UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(Mark One)
[ X ] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended March 30, 1996
or
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from ______ to ______
Commission File Number: 0-18281
Hologic, Inc.
(Exact name of registrant as specified in its charter)
Delaware 04-2902449
(State of incorporation) (I.R.S. Employer Identification No.)
590 Lincoln Street, Waltham, Massachusetts 02154
(Address of principal executive offices) (Zip Code)
(617) 890-2300
(Registrant's telephone number, including area code)
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to
such filing requirements for the past 90 days.
Yes X No __
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date.
As of April 26, 1996, 11,043,566 shares of the registrant's Common Stock,
$.01 par value, were outstanding.
HOLOGIC, INC. AND SUBSIDIARIES
INDEX
Page
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements
Consolidated Balance Sheets
March 30, 1996 and September 30, 1995 3
Consolidated Statements of Income
Three and Six Months Ended March 30, 1996
and March 25, 1995 4
Consolidated Statement of Stockholders' Equity
Six Months ended March 30, 1996 5
Consolidated Statements of Cash Flows
Six Months Ended March 30, 1996
and March 25, 1995 6
Notes to Consolidated Financial Statements 7
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of Operations 10
PART II - OTHER INFORMATION 14
SIGNATURES 16
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements
<TABLE>
HOLOGIC, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(Unaudited)
<CAPTION>
ASSETS
March 30, September 30,
1996 1995
<S> <C> <C>
CURRENT ASSETS:
Cash and cash equivalents................... $57,883,436 $7,447,813
Short-term investments...................... 4,132,744 2,492,671
Accounts receivable, less reserves of
$1,200,000 and $850,000, respectively...... 16,172,161 11,643,883
Inventories................................ 6,735,613 6,917,000
Prepaid expenses and other current assets.. 2,503,637 2,058,707
----------- ----------
Total current assets..................... 87,427,591 30,560,074
PROPERTY AND EQUIPMENT, at cost:
Equipment.................................. 3,188,161 2,600,381
Furniture and fixtures..................... 694,562 652,446
Leasehold improvements..................... 548,375 506,495
--------- ---------
4,431,098 3,759,322
Less- Accumulated depreciation
and amortization........................ 2,578,428 2,298,168
--------- ---------
1,852,670 1,461,154
Other assets, net.......................... 2,206,047 1,840,785
--------- ---------
$91,486,308 $33,862,013
=========== ===========
<CAPTION>
LIABILITIES AND STOCKHOLDERS' EQUITY
March 30, September 30,
1996 1995
--------- -------------
<S> <C> <C>
CURRENT LIABILITIES:
Line of credit........................... $2,183,150 $2,058,898
Accounts payable......................... 3,308,513 3,773,000
Accrued expenses......................... 5,528,095 3,965,750
Deferred revenue......................... 1,848,587 1,392,667
---------- ----------
Total current liabilities............... 12,868,345 11,190,315
STOCKHOLDERS' EQUITY:
Common stock, $.01 par value-
Authorized - 30,000,000 shares
Issued and outstanding - 11,040,566 and
8,244,200 shares, respectively....... 110,406 82,442
Capital in excess of par value.......... 66,907,258 15,313,672
Retained earnings....................... 11,751,600 7,420,593
Cumulative translation adjustment....... (151,301) (145,009)
---------- -----------
Total stockholders' equity............... 78,617,963 22,671,698
---------- ----------
$91,486,308 $33,862,013
=========== ===========
</TABLE>
The accompanying notes are an integral part of these consolidated financial
statements.
<TABLE>
HOLOGIC, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)
<CAPTION>
Three Months Ended Six Months Ended
March 30, March 25, March 30, March 25,
1996 1995 1996 1995
<S> <C> <C> <C> <C>
REVENUES:
Product sales $17,990,756 $8,520,603 $32,067,304 $18,303,724
Other revenues.............. 766,312 510,516 1,453,397 926,250
----------- ---------- ----------- -----------
18,757,068 9,031,119 33,520,701 19,229,974
COSTS AND EXPENSES:
Cost of product sales....... 8,442,200 4,893,065 15,211,781 10,235,955
Research and development.... 1,769,406 1,108,986 3,076,899 2,076,566
Selling and marketing....... 3,020,980 1,711,619 5,758,126 3,534,468
General and administrative.. 1,843,564 900,222 3,250,551 2,039,807
Litigation expenses......... -- 297,914 797,819 351,859
----------- --------- --------- ----------
15,076,150 8,911,806 28,095,176 18,238,655
Income from operations..... 3,680,918 119,313 5,425,525 991,319
Interest income............ 593,541 166,889 749,245 282,571
Other expense.............. (58,169) (72,592) (123,763) (156,560)
--------- --------- --------- -----------
Income before
provision for income taxes. 4,216,290 213,610 6,051,007 1,117,330
PROVISION FOR INCOME TAXES. 1,200,000 60,000 1,720,000 320,000
--------- ------- --------- ----------
Net income............... $3,016,290 $153,610 $4,331,007 $797,330
========== ======== ========== ==========
NET INCOME PER COMMON AND
COMMON EQUIVALENT SHARE.. $ .27 $ .02 $. 42 $ .09
===== ===== ====== =======
WEIGHTED AVERAGE NUMBER OF COMMON
AND COMMON EQUIVALENT SHARES
OUTSTANDING................. 11,253,038 8,820,786 10,298,346 8,799,086
========== ========= ========== =========
</TABLE>
The accompanying notes are an integral part of these consolidated financial
statements.
<TABLE>
HOLOGIC, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY
(Unaudited)
<CAPTION>
Common Stock Capital in Cumulative Total
Number of $.01 Excess of Retained Translation Stockholders'
Shares Par Value Par Value Earnings Adjustment Equity
<S> <C> <C> <C> <C> <C> <C>
--------- --------- ----------- --------- --------- -------------
Balance,
September
30, 1995... 8,244,200 $82,442 $15,313,672 $7,420,593 $(145,009) $22,671,698
Issuance of
common stock,
net of
issuance costs
of $301,631.. 2,492,000 24,920 49,258,019 -- -- 49,282,939
Issuance of
common stock
pursuant to
options and
employee stock
purchase plan. 304,366 3,044 1,005,787 -- -- 1,008,831
Compensation
expense related
to issuance
of stock options -- -- 79,780 -- -- 79,780
Tax benefit
from stock
options exercised -- -- 1,250,000 -- -- 1,250,000
Net income -- -- -- 4,331,007 -- 4,331,007
Translation
adjustments -- -- -- -- (6,292) (6,292)
------- -------- ---------- ---------- -------- -----------
Balance,
March 30, 1996 11,040,566 $110,406 $66,907,258 $11,751,600 $(151,301) $78,617,963
========== ======== =========== =========== ========= ============
</TABLE>
The accompanying notes are an integral part of these consolidated financial
statements.
<TABLE>
HOLOGIC, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
<CAPTION>
Six Months Ended
March 30, March 25,
1996 1995
---------- ----------
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income.................................. $4,331,007 $797,330
Adjustments to reconcile net income
to net cash provided by operating activities-
Depreciation and amortization............ 349,976 264,498
Compensation expense related to
issuance of stock options............... 79,780 --
Changes in assets and liabilities-
Accounts receivable.................. (4,752,660) 2,553,567
Inventories.......................... 134,842 (780,960)
Prepaid expenses and
other current assets............... (452,408) (709,971)
Accounts payable..................... (433,247) 100,528
Accrued expenses..................... 1,578,848 (116,467)
Deferred revenue..................... 465,237 248,289
----------- ----------
Net cash provided by
operating activities............ 1,301,375 2,356,814
CASH FLOWS FROM INVESTING ACTIVITIES:
(Purchases) sales of short-term
investments, net...................... (1,640,073) 2,022,357
Purchase of property and equipment.......... (685,712) (405,764)
Increase in other assets.................... (284,495) (93,447)
----------- ----------
Net cash (used in) provided by
investing activities............. (2,610,280) 1,523,146
CASH FLOWS FROM FINANCING ACTIVITIES:
Net borrowings (settlements)
on line of credit.................... 183,747 (60,620)
Issuance of common stock, net.............. 49,282,939 --
Issuance of common stock pursuant to
options and employee
stock purchase plans................... 1,008,831 102,703
Tax benefit from stock options exercised... 1,250,000 --
---------- ----------
Net cash provided by
financing activities............ 51,725,517 42,083
EFFECT OF EXCHANGE RATE CHANGES ON CASH...... 19,011 46,156
NET INCREASE IN CASH AND
CASH EQUIVALENTS............................. 50,435,623 3,968,199
CASH AND CASH EQUIVALENTS, beginning of period. 7,447,813 5,880,010
---------- ---------
CASH AND CASH EQUIVALENTS, end of period....... $57,883,436 $9,848,209
=========== ==========
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
Cash paid during the period for income taxes.. $724,081 $ 104,480
=========== ==========
SUPPLEMENTAL SCHEDULE OF NONCASH TRANSACTIONS:
Preferred stock investment acquired in
exchange for common stock.................... $ -- $ 324,088
========== ===========
</TABLE>
The accompanying notes are an integral part of these consolidated financial
statements.
HOLOGIC, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
(1) Basis of Presentation
The consolidated financial statements of Hologic, Inc. (the Company)
presented herein have been prepared pursuant to the rules of the Securities
and Exchange Commission for quarterly reports on Form 10-Q and do not include
all of the information and note disclosures required by generally accepted
accounting principles. These statements should be read in conjunction with
the consolidated financial statements and notes thereto for the year ended
September 30, 1995, included in the Company's Form 10-K as filed with the
Securities and Exchange Commission on December 26, 1995.
The consolidated balance sheet as of March 30, 1996, the consolidated
statements of income for the three and six months ended March 30, 1996 and
March 25, 1995, the consolidated statement of stockholders' equity for the six
months ended March 30, 1996 and, the consolidated statements of cash flows for
the six months ended March 30, 1996 and March 25, 1995, are unaudited but, in
the opinion of management, include all adjustments (consisting of normal,
recurring adjustments) necessary for a fair presentation of results for these
interim periods.
The results of operations for the three and six months ended March 30,
1996 are not necessarily indicative of the results to be expected for the
entire fiscal year ending September 28, 1996.
(2) Summary of Significant Accounting Policies
The accompanying consolidated financial statements reflect the
application of certain accounting policies described in this and other notes
to the consolidated financial statements.
(a) Inventories: Inventories are stated at the lower of cost (first-
in, first-out) or market and consist of the following:
March 30, September 30,
1996 1995
-------- -------------
Raw materials and work-in-process.... . $4,986,364 $4,030,275
Finished goods....................... 1,749,249 2,886,725
---------- ----------
$6,735,613 $6,917,000
=========== ===========
Work-in-process and finished goods inventories consist of material,
labor and manufacturing overhead.
(b) Foreign Currency Translation:
Assets and liabilities of the Company's foreign subsidiaries are
translated into U.S. dollars at exchange rates in effect at the end of the
period, and revenues and expenses are translated at the weighted average
exchange rate in effect during the period. Gains and losses from foreign
currency translation are included in the stockholders' equity section under
cumulative translation adjustment. Foreign currency transaction gains and
losses arising primarily from settlement of sales transactions with the
Company's foreign subsidiaries are included in results of operations. A
transaction loss of $23,617 and $45,697 for the three and six months ended
March 30, 1996, respectively, and transaction losses of $26,802 and $67,173
for the three and six months ended March 25, 1995, respectively, are included
in other expense in the accompanying consolidated statements of income.
(3) Line of Credit
The Company has an international line of credit with a bank for the
equivalent of $3,000,000, which bears interest at PIBOR plus 2.25%. The
borrowings under this line are denominated in the local currency of its
European subsidiaries and are primarily used by these subsidiaries to settle
intercompany sales.
(4) Significant Customers and Concentration of Credit Risk
In the six months ended March 30, 1996 and March 25, 1995, the Company
had one customer who comprised 20% and 32% of product sales, respectively.
This customer had amounts due to the Company of approximately $3,355,000 at
March 30, 1996, all of which were within the payment terms of the sales.
(5) Patent Litigation
The Company incurred litigation expenses in the first quarter of fiscal
1996 and in fiscal 1995 relating primarily to a patent dispute with Lunar
Corporation ("Lunar") and, to a lesser extent, a separate patent dispute with
B.V. Optische Industrie de Oude Delft ("Oldelft"). In November 1995, a
definitive settlement agreement was reached between the Company and Lunar
settling all outstanding disputes relating to x-ray and ultrasound technology.
The complaint brought by Oldelft against the Company was dismissed in December
1995. In January 1996, Oldelft filed a motion for reconsideration of the
dismissal and amended its complaint. In April 1996, the Court denied Oldelft
its motion for reconsideration of the dismissal.
(6) Stockholders' Equity
On January 26, 1996, the Company completed a secondary public offering
of an additional 2,492,000 shares (post split) of the Company's Common Stock
at a price of $19.90 per share which resulted in net proceeds (after deducting
issuance costs) of approximately $49,300,000.
On February 25, 1996, the stockholders' of the Company approved an
amendment to the Company's Certificate of Incorporation to increase the number
of shares of Common Stock authorized from 10,000,000 to 30,000,000. On March
25, 1996, the Company effected a two-for-one stock split in the form of a
stock dividend. All share and per share data in the accompanying consolidated
financial statements have been retroactively restated to reflect the stock
split.
PART I - FINANCIAL INFORMATION (Continued)
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations
HOLOGIC, INC. AND SUBSIDIARIES
Results of Operations
The Company's results of operations have and may continue to be subject
to significant quarterly variation. The results for a particular quarter may
vary due to a number of factors, including the overall state of health care
and cost containment efforts, the development status and demand for drug
therapies to treat osteoporosis, economic conditions in the Company's markets,
the timing of orders, the timing of expenditures in anticipation of future
sales, the mix of products sold by the Company, the introduction of new
products and product enhancements by the Company or its competitors and
pricing and other competitive conditions.
Revenues. Total revenues for the second quarter of fiscal 1996
increased 108% to $18,757,068 from $9,031,119 for the second quarter of fiscal
1995. Total revenues for the current six month period increased 74% to
$33,520,701 from $19,229,974 for the first six months of fiscal 1995. This
increase was primarily due to the increase in the total number of DXA bone
densitometer product shipments in both the Company's domestic and
international markets, particularly in the United States where product sales
for the first half of the year increased 600% over the prior year. There was
also a shift in product sales mix to the Company's new line of bone
densitometers, the ACCLAIM[trademark] series, which the Company began
shipping in January 1995. The new ACCLAIM products have higher average
selling prices than the comparable DXA bone densitometers which they replace.
For the current quarter, sales of the ACCLAIM product accounted for over 93% of
product sales. Other revenues also increased for the current three and six
month periods due to increases in revenue relating to medical data management
services provided to pharmaceutical companies to assist in the collection and
monitoring of clinical trial data.
Total revenues for the second quarter of fiscal 1996 increased 27% from
$14,763,633 in the immediately preceding quarter primarily due to an increase
in the number of DXA systems sold in the United States.
In the first six months of fiscal 1996, approximately 44% of product
sales were generated in the United States, 27% in Asia, 23% in Europe, and 6%
in other international markets. In the first six months of fiscal 1995,
approximately 12% of product sales were generated in the United States, 41% in
Asia, 40% in Europe and 7% in other international markets.
The Company believes that the two major drivers of the growth in demand
for its bone densitometers are (i) the availability of new and effective drug
therapies to treat and prevent bone diseases, including osteoporosis, and (ii)
the availability of reimbursement to healthcare providers for bone density
measurements of patients. On September 29, 1995, the FDA cleared for
marketing Merck & Co., Inc.'s ("Merck") new bisphosphonate, Fosamax, for
treatment of established osteoporosis in post-menopausal women. The Health
Care Finance Administration, the agency which administers Medicare, increased
the recommended reimbursement rate for DXA tests to a national average of
$124, effective January 1, 1995, from $68, the original recommended
reimbursement rate which went into effect in April 1994.
Costs and Expenses. The cost of product sales decreased as a
percentage of product sales to 47% in the first three and six months of fiscal
1996 from 57% and 56% in the first three and six months of fiscal 1995,
respectively. In the current quarter and six months, these costs decreased as
a percentage of product sales primarily due to increasing shipments of the
Company's new family of DXA bone densitometers, the ACCLAIM series, a volume
increase in the number of DXA systems sold resulting in certain manufacturing
efficiencies, and an increase in sales by the Company's direct sales force
(primarily in the United States) which results in higher selling prices. The
Company began selling the ACCLAIM product in the second quarter of fiscal 1995
and has recognized higher gross margins than on the older DXA product line
from higher average selling prices and lower labor and overhead-related
manufacturing costs.
Research and development expenses increased 60% to $1,769,406 (9% of
total revenues) in the current quarter from $1,108,986 (12% of total revenues)
in the second quarter of fiscal 1995. For the current six month period,
research and development expenses increased 48% to $3,076,899 (9% of total
revenues) from $2,076,566 (11% of total revenues) for the first six months of
1995. The increase in research and development expenses in 1996 is primarily
due to the addition of engineering personnel and outside consultants working
on the development of new products. As a percentage of total revenues,
research and development expenses declined in the current year, reflecting
increased revenues in fiscal 1996.
Selling and marketing expenses increased 76% to $3,020,980 (17% of
product sales) in the current quarter from $1,711,619 (20% of product sales)
in the second quarter of fiscal 1995. For the current six month period,
selling and marketing expenses increased 63% to $5,758,126 (18% of product
sales) from $3,534,468 (19% of product sales) for the first six months of
1995. The increase in selling and marketing expenses in 1996 is primarily due
to an increase in sales personnel and related expenses, marketing and
promotional costs incurred in connection with the introduction of the ACCLAIM
series and increased sales commissions based on the higher sales volume. In
addition, the Company incurred additional costs in connection with its
strategic alliances for the development of new products and the distribution
of products through new sales channels.
General and administrative expenses increased 105% to $1,843,564 (10% of
total revenues) in the current quarter from $900,222 (10% of total revenues)
in the second quarter of fiscal 1995. During the first six months of fiscal
1996, general and administrative expenses increased 59% to $3,250,551 (10% of
total revenues) from $2,039,807 (11% of total revenues) in the first six
months of 1995. The increase in general and administrative expenses in fiscal
1996 were primarily due to increased headcount and other compensation-related
expenditures, and an increase in accounts receivable reserves, which reflects
the increase in accounts receivable.
Litigation expenses incurred in the first quarter of fiscal 1996 and in
fiscal 1995 were in connection with the Company's disputes with Lunar and
Oldelft. Legal expenses in connection with the patent litigation with Lunar
began in October 1994 and represent a substantial portion of the total
litigation expenses. In November 1995, a definitive agreement that provides
for the cross-licensing of certain patent rights and a non-assertion agreement
for all patents involving DXA and ultrasound technologies for a period of ten
years was reached by the Company and Lunar. The complaint brought by Oldelft
against the Company was dismissed in December 1995. In January 1996, Oldelft
filed a motion for reconsideration of the dismissal and amended its complaint.
In April 1996, the Court denied Oldelft its motion for reconsideration of the
dismissal.
Interest Income. Interest income increased to $593,541 in the current
quarter from $166,889 in the same quarter of fiscal 1995 and increased to
$749,245 in the current six month period from $282,571 in the comparable
period in fiscal 1995 as the Company earned a higher rate of return on a
higher investment base than in the prior year. During the quarter, the
Company received proceeds of approximately $49,300,000 from a public sale of
Common Stock which increased the investment base. The Company has invested
these proceeds in investment grade corporate and government securities. In
fiscal 1996, the Company has also increased the number of long-term
receivables to Latin American customers which generates additional interest
income.
Other Expense. In the second quarter and for the first six months of
fiscal 1996, the Company incurred other expenses of $58,169 and $123,763,
respectively. These expenses were slightly less than other expenses incurred
in the comparable periods of fiscal 1995 and were primarily attributable to
the interest costs on the line of credit established by the Company in the
third quarter of fiscal 1994 and, to a lesser extent, foreign currency
exchange losses arising from the Company's U.S. dollar denominated sales
transactions to its European subsidiaries. The Company's European
subsidiaries utilize the line of credit to borrow funds in their local
currencies to pay for all intercompany sales, thereby reducing the foreign
currency exposure on those transactions. To the extent that foreign currency
exchange rates fluctuate in the future, the Company may be exposed to
continued financial risk. Although the Company has established a borrowing
line denominated in the two foreign currencies (the French Franc and the
Belgian Franc) in which the subsidiaries currently conduct business to
minimize this risk, there can be no assurance that the Company will be
successful or can fully hedge its foreign currency exposure.
Provision for Income Taxes. The Company's effective tax rate for the
first six months of fiscal 1996 is 28.4%. The Company's effective tax rate is
lower than the statutory tax rates due primarily to the utilization of tax
credits, the utilization of net operating losses in foreign jurisdictions and
tax benefits associated with the Company's foreign sales corporation. The
Company's effective tax rate may increase for the remainder of fiscal 1996
depending on the mix of U.S. versus international income and the availability
of tax credits.
Liquidity and Capital Resources
The Company has funded its operations primarily through cash flows from
operations and the issuance of securities.
At March 30, 1996, the Company's working capital was $74,559,246. At
such date, the Company had $62,016,180 in cash, cash equivalents and short-
term investments. The cash, cash equivalents and investments balance
increased approximately $52,076,000 from September 30, 1995 primarily due to
the net proceeds of approximately $49,300,000 from the public offering of
common stock in the second quarter. In addition, the cash and investments
balance increased approximately $2,776,000 primarily due to the proceeds and
tax benefits from the exercise of stock options and an increase in the
Company's current liabilities, which were partially offset by an increase in
accounts receivable. The increase in current liabilities and accounts
receivable reflects the Company's introduction of its new ACCLAIM family of
bone densitometers and the increase in sales activity. At March 30, 1996, one
customer had accounts receivable outstanding of approximately $3,355,000,
which were current within their payment terms. The Company finances certain
sales to Latin America over a two to three year time frame. At March 30,
1996, the Company had long-term accounts receivable outstanding of
approximately $942,000 relating to these sales, which were included in other
assets. In the first six months of fiscal 1996, the Company purchased
approximately $686,000 of property and equipment, primarily computers and
other equipment associated with the hiring of additional personnel.
The Company does not currently have any significant capital commitments
and believes that existing sources of liquidity, including the net proceeds of
the offering, funds expected to be generated from operations and a $3.0
million credit line for use by its European subsidiaries, will provide
adequate cash to fund the Company's anticipated working capital and other cash
needs for the foreseeable future.
PART II - OTHER INFORMATION
HOLOGIC, INC. AND SUBSIDIARIES
Item 1. Legal Proceedings.
Patent Litigation. On January 24, 1995, B.V. Optische Industrie
de Oude Delft ("Oldelft") filed suit in the United States District Court for
the Southern District of New York against the Company. The complaint brought
by Oldelft against the Company was dismissed in December 1995. In January
1996, Oldelft filed a motion for reconsideration of the dismissal and amended
its complaint. In April 1996, the Court denied Oldelft its motion for
reconsideration of the dismissal.
Item 2. Changes in Securities.
None.
Item 3. Defaults Upon Senior Securities.
None.
Item 4. Submission of Matters to a Vote of Security-Holders.
<TABLE>
The Company held its Annual Meeting of Stockholders on February
28, 1996. Approximately 4,114,092 shares or 98.2% of the Common Stock issued
and outstanding as of the record date, were represented at the meeting in
person or by proxy. Set forth below is a brief description of each matter
voted upon at the meeting and the voting results with respect to each matter.
<CAPTION>
1. A proposal to elect the following six persons to serve as members of
the Company's Board of Directors for the ensuing year:
Name For Withheld Abstain
<S> <C> <C> <C>
S. David Ellenbogen 3,907,615 206,477 0
Irwin Jacobs 3,906,990 207,102 0
William A. Peck 3,907,515 206,577 0
Gerald Segel 3,907,515 206,577 0
Jay A. Stein 3,907,515 206,577 0
Elaine Ullian 3,907,515 206,577 0
2. A proposal to amend the Company's Certificate of Incorporation to
increase the number of authorized shares from 10,000,000 to 30,000,000.
For: 3,285,471 Against: 788,111 Abstain: 3,440 Broker Non-votes: 37,070
3. A proposal to adopt the Company's 1995 Combination Stock Option
Plan.
For: 2,211,332 Against: 1,356,481 Abstain: 7,212 Broker Non-votes: 539,067
4. A proposal to amend the Company's Amended and Restated Non-Employee
Director Stock Option Plan.
For: 2,529,942 Against: 1,045,690 Abstain: 9,043 Broker Non-votes: 529,417
5. A proposal to ratify the appointment of Arthur Andersen, LLP as
independent public accountants of the Company.
For: 4,102,697 Against: 2,801 Abstain: 8,594
</TABLE>
Item 5. Other Information.
None.
Item 6. Exhibits and Reports on Form 8-K.
(a) Exhibits furnished:
(3.03) Certificate of Amendment of Certificate of
Incorporation together Certificate of Incorporation
(10.25) 1995 Combination Stock Option Plan
(10.26) Second Amended and Restated 1990 Non-Employee Director
Stock Option Plan.
(11) Statement Re: Computation of Earnings Per Share.
(b) Reports on Form 8-K:
A Form 8-K was filed on March 13, 1996 relating to the increase in
the number of authorized shares of common stock from 10,000,000 to
30,000,000 and a declaration of a two-for-one stock split in the
form of a 100% stock dividend.
HOLOGIC, INC. AND SUBSIDIARIES
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
Hologic, Inc.
(Registrant)
May 14, 1996 /s/ S. David Ellenbogen
- ------------- ------------------------
Date S. David Ellenbogen
Chairman and
Chief Executive Officer
May 14, 1996 /s/ Glenn P. Muir
- ------------ --------------------------
Date Glenn P. Muir
Vice President, Finance
and Treasurer
(Principal Financial and
Chief Accounting Officer)
<TABLE>
HOLOGIC, INC. AND SUBSIDIARIES
STATEMENT RE: COMPUTATION OF EARNINGS PER SHARE
(Unaudited)
<CAPTION>
Three Months Ended Six Months Ended
March 30, March 25, March 30, March 25,
1996 1995 1996 1995
-------- -------- -------- --------
<S> <C> <C> <C> <C>
PRIMARY:
Net income............... $3,016,290 $ 153,610 $4,331,007 $797,330
Weighted average
shares outstanding....... 10,091,438 8,086,044 9,198,872 8,069,092
Common stock equivalents
outstanding,
pursuant to the
treasury stock method.... 1,161,600 734,742 1,099,474 729,994
---------- ---------- --------- ----------
Primary weighted average
number of common and
common equivalent
shares outstanding....... 11,253,038 8,820,786 10,298,346 8,799,086
========== ========= ========== =========
Per share amount.......... $ .27 $ .02 $ .42 $ .09
====== ====== ===== ======
</TABLE>
* All share and per-share amounts have been adjusted to reflect the two-for-one
stock split effected on March 25, 1996.
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from the
financial statements in the Company's quarterly report on Form 10-Q for
the period ended March 30, 1996.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> SEP-28-1996
<PERIOD-END> MAR-30-1996
<CASH> 57,883,436
<SECURITIES> 4,132,744
<RECEIVABLES> 16,172,161
<ALLOWANCES> 1,200,000
<INVENTORY> 6,735,613
<CURRENT-ASSETS> 2,503,637
<PP&E> 4,431,098
<DEPRECIATION> 2,578,428
<TOTAL-ASSETS> 91,486,308
<CURRENT-LIABILITIES> 12,868,345
<BONDS> 0
<COMMON> 110,406
0
0
<OTHER-SE> 78,658,858
<TOTAL-LIABILITY-AND-EQUITY> 91,486,308
<SALES> 32,067,304
<TOTAL-REVENUES> 33,520,701
<CGS> 15,211,781
<TOTAL-COSTS> 28,095,176
<OTHER-EXPENSES> 123,763
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 6,051,007
<INCOME-TAX> 1,720,000
<INCOME-CONTINUING> 4,331,007
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 4,331,007
<EPS-PRIMARY> .42
<EPS-DILUTED> .42
</TABLE>
CERTIFICATE OF AMENDMENT
OF
CERTIFICATE OF INCORPORATION
Hologic, Inc., a corporation organized and existing under and by
virtue of the General Corporation Law of the State of Delaware, DOES
HEREBY CERTIFY:
FIRST: That at a meeting of the Board of Directors of Hologic,
Inc., resolutions were duly adopted setting forth a proposed amendment
to the Certificate of Incorporation of said corporation, declaring said
amendment to be advisable and calling a meeting of the stockholders of
said corporation for consideration thereof. The resolution setting
forth the proposed amendment is as follows:
RESOLVED: That it is advisable and in the best interests of the
corporation to amend the Certificate of Incorporation of the corporation
so that the first paragraph of Article Fourth shall read in its entirety
as follows:
(a) The total number of shares of all classes of
stock which the Corporation shall have authority to
issue is (i) 30,000,000 shares of Common Stock, $.01
par value per share ("Common Stock"), and (ii)
1,622,685 shares of Preferred Stock, $.01 par value
per share ("Preferred Stock").
SECOND: That thereafter, pursuant to resolution of its Board of
Directors, an annual meeting of the stockholders of said corporation was
duly called and held, upon notice in accordance with Section 222 of the
General Corporation Law of the State of Delaware at which meeting the
necessary number of shares as required by statute were voted in favor of
the amendment.
THIRD: That said amendment was duly adopted in accordance with
the provisions of Section 242 of the General Corporation Law of the
State of Delaware.
IN WITNESS WHEREOF, said Hologic, Inc. has caused this Certificate
to be signed by S. David Ellenbogen, its Chairman, this 27th day of
February, 1996.
HOLOGIC, INC.
By: /s/ S. David Ellenbogen
----------------------------
Name: S. David Ellenbogen
Title: Chairman
CERTIFICATE OF INCORPORATION
OF
HOLOGIC, INC.
The undersigned, a natural person, for the purposes of
organizing a corporation for conducting the business and promoting the
purposes hereinafter stated, under the provisions and subject to the
requirements of the laws of the State of Delaware (particularly Chapter
1, Title 8 of the Delaware Code and the acts amendatory thereof and
supplemental thereto, and generally known as the "General Corporation
Law of the State of Delaware"), hereby certifies that:
FIRST: The name of the corporation (hereinafter called the
"Corporation") is Hologic, Inc.
SECOND: The address, including street, number, city, and
county, of the registered office of the Corporation in the State of
Delaware is 32 Lookerman Square, Suite L-100, Dover, County of Kent,
Delaware 19901; and the name of the registered agent of the Corporation
in the State of Delaware at such address is Prentice-Hall Corporate
Services.
THIRD: The nature of the business and the purposes to be
conducted and promoted by the Corporation, shall be (a) to engage in
the manufacture, sale, research and development of medical products and
(b) any lawful business, to promote any lawful purpose, and to engage in
any lawful act or activity for which corporations may be organized under
the General Corporation Law of the State of Delaware.
FOURTH:
(a) The total number of shares of all classes of stock
which the Corporation shall have authority to issue is (i) 10,000,000
shares of Common Stock, $.01 par value per share ("Common Stock"), and
(ii) 1,622,685 shares of Preferred Stock, $.01 par value per share (the
"Preferred Stock").
(b) The Preferred Stock may be issued and designated by
the Board of Directors, in one or more classes or series and with such
rights, powers, preferences and terms and at such times and for such
consideration as the Board of Directors shall determine, without further
stockholder action. With respect to each class or series of Preferred
Stock, prior to issuance, the Board of Directors by resolution shall
designate that class or series to distinguish it from other classes and
series of stock of the Corporation, shall specify the number of shares
to be included in the class or series, and shall fix the rights, powers,
preferences and terms of the shares of the class or series, including,
but without limitation: (i) the dividend rate, which may be fixed or
variable, its preference as to any other class or series of capital
stock, and whether dividends will be cumulative or noncumulative; (ii)
whether the shares are to be redeemable and, if so, at what times and
prices (which price or prices may, but need not, vary according to the
time or circumstances of such redemption) and on what other terms and
conditions; (iii) the terms and amount of any sinking fund provided for
the purchase or redemption of the shares; (iv) whether the shares shall
be convertible or exchangeable and, if so, the times, prices, rates,
adjustments and other terms of such conversion or exchange; (v) the
voting rights, if any, applicable to the shares in addition to those
prescribed by law; (vi) the restrictions and conditions, if any, on the
issue or reissue of any additional shares of such class or series or of
any other class or series of Preferred Stock ranking on a parity with or
prior to the shares of such class or series; (vii) whether, and the
extent to which, any of the rights, powers, preferences and terms of any
such class or series may be made dependent upon facts ascertainable
outside of the Certificate of Incorporation or outside the resolution or
resolutions providing for the issuance of such class or series by the
Board of Directors, provided that the manner in which such facts shall
operate is clearly set forth in the resolution or resolutions providing
for the issuance of such class or series adopted by the Board of
Directors; and (viii) the rights of the holders of such shares upon
voluntary or involuntary liquidation, dissolution or winding up of the
Corporation.
FIFTH: The name and the mailing address of the
incorporator(s) are as follows:
NAME ADDRESS
Ann C. Brachman Brown, Rudnick, Freed & Gesmer
One Financial Center
Boston, MA 02111
SIXTH: The name and the mailing address of the directors of
the Corporation, each of whom shall serve until the first annual meeting
of shareholders and until his or her successor is elected and qualified,
are as follows:
NAME ADDRESS
S. David Ellenbogen 300 Bear Hill Road
Waltham MA 02154
Jay A. Stein 300 Bear Hill Road
Waltham MA 02154
Esther Sharp One Post Office Square
Suite 3800
Boston MA 02109
SEVENTH: The Corporation shall have perpetual existence.
EIGHTH: Whenever a compromise or arrangement is proposed
between this Corporation and its creditors or any class of them and/or
between this Corporation 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 this Corporation or of any creditor or
stockholder thereof or on the application of any receiver or receivers
appointed for this Corporation under the provisions of Section 29l of
Title 8 of the Delaware Code or on the application of trustees in
dissolution or of any receiver or receivers appointed for this
Corporation 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 this Corporation,
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 creditors or class of
creditors, and/or of the stockholders or class of stockholders of this
Corporation, as the case may be, agrees to any compromise or arrangement
and to any reorganization of this Corporation 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
this Corporation, as the case may be, and also on this Corporation.
NINTH: For the management of the business and for the
conduct of the affairs of the Corporation, and in further definition,
limitation and regulation of the powers of the Corporation and of its
directors and of its stockholders or any class thereof, as the case may
be, it is further provided that:
(a) The business of the Corporation shall be conducted
by the officers of the Corporation under the supervision of the Board of
Directors.
(b) The number of directors which shall constitute the
whole Board of Directors shall be fixed by, or in the manner provided
in, the By-Laws. No election of Directors need be by written ballot.
(c) The Board of Directors of the Corporation may adopt,
amend or repeal the By-Laws of the Corporation at any time after the
original adoption of the By-Laws according to Section 109 of the General
Corporation Law of the State of Delaware; provided, however, that any
amendment to provide for the classification of directors of the
Corporation for staggered terms pursuant to the provisions of subsection
(d) of Section 141 of the General Corporation Law of the State of
Delaware shall be set forth in an amendment to this Certificate of
Incorporation, in an initial By-Law, or in a By-Law adopted by the
stockholders of the Corporation entitled to vote.
TENTH:
(a) The Corporation may, to the fullest extent permitted
by Section 145 of the General Corporation Law of the State of Delaware,
as the same may be amended and supplemented, indemnify any and all
persons whom it shall have power to indemnify under said section from
and against any and all of the expenses, liabilities or other matters
referred to in or covered by said section, and the indemnification
provided for herein shall not be deemed exclusive of any other rights to
which a person indemnified may be entitled under any By-Law, agreement,
vote of stockholders or disinterested Directors or otherwise, both as to
action in his official capacity and as to action in another capacity
while holding such office, and shall continue as to a person who has
ceased to be a Director, officer, employee or agent and shall inure to
the benefit of the heirs, executors and administrators of such a person.
(b) No director shall be personally liable to the
Corporation or its stockholders for monetary damages for any breach of
fiduciary duty by such director as a director. Notwithstanding the
foregoing sentence, a director shall be liable to the extent provided by
applicable law (i) for breach of the Director's duty of loyalty to the
Corporation or its stockholders, (ii) for acts or omissions not in good
faith or which involve intentional misconduct or a knowing violation of
law, (iii) pursuant to Section 174 of the General Corporation Law of the
State of Delaware or (iv) for any transaction from which the director
derived an improper personal benefit. No amendment to or repeal of this
paragraph (b) of this Article Tenth shall apply to or have any effect on
the liability or alleged liability of any director of the Corporation
for or with respect to any acts or omissions of such Director occurring
prior to such amendment.
ELEVENTH: From time to time, subject to the provisions of
this Certificate of Incorporation (including without limitation the
provisions of paragraph (d) of Article Twelfth and of Article
Fourteenth), any of the provisions of this Certificate of Incorporation
may be amended, altered or repealed, and other provisions authorized by
the laws of the State of Delaware at the time in force may be added or
inserted in the manner and at the time prescribed by said laws, and all
rights at any time conferred upon the stockholders of the Corporation by
this Certificate of Incorporation are granted subject to the provisions
of this Article Eleventh.
TWELFTH:
(a) Any direct or indirect purchase or other acquisition
in one or more transactions by the Corporation or any Subsidiary of any
of the outstanding Voting Stock of any class from any one or more
individuals or entities known by the Corporation to be a Related Person,
who has beneficially owned such security or right for less than two
years prior to the date of such purchase, at a price in excess of the
Fair Market Value shall, except as hereinafter provided, require the
affirmative vote of the holders of at least two-thirds of the shares of
Voting Stock, voting as a single class, excluding any votes cast with
respect to shares of Voting Stock beneficially owned by such Related
Person. Such affirmative vote shall be required notwithstanding the
fact that no vote may be required, or that a lesser percentage may be
specified by law or any agreement with any national securities exchange,
or otherwise, but no such affirmative vote shall be required with
respect to any purchase or other acquisition of securities made as part
of (i) a tender or exchange offer by the Corporation to purchase
securities of the same class made on the same terms to all holders of
such securities and complying with the applicable requirements of the
Exchange Act and the rules and regulations thereunder, or any successor
rule or regulation or (ii) pursuant to an open-market purchase program
conducted in accordance with the requirements of Rule 10b-18 promulgated
by the Securities and Exchange Commission pursuant to the Exchange Act
or any successor rule or regulation.
(b) A majority of the Continuing Directors shall have
the power and duty to determine, on the basis of information known to
them after reasonable inquiry, all facts necessary to determine
compliance with this Article Twelfth including, without limitation, (i)
whether a person is a Related Person, (ii) the number of shares of
Voting Stock beneficially owned by any person and (iii) whether a price
is in excess of Fair Market Value.
(c) Nothing contained in this Article Twelfth
shall be construed to relieve any Related Person from any fiduciary
obligation imposed by law.
(d) Notwithstanding anything contained in this
Certificate of Incorporation to the contrary, the affirmative vote of
the holders of at least two-thirds of the outstanding shares of Voting
Stock, voting together as a single class, shall be required to alter,
change, amend, repeal or adopt any provision inconsistent with this
Article Twelfth.
THIRTEENTH: The Board of Directors of the Corporation, when
evaluating any offer of another Person to (a) purchase or exchange any
securities or property for any outstanding equity securities of the
Corporation, (b) merge or consolidate the Corporation with another
corporation, or (c) purchase or otherwise acquire all or substantially
all of the properties and assets of the Corporation, shall in connection
with the exercise of its judgment in determining what is in the best
interests of the Corporation and its stockholders, give due
consideration not only to the price or other consideration being
offered, but also to all other relevant factors, including but without
limitation, the interests of the Corporation's employees, suppliers,
creditors and customers, the economy of the state, region and nation,
community and societal considerations, and the long-term and short-term
interests of the Corporation and its stockholders, including the
possibility that these interests may be best served by the continued
independence of the Corporation.
FOURTEENTH: Except as otherwise provided in this Certificate
of Incorporation, the By-laws, any designation of terms pursuant to
Section 151 of the General Corporation Law of the State of Delaware, any
vote required by stockholders pursuant to said General Corporation Law,
other than the election of directors (which shall not be affected by
this provision), shall be effective if recommended by a majority of the
Continuing Directors and the vote of a majority of each class of stock
outstanding and entitled to vote thereon; and if not recommended by a
majority of the Continuing Directors, then by the vote of 80% of each
class of stock outstanding and entitled to vote thereon.
FIFTEENTH:
Definitions
The following definitions shall apply for the purpose of
Articles Twelfth, Thirteenth and Fourteenth only:
(a) "Affiliate" shall have the meaning given such term
in Rule 12b-2 under the Exchange Act.
(b) "Associate" shall have the meaning given such term
in Rule 12b-2 under the Exchange Act.
(c) "Continuing Director" shall mean any member of the
Board of Directors who is not an Affiliate of any Related Person and who
was a member of the Board of Directors prior to the time that any such
Related Person became a Related Person, and any successor of a
Continuing Director who is unaffiliated with any Related Person and is
recommended to succeed a Continuing Director by a majority of the
Continuing Directors then on the Board of Directors. Notwithstanding
the above, a majority of the then existing Continuing Directors can deem
a new director to be a Continuing Director, even though such person is
Affiliated with a Related Person.
(d) "Exchange Act" shall mean the Securities Exchange
Act of 1934, as amended, from time to time.
(e) "Fair Market Value" shall mean: (i) in the case of
stock, the highest closing sale price during the 30-day period
immediately preceding the date in question of a share of such stock on
the principal United States securities exchange registered under the
Exchange Act on which such stock is listed, or, if such stock is not
listed on any such exchange, the highest closing bid quotation with
respect to a share of such stock during the 30-day period preceding the
date in question on the National Association of Securities Dealers, Inc.
Automated Quotations System or any system then in use or, if no such
quotations are available, the fair market value on the date in question
of a share of such stock as determined by the Board of Directors in good
faith; and (ii) in the case of property other than cash or stock, the
fair market value of such property on the date in question as determined
by the Board of Directors in good faith.
(f) "Massachusetts Predecessor" shall mean Hologic,
Inc., a Massachusetts corporation.
(g) "Merger Date" shall mean the date upon which the
Massachusetts predecessor merges with an into the Corporation.
(h) "Person" shall mean any individual, firm,
corporation or other entity.
(i) "Related Person" shall mean any Person (other than
the Corporation, any Subsidiary or any individual who was a stockholder
of the Corporation's Massachusetts Predecessor on December 31, 1985)
which, together with its Affiliates and Associates and with any other
Person (other than the Corporation, any Subsidiary or any individual who
was a stockholder of the Corporation's Massachusetts Predecessor on
December 31, 1985) with which it or they have entered into, after the
Merger Date, any agreement, arrangement or understanding with respect to
acquiring, holding or disposing of Voting Stock, acquires beneficial
ownership (as defined in Rule 13d-3 of the Exchange Act, except that
such term shall include any Voting Stock which such person has the right
to acquire, whether or not such right may be exercised within 60 days),
directly or indirectly of more than 5% of the voting power of the
outstanding Voting Stock after the Merger Date.
(j) "Subsidiary" shall mean any corporation in which a
majority of the capital stock entitled to vote generally in the election
of directors is owned, directly or indirectly, by the Corporation.
(k) "Voting Stock" shall mean all of the then
outstanding shares of the capital stock of the Corporation entitled to
vote generally in the election of directors.
Signed on the 18th day of January, 1990.
/s/ Ann C. Brachman
--------------------
Ann C. Brachman, Incorporator
HOLOGIC, INC.
SECOND
AMENDED AND RESTATED
1990 NON-EMPLOYEE DIRECTOR STOCK OPTION PLAN
1. Purpose. The purpose of this 1990 Non-Employee Director Stock
Option Plan is to attract and retain the services of experienced and
knowledgeable independent directors of the Corporation for the benefit of the
Corporation and its stockholders and to provide additional incentives for such
independent directors to continue to work for the best interests of the
Corporation and its stockholders through continuing ownership of its common
stock.
2. Definitions. As used herein, each of the following terms has the
indicated meaning:
"Corporation" means Hologic, Inc.
"Eligible Director" means each director of the Corporation who is not
then an employee of the Corporation or affiliated with any holder of more than
5% of the outstanding voting stock of the Corporation.
"Fair Market Value" means the last sale price of the Shares as reported
on the National Association of Securities Dealers Automated Quotation System
("NASDAQ") or on a national securities exchange on which the Shares may be
traded on the date of the granting of the Option, or if such date is not a
business day, the first business day preceding such grant. If the Shares are
not publicly traded, the fair market value shall mean the fair market value of
the Shares as determined by the Board of Directors.
"Option" means the contractual right to purchase Shares upon the specific
terms set forth in this Plan.
"Option Exercise Period" means the period commencing on the date of grant
of an Option pursuant to this Plan and ending ten years from the date of
grant.
"Plan" means this amended and restated Hologic, Inc. 1990 Non-Employee
Director Stock Option Plan.
"Shares" means the Common Stock, $.01 par value, of the Corporation.
3. Stock Subject to the Plan. The aggregate number of Shares that may
be issued and sold under the Plan shall be 100,000 shares. The Shares to be
issued upon exercise of Options granted under this Plan shall be made
available, at the discretion of the Board of Directors, from (i) treasury
Shares and/or Shares reacquired by the Corporation for such purposes,
including Shares purchased in the open market, (ii) authorized but unissued
Shares, and (iii) Shares previously reserved for issuance upon exercise of
Options which have expired or been terminated. If any Option granted under
this Plan shall expire or terminate for any reason without having been
exercised in full, the unpurchased Shares covered thereby shall become
available for grant as additional Options under the Plan so long as it shall
remain in effect.
4. Administration of the Plan. The Plan shall be administered by the
Board of Directors of the Corporation (the "Board"). The Board shall, subject
to the provisions of the Plan, grant options under the Plan and shall have the
power to construe the Plan, to determine all questions as to eligibility, and
to adopt and amend such rules and regulations for the administration of the
Plan as it may deem desirable. The Board may delegate any and all of its
authority hereunder to one or more Committees of the Board.
5. Eligibility; Grant of Options. Each Eligible Director shall be
granted an option to acquire 5,000 Shares (the "Initial Option") effective on
the date he or she is first elected to the Board. In addition, each Eligible
Director who has served as a Director for a full fiscal year will be entitled
to receive options to purchase an additional 4,000 shares of Common Stock on
December 15 of each year (provided the director continues to be an Eligible
Director on that Date) until the director has received options to purchase
22,000 additional shares (the "Additional Options").
6. Terms of Options and Limitations Thereon.
(a) Option Agreement. Each Option granted under this Plan shall
be evidenced by an option agreement between the Corporation and the Option
holder and shall be upon such terms and conditions not inconsistent with this
Plan as the Board may determine. Each Option shall explicitly state that it
is not intended to be an "incentive stock option" as that term is defined in
Section 422 of the Internal Revenue Code.
(b) Price. The price at which any Shares may be purchased
pursuant to the exercise of an Option shall be the Fair Market Value of the
Shares on the date of grant, but in no event shall the price be less than the
par value of the Shares.
(c) Exercise of Options. Subject to Paragraph 7 of this Plan,
each Option granted under this Plan may be exercised in full at one time or in
part from time to time only during the Option Exercise Period on the giving of
written notice, signed by the person or persons exercising the Option, to the
Corporation stating the numbers of Shares with respect to which the Option is
being exercised, accompanied by full payment for such Shares pursuant to
Paragraph 7(b) hereof; provided however, (i) if a person to whom an Option has
been granted is permanently disabled or dies during the Option Exercise
Period, the portion of such Option then exercisable, as provided in Paragraph
7(a), shall be exercisable by him or her or by the executors, administrators,
legatees or distributees of his or her estate during the 12 months following
his or her or death or permanent disability and, (ii) if a person to whom an
Option has been granted ceases to be a director of the Corporation for any
cause other than death or permanent disability, the portion of Option then
exercisable shall be exercisable during the thirty (30) day period following
the date such person ceased to be a director, but, in any event, only to the
extent vested pursuant to Paragraph 7(a) hereof.
(d) Non-Assignability. No Option or right or interest in an
Option shall be assignable or transferable by the holder except by will or the
laws of descent and distribution and during the lifetime of the holder shall
be exercisable only by him or her.
7. Vesting; Payment.
(a) Options granted under this Plan may be exercised as follows:
the Initial Options may be exercised during the Option Exercise Period at the
rate of 20% per year, commencing one year after the date of grant, such that
the Option may be exercised in full from and after five years from the date of
grant, and the Additional Options may be exercised during the Option Exercise
Period at any time after six months from the date of grant.
(b) The purchase price of Shares upon exercise of an Option shall
be paid by the Option holder in full upon exercise and may be paid (i) in
cash, (ii) by delivery of Shares having a Fair Market Value on the date of
exercise equal to the purchase price, or (iii) any combination of cash and
Shares, as the Board may determine.
(c) No Shares shall be issued or transferred upon exercise of any
Option under this Plan unless and until all legal requirements applicable to
the issuance or transfer of such shares and such other requirements as are
consistent with the Plan have been complied with to the satisfaction of the
Board, including without limitation those described in Paragraph 10 hereof.
8. Stock Adjustments.
(a) If the Corporation is a party to any merger or consolidation,
any purchase or acquisition of property or stock, or any separation,
reorganization or liquidation, the Board (or, if the Corporation is not the
surviving corporation, the Board of Directors of the surviving corporation)
shall have the power to make arrangements, which shall be binding upon the
holders of unexpired Options, for the substitution of new options for, or the
assumption by another corporation of, any unexpired Options then outstanding
hereunder.
(b) If by reason of recapitalization, reclassification, stock
split-up, combination of shares, separation (including a spin-off) or dividend
on the Stock payable in Shares, the outstanding Shares of the Corporation are
increased or decreased or changed into or exchanged for a different number or
kind of shares or other securities of the Corporation, the Board shall
conclusively determine the appropriate adjustment in the exercise prices of
outstanding Options and in the number and kind of shares as to which
outstanding Options shall be exercisable.
(c) In the event of a transaction of the type described in
Paragraphs (a) and (b) above, the total number of Shares on which Options may
be granted under this Plan shall be appropriately adjusted by the Board.
9. No Rights Other Than Those Expressly Created. No person affiliated
with the Corporation or other person shall have any claim or right to be
granted an Option hereunder. Neither this Plan nor any action taken hereunder
shall be construed as (i) giving any Option holder any right to continue to be
affiliated with the Corporation, (ii) giving any Option holder any equity or
interest of any kind in any assets of the Corporation, or (iii) creating a
trust of any kind or a fiduciary relationship of any kind between the
Corporation and any such person. No Option holder shall have any of the
rights of a stockholder with respect to Shares covered by an Option until such
time as the Option has been exercised and Shares have been issued to such
person.
10. Miscellaneous.
(a) Withholding of Taxes. Pursuant to applicable federal, state,
local or foreign laws, the Corporation may be required to collect income or
other taxes upon the grant of an Option to, or exercise of an Option by, a
holder. The Corporation may require, as a condition to the exercise of an
Option, that the recipient pay the Corporation, at such time as the Board
determines, the amount of any taxes which the Board may determine is required
to be withheld.
(b) Securities Law Compliance. Upon exercise of an Option, the
holder shall be required to make such representations and furnish such
information as may, in the opinion of counsel for the Corporation, be
appropriate to permit the Corporation to issue or transfer the Shares in
compliance with the provisions of applicable federal or state securities laws.
The Corporation, in its discretion, may postpone the issuance and delivery of
Shares upon any exercise of an Option until completion of such registration or
other qualification of such Shares under any federal or state laws, or stock
exchange listing, as the Corporation may consider appropriate. The
Corporation is not obligated to register or qualify the Shares under federal
or state securities laws and may refuse to issue such Shares if neither
registration nor exemption therefrom is practical. The Board may require that
prior to the issuance or transfer of any Shares upon exercise of an Option,
the recipient enter into a written agreement to comply with any restrictions
on subsequent disposition that the Board or the Corporation deems necessary or
advisable under any applicable federal and state securities laws.
Certificates representing the Shares issued hereunder may be legended to
reflect such restrictions.
(c) Indemnity. The Board shall not be liable for any act,
omission, interpretation, construction or determination made in good faith in
connection with its responsibilities with respect to the Plan, and the
Corporation hereby agrees to indemnify the members of the Board, in respect of
any claim, loss, damage, or expense (including counsel fees) arising from any
such act, omission, interpretation, construction or determination to the full
extent permitted by law.
11. Effective Date; Amendment; Termination.
(a) The effective date of this Plan shall be the date of the
approval of stockholders of the Corporation holding at least a majority of the
voting stock of the Corporation.
(b) The date of grant of any Option granted hereunder shall be
the date upon which the Eligible Director to whom the Option is granted
becomes a director of the Company.
(c) The Board, or any Committee who has been delegated the
authority to do so, may at any time, and from time to time, amend, suspend or
terminate this Plan in whole or in part. Provided however, that so long as
there is a requirement under Rule 16b-3 under the Securities Exchange Act of
1934, as amended, for stockholder approval of a Plan and certain amendments
thereto, any such amendment which (i) materially increases the number of
Shares which may be subject to Options granted under the Plan, (ii) materially
increases the benefits accruing to participants in the Plan, or (iii)
materially modifies the requirement for eligibility to participate in the
Plan, shall be subject to stockholder approval, to the extent so required
under said Rule; and provided further that the Plan may not be modified more
often than once every six months to materially modify (i) the requirements for
eligibility under the Plan, (ii) the timing of the grants of Options under the
Plan or (iii) the number of Shares subject to Options to be granted under the
Plan. Except as provided herein, no amendment, suspension or termination of
this Plan may adversely affect the rights of any person under an Option that
has been granted to such person without such person's consent.
(d) This Plan shall terminate January 3, 2000, and no Option
shall be granted under this Plan thereafter, but such termination shall not
affect the validity of Options granted prior to the date of termination.
Date of Original Board of Director Adoption: January 3, 1990
Date of Original Stockholder Adoption: January 10, 1990
Date of Amendments:
Board of Director Approval Stockholder Approval
- ------------------------- ---------------------
December 13, 1991 (amended and February 10, 1992
restated)
December 10, 1993 February 25, 1994
December 4, 1995 (second February 27, 1996
amendment and restatement)
HOLOGIC, INC.
1995 COMBINATION STOCK OPTION PLAN
Section I. Purpose of the Plan.
The purposes of this Hologic, Inc. 1995 Combination Stock Option Plan
(the "1995 Plan") are (i) to provide long-term incentives and rewards to those
key employees (the "Employee Participants") of Hologic, Inc. (the
"Corporation") and its subsidiaries (if any), and any other persons (the "Non-
employee Participants") who are in a position to contribute to the long-term
success and growth of the Corporation and its subsidiaries, (ii) to assist the
Corporation in retaining and attracting executives and key employees with
requisite experience and ability, and (iii) to associate more closely the
interests of such executives and key employees with those of the Corporation's
stockholders. Notwithstanding the foregoing, if Section 16, as defined in
Section II, is applicable to the Corporation, then any director of the
Corporation who is a member of the Committee, as defined in paragraph (a) of
Section III, shall not be eligible to receive any Stock Options.
Section II. Definitions.
"Code" is the Internal Revenue Code of 1986, as it may be amended
from time to time.
"Common Stock" is the $.01 par value common stock of the
Corporation.
"Committee" is defined in Section III, paragraph (a).
"Corporation" is defined in Section I.
"Corporation ISOs" are all stock options (including 1995 Plan
ISOs) which (i) are Incentive Stock Options and (ii) are granted under
any plans (including this 1995 Plan) of the Corporation, a Parent
Corporation and/or a Subsidiary Corporation.
"Employee Participants" is defined in Section I.
"Fair Market Value" of any property is the value of the property
as reasonably determined by the Committee.
"Incentive Stock Option" is a stock option which is treated as an
incentive stock option under Section 422 of the Code.
"1995 Plan" is defined in Section I.
"1995 Plan ISOs" are Stock Options which are Incentive Stock
Options.
"Non-employee Participants" is defined in Section I.
"Non-qualified Option" is a Stock Option which does not qualify as
an Incentive Stock Option or for which the Committee provides, in the
terms of such option and at the time such option is granted, that the
option shall not be treated as an Incentive Stock Option.
"Parent Corporation" has the meaning provided in Section 424(e) of
the Code.
"Participants" are all persons who are either Employee
Participants or Non-employee Participants.
"Permanent and Total Disability" has the meaning provided in
Section 22(e)(3) of the Code.
"Section 16" means Section 16 of the Securities Exchange Act of
1934, as amended, or any similar or successor statute, and any rules,
regulations, or policies adopted or applied thereunder.
"Stockholder Approval" means the affirmative vote of at least a
majority of the shares of Common Stock present and entitled to vote at a
duly held meeting of the stockholders of the Corporation, unless a
greater vote is required by state law or Section 16, if applicable to
the Corporation, in which case such greater requirement shall apply.
Stockholder approval may be obtained by written consent or other means,
to the extent permitted by applicable state law.
"Stock Options" are rights granted pursuant to this 1995 Plan to
purchase shares of Common Stock at a fixed price.
"Subsidiary Corporation" has the meaning provided in Section
424(f) of the Code.
"Ten Percent Stockholder" means, with respect to a 1995 Plan ISO,
any individual who directly or indirectly owns stock possessing more
than 10% of the total combined voting power of all classes of stock of
the Corporation or any Parent Corporation or any Subsidiary Corporation
at the time such 1995 Plan ISO is granted.
Section III. Administration.
(a) The Committee. This 1995 Plan shall be administered by a
compensation committee designated by the Board of Directors of the
Corporation, which may include any persons (including any or all of the
directors) designated by the Board of Directors (the administering body is
hereafter referred to as the "Committee"). The Committee shall serve at the
pleasure of the Board of Directors, which may from time to time, and in its
sole discretion, discharge any member, appoint additional new members in
substitution for those previously appointed and/or fill vacancies however
caused. A majority of the Committee shall constitute a quorum and the acts of
a majority of the members present at any meeting at which a quorum is present
shall be deemed the action of the Committee. No person shall be eligible to
be a member of the Committee if that person's membership would prevent the
plan from complying with Section 16, if applicable to the Corporation. At
such time as any class of equity security of the Corporation is registered
pursuant to Section 12 of the Securities Exchange Act of 1934, as amended (the
"Act"), (i) the Committee shall consist of at least two members of the Board
of Directors and (ii) no member of the Committee while a member thereof shall
be granted Stock Options under this Plan, nor may any person be appointed to
the Committee unless he was not granted or awarded stock options or shares of
Common Stock under this 1995 Plan or any other plan of the Corporation at any
time within the one-year period immediately prior to such appointment as
provided in Rule 16b-3 promulgated under the Act.
(b) Authority and Discretion of the Committee. Subject to the express
provisions of this 1995 Plan and provided that all actions taken shall be
consistent with the purposes of this 1995 Plan, and subject to ratification by
the Board of Directors only if required by applicable law, the Committee shall
have full and complete authority and the sole discretion to: (i) determine
those persons who shall constitute key employees eligible to be Employee
Participants; (ii) select the Participants to whom Stock Options shall be
granted under this 1995 Plan; (iii) determine the size and the form of the
Stock Options, if any, to be granted to any Participant; (iv) determine the
time or times such Stock Options shall be granted including the grant of Stock
Options in connection with other awards made, or compensation paid, to the
Participant; (v) establish the terms and conditions upon which such Stock
Options may be exercised and/or transferred, including the exercise of Stock
Options in connection with other awards made, or compensation paid, to the
Participant; (vi) make or alter any restrictions and conditions upon such
Stock Options and the Stock received on exercise thereof, including, but not
limited to, providing for limitations on the Participant's right to keep any
Stock received on termination of employment; (vii) determine whether the
Participant or the Corporation has achieved any goals or otherwise satisfied
any conditions or requirements that may be imposed on or related to the
exercise of Stock Options; and (viii) adopt such rules and regulations,
establish, define and/or interpret these and any other terms and conditions,
and make all determinations (which may be on a case-by-case basis) deemed
necessary or desirable for the administration of this 1995 Plan.
Notwithstanding any provision of this 1995 Plan to the contrary, only Employee
Participants shall be eligible to receive 1995 Plan ISOs. If the Common Stock
is registered pursuant to Section 12 of the 1934 Act, then notwithstanding any
provision of this 1995 Plan to the contrary, grants of Stock Options to non-
employee directors must be uniformly offered to all such non-employee
directors.
(c) Applicable Law. This 1995 Plan, and all Stock Options shall be
governed by the law of the state in which the Corporation is incorporated.
Section IV. Terms of Stock Options.
(a) Agreements. Stock Options shall be evidenced by a written
agreement between the Corporation and the Participant awarded the Stock
Option. This agreement shall be in such form, and contain such terms and
conditions (not inconsistent with this 1995 Plan) as the Committee may
determine. If the Stock Option described therein is not intended to be an
Incentive Stock Option, but otherwise qualifies as an Incentive Stock Option,
the agreement shall include the following, or a similar, statement: "This
stock option is not intended to be an Incentive Stock Option, as that term is
described in Section 422 of the Internal Revenue Code of 1986, as amended."
(b) Term. Stock Options shall be for such periods as may be
determined by the Committee, provided that in the case of 1995 Plan ISOs, the
term of any such 1995 Plan ISO shall not extend beyond three months after the
time the Participant ceases to be an employee of the Corporation.
Notwithstanding the foregoing, the Committee may provide in a 1995 Plan ISO
that in the event of the Permanent and Total Disability or death of the
Participant, the 1995 Plan ISO may be exercised by the Participant or his
estate (if applicable) for a period of up to one year after the date of such
Permanent and Total Disability or Death. In no event may a 1995 Plan ISO be
exercisable (including provisions, if any, for exercise in installments)
subsequent to ten years after the date of grant, or, in the case of 1995 Plan
ISOs granted to Ten Percent Stockholders, more than five years after the date
of grant.
(c) Purchase Price. The purchase price of shares purchased pursuant
to any Stock Option shall be determined by the Committee, and shall be paid by
the Participant or other person permitted to exercise the Stock Option in full
upon exercise, (i) in cash, (ii) by delivery of shares of Common Stock (valued
at their Fair Market Value on the date of such exercise), (iii) any other
property (valued at its Fair Market Value on the date of such exercise), or
(iv) any combination of cash, stock and other property, with any payment made
pursuant to subparagraphs (ii), (iii) or (iv) only as permitted by the
Committee, in its sole discretion. In no event will the purchase price of
Common Stock be less than the par value of the Common Stock. Furthermore, the
purchase price of Common Stock subject to a 1995 Plan ISO shall not be less
than the Fair Market Value of the Common Stock on the date of the issuance of
the 1995 Plan ISO, provided that in the case of 1995 Plan ISOs granted to Ten
Percent Stockholders, the purchase price shall not be less than 110% of the
Fair Market Value of the Common Stock on the date of issuance of the 1995 Plan
ISO.
(d) Further Restrictions as to Incentive Stock Options. To the extent
that the aggregate Fair Market Value of Common Stock with respect to which
Corporation ISOs (determined without regard to this section) are exercisable
for the first time by any Employee Participant during any calendar year
exceeds $100,000, such Corporation ISOs shall be treated as options which are
not Incentive Stock Options. For the purpose of this limitation, options
shall be taken into account in the order granted, and the Committee may
designate that portion of any Corporation ISO that shall be treated as not an
Incentive Stock Option in the event that the provisions of this paragraph
apply to a portion of any option, unless otherwise required by the Code or
regulations of the Internal Revenue Service. The designation described in the
preceding sentence may be made at such time as the Committee considers
appropriate, including after the issuance of the option or at the time of its
exercise. For the purpose of this section, Fair Market Value shall be
determined as of the time the option with respect to such stock is granted.
(e) Restrictions. At the discretion of the Committee, the Stock
Options, as well as the Common Stock issued pursuant to the Stock Options, may
be subject to restrictions on vesting or transferability. For the purposes of
this limitation, options shall be taken into account in the order granted.
(f) Withholding of Taxes. Pursuant to applicable federal, state,
local or foreign laws, the Corporation may be required to collect income or
other taxes upon the grant of a Stock Option to, or exercise of a Stock Option
by, a holder. The Corporation may require, as a condition to the exercise of
a Stock Option, or demand, at such other time as it may consider appropriate,
that the Participant pay the Corporation the amount of any taxes which the
Corporation may determine is required to be withheld or collected, and the
Participant shall comply with the requirement or demand of the Corporation.
In its discretion, the Corporation may withhold shares to be received upon
exercise of a Stock Option if it deems this an appropriate method for
withholding or collecting taxes.
(g) Securities Law Compliance. Upon exercise (or partial exercise) of
a Stock Option, the Participant or other holder of the Stock Option shall make
such representations and furnish such information as may, in the opinion of
counsel for the Corporation, be appropriate to permit the Corporation to issue
or transfer Stock in compliance with the provisions of applicable federal or
state securities laws. The Corporation, in its discretion, may postpone the
issuance and delivery of Stock upon any exercise of this Option until
completion of such registration or other qualification of such shares under
any federal or state laws, or stock exchange listing, as the Corporation may
consider appropriate. Furthermore, the Corporation is not obligated to
register or qualify the shares of Common Stock to be issued upon exercise of a
Stock Option under federal or state securities laws (or to register or qualify
them at any time thereafter), and it may refuse to issue such shares if, in
its sole discretion, registration or exemption from registration is not
practical or available. The Corporation may require that prior to the
issuance or transfer of Stock upon exercise of a Stock Option, the Participant
enter into a written agreement to comply with any restrictions on subsequent
disposition that the Corporation deems necessary or advisable under any
applicable federal and state securities laws. Certificates of Stock issued
hereunder may bear a legend reflecting such restrictions.
(h) Right to Stock Option. No employee of the Corporation or any
other person shall have any claim or right to be a participant in this 1995
Plan or to be granted a Stock Option hereunder. Neither this 1995 Plan nor
any action taken hereunder shall be construed as giving any person any right
to be retained in the employ of the Corporation. Nothing contained hereunder
shall be construed as giving any person any equity or interest of any kind in
any assets of the Corporation or creating a trust of any kind or a fiduciary
relationship of any kind between the Corporation and any such person. As to
any claim for any unpaid amounts under this 1995 Plan, any person having a
claim for payments shall be an unsecured creditor.
(i) Indemnity. Neither the Board of Directors nor the Committee, nor
any members of either, nor any employees of the Corporation or any parent,
subsidiary, or other affiliate, shall be liable for any act, omission,
interpretation, construction or determination made in good faith in connection
with their responsibilities with respect to this 1995 Plan, and the
Corporation hereby agrees to indemnify the members of the Board of Directors,
the members of the Committee, and the employees of the Corporation and its
parent or subsidiaries in respect of any claim, loss, damage, or expense
(including reasonable counsel fees) arising from any such act, omission,
interpretation, construction or determination to the full extent permitted by
law.
(j) Participation by Foreigners. Without amending this 1995 Plan,
except to the extent required by the Code in the case of Incentive Stock
Options, the Committee may modify grants made to participants who are foreign
nationals or employed outside the United States so as to recognize differences
in local law, tax policy, or custom.
Section V. Amendment and Termination; Adjustments Upon Changes in
Stock.
The Board of Directors of the Corporation may at any time, and from time
to time, amend, suspend or terminate this 1995 Plan in whole or in part;
provided, however, that neither the Board of Directors nor the Committee may
materially amend or modify the definition of Employee Participants,
materially increase the benefits accruing to Participants, increase the number
of shares of Common Stock reserved for purposes of this 1995 Plan, extend the
term of this 1995 Plan, materially modify the requirements to be a Participant
in this 1995 Plan, or otherwise modify this 1995 Plan in any way or manner
requiring the approval of the Stockholders under the Code, or rules and
regulations thereunder, or Section 16, if applicable to the Corporation,
without Stockholder Approval and compliance with any applicable law, rules, or
regulations. Except as provided herein, no amendment, suspension or
termination of this 1995 Plan may affect the rights of a Participant to whom a
Stock Option has been granted without such Participant's consent. The
Committee is specifically authorized to convert, in its discretion, the
unexercised portion of any 1995 Plan ISO granted to an Employee Participant to
a Non-qualified Option at any time prior to the exercise, in full, of such
1995 Plan ISO. If there shall be any change in the Common Stock or to any
Stock Option granted under this 1995 Plan through merger, consolidation,
reorganization, recapitalization, stock dividend, stock split or other change
in the corporate structure of the Corporation, appropriate adjustments may be
made by the Committee (or if the Corporation is not the surviving corporation
in any such transaction, the Board of Directors of the surviving corporation,
or its designee) in the aggregate number and kind of shares subject to this
1995 Plan, and the number and kind of shares and the price per share subject
to outstanding options, provided that such adjustment does not affect the
qualification of any 1995 Plan ISO as an Incentive Stock Option. In
connection with the foregoing, the Committee may issue new Stock Options in
exchange for outstanding Stock Options.
Section VI. Shares of Stock Subject to the Plan.
The number of shares of Common Stock that may be the subject of awards
under this 1995 Plan shall not exceed an aggregate of 550,000 shares. Shares
to be delivered under this 1995 Plan may be either authorized but unissued
shares of Common Stock or treasury shares. Any shares subject to an option
hereunder which for any reason terminates, is cancelled or otherwise expires
unexercised, and any shares reacquired by the Corporation due to restrictions
imposed on the shares, shares returned because payment is made hereunder in
stock of equivalent value rather than in cash, and/or shares reacquired from a
recipient for any other reason shall, at such time, no longer count towards
the aggregate number of shares which have been the subject of Stock Options
issued hereunder, and such number of shares shall be subject to further awards
under this 1995 Plan, provided, first, that the total number of shares then
eligible for award under this 1995 Plan may not exceed the total specified in
the first sentence of this Section VI, and second, that the number of shares
subject to further awards shall not be increased in any way that would cause
this 1995 Plan or any Stock Option to not comply with Section 16, if
applicable to the Corporation.
Section VII. Effective Date and Term of this Plan.
Provided there is Stockholder Approval on or before June 28, 1996, the
effective date of this 1995 Plan is June 28, 1995 (the "Effective Date") and
awards under this 1995 Plan may be made for a period of ten years commencing
on the Effective Date. The period during which a Stock Option may be
exercised may extend beyond that time as provided herein.
Date of Approval by Board of Directors: June 28, 1995
Date of Approval by the Stockholders: March 15, 1996
