the success of the Company's business.
Options granted under the Plan may be Incentive Stock Options or Nonstatutory
Stock Options, as determined by the Administrator at the time of grant. Stock
Rights may also be granted under the Plan.
2. DEFINITIONS. As used herein, the following definitions shall apply:
(a) "ADMINISTRATOR" means the Board or any of its Committees as shall be
administering the Plan, in accordance with Section 4 of the Plan.
(b) "APPLICABLE LAWS" means the legal requirements relating to the
administration of stock option plans under state corporate and securities
laws and the Code.
(c) "BOARD" means the Board of Directors of the Company.
(d) "CODE" means the Internal Revenue Code of 1986, as amended.
(e) "COMMITTEE" means a Committee appointed by the Board in accordance
with Section 4 of the Plan.
(f) "COMMON STOCK" means the Common Stock of the Company.
(g) "COMPANY" means VISX Incorporated, a Delaware corporation.
(h) "CONSULTANT" means any person, including an advisor, engaged by the
Company or a Parent or Subsidiary to render services and who is
compensated for such services. The term"Consultant" shall not include
Directors who are paid only a director's fee by the Company or who are not
compensated by the Company for their services as Directors.
(i) "CONTINUOUS STATUS AS AN EMPLOYEE OR CONSULTANT" means that the
employment or consulting relationship with the Company, any Parent, or
Subsidiary, is not interrupted or terminated. Continuous Status as an
Employee or Consultant shall not be considered interrupted in the case of
(i) any leave of absence approved by the Company or (ii) transfers between
locations of the Company or between the Company, its Parent, any Subsidiary,
or any successor. A leave of absence approved by the Company shall include
sick leave, military leave, or any other personal leave approved by an
authorized representative of the Company. For purposes of Incentive Stock
Options, no such leave may exceed ninety days, unless reemployment upon
expiration of such leave is guaranteed by statute or contract. If
reemployment upon expiration of a leave of absence approved by the Company
is not so guaranteed, on the 181st day of such leave any Incentive Stock
Option held by the Optionee shall cease to be treated as an Incentive Stock
Option and shall be treated for tax purposes as a Nonstatutory Stock Option.
(j) "DIRECTOR" means a member of the Board.
(k) "DISABILITY" means total and permanent disability as defined in
Section 22(e)(3) of the Code.
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(l) "EMPLOYEE" means any person, including Officers and Directors,
employed by the Company or any Parent or Subsidiary of the Company.
Neither service as a Director nor payment of a director's fee by the Company
shall be sufficient to constitute "employment" by the Company.
(m) "EXCHANGE ACT" means the Securities Exchange Act of 1934, as
amended.
(n) "FAIR MARKET VALUE" means, as of any date, the value of Common Stock
determined as follows:
(i) If the Common Stock is listed on any established stock exchange
or a national market system, including without limitation the Nasdaq
National Market of the National Association of Securities Dealers, Inc.
Automated Quotation ("NASDAQ") System, the Fair Market Value of a Share
of Common Stock shall be the closing sales price for such stock (or the
closing bid, if no sales were reported) as quoted on such system or
exchange (or the exchange with the greatest volume of trading in Common
Stock) on the last market trading day prior to the day of determination,
as reported in THE WALL STREET JOURNAL or such other source as the
Administrator deems reliable;
(ii) If the Common Stock is quoted on the NASDAQ System (but not on
the Nasdaq National Market thereof) or is regularly quoted by a
recognized securities dealer but selling prices are not reported, the
Fair Market Value of a Share of Common Stock shall be the mean between
the high bid and low asked prices for the Common Stock on the last market
trading day prior to the day of determination, as reported in THE WALL
STREET JOURNAL or such other source as the Administrator deems reliable;
(iii) In the absence of an established market for the Common Stock,
the Fair Market Value shall be determined in good faith by the
Administrator.
(o) "INCENTIVE STOCK OPTION" means an Option intended to qualify as an
incentive stock option within the meaning of Section 422 of the Code and
the regulations promulgated thereunder.
(p) "NONSTATUTORY STOCK OPTION" means an Option not intended to qualify
as an Incentive Stock Option.
(q) "NOTICE OF GRANT" means a written notice evidencing certain terms
and conditions of an individual Option or Stock Right grant. In the case
of Options, the Notice of Grant is part of the Option Agreement.
(r) "OFFICER" means a person who is an officer of the Company within the
meaning of Section 16 of the Exchange Act and the rules and regulations
promulgated thereunder.
(s) "OPTION" means a stock option granted pursuant to the Plan.
(t) "OPTION AGREEMENT" means a written agreement between the Company and
an Optionee evidencing the terms and conditions of an individual Option
grant. The Option Agreement is subject to the terms and conditions of the
Plan.
(u) "OPTIONED STOCK" means the Common Stock subject to an Option or
Stock Right.
(v) "OPTIONEE" means an Employee or Consultant who holds an outstanding
Option or Stock Right.
(w) "PARENT" means a "parent corporation", whether now or hereafter
existing, as defined in Section 424(e) of the Code.
(x) "PLAN" means this 1995 Stock Plan.
(y) "RESTRICTED STOCK" means shares of Common Stock acquired pursuant to
a grant of Stock Rights under Section 11 below.
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(z) "RESTRICTED STOCK AWARD AGREEMENT" means a written agreement between
the Company and the Optionee evidencing the terms and restrictions
applying to stock awarded under a Stock Right. The Restricted Stock Award
Agreement is subject to the terms and conditions of the Plan and the Notice
of Grant.
(aa) "RESTRICTED STOCK PURCHASE AGREEMENT" means a written agreement
between the Company and the Optionee evidencing the terms and
restrictions applying to stock purchased under a Stock Right. The Restricted
Stock Purchase Agreement is subject to the terms and conditions of the Plan
and the Notice of Grant.
(bb) "RULE 16B-3" means Rule 16b-3 of the Exchange Act or any successor
to Rule 16b-3, as in effect when discretion is being exercised with
respect to the Plan.
(cc) "SECTION 16(B)" means Section 16(b) of the Securities Exchange Act
of 1934, as amended.
(dd) "SHARE" means a share of the Common Stock, as adjusted in
accordance with Section 13 of the Plan.
(ee) "STOCK RIGHT" means the right to purchase or receive as an award
Common Stock pursuant to Section 11 of the Plan, as evidenced by a Notice
of Grant.
(ff) "SUBSIDIARY" means a "subsidiary corporation", whether now or
hereafter existing, as defined in Section 424(f) of the Code.
3. STOCK SUBJECT TO THE PLAN. Subject to the provisions to Section 11 of
the Plan, the total number of Shares reserved and available for issuance under
the Plan is 10% of the Shares issued and outstanding on the date of adoption of
the Plan, less the number of Shares issued under the VISX Incorporated 1996
Supplemental Stock Option Plan prior to the date the Plan is approved by the
Company's shareholders, which number shall be increased on the first day of each
new fiscal year of the Company from and including the 1996 fiscal year by a
number of Shares equal to 3% of the number of Shares outstanding as of the last
business day preceding each such first day of each new fiscal year. However,
notwithstanding the preceding sentence, the maximum number of Shares available
for issuance pursuant to Incentive Stock Options is 10% of the Shares issued and
outstanding on the date of adoption of the Plan, less the number of Shares
issued under the VISX Incorporated 1996 Supplemental Stock Option Plan prior to
the date the Plan is approved by the Company's shareholders, which number shall
be increased on the first day of each new fiscal year of the Company from and
including the 1996 fiscal year by a number of Shares equal to 3% of the number
of Shares outstanding as of the date of adoption of the Plan.
If an Option or Stock Right expires or becomes unexercisable without having
been exercised in full, the unpurchased Shares which were subject thereto shall
become available for future grant or sale under the Plan (unless the Plan has
terminated); PROVIDED, HOWEVER, that Shares that have actually been issued under
the Plan, whether upon exercise of an Option or Right, shall not be returned to
the Plan and shall not become available for future distribution under the Plan,
except that if Shares of Restricted Stock are repurchased or reacquired by the
Company at their original purchase price, and the original purchaser of such
Shares did not receive any benefits of ownership of such Shares, such Shares
shall become available for future grant under the Plan. For purposes of the
preceding sentence, voting rights shall not be considered a benefit of Share
ownership.
4. ADMINISTRATION OF THE PLAN.
(a) PROCEDURE.
(i) MULTIPLE ADMINISTRATIVE BODIES. If permitted by Rule 16b-3, the
Plan may be administered by different bodies with respect to Directors,
Officers who are not Directors, and Employees who are neither Directors nor
Officers.
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(ii) ADMINISTRATION WITH RESPECT TO DIRECTORS AND OFFICERS SUBJECT TO
SECTION 16(B). With respect to Option or Stock Right grants made to
Employees who are also Officers or Directors subject to Section 16(b) of the
Exchange Act, the Plan shall be administered by (A) the Board, if the Board
may administer the Plan in a manner complying with the rules under Rule
16b-3 relating to the disinterested administration of employee benefit plans
under which Section 16(b) exempt discretionary grants and awards of equity
securities are to be made, or (B) a committee designated by the Board to
administer the Plan, which committee shall be constituted to comply with the
rules under Rule 16b-3 relating to the disinterested administration of
employee benefit plans under which Section 16(b) exempt discretionary grants
and awards of equity securities are to be made. Once appointed, such
Committee shall continue to serve in its designated capacity until otherwise
directed by the Board. From time to time the Board may increase the size of
the Committee and appoint additional members, remove members (with or
without cause) and substitute new members, fill vacancies (however caused),
and remove all members of the Committee and thereafter directly administer
the Plan, all to the extent permitted by the rules under Rule 16b-3 relating
to the disinterested administration of employee benefit plans under which
Section 16(b) exempt discretionary grants and awards of equity securities
are to be made.
(iii) ADMINISTRATION WITH RESPECT TO OTHER PERSONS. With respect to
Option or Stock Right grants made to Employees or Consultants who are
neither Directors nor Officers of the Company, the Plan shall be
administered by (A) the Board or (B) a committee designated by the Board,
which committee shall be constituted to satisfy Applicable Laws. Once
appointed, such Committee shall serve in its designated capacity until
otherwise directed by the Board. The Board may increase the size of the
Committee and appoint additional members, remove members (with or without
cause) and substitute new members, fill vacancies (however caused), and
remove all members of the Committee and thereafter directly administer the
Plan, all to the extent permitted by Applicable Laws.
(b) POWERS OF THE ADMINISTRATOR. Subject to the provisions of the Plan,
and in the case of a Committee, subject to the specific duties delegated by the
Board to such Committee, the Administrator shall have the authority, in its
discretion:
(i) to determine the Fair Market Value of the Common Stock, in
accordance with Section 2(n) of the Plan;
(ii) to select the Consultants and Employees to whom Options and Stock
Rights may be granted hereunder;
(iii) to determine whether and to what extent Options and Stock Rights or
any combination thereof, are granted hereunder;
(iv) to determine the number of shares of Common Stock to be covered by
each Option and Stock Right granted hereunder;
(v) to approve forms of agreement for use under the Plan;
(vi) to determine the terms and conditions, not inconsistent with the
terms of the Plan, of any award granted hereunder. Such terms and conditions
include, but are not limited to, the exercise price, the time or times when
Options or Stock Rights may be exercised (which may be based on performance
criteria), any vesting acceleration or waiver of forfeiture restrictions,
and any restriction or limitation regarding any Option or Stock Right or the
shares of Common Stock relating thereto, based in each case on such factors
as the Administrator, in its sole discretion, shall determine;
(vii) to construe and interpret the terms of the Plan and awards granted
pursuant to the Plan;
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(viii) to prescribe, amend and rescind rules and regulations relating to
the Plan, including rules and regulations relating to sub-plans established
for the purpose of qualifying for preferred tax treatment under foreign tax
laws;
(ix) to modify or amend each Option or Stock Right (subject to Section
15(c) of the Plan), including the discretionary authority to extend the
post-termination exercisability period of Options longer than is otherwise
provided for in the Plan;
(x) to authorize any person to execute on behalf of the Company any
instrument required to effect the grant of an Option or Stock Right
previously granted by the Administrator;
(xi) to determine the terms and restrictions applicable to Options and
Stock Rights and any Restricted Stock; and
(xii) to make all other determinations deemed necessary or advisable for
administering the Plan.
(c) EFFECT OF ADMINISTRATOR'S DECISION. The Administrator's decisions,
determinations and interpretations shall be final and binding on all Optionees
and any other holders of Options or Stock Rights.
5. ELIGIBILITY. Nonstatutory Stock Options and Stock Rights may be granted
to Employees and Consultants. Incentive Stock Options may be granted only to
Employees. If otherwise eligible, an Employee or Consultant who has been granted
an Option or Stock Right may be granted additional Options or Stock Rights.
6. LIMITATIONS.
(a) Each Option shall be designated in the written option agreement as
either an Incentive Stock Option or a Nonstatutory Stock Option. However,
notwithstanding such designation, to the extent that the aggregate Fair Market
Value of the Shares with respect to which Incentive Stock Options are
exercisable for the first time by the Optionee during any calendar year (under
all plans of the Company and any Parent or Subsidiary) exceeds $100,000, such
Options shall be treated as Nonstatutory Stock Options. For purposes of this
Section 6(a), Incentive Stock Options shall be taken into account in the order
in which they were granted. The Fair Market Value of the Shares shall be
determined as of the time the Option with respect to such Shares is granted.
(b) Neither the Plan nor any Option or Stock Right shall confer upon an
Optionee any right with respect to continuing the Optionee's employment or
consulting relationship with the Company, nor shall they interfere in any way
with the Optionee's right or the Company's right to terminate such employment or
consulting relationship at any time, with or without cause.
(c) The following limitations shall apply to grants of Options and Stock
Rights to Employees:
(i) No Employee shall be granted, in any fiscal year of the Company,
Options and Stock Rights to purchase more than 500,000 Shares.
(ii) In connection with his or her initial employment, an Employee may
be granted Options and Stock Rights to purchase up to an additional 500,000
Shares which shall not count against the limit set forth in subsection (i)
above.
(iii) The foregoing limitations shall be adjusted proportionately in
connection with any change in the Company's capitalization as described in
Section 13.
7. TERM OF PLAN. Subject to Section 19 of the Plan, the Plan shall become
effective upon the earlier to occur of its adoption by the Board or its approval
by the stockholders of the Company as described in Section 19 of the Plan. It
shall continue in effect for a term of five (5) years unless terminated earlier
under Section 15 of the Plan.
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8. TERM OF OPTION. The term of each Option shall be stated in the Notice
of Grant; provided, however, that in the case of an Incentive Stock Option, the
term shall be ten (10) years from the date of grant or such shorter term as may
be provided in the Notice of Grant. Moreover, in the case of an Incentive Stock
Option granted to an Optionee who, at the time the Incentive Stock Option is
granted, owns stock representing more than ten percent (10%) of the voting power
of all classes of stock of the Company or any Parent or Subsidiary, the term of
the Incentive Stock Option shall be five (5) years from the date of grant or
such shorter term as may be provided in the Notice of Grant.
9. OPTION EXERCISE PRICE AND CONSIDERATION.
(a) EXERCISE PRICE. The per share exercise price for the Shares to be
issued pursuant to exercise of an Option shall be determined by the
Administrator, subject to the following:
(i) In the case of an Incentive Stock Option
(A) granted to an Employee who, at the time the Incentive Stock
Option is granted, owns stock representing more than ten percent (10%) of
the voting power of all classes of stock of the Company or any Parent or
Subsidiary, the per Share exercise price shall be no less than 110% of
the Fair Market Value per Share on the date of grant.
(B) granted to any Employee other than an Employee described in
paragraph (A) immediately above, the per Share exercise price shall be no
less than 100% of the Fair Market Value per Share on the date of grant.
(ii) In the case of a Nonstatutory Stock Option, the per Share exercise
price shall be determined by the Administrator.
(b) WAITING PERIOD AND EXERCISE DATES. At the time an Option is granted,
the Administrator shall fix the period within which the Option may be exercised
and shall determine any conditions which must be satisfied before the Option may
be exercised. In so doing, the Administrator may specify that an Option may not
be exercised until the completion of a service period.
(c) FORM OF CONSIDERATION. The Administrator shall determine the
acceptable form of consideration for exercising an Option, including the method
of payment. In the case of an Incentive Stock Option, the Administrator shall
determine the acceptable form of consideration at the time of grant. Such
consideration may consist entirely of:
(i) cash;
(ii) check;
(iii) promissory note;
(iv) other Shares which (A) in the case of Shares acquired upon exercise
of an option, have been owned by the Optionee for more than six months on
the date of surrender, and (B) have a Fair Market Value on the date of
surrender equal to the aggregate exercise price of the Shares as to which
said Option shall be exercised;
(v) delivery of a properly executed exercise notice together with such
other documentation as the Administrator and the broker, if applicable,
shall require to effect an exercise of the Option and delivery to the
Company of the sale or loan proceeds required to pay the exercise price;
(vi) a reduction in the amount of any Company liability to the Optionee,
including any liability attributable to the Optionee's participation in any
Company-sponsored deferred compensation program or arrangement;
(vii) any combination of the foregoing methods of payment; or
(viii) such other consideration and method of payment for the issuance of
Shares to the extent permitted by Applicable Laws.
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10. EXERCISE OF OPTION.
(a) PROCEDURE FOR EXERCISE; RIGHTS AS A STOCKHOLDER. Any Option granted
hereunder shall be exercisable according to the terms of the Plan and at such
times and under such conditions as determined by the Administrator and set forth
in the Option Agreement.
An Option may not be exercised for a fraction of a Share.
An Option shall be deemed exercised when the Company receives: (i) written
notice of exercise (in accordance with the Option Agreement) from the person
entitled to exercise the Option, and (ii) full payment for the Shares with
respect to which the Option is exercised. Full payment may consist of any
consideration and method of payment authorized by the Administrator and
permitted by the Option Agreement and the Plan. Shares issued upon exercise of
an Option shall be issued in the name of the Optionee or, if requested by the
Optionee, in the name of the Optionee and his or her spouse. Until the stock
certificate evidencing such Shares is issued (as evidenced by the appropriate
entry on the books of the Company or of a duly authorized transfer agent of the
Company), no right to vote or receive dividends or any other rights as a
stockholder shall exist with respect to the Optioned Stock, notwithstanding the
exercise of the Option. The Company shall issue (or cause to be issued) such
stock certificate promptly after the Option is exercised. No adjustment will be
made for a dividend or other right for which the record date is prior to the
date the stock certificate is issued, except as provided in Section 13 of the
Plan.
Exercising an Option in any manner shall decrease the number of Shares
thereafter available, both for purposes of the Plan and for sale under the
Option, by the number of Shares as to which the Option is exercised.
(b) TERMINATION OF EMPLOYMENT OR CONSULTING RELATIONSHIP. Upon termination
of an Optionee's Continuous Status as an Employee or Consultant, other than upon
the Optionee's death or Disability, the Optionee may exercise his or her Option,
but only within such period of time as is specified in the Notice of Grant, and
only to the extent that the Optionee was entitled to exercise it at the date of
termination (but in no event later than the expiration of the term of such
Option as set forth in the Notice of Grant). In the absence of a specified time
in the Notice of Grant, the Option shall remain exercisable for three (3) months
following the Optionee's termination. In the case of an Incentive Stock Option,
such period of time for exercise shall not exceed three (3) months from the date
of termination. If, on the date of termination, the Optionee is not entitled to
exercise the Optionee's entire Option, the Shares covered by the unexercisable
portion of the Option shall revert to the Plan. If, after termination, the
Optionee does not exercise his or her Option within the time specified by the
Administrator, the Option shall terminate, and the Shares covered by such Option
shall revert to the Plan.
Notwithstanding the above, in the event of an Optionee's change in status
from Consultant to Employee or Employee to Consultant, an Optionee's Continuous
Status as an Employee or Consultant shall not automatically terminate solely as
a result of such change in status. However, in such event, an Incentive Stock
Option held by the Optionee shall cease to be treated as an Incentive Stock
Option and shall be treated for tax purposes as a Nonstatutory Stock Option
three months and one day following such change of status.
(c) DISABILITY OF OPTIONEE. In the event that an Optionee's Continuous
Status as an Employee or Consultant terminates as a result of the Optionee's
Disability, the Optionee may exercise his or her Option at any time within
twelve (12) months from the date of such termination, but only to the extent
that the Optionee was entitled to exercise it at the date of such termination
(but in no event later than the expiration of the term of such Option as set
forth in the Notice of Grant). If, at the date of termination, the Optionee is
not entitled to exercise his or her entire Option, the Shares covered by the
unexercisable portion of the Option shall revert to the Plan. If, after
termination, the Optionee does not exercise his or her Option within the time
specified herein, the Option shall terminate, and the Shares covered by such
Option shall revert to the Plan.
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(d) DEATH OF OPTIONEE. In the event of the death of an Optionee, the
Option may be exercised at any time within twelve (12) months following the date
of death (but in no event later than the expiration of the term of such Option
as set forth in the Notice of Grant), by the Optionee's estate or by a person
who acquired the right to exercise the Option by bequest or inheritance, but
only to the extent that the Optionee was entitled to exercise the Option at the
date of death. If, at the time of death, the Optionee was not entitled to
exercise his or her entire Option, the Shares covered by the unexercisable
portion of the Option shall immediately revert to the Plan. If, after death, the
Optionee's estate or a person who acquired the right to exercise the Option by
bequest or inheritance does not exercise the Option within the time specified
herein, the Option shall terminate, and the Shares covered by such Option shall
revert to the Plan.
(e) RULE 16B-3. Options granted to individuals subject to Section 16 of
the Exchange Act ("Insiders") must comply with the applicable provisions of Rule
16b-3 and shall contain such additional conditions or restrictions as may be
required thereunder to qualify for the maximum exemption from Section 16 of the
Exchange Act with respect to Plan transactions.
11. STOCK RIGHTS.
(a) RIGHTS TO PURCHASE. Stock Rights may be issued either alone, in
addition to, or in tandem with other awards granted under the Plan and/or cash
awards made outside of the Plan. After the Administrator determines that it will
offer Stock Rights under the Plan, it shall advise the offeree in writing, by
means of a Notice of Grant, of the terms, conditions and restrictions related to
the offer, including the number of Shares that the offeree shall be entitled to
purchase or receive, the price to be paid (if any), and the time within which
the offeree must accept such offer, which shall in no event exceed six (6)
months from the date upon which the Administrator made the determination to
grant the Stock Right. The offer shall be accepted by execution of a Restricted
Stock Award Agreement or a Restricted Stock Purchase Agreement in such form as
the Administrator shall determine and if so required by the Administrator. The
number of Shares subject to grants of Stock Rights shall not exceed five percent
(5%) of the total number of Shares authorized under the Plan.
(b) REPURCHASE/REACQUISITION OPTION. Unless the Administrator determines
otherwise, the Restricted Stock Award Agreement or the Restricted Stock Purchase
Agreement, as the case may be, shall grant the Company a repurchase or
reacquisition option exercisable upon the voluntary or involuntary termination
of the purchaser's employment with the Company for any reason (including death
or Disability). The purchase price for Shares repurchased pursuant to the
Restricted Stock Purchase Agreement shall be the Fair Market Value of the Shares
at the date of grant of the Stock Right and may be paid by cancellation of any
indebtedness of the purchaser to the Company. Reacquisition of Shares pursuant
to the Restricted Stock Award Agreement shall require no consideration to be
paid by the Company. The repurchase/reacquisition option shall lapse at a rate
determined by the Administrator.
(c) RULE 16B-3. Stock Rights granted to Insiders, and Shares purchased or
received by Insiders in connection with Stock Rights, shall be subject to any
restrictions applicable thereto in compliance with Rule 16b-3. An Insider may
only purchase Shares pursuant to the grant of a Stock Right, and may only sell
Shares purchased pursuant to the grant of a Stock Right, during such time or
times as are permitted by Rule 16b-3.
(d) OTHER PROVISIONS. The Restricted Stock Award Agreement or the
Restricted Stock Purchase Agreement, as applicable, shall contain such other
terms, provisions and conditions not inconsistent with the Plan as may be
determined by the Administrator in its sole discretion. In addition, the
provisions of Restricted Stock Award Agreements and Restricted Stock Purchase
Agreements need not be the same with respect to each purchaser.
(e) RIGHTS AS A STOCKHOLDER. Once the Stock Right is exercised, the
purchaser shall have the rights equivalent to those of a stockholder, and shall
be a stockholder when his or her purchase is
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entered upon the records of the duly authorized transfer agent of the Company.
No adjustment will be made for a dividend or other right for which the record
date is prior to the date the Stock Right is exercised, except as provided in
Section 13 of the Plan.
12. NON-TRANSFERABILITY OF OPTIONS AND STOCK RIGHTS. An Option or Stock
Right may not be sold, pledged, assigned, hypothecated, transferred, or disposed
of in any manner other than by will or by the laws of descent or distribution
and may be exercised, during the lifetime of the Optionee, only by the Optionee.
13. ADJUSTMENTS UPON CHANGES IN CAPITALIZATION, DISSOLUTION, MERGER OR
ASSET SALE.
(a) CHANGES IN CAPITALIZATION. Subject to any required action by the
stockholders of the Company, the number of shares of Common Stock covered by
each outstanding Option and Stock Right, and the number of shares of Common
Stock which have been authorized for issuance under the Plan but as to which no
Options or Stock Rights have yet been granted or which have been returned to the
Plan upon cancellation or expiration of an Option or Stock Right, as well as the
price per share of Common Stock covered by each such outstanding Option or Stock
Right, shall be proportionately adjusted for any increase or decrease in the
number of issued shares of Common Stock resulting from a stock split, reverse
stock split, stock dividend, combination or reclassification of the Common
Stock, or any other increase or decrease in the number of issued shares of
Common Stock effected without receipt of consideration by the Company; provided,
however, that conversion of any convertible securities of the Company shall not
be deemed to have been "effected without receipt of consideration." Such
adjustment shall be made by the Board, whose determination in that respect shall
be final, binding and conclusive. Except as expressly provided herein, no
issuance by the Company of shares of stock of any class, or securities
convertible into shares of stock of any class, shall affect, and no adjustment
by reason thereof shall be made with respect to, the number or price of shares
of Common Stock subject to an Option or Stock Right.
(b) DISSOLUTION OR LIQUIDATION. In the event of the proposed dissolution
or liquidation of the Company, to the extent that an Option or Stock Right has
not been previously exercised, it will terminate immediately prior to the
consummation of such proposed action. The Board may, in the exercise of its sole
discretion in such instances, declare that any Option or Stock Right shall
terminate as of a date fixed by the Board and give each Optionee the right to
exercise his or her Option or Stock Right as to all or any part of the Optioned
Stock, including Shares as to which the Option or Stock Right would not
otherwise be exercisable.
(c) MERGER OR ASSET SALE. In the event of a merger of the Company with or
into another corporation, or the sale of substantially all of the assets of the
Company, each outstanding Option and Stock Right shall be assumed or an
equivalent option or right substituted by the successor corporation or a Parent
or Subsidiary of the successor corporation. In the event that the successor
corporation refuses to assume or substitute for the Option or Stock Right, the
Optionee shall have the right to exercise the Option or Stock Right as to all of
the Optioned Stock, including Shares as to which it would not otherwise be
exercisable. If an Option or Stock Right is exercisable in lieu of assumption or
substitution in the event of a merger or sale of assets, the Administrator shall
notify the Optionee that the Option or Stock Right shall be fully exercisable
for a period of fifteen (15) days from the date of such notice, and the Option
or Stock Right shall terminate upon the expiration of such period. For the
purposes of this paragraph, the Option or Stock Right shall be considered
assumed if, following the merger or sale of assets, the option or right confers
the right to purchase or receive, for each Share of Optioned Stock subject to
the Option or Stock Right immediately prior to the merger or sale of assets, the
consideration (whether stock, cash, or other securities or property) received in
the merger or sale of assets by holders of Common Stock for each Share held on
the effective date of the transaction (and if holders were offered a choice of
consideration, the type of consideration chosen by the holders of a majority of
the outstanding Shares); provided, however, that if such consideration received
in the merger or sale of assets was not solely common stock of the successor
corporation or its Parent, the Administrator may, with the consent of the
successor corporation, provide for the consideration to be
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received upon the exercise of the Option or Stock Right, for each Share of
Optioned Stock subject to the Option or Stock Right, to be solely common stock
of the successor corporation or its Parent equal in fair market value to the per
share consideration received by holders of Common Stock in the merger or sale of
assets.
14. DATE OF GRANT. The date of grant of an Option or Stock Right shall be,
for all purposes, the date on which the Administrator makes the determination
granting such Option or Stock Right, or such other later date as is determined
by the Administrator. Notice of the determination shall be provided to each
Optionee within a reasonable time after the date of such grant.
15. AMENDMENT AND TERMINATION OF THE PLAN.
(a) AMENDMENT AND TERMINATION. The Board may at any time amend, alter,
suspend or terminate the Plan.
(b) STOCKHOLDER APPROVAL. The Company shall obtain stockholder approval of
any Plan amendment to the extent necessary and desirable to comply with Rule
16b-3 or with Section 422 of the Code (or any successor rule or statute or other
applicable law, rule or regulation, including the requirements of any exchange
or quotation system on which the Common Stock is listed or quoted). Such
stockholder approval, if required, shall be obtained in such a manner and to
such a degree as is required by the applicable law, rule or regulation.
(c) EFFECT OF AMENDMENT OR TERMINATION. No amendment, alteration,
suspension or termination of the Plan shall impair the rights of any Optionee,
unless mutually agreed otherwise between the Optionee and the Administrator,
which agreement must be in writing and signed by the Optionee and the Company.
16. CONDITIONS UPON ISSUANCE OF SHARES.
(a) LEGAL COMPLIANCE. Shares shall not be issued pursuant to the exercise
of an Option or Stock Right unless the exercise of such Option or Stock Right
and the issuance and delivery of such Shares shall comply with all relevant
provisions of law, including, without limitation, the Securities Act of 1933, as
amended, the Exchange Act, the rules and regulations promulgated thereunder,
Applicable Laws, and the requirements of any stock exchange or quotation system
upon which the Shares may then be listed or quoted, and shall be further subject
to the approval of counsel for the Company with respect to such compliance.
(b) INVESTMENT REPRESENTATIONS. As a condition to the exercise of an
Option or Stock Right, the Company may require the person exercising such Option
or Stock Right to represent and warrant at the time of any such exercise that
the Shares are being purchased only for investment and without any present
intention to sell or distribute such Shares if, in the opinion of counsel for
the Company, such a representation is required.
17. LIABILITY OF COMPANY.
(a) INABILITY TO OBTAIN AUTHORITY. The inability of the Company to obtain
authority from any regulatory body having jurisdiction, which authority is
deemed by the Company's counsel to be necessary to the lawful issuance and sale
of any Shares hereunder, shall relieve the Company of any liability in respect
of the failure to issue or sell such Shares as to which such requisite authority
shall not have been obtained.
(b) GRANTS EXCEEDING ALLOTTED SHARES. If the Optioned Stock covered by an
Option or Stock Right exceeds, as of the date of grant, the number of Shares
which may be issued under the Plan without additional stockholder approval, such
Option or Stock Right shall be void with respect to such excess Optioned Stock,
unless stockholder approval of an amendment sufficiently increasing the number
of Shares subject to the Plan is timely obtained in accordance with Section
15(b) of the Plan.
18. RESERVATION OF SHARES. The Company, during the term of this Plan, will
at all times reserve and keep available such number of Shares as shall be
sufficient to satisfy the requirements of the Plan.
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19. STOCKHOLDER APPROVAL. Continuance of the Plan shall be subject to
approval by the stockholders of the Company within twelve (12) months before or
after the date the Plan is adopted. Such stockholder approval shall be obtained
in the manner and to the degree required under applicable federal and state law.
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PRELIMINARY PROXY
EXHIBIT D
AMENDED AND RESTATED
CERTIFICATE OF INCORPORATION
OF
VISX, INCORPORATED
------------------------
VISX, INCORPORATED (the "Company"), a corporation organized and existing
under and by virtue of the General Corporation Law of the State of Delaware (the
"General Corporation Law"), having filed its original Certificate of
Incorporation on June 7, 1988, under the name of TTI Acquisition Corp., DOES
HEREBY CERTIFY: That the following resolutions amending and restating the
Company's Certificate of Incorporation were duly adopted by the Company's Board
of Directors, and by a majority of the Company's Stockholders, in accordance
with the provisions of Sections 242 and 245 of the General Corporation Law by
the Board of Directors and by vote of the stockholders:
NOW, THEREFORE, BE IT RESOLVED, that the Certificate of Incorporation of the
Corporation be amended and restated in its entirety as follows:
I: The name of the Company is VISX, Incorporated.
II: The address of its registered office in the State of Delaware is
1209 Orange Street, City of Wilmington, County of New Castle, Delaware
19801. The name of the registered agent at such address is The Trust Company
Corporation.
III: The nature of the business or purposes to be conducted or promoted
is to engage in any lawful act or activity for which corporations may be
organized under the General Corporation Law of Delaware.
IV:
(A) The total number of shares of all classes of stock that the
Company is authorized to issue is ninety-five million (95,000,000)
shares, consisting of (1) ninety million (90,000,000) shares of Common
Stock with a par value of $0.01 per share, and (2) five million
(5,000,000) shares of Preferred Stock with a par value of $0.01 per
share.
(B) PREFERRED STOCK. The Preferred Stock may be issued in one or more
series, and the Board of Directors of the Company is expressly authorized
(I) to fix the descriptions, powers, preferences, rights, qualifications,
limitations, and restrictions with respect to any series of Preferred
Stock, and (II) to specify the number of shares of any series of
Preferred Stock
V: The Company reserves the right to amend, alter, change or repeal any
provision contained in this certificate of incorporation, in the manner now
or hereafter prescribed by statute, and all rights and powers conferred
herein upon stockholders and directors are granted subject to this
reservation.
VI: In furtherance and not in limitation of the powers conferred by
statute, the Board of Directors is expressly authorized to adopt, alter or
repeal the Bylaws of the Company.
VII: Meetings of stockholders shall be held at such place, within or
without the State of Delaware, as may be designated by or in the manner
provided in the Bylaws, or, if not so designated, at the registered office
of the Company in the State of Delaware. Elections of directors need not be
by written ballot unless and to the extent that the Bylaws so provide.
VIII: To the fullest extent permitted by the Delaware General Corporation
Law as the same exists or may hereafter be amended, a director of this
Company shall not be liable to the Company or its stockholders for monetary
damages for breach of fiduciary duty as a director. Without limiting the
foregoing in any respect, a director of this Company shall not be personally
liable to
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<PAGE>
the Company or its stockholders for monetary damages for breach of fiduciary
duty as a director, except for liability (1) for any breach of the
director's duty of loyalty to the Company or its stockholders, (2) for acts
or omissions not in good faith or which involve intentional misconduct or a
knowing violation of law, (3) under Section 174 of the Delaware General
Corporation Law, or (4) for any transaction from which the director derived
an improper personal benefit.
IX: (A) RIGHT TO INDEMNIFICATION.
(1) Each person who was or is made a party or is threatened to be
made a party to or is involved in any action, suit or proceeding,
whether civil, criminal, administrative or investigative
(hereinafter, a "proceeding"), by reason of the fact that he or she,
or a person of whom he or she is the legal representative, is or was
a director or officer of the Company, including service with respect
to employee benefit plans, whether the basis of such proceeding is
alleged action in an official capacity as a director, officer,
employee or agent or in any other capacity while serving as a
director, officer , employee or agent, shall be indemnified and held
harmless by the Company to the fullest extent authorized by the
Delaware General Corporation Law, as the same exists or may hereafter
be amended (but, in the case of any such amendment, only to the
extent that such amendment permits the Company to provide broader
indemnification rights than said law permitted the Company to provide
prior to such amendment), against all expenses, liability and loss
(including attorneys' fees, judgments, fines, ERISA excise taxes or
penalties and amounts paid or to be paid in settlement) reasonably
incurred or suffered by such person in connection therewith and such
indemnification shall continue as to a person who has ceased to be a
director, officer, employee or agent and shall inure to the benefit
of his or her heirs, executors and administrators.
(2) The Company shall indemnify and hold harmless in such manner
any person who was or is made a party or is threatened to be made a
party to a proceeding by reason of the fact that he, she or a person
of whom he or she is the legal representative, is or was serving at
the request of the Company as a director, officer, employee or agent
of another corporation or a partnership, joint venture, trust or
other enterprise;
(3) Notwithstanding the foregoing, except as provided in
paragraph IX(B) below, the Company shall indemnify any such person
seeking indemnification in connection with a proceeding (or part
thereof) initiated by such person only if such proceeding (or part
thereof) was authorized by the Board of Directors of the Company. In
the event a director or officer of the Company shall serve as a
director, officer, employee or agent of any corporation, partnership,
joint venture, trust or other enterprise in which the Company
maintains an investment it shall be conclusively presumed for
purposes of the indemnification provided for in subsection (A)(2)
above that such service has been undertaken at the request of the
Company. The foregoing presumption shall apply regardless of whether
such director or officer is serving such entity at the request of a
third party or that his or her service with such entity was commenced
prior to the effectiveness of this Article of the Certificate of
Incorporation or prior to his or her becoming an officer or director
of the Company. The right to indemnification conferred in subsection
(A)(1) above shall be a contract right based upon an offer from the
Company which shall be deemed to be accepted by such person's service
or continued service with the Company for any period after the
adoption of this Article of the Certificate of Incorporation and
shall include the right to be paid by the Company the expenses
incurred in defending any such proceeding in advance of its final
disposition; PROVIDED, HOWEVER, that (if the Delaware General
Corporation Law requires) the payment of such expenses incurred by a
director or officer in his or her capacity as a director or officer
(and not in any other capacity in which service was or is rendered by
such person while a director or officer, including, without
limitation, service to an employee benefit plan) in advance of the
final disposition of a proceeding shall be made only upon delivery to
the
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Company of an undertaking, by or on behalf of such director or
officer, to repay all amounts so advanced if it shall ultimately be
determined that such director or officer is not entitled to be
indemnified under this Section or otherwise. The Company may, by
action of its Board of Directors, provide indemnification to
employees or agents of the Company with the same scope and effect as
the foregoing indemnification of directors and officers.
(B) RIGHT OF CLAIMANT TO BRING SUIT. If a claim under subsection
IX(A)(1) of this Article is not paid in full by the Company within thirty
days after a written claim has been received by the Company, the claimant
may at any time thereafter bring suit against the Company to recover the
unpaid amount of the claim, and, if successful in whole or in part, the
claimant shall be entitled to be paid also the expense of prosecuting
such claim. It shall be a defense to any such action (other than an
action brought to enforce a claim for expenses incurred in defending any
proceeding in advance of its final disposition where the required
undertaking, if any is required, has been tendered to the Company) that
the claimant has not met the standards of conduct which make it
permissible under the Delaware General Corporation Law for the Company to
indemnify the claimant for the amount claimed. Neither the failure of the
Company (including its Board of Directors, independent legal counsel, or
its stockholders) to have made a determination prior to the commencement
of such action that indemnification of the claimant is proper in the
circumstances because he or she has met the applicable standard of
conduct set forth in the Delaware General Corporation Law, nor an actual
determination by the Company (including its Board of Directors,
independent legal counsel, or its stockholders) that the claimant has not
met such applicable standard of conduct, shall be a defense to the action
or create a presumption that the claimant has not met the applicable
standard of conduct.
(C) NON-EXCLUSIVITY OF RIGHTS. The right to indemnification and the
payment of expenses incurred in defending a proceeding in advance of its
final disposition conferred in this Section shall not be exclusive of any
other right which any person may have or hereafter acquire under statute,
provision of the Certificate of Incorporation, by-law, agreement, vote of
stockholders or disinterested directors, or otherwise.
(D) INSURANCE. The Company may maintain insurance, at its expense, to
protect itself and any director, officer, employee or agent of the
Company or another corporation, partnership, joint venture, trust or
other enterprise against any such expense, liability or loss, whether or
not the Company would have the power to indemnify such person against
such expense, liability or loss under the Delaware Corporation Law.
X: Whenever a compromise or arrangement is proposed between the Company
and its creditors or any class of them and/or between the Company and its
stockholders or any class of them, any court of equitable jurisdiction
within the State of Delaware may, on the application in a summary way of the
Company or of any creditor or stockholder thereof or on the application of
any receiver or receivers appointed for the Company under the provisions of
Section 291 Title 8 of the Delaware Code or on the application of trustees
in dissolution or any receiver or receivers appointed for the Company under
the provisions of Section 279 of Title 8 of the Delaware Code, order a
meeting of the creditors or class of creditors, and/or of the stockholders
or class of stockholders of the Company, as the case may be, to be summoned
in such manner as the said court directs. If a majority in number
representing three-fourths in value of the creditors or class of creditors,
and/or of the stockholders or class of stockholders of the Company, as the
case may be, agree to any compromise or arrangement and to any
reorganization of this Company as a consequence of such compromise or
arrangement, the said compromise or arrangement and the said reorganization
shall, if sanctioned by the court to which the said application has been
made, be binding on all the creditors or class of creditors and/or on all
the stockholders or class of stockholders of the Company, as the case may
be, and also on the Company.
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RESOLVED FURTHER, that the foregoing Amended and Restated Certificate of
Incorporation is hereby approved and adopted.
IN WITNESS WHEREOF, VISX, INCORPORATED has caused this Restated Certificate
to be signed by Mark B. Logan, its President and Chief Executive Officer, this
day of , 1996.
VISX, INCORPORATED
By:-----------------------------------
Mark B. Logan
PRESIDENT AND CHIEF EXECUTIVE
OFFICER
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<PAGE>
PRELIMINARY PROXY
EXHIBIT E
VISX, INCORPORATED
INDEMNIFICATION AGREEMENT
This Indemnification Agreement ("Agreement") is effective as of
, 1995 by and between VISX, Incorporated, a Delaware corporation
(the "Company"), and ("Indemnitee").
RECITALS:
A. The Company desires to attract and retain the services of highly
qualified individuals, such as Indemnitee, to serve the Company and its related
entities;
B. In order to induce Indemnitee to continue to provide services to the
Company, the Company wishes to provide for the indemnification of, and the
advancement of expenses to, Indemnitee to the maximum extent permitted by law;
C. The Company and Indemnitee recognize the continued difficulty in
obtaining liability insurance for the Company's directors and executive
officers, the significant increases in the cost of such insurance and the
general reductions in the coverage of such insurance;
D. The Company and Indemnitee further recognize the substantial increase in
corporate litigation in general, subjecting directors, officers, employees,
agents and fiduciaries to expensive litigation risks at the same time as the
availability and coverage of liability insurance has been severely limited; and
E. In view of the considerations set forth above, the Company desires that
Indemnitee shall be indemnified and advanced expenses by the Company as set
forth herein;
NOW, THEREFORE, the Company and Indemnitee hereby agree as set forth below.
AGREEMENT:
1. CERTAIN DEFINITIONS.
(a) "Change in Control" shall mean, and shall be deemed to have occurred if,
on or after the date of this Agreement,
(i) any "person" (as such term is used in Sections 13(d) and 14(d) of
the Securities Exchange Act of 1934, as amended), other than a trustee or
other fiduciary holding securities under an employee benefit plan of the
Company acting in such capacity or a corporation owned directly or
indirectly by the stockholders of the Company in substantially the same
proportions as their ownership of stock of the Company, becomes the
"beneficial owner" (as defined in Rule 13d-3 under said Act), directly or
indirectly, of securities of the Company representing more than 50% of the
total voting power represented by the Company's then outstanding Voting
Securities,
(ii) during any period of two consecutive years, individuals who at the
beginning of such period constitute the Board of Directors of the Company
and any new director whose election by the Board of Directors or nomination
for election by the Company's stockholders was approved by a vote of at
least two thirds (2/3) of the directors then still in office who either were
directors at the beginning of the period or whose election or nomination for
election was previously so approved, cease for any reason to constitute a
majority thereof,
(iii) the stockholders of the Company approve a merger or consolidation
of the Company with any other corporation other than a merger or
consolidation which would result in the Voting
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Securities of the Company outstanding immediately prior thereto continuing
to represent (either by remaining outstanding or by being converted into
Voting Securities of the surviving entity) at least 80% of the total voting
power represented by the Voting Securities of the Company or such surviving
entity outstanding immediately after such merger or consolidation,
(iv) the stockholders of the Company approve a plan of complete
liquidation of the Company or an agreement for the sale or disposition by
the Company of (in one transaction or a series of related transactions) all
or substantially all of the Company's assets.
(b) "Claim" shall mean with respect to a Covered Event: any threatened,
pending or completed action, suit, proceeding or alternative dispute resolution
mechanism, or any hearing, inquiry or investigation that Indemnitee in good
faith believes might lead to the institution of any such action, suit,
proceeding or alternative dispute resolution mechanism, whether civil, criminal,
administrative, investigative or other.
(c) References to the "Company" shall include, in addition to VISX,
Incorporated, any constituent corporation (including any constituent of a
constituent) absorbed in a consolidation or merger to which VISX, Incorporated
(or any of its wholly owned subsidiaries) is a party which, if its separate
existence had continued, would have had power and authority to indemnify its
directors, officers, employees, agents or fiduciaries, so that if Indemnitee is
or was a director, officer, employee, agent or fiduciary of such constituent
corporation, or is or was serving at the request of such constituent corporation
as a director, officer, employee, agent or fiduciary of another corporation,
partnership, joint venture, employee benefit plan, trust or other enterprise,
Indemnitee shall stand in the same position under the provisions of this
Agreement with respect to the resulting or surviving corporation as Indemnitee
would have with respect to such constituent corporation if its separate
existence had continued.
(d) "Covered Event" shall mean any event or occurrence related to the fact
that Indemnitee is or was a director, officer, employee, agent or fiduciary of
the Company, or any subsidiary of the Company, or is or was serving at the
request of the Company as a director, officer, employee, agent or fiduciary of
another corporation, partnership, joint venture, trust or other enterprise, or
by reason of any action or inaction on the part of Indemnitee while serving in
such capacity.
(e) "Expenses" shall mean any and all expenses (including attorneys' fees
and all other costs, expenses and obligations incurred in connection with
investigating, defending, being a witness in or participating in [including on
appeal], or preparing to defend, to be a witness in or to participate in, any
action, suit, proceeding, alternative dispute resolution mechanism, hearing,
inquiry or investigation), judgments, fines, penalties and amounts paid in
settlement (if such settlement is approved in advance by the Company, which
approval shall not be unreasonably withheld) of any Claim and any federal,
state, local or foreign taxes imposed on the Indemnitee as a result of the
actual or deemed receipt of any payments under this Agreement.
(f) "Expense Advance" shall mean a payment to Indemnitee pursuant to Section
3 of Expenses in advance of the settlement of or final judgement in any action,
suit, proceeding or alternative dispute resolution mechanism, hearing, inquiry
or investigation which constitutes a Claim.
(g) "Independent Legal Counsel" shall mean an attorney or firm of attorneys,
selected in accordance with the provisions of Section 2(d) hereof, who shall not
have otherwise performed services for the Company or Indemnitee within the last
three years (other than with respect to matters concerning the rights of
Indemnitee under this Agreement, or of other Indemnitees under similar indemnity
agreements).
(h) References to "other enterprises" shall include employee benefit plans;
references to "fines" shall include any excise taxes assessed on Indemnitee with
respect to an employee benefit plan; and references to "serving at the request
of the Company" shall include any service as a director, officer, employee,
agent or fiduciary of the Company which imposes duties on, or involves services
by, such director, officer, employee, agent or fiduciary with respect to an
employee benefit plan, its participants
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or its beneficiaries; and if Indemnitee acted in good faith and in a manner
Indemnitee reasonably believed to be in the interest of the participants and
beneficiaries of an employee benefit plan, Indemnitee shall be deemed to have
acted in a manner "not opposed to the best interests of the Company" as referred
to in this Agreement.
(i) "Reviewing Party" shall mean, subject to the provisions of Section 2(d),
any person or body appointed by the Board of Directors in accordance with
applicable law to review the Company's obligations hereunder and under
applicable law, which may include a member or members of the Company's Board of
Directors, Independent Legal Counsel or any other person or body not a party to
the particular Claim for which Indemnitee is seeking indemnification.
(j) "Section" refers to a section of this Agreement unless otherwise
indicated.
(k) "Voting Securities" shall mean any securities of the Company that vote
generally in the election of directors.
2. INDEMNIFICATION.
(a) INDEMNIFICATION OF EXPENSES. Subject to the provisions of Section 2(b)
below, the Company shall indemnify Indemnitee for Expenses to the fullest extent
permitted by law if Indemnitee was or is or becomes a party to or witness or
other participant in, or is threatened to be made a party to or witness or other
participant in, any Claim (whether by reason of or arising in part out of a
Covered Event), including all interest, assessments and other charges paid or
payable in connection with or in respect of such Expenses.
(b) REVIEW OF INDEMNIFICATION OBLIGATIONS. Notwithstanding the foregoing,
in the event any Reviewing Party shall have determined (in a written opinion, in
any case in which Independent Legal Counsel is the Reviewing Party) that
Indemnitee is not entitled to be indemnified hereunder under applicable law, (i)
the Company shall have no further obligation under Section 2(a) to make any
payments to Indemnitee not made prior to such determination by such Reviewing
Party, and (ii) the Company shall be entitled to be reimbursed by Indemnitee
(who hereby agrees to reimburse the Company) for all Expenses theretofore paid
to Indemnitee to which Indemnitee is not entitled hereunder under applicable
law; PROVIDED, HOWEVER, that if Indemnitee has commenced or thereafter commences
legal proceedings in a court of competent jurisdiction to secure a determination
that Indemnitee is entitled to be indemnified hereunder under applicable law,
any determination made by any Reviewing Party that Indemnitee is not entitled to
be indemnified hereunder under applicable law shall not be binding and
Indemnitee shall not be required to reimburse the Company for any Expenses
theretofore paid in indemnifying Indemnitee until a final judicial determination
is made with respect thereto (as to which all rights of appeal therefrom have
been exhausted or lapsed). Indemnitee's obligation to reimburse the Company for
any Expenses shall be unsecured and no interest shall be charged thereon.
(c) INDEMNITEE RIGHTS ON UNFAVORABLE DETERMINATION; BINDING EFFECT. If any
Reviewing Party determines that Indemnitee substantively is not entitled to be
indemnified hereunder in whole or in part under applicable law, Indemnitee shall
have the right to commence litigation, at Indemnitee's expense, seeking an
initial determination by the court or challenging any such determination by such
Reviewing Party or any aspect thereof, including the legal or factual bases
therefor, and, subject to the provisions of Section 15 below, the Company hereby
consents to service of process and to appear in any such proceeding. Absent such
litigation, any determination by any Reviewing Party shall be conclusive and
binding on the Company and Indemnitee.
(d) SELECTION OF REVIEWING PARTY; CHANGE IN CONTROL. If during the term of
this Agreement there has not been a Change in Control, any Reviewing Party shall
be selected by the Board of Directors, and if during the term of this Agreement
there has been such a Change in Control (other than a Change in Control which
has been approved by a majority of the Company's Board of Directors who were
directors immediately prior to such Change in Control), any Reviewing Party with
respect to all matters thereafter arising concerning the rights of Indemnitee to
indemnification of Expenses
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under this Agreement or any other agreement or under the Company's Certificate
of Incorporation or Bylaws as now or hereafter in effect, or under any other
applicable law, if desired by Indemnitee, shall be Independent Legal Counsel
selected by Indemnitee and approved by the Company (which approval shall not be
unreasonably withheld). Such counsel, among other things, shall render its
written opinion to the Company and Indemnitee as to whether and to what extent
Indemnitee would be entitled to be indemnified hereunder under applicable law
and the Company agrees to abide by such opinion. The Company agrees to pay the
reasonable fees of the Independent Legal Counsel referred to above and to
indemnify fully such counsel against any and all expenses (including attorneys'
fees), claims, liabilities and damages arising out of or relating to this
Agreement or its engagement pursuant hereto. Notwithstanding any other provision
of this Agreement, the Company shall not be required to pay Expenses of more
than one Independent Legal Counsel in connection with all matters concerning a
single Indemnitee, and such Independent Legal Counsel shall be the Independent
Legal Counsel for any or all other Indemnitees unless (i) the employment of
separate counsel by one or more Indemnitees has been previously authorized by
the Company in writing, or (ii) an Indemnitee shall have provided to the Company
a written statement that such Indemnitee has reasonably concluded that there may
be a conflict of interest between such Indemnitee and the other Indemnitees with
respect to the matters arising under this Agreement.
(e) MANDATORY PAYMENT OF EXPENSES. Notwithstanding any other provision of
this Agreement other than Section 10 below, to the extent that Indemnitee has
been successful on the merits or otherwise, including, without limitation, the
dismissal of an action without prejudice, in defense of any Claim, Indemnitee
shall be indemnified against all Expenses incurred by Indemnitee in connection
therewith.
3. EXPENSE ADVANCES.
(a) OBLIGATION TO MAKE EXPENSE ADVANCES. Upon receipt of a written
undertaking by or on behalf of the Indemnitee to repay such amounts if it shall
ultimately be determined that the Indemnitee is not entitled to be indemnified
therefor by the Company hereunder under applicable law, the Company shall make
Expense Advances to Indemnitee.
(b) FORM OF UNDERTAKING. Any obligation to repay any Expense Advances
hereunder pursuant to a written undertaking by the Indemnitee shall be unsecured
and no interest shall be charged thereon.
(c) DETERMINATION OF REASONABLE EXPENSE ADVANCES. The parties agree that
for the purposes of any Expense Advance for which Indemnitee has made written
demand to the Company in accordance with this Agreement, all Expenses included
in such Expense Advance that are certified by affidavit of Indemnitee's counsel
as being reasonable shall be presumed conclusively to be reasonable.
4. PROCEDURES FOR INDEMNIFICATION AND EXPENSE ADVANCES.
(a) TIMING OF PAYMENTS. All payments of Expenses (including without
limitation Expense Advances) by the Company to the Indemnitee pursuant to this
Agreement shall be made to the fullest extent permitted by law as soon as
practicable after written demand by Indemnitee therefor is presented to the
Company, but in no event later than thirty (30) business days after such written
demand by Indemnitee is presented to the Company, except in the case of Expense
Advances, which shall be made no later than ten (10) business days after such
written demand by Indemnitee is presented to the Company.
(b) NOTICE/COOPERATION BY INDEMNITEE. Indemnitee shall, as a condition
precedent to Indemnitee's right to be indemnified or Indemnitee's right to
receive Expense Advances under this Agreement, give the Company notice in
writing as soon as practicable of any Claim made against Indemnitee for which
indemnification will or could be sought under this Agreement. Notice to the
Company shall be directed to the Chief Executive Officer of the Company at the
address shown on the
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signature page of this Agreement (or such other address as the Company shall
designate in writing to Indemnitee). In addition, Indemnitee shall give the
Company such information and cooperation as it may reasonably require and as
shall be within Indemnitee's power.
(c) NOTICE TO INSURERS. If, at the time of the receipt by the Company of a
notice of a Claim pursuant to Section 4(b) hereof, the Company has liability
insurance in effect which may cover such Claim, the Company shall give prompt
notice of the commencement of such Claim to the insurers in accordance with the
procedures set forth in the respective policies.
(d) SELECTION OF COUNSEL. If the Company is obligated hereunder to provide
indemnification for or make any Expense Advances with respect to the Expenses of
any Claim, the Company, if appropriate, shall be entitled to assume the defense
of such Claim with counsel approved by Indemnitee (which approval shall not be
unreasonably withheld) upon the delivery to Indemnitee of written notice of the
Company's election to do so. After delivery of the foregoing notice, approval of
counsel by the Indemnitee and the retention of the approved counsel by the
Company, the Company will not be liable to Indemnitee under this Agreement for
any fees or expenses of separate counsel subsequently retained by or on behalf
of Indemnitee with respect to the same Claim; provided that, (i) Indemnitee
shall have the right to employ Indemnitee's separate counsel in any such Claim
at Indemnitee's expense and (ii) if (A) the employment of separate counsel by
Indemnitee has been previously authorized by the Company, (B) Indemnitee
reasonably concludes that there may be a conflict of interest between the
Company and Indemnitee in the conduct of any such defense, or (C) the Company
does not continue to retain such counsel to defend such Claim, then the fees and
expenses of Indemnitee's separate counsel shall be Expenses for which Indemnitee
may receive indemnification or Expense Advances under this Agreement.
5. ADDITIONAL INDEMNIFICATION RIGHTS; NONEXCLUSIVITY.
(a) SCOPE. The Company hereby agrees to indemnify the Indemnitee to the
fullest extent permitted by law, notwithstanding that such indemnification is
not specifically authorized by the other provisions of this Agreement, the
Company's Certificate of Incorporation, the Company's Bylaws or by statute. In
the event of any change after the date of this Agreement in any applicable law,
statute or rule which expands the right of a Delaware corporation to indemnify a
member of its board of directors or an officer, it is the intent of the parties
hereto that Indemnitee shall enjoy by this Agreement the greater benefits
afforded by such change. In the event of any change in any applicable law,
statute or rule which narrows the right of a Delaware corporation to indemnify a
member of its board of directors or an officer, employee, agent or fiduciary,
such change, to the extent not otherwise required by such law, statute or rule
to be applied to this Agreement, shall have no effect on this Agreement or the
parties' rights and obligations hereunder except as set forth in Section 10(a)
below.
(b) NONEXCLUSIVITY. The indemnification and the payment of Expense
Advances provided by this Agreement shall be in addition to any rights to which
Indemnitee may be entitled under the Company's Certificate of Incorporation, its
Bylaws, any other agreement, any vote of stockholders or disinterested
directors, the General Corporation Law of the State of Delaware, or otherwise.
The indemnification and the payment of Expense Advances provided under this
Agreement shall continue as to Indemnitee for any action taken or not taken
while serving in an indemnified capacity even though, subsequent to the event
giving rise to Indemnitee's right to indemnification under this Agreement,
Indemnitee may have ceased to serve in an indemnified capacity.
6. NO DUPLICATION OF PAYMENTS. The Company shall not be liable under this
Agreement to make any payment in connection with any Claim made against
Indemnitee to the extent Indemnitee has otherwise actually received payment
(under any insurance policy, provision of the Company's Certificate of
Incorporation, Bylaws or otherwise) of the amounts otherwise payable under this
Agreement.
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7. PARTIAL INDEMNIFICATION. If Indemnitee is entitled under any provision
of this Agreement to indemnification by the Company for some or a portion of
Expenses incurred in connection with any Claim, but not, however, for all of the
total amount of such Expenses, the Company shall nevertheless indemnify
Indemnitee for the portion of such Expenses to which Indemnitee is entitled.
8. MUTUAL ACKNOWLEDGMENT. Both the Company and Indemnitee acknowledge that
in certain instances, federal law or applicable public policy may prohibit the
Company from indemnifying its directors and officers under this Agreement or
otherwise. Indemnitee understands and acknowledges that the Company has
undertaken or may be required in the future to undertake with the Securities and
Exchange Commission to submit the question of indemnification to a court in
certain circumstances for a determination of the Company's right under public
policy to indemnify Indemnitee.
9. LIABILITY INSURANCE. To the extent the Company maintains liability
insurance applicable to directors and officers, employees, agents or
fiduciaries, the actions of Indemnitee shall be covered by such policies in such
a manner as to provide Indemnitee the same rights and benefits as are provided
to the most favorably insured of the Company's directors, if Indemnitee is a
director; or of the Company's officers, if Indemnitee is not a director of the
Company but is an officer.
10. EXCEPTIONS. Notwithstanding any other provision of this Agreement, the
Company shall not be obligated pursuant to the terms of this Agreement to do any
of the following:
(a) EXCLUDED ACTION OR OMISSIONS. To indemnify or make Expense Advances to
Indemnitee with respect to Claims arising out of acts, omissions or transactions
for which Indemnitee is prohibited from receiving indemnification under
applicable law.
(b) CLAIMS INITIATED BY INDEMNITEE. To indemnify or make Expense Advances
to Indemnitee with respect to Claims initiated or brought voluntarily by
Indemnitee and not by way of defense, counterclaim or crossclaim, except (i)
with respect to actions or proceedings brought to establish or enforce a right
to indemnification under this Agreement or any other agreement or insurance
policy or under the Company's Certificate of Incorporation or Bylaws now or
hereafter in effect relating to Claims for Covered Events, (ii) in specific
cases if the Board of Directors has approved the initiation or bringing of such
Claim, or (iii) as otherwise required under Section 145 of the Delaware General
Corporation Law, regardless of whether Indemnitee ultimately is determined to be
entitled to such indemnification, Expense Advances, or insurance recovery, as
the case may be.
(c) LACK OF GOOD FAITH. To indemnify Indemnitee for any Expenses incurred
by the Indemnitee with respect to any action instituted (i) by Indemnitee to
enforce or interpret this Agreement, if a court having jurisdiction over such
action determines as provided in Section 13 that each of the material assertions
made by the Indemnitee as a basis for such action was not made in good faith or
was frivolous, or (ii) by or in the name of the Company to enforce or interpret
this Agreement, if a court having jurisdiction over such action determines as
provided in Section 13 that each of the material defenses asserted by Indemnitee
in such action was made in bad faith or was frivolous.
(d) CLAIMS UNDER SECTION 16(B). To indemnify Indemnitee for Expenses and
the payment of profits arising from the purchase and sale by Indemnitee of
securities in violation of Section 16(b) of the Securities Exchange Act of 1934,
as amended, or any similar successor statute.
11. COUNTERPARTS. This Agreement may be executed in one or more
counterparts, each of which shall constitute an original.
12. BINDING EFFECT; SUCCESSORS AND ASSIGNS. This Agreement shall be
binding upon and inure to the benefit of and be enforceable by the parties
hereto and their respective successors, assigns (including any direct or
indirect successor by purchase, merger, consolidation or otherwise to all or
substantially all of the business or assets of the Company), spouses, heirs and
personal and legal representatives. The Company shall require and cause any
successor (whether direct or indirect, and whether by purchase, merger,
consolidation or otherwise) to all, substantially all, or a substantial part, of
the business or assets of the Company, by written agreement in form and
substance satisfactory to
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<PAGE>
Indemnitee, expressly to assume and agree to perform this Agreement in the same
manner and to the same extent that the Company would be required to perform if
no such succession had taken place. This Agreement shall continue in effect
regardless of whether Indemnitee continues to serve as a director, officer,
employee, agent or fiduciary (as applicable) of the Company or of any other
enterprise at the Company's request.
13. EXPENSES INCURRED IN ACTION RELATING TO ENFORCEMENT OR
INTERPRETATION. In the event that any action is instituted by Indemnitee under
this Agreement or under any liability insurance policies maintained by the
Company to enforce or interpret any of the terms hereof or thereof, Indemnitee
shall be entitled to be indemnified for all Expenses incurred by Indemnitee with
respect to such action (including without limitation attorneys' fees),
regardless of whether Indemnitee is ultimately successful in such action, unless
as a part of such action a court having jurisdiction over such action makes a
final judicial determination (as to which all rights of appeal therefrom have
been exhausted or lapsed) that each of the material assertions made by
Indemnitee as a basis for such action was not made in good faith or was
frivolous; provided, however, that until such final judicial determination is
made, Indemnitee shall be entitled under Section 3 to receive payment of Expense
Advances hereunder with respect to such action. In the event of an action
instituted by or in the name of the Company under this Agreement to enforce or
interpret any of the terms of this Agreement, Indemnitee shall be entitled to be
indemnified for all Expenses incurred by Indemnitee in defense of such action
(including without limitation costs and expenses incurred with respect to
Indemnitee's counterclaims and cross-claims made in such action), unless as a
part of such action a court having jurisdiction over such action makes a final
judicial determination (as to which all rights of appeal therefrom have been
exhausted or lapsed) that each of the material defenses asserted by Indemnitee
in such action was made in bad faith or was frivolous; provided, however, that
until such final judicial determination is made, Indemnitee shall be entitled
under Section 3 to receive payment of Expense Advances hereunder with respect to
such action.
14. PERIOD OF LIMITATIONS. No legal action shall be brought and no cause
of action shall be asserted by or in the right of the Company against
Indemnitee, Indemnitee's estate, spouse, heirs, executors or personal or legal
representatives after the expiration of two years from the date of accrual of
such cause of action, and any claim or cause of action of the Company shall be
extinguished and deemed released unless asserted by the timely filing of a legal
action within such two year period; PROVIDED, HOWEVER, that if any shorter
period of limitations is otherwise applicable to any such cause of action, such
shorter period shall govern.
15. NOTICE. All notices, requests, demands and other communications under
this Agreement shall be in writing and shall be deemed duly given (i) if
delivered by hand or by overnight express delivery service and signed for by the
party addressed, on the date of such delivery, or (ii) if mailed by domestic
certified or registered mail with postage prepaid, on the third business day
after the date postmarked. Addresses for notice to either party are as shown on
the signature page of this Agreement, or as subsequently modified by written
notice.
16. CONSENT TO JURISDICTION. The Company and Indemnitee each hereby
irrevocably consent to the jurisdiction of the courts of the State of Delaware
for all purposes in connection with any action or proceeding which arises out of
or relates to this Agreement and agree that any action instituted under this
Agreement shall be commenced, prosecuted and continued only in the Court of
Chancery of the State of Delaware in and for New Castle County, which shall be
the exclusive and only proper forum for adjudicating such a claim.
17. SEVERABILITY. The provisions of this Agreement shall be severable in
the event that any of the provisions hereof (including any provision within a
single section, paragraph or sentence) are held by a court of competent
jurisdiction to be invalid, void or otherwise unenforceable, and the remaining
provisions shall remain enforceable to the fullest extent permitted by law.
Furthermore, to the fullest extent possible, the provisions of this Agreement
(including without limitation each portion of this
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<PAGE>
Agreement containing any provision held to be invalid, void or otherwise
unenforceable, that is not itself invalid, void or unenforceable) shall be
construed so as to give effect to the intent manifested by the provision held
invalid, illegal or unenforceable.
18. CHOICE OF LAW. This Agreement, and all rights, remedies, liabilities,
powers and duties of the parties to this Agreement, shall be governed by and
construed in accordance with the laws of the State of Delaware as applied to
contracts between Delaware residents entered into and to be performed entirely
in the State of Delaware without regard to principles of conflicts of laws.
19. SUBROGATION. In the event of payment under this Agreement, the Company
shall be subrogated to the extent of such payment to all of the rights of
recovery of Indemnitee, who shall execute all documents required and shall do
all acts that may be necessary to secure such rights and to enable the Company
effectively to bring suit to enforce such rights.
20. AMENDMENT AND TERMINATION. No amendment, modification, termination or
cancellation of this Agreement shall be effective unless it is in writing signed
by both the parties to this Agreement. No waiver of any of the provisions of
this Agreement shall be deemed to be or shall constitute a waiver of any other
provisions hereof (whether or not similar), nor shall such waiver constitute a
continuing waiver.
21. INTEGRATION AND ENTIRE AGREEMENT. This Agreement sets forth the entire
understanding between the parties to this Agreement and supersedes and merges
all previous written and oral negotiations, commitments, understandings and
agreements relating to the subject matter hereof between the parties hereto.
22. NO CONSTRUCTION AS EMPLOYMENT AGREEMENT. Nothing contained in this
Agreement shall be construed as giving Indemnitee any right to be retained in
the employ of the Company or any of its subsidiaries or affiliated entities.
IN WITNESS WHEREOF, the parties hereto have executed this Indemnification
Agreement as of the date first above written.
VISX, INCORPORATED
By:
Name:
Title:
Address: 3400 Central Expressway
Santa Clara, California 95051
AGREED TO AND ACCEPTED
INDEMNITEE:
(signature)
Name
Address
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<PAGE>
Preliminary Proxy
VISX Logo
Dear Stockholder:
You are cordially invited to attend the Annual Meeting of Stockholders to be
held at 9:00 a.m. on Friday, May 17, 1996, at the offices of the Company in
Santa Clara, California. Detailed information as to the business to be
transacted at the meeting is contained in the accompanying Notice of Annual
Meeting and Proxy Statement.
Regardless of whether you plan to attend the meeting, it is important that your
shares be voted. Accordingly, we ask that you sign and return your proxy as
soon as possible in the envelope provided. If you do plan to attend the
meeting, please mark the appropriate box on the proxy.
Sincerely,
Mark B. Logan
Chairman of the Board and
Chief Executive Officer
/X/ Please mark votes as in this example.
DIRECTORS RECOMMEND A VOTE "FOR" THE FOLLOWING PROPOSALS
the following five Directors:
Elizabeth H. Davila
Glendon E. French FOR WITHHELD
John W. Galiardo / / / /
Mark B. Logan
Richard B. Sayford
/ / ______________________________________
For all nominees except as noted above
2. To ratify the adoption of amended FOR AGAINST ABSTAIN
and restated Bylaws of the Company / / / / / /
3. To ratify the adoption of the 1995 / / / / / /
Directors' Option Plan.
4. To ratify the adoption of the 1995 / / / / / /
Stock Plan.
5. To approve an amendment to the / / / / / /
Company's Restated Certificate of
Incorporation to increase the
authorized number of shares of
Common Stock.
6. To approve an amendment to the / / / / / /
Company's Restated Certificate of
Incorporation to authorize a class
of Preferred Stock.
7. To adopt a form of / / / / / /
Indemnification Agreement.
8. To ratify the appointment of independent / / / / / /
public accountants.
9. To act upon such other matters as may / / / / / /
properly come before the meeting or any
adjournment or postponement thereof.
MARK HERE FOR ADDRESS CHANGE / /
MARK HERE FOR COMMENTS / /
MARK HERE TO DISCONTINUE DUPLICATE MAILINGS / /
REGISTRATION
Please sign exactly as your name(s) appear. Joint owners should both sign.
Signature: ___________________________________ Date:_____________
Signature: ___________________________________ Date:_____________
<PAGE>
VISX, INCORPORATED
PROXY SOLICITED ON BEHALF OF BOARD OF DIRECTORS
The undersigned hereby appoints Mark B. Logan and Elizabeth H. Davila as
proxies to vote at the Annual Meeting of Stockholders of VISX, Incorporated (the
"Company") to be held on May 17, 1996 at 9:00 a.m. local time, and at any
adjournment or postponement thereof, hereby revoking any proxies previously
given, to vote all shares of Common Stock of the Company held or owned by the
undersigned as directed below, and in their discretion upon such other matters
as may come before the meeting. If no direction is made, this proxy will be
voted for each nominee for director, for proposals 2, 3, 4, 5, 6, 7, and 8, and
at the discretion of the proxy holders upon such other business as may properly
come before the meeting. If any nominee for director is unable or declines to
serve as a director, this proxy will be voted for any nominee that the present
Board of Directors designates.
(To be Signed on Reverse Side)
