<PAGE> 1
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:
[ ] Preliminary Proxy Statement
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to 240.14a-11(c) or 240.14a-12
VISX, Incorporated
- --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement)
Payment of Filing Fee (Check the appropriate box):
[X] No fee.
[ ] $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), 14a-6(j)(2).
[ ] $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 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:
----------------------------------------------------------------------
(4) Proposed maximum aggregate value of transaction:
----------------------------------------------------------------------
Set forth the amount on which the filing fee is calculated and state how
it was determined.
[ ] 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> 2
VISX LOGOTM
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD MAY 16, 1997
To the Stockholders:
The Annual Meeting of Stockholders of VISX, Incorporated (the "Company")
will be held on Friday, May 16, 1997 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 appointment of Arthur Andersen LLP as the Company's
independent public accountants for the year ending December 31, 1997;
and
3. 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 March 21, 1997 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
/s/ Katrina J. Church
Katrina J. Church
Secretary
Santa Clara, California
April 15, 1997
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> 3
VISX, INCORPORATED
------------------------
PROXY STATEMENT
1997 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 16, 1997 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 15, 1997.
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
March 21, 1997 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 March 21, 1997, there were
approximately 15,367,465 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 March 21,
1997 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 and 2 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.
<PAGE> 4
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. 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 1998 ANNUAL MEETING
Stockholder proposals that are intended to be presented at the Company's
annual meeting of stockholders to be held in 1998 must be received by the
Company no later than December 19, 1997 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. If 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. The Company does not expect that any nominee listed below will be
unable or will decline to serve as a director. If 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 proxy holder(s) will
determine the specific nominees to be voted for. 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, 52, 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
<PAGE> 5
GLENDON E. FRENCH DIRECTOR SINCE 1995
Mr. French, 63, 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 SINCE 1996
Mr. Galiardo, 63, 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 of 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, 58, 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. Mr. Logan is
a member of the Board of Directors of Imagyn Medical Inc. and Whetstone
Partners, LLC.
RICHARD B. SAYFORD DIRECTOR SINCE 1995
Mr. Sayford, 66, 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 IN THIS
PROXY STATEMENT. 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> 6
FURTHER INFORMATION CONCERNING
THE BOARD OF DIRECTORS
BOARD COMMITTEES AND MEETINGS
The Board of Directors of the Company held five meetings, one telephonic
meeting and took action by written consent one time during 1996. All current
directors attended 100% of the total meetings of the Board and the Board
committees of which they were members during 1996. The Board of Directors has
standing Audit, Compensation, and Nominating Committees.
Audit Committee. In 1996, the Audit Committee was comprised of Directors
French (chair), Galiardo and Sayford. 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 two meetings during 1996.
Compensation Committee. In 1996, the Compensation Committee was comprised
of Directors French, Galiardo and Sayford (chair). 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 during 1996.
Nominating Committee. The Nominating Committee is comprised of Directors
Logan, French and Sayford. 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 1996, non-employee directors were paid an annual retainer of $15,000, a
fee of $1,000 for each Board meeting the director attended ($250 for attendance
by telephone), and $500 for each Committee meeting that the director attended
($750 for the chairperson of the Committee). Non-employee directors also receive
automatic annual grants of options to purchase 2,000 shares of the Company's
Common Stock. 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. In addition, directors are reimbursed for out-of-pocket
travel expenses associated with their attendance at Board meetings.
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 Securities
and Exchange Commission 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 1996 all filing requirements were complied with.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
The Company's Compensation Committee consists of Directors French, Galiardo
and Sayford, all of whom are 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 1996.
4
<PAGE> 7
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 which 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 takes into account 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.
1996 Executive Compensation Program. In 1996, 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.
5
<PAGE> 8
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. The Committee has approved a
performance-based executive compensation plan (the "Incentive Compensation
Plan"). The Committee awarded bonuses for 1996 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 1996 performance. After reviewing the Company's
1996 performance and the executives' individual performance, the Committee
approved grants of bonuses for the executive officers. All Named Officers (as
defined below) were awarded cash bonuses in 1997 based on 1996 performance.
STOCK AWARDS. The Committee approved stock option awards for all of the
Named Officers in 1996.
1996 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's
salary was increased to $325,000 for 1996. Mr. Logan's Incentive Compensation
Plan award was based on the outstanding achievements of the Company during 1996
and Mr. Logan's contributions to those achievements.
Submitted by the 1997
Compensation Committee of the Company's
Board of Directors:
Glendon E. French
John W. Galiardo
Richard B. Sayford
6
<PAGE> 9
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
1996 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 ALL OTHER
NAME AND PRINCIPAL POSITION YEAR SALARY(1) BONUS(2) COMPENSATION UNDERLYING OPTIONS COMPENSATION(3)
- ----------------------------------- ----- --------- -------- ------------ ------------------ ---------------
<S> <C> <C> <C> <C> <C> <C>
MARK B. LOGAN(4)................... 1996 $ 324,039(5) $250,000 -- 100,000 $ 2,311
Chief Executive Officer, 1995 275,000 275,000 -- --
President and 1994 41,250 -- $ 75,000(6) 300,000
Chairman of the Board
ELIZABETH H. DAVILA(7)............. 1996 204,808(5) 115,000 -- 50,000 886
Executive Vice President and 1995 126,000 90,000 -- 100,000
Chief Operating Officer 1994 N/A N/A N/A N/A
TERRANCE N. CLAPHAM................ 1996 149,905(5) 45,000 15,000 346
Vice President, Research 1995 144,904 35,000 -- 10,000
and Development 1994 139,711 22,000 -- 11,500
JAMES W. MCCOLLUM(8)............... 1996 169,489(5) 60,000 40,000(9) 40,000 104
Vice President, 1995 N/A N/A N/A N/A
Sales and Marketing 1994 N/A N/A N/A N/A
TIMOTHY R. MAIER(10)............... 1996 139,905(5) 52,000 -- 25,000 311
Vice President and Chief 1995 68,962 37,000 -- 60,000
Financial Officer 1994 N/A N/A N/A N/A
</TABLE>
- ---------------
(1) No compensation is paid to officers of the Company for services rendered as
directors.
(2) Includes bonuses earned in the designated year but paid the following year.
(3) Represents premiums paid by the Company for Group Term Life Insurance.
(4) Mr. Logan joined the Company in November 1994.
(5) Differences between reported salary and employment agreement amounts
represent actual amounts paid over 26 pay periods.
(6) Consists of expenses paid in connection with Mr. Logan's relocation to
California.
(7) Ms. Davila joined the Company in May 1995.
(8) Mr. McCollum joined the Company in February 1996.
(9) Consists of expenses paid in connection with Mr. McCollum's relocation to
California.
(10) Mr. Maier joined the Company in June 1995.
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<PAGE> 10
Option Grants in Last Fiscal Year. The table below provides details
regarding stock options granted to the Named Officers in 1996, 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 1996, the Company
announced its intention to use the 5% and 10% rates called for in the SEC
regulations as an indicator of the grant date present value of option grants.
<TABLE>
<CAPTION>
POTENTIAL REALIZABLE
VALUE AT ASSUMED
NUMBER OF PERCENT OF RATES OF STOCK PRICE
SHARES TOTAL OPTIONS APPRECIATION FOR
UNDERLYING GRANTED TO EXERCISE OPTION TERM
OPTIONS EMPLOYEES IN PRICE PER EXPIRATION -------------------------
NAME GRANTED(1) FISCAL YEAR SHARE DATE 5% 10%
- --------------------------- ---------- ------------- --------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C>
Mark B. Logan.............. 100,000 15% $ 34.75 05/23/06 $2,185,409 $5,538,255
Elizabeth H. Davila........ 50,000 8 34.75 05/23/06 1,092,704 2,769,128
Terrance N. Clapham........ 15,000 2 34.75 05/23/06 327,811 830,738
James W. McCollum.......... 40,000 6 32.50 02/14/06 817,563 2,071,865
Timothy R. Maier........... 25,000 4 34.75 05/23/06 546,352 1,384,564
</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.
Aggregate Option Exercises in Last Fiscal Year and Fiscal Year-End
Values. The following table provides information with respect to option
exercises in 1996 by the Named Officers and the value of such officers'
unexercised options as of December 31, 1996. The values for "in-the-money"
options represent the 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.............. 40,000 $ 881,337 116,248 243,752 $ 1,147,949 $ 1,419,551
Elizabeth H. Davila........ 35,416 500,743 4,167 110,417 36,982 536,201
Terrance N. Clapham........ 15,000 455,325 96,384 25,116 1,391,698 85,490
James W. McCollum.......... -- -- -- 40,000 -- --
Timothy R. Maier........... 15,000 240,206 7,499 62,501 80,614 403,136
</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 $22.125 per
share on December 31, 1996 (the last trading day for fiscal 1996), minus the
exercise price.
8
<PAGE> 11
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
gave Mr. Clapham notice in November 1996 that it does not intend to renew the
contract, which will now expire (unless earlier terminated by either party) in
November 1997. The Company may terminate the agreement for cause, as defined in
the agreement, 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 1996, the Compensation Committee approved a salary
increase for Mr. Clapham (to $155,000 per year). The bonus program provides for
cash payments of 18%-45% of base salary, subject to accomplishing performance
objectives set by the Compensation Committee.
Pursuant to an employment arrangement with the Company, Mr. Logan will 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> 12
PERFORMANCE GRAPH
The SEC requires the Company to 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 31, 1991
(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>
Measurement Period VISX, Nasdaq Composite
(Fiscal Year Covered) Incorporated S&P Medical Prod. (US)
<S> <C> <C> <C>
12/31/91 100 100 100
12/31/92 74 86 115
12/31/93 98 65 132
12/31/94 63 77 128
12/29/95 235 131 179
12/31/96 133 150 220
</TABLE>
10
<PAGE> 13
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 21,
1997 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>
COMMON APPROXIMATE
STOCK PERCENT
BENEFICIALLY BENEFICIALLY
BENEFICIAL OWNER OWNED OWNED
- --------------------------------------------------------------------- ------------ -----------
<S> <C> <C>
Chancellor LGT Asset Management, Inc................................. 2,125,700(1) 14%
1166 Avenue of the Americas
New York, New York 10036
Dresdner Bank AG..................................................... 1,479,500(2) 10%
Jurgen-Ponto-Platz 1
60301 Frankfurt, Germany
RCM Capital Management, L.L.C. ...................................... 1,479,500(3) 10%
Four Embarcadero Center, Suite 2900
San Francisco, California 94111
Merrill Lynch & Co., Inc............................................. 848,441(4) 6%
250 Vesey Street
World Financial Center North Tower
New York, New York, 10281-1334
Terrance N. Clapham.................................................. 303,207(5) 2%
Mark B. Logan........................................................ 174,173(6) 1%
Elizabeth H. Davila.................................................. 28,330(7) +
Timothy R. Maier..................................................... 20,359(8) +
James W. McCollum.................................................... 12,499(9) +
Richard B. Sayford................................................... 8,929(10) +
Glendon E. French.................................................... 8,729(11) +
John W. Galiardo..................................................... 3,750(12) +
All directors and executive officers as a group (11 persons)......... 596,703(13) 4%
</TABLE>
- ---------------
+ Represents less than 1% of the Company's outstanding Common Stock.
(1) As reported on Schedule 13G/A filed with the Securities and Exchange
Commission ("SEC") on or about February 7, 1997. Chancellor LGT Asset
Management, Inc. has sole voting power and sole dispositive power with
respect to all of the shares.
(2) As reported on Schedule 13G/A filed with the SEC on or about February 11,
1997. Dresdner Bank AG ("Dresdner") has neither sole voting power nor sole
dispositive power with respect to any of the shares. Dresdner has
beneficial ownership of the securities reported on this Schedule 13G/A only
to the extent that Dresdner may be deemed to have beneficial ownership of
securities deemed to be beneficially owned by RCM Capital Management,
L.L.C., a wholly-owned subsidiary of Dresdner. See Footnote (3).
11
<PAGE> 14
(3) As reported on Schedule 13G/A filed jointly with the SEC on or about
February 4, 1997, by RCM Capital Management, L.L.C. ("RCM Capital"), RCM
Limited L.P. ("RCM Limited") and RCM General Corporation ("RCM General").
RCM Capital is a wholly-owned subsidiary of Dresdner Bank AG. See Footnote
(2). RCM Limited is the Managing Agent of RCM Capital. RCM Limited has
beneficial ownership of the securities reported on this Schedule 13G/A only
to the extent that RCM Limited may be deemed to have beneficial ownership
of securities beneficially owned by RCM Capital. RCM General is the General
Partner of RCM Limited. RCM General has beneficial ownership of the
securities reported on this Schedule 13G/A only to the extent that RCM
General may be deemed to have beneficial ownership of securities
beneficially owned by RCM Capital. RCM Capital has sole voting power with
respect to 1,166,500 shares and sole dispositive power with respect to
1,414,500 shares.
(4) As reported on Schedule 13G filed with the SEC on or about January 24,
1977. Merrill Lynch & Co., Inc. has neither sole voting power nor sole
dispositive power with respect to any of the shares.
(5) The total includes options to purchase 103,207 shares that will be
exercisable on or before May 31, 1997.
(6) The total includes options to purchase 172,498 shares that will be
exercisable on or before May 31, 1997.
(7) The total includes options to purchase 27,083 shares that will be
exercisable on or before May 31, 1997.
(8) The total includes options to purchase 19,999 shares that will be
exercisable on or before May 31, 1997.
(9) The total includes options to purchase 12,499 shares that will be
exercisable on or before May 31, 1997.
(10) The total includes options to purchase 8,729 shares that will be
exercisable on or before May 31, 1997.
(11) The total includes options to purchase 8,729 shares that will be
exercisable on or before May 31, 1997.
(12) The total includes options to purchase 3,750 shares that will be
exercisable on or before May 31, 1997.
(13) The total includes options to purchase an aggregate of 392,955 shares held
by non-employee directors and the executive officers that will be
exercisable on or before May 31, 1997.
12
<PAGE> 15
PROPOSAL NO. 2
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, 1997. 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 2.
Ratification of the appointment of Arthur Andersen LLP as the Company's
independent public accountants for the year ending December 31, 1997 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.
* * * *
13
<PAGE> 16
Proxy Card
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 16, 1997, 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
<TABLE>
<S> <C> <C> <C> <C> <C>
To elect the following five Directors:
Elizabeth H. Davila
Glendon E. French FOR WITHHELD FOR AGAINST ABSTAIN FOR AGAINST ABSTAIN
John W. Galiardo [ ] [ ] 2. To ratify the [ ] [ ] [ ] 3. To act upon such other [ ] [ ] [ ]
Mark B. Logan appointment of matters as may properly
Richard B. Sayford independent come before the meeting or
public accountants any adjournment or
postponement thereof.
</TABLE>
MARK HERE
FOR ADDRESS [ ]
[ ] CHANGE
--------------------------------------------------
For all nominees except as noted above 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> 17
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 16, 1997 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 proposal 2, 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.
