As filed with the Securities and Exchange Commission on November 18, 1997
Registration No. 333-
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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
LUNAR CORPORATION
(Exact Name of Registrant as Specified in Its Charter)
Wisconsin
(State or Other
Jurisdiction of
Incorporation or
Organization)
39-1200501
(I.R.S. Employer
Identification Number)
313 West Beltline Highway
Madison, Wisconsin 53713
Telephone: (608) 274-2663
(Address, Including Zip Code, and Telephone Number, Including
Area Code, of Registrant's Principal Executive Offices)
Richard B. Mazess, President
Lunar Corporation
313 West Beltline Highway
Madison, Wisconsin 53713
Telephone: (608) 274-2663
(Name, Address, Including Zip Code, and Telephone
Number, Including Area Code, of Agent For Service)
Copy to:
Jim L. Kaput
Sidley & Austin
One First National Plaza
Chicago, Illinois 60603
Approximate date of commencement of proposed sale to the public: From time
to time after this registration statement becomes effective.
If the only securities being registered on this Form are
being offered pursuant to dividend or interest reinvestment plans, please check
the following box. / /
If any of the securities being registered on this Form are
to be offered on a delayed or continuous basis pursuant to Rule 415 under the
Securities Act of 1933, other than securities offered only in connection with
dividend or interest reinvestment plans, check the following box. /X/
If this form is filed to register additional securities for
an offering pursuant to Rule 462(b) under the Securities Act, please check
the following box and list the Securities Act registration statement number of
the earlier effective registration statement for the same offering. / /
If this form is a post-effective amendment filed pursuant to
Rule 462 under the Securities Act, check the following box and list the
Securities Act registration statement number of the earlier effective
registration statement for the same offering. / /
If delivery of the prospectus is expected to be made
pursuant to Rule 434, please check the following box. / /
CALCULATION OF REGISTRATION FEE
Title of Shares Amount Proposed Proposed Amount of
To Be To Be Maximum Maximum Registration
Registered Registered Aggregate Aggregate Fee
Price Offering
Per Unit Price (1)
- ----------------------------------------------------------------------
Common 250,000(1) $21.75(2) 4,990,140(2) $1,512.16
Stock, par
value $.01
per share
- ----------------------------------------------------------------------
(1) Also registered hereby are such additional and indeterminate
number of shares as may become issuable because of the provisions of the
Lunar Corporation Amended and Restated Stock Option Plan relating to
adjustments for changes resulting from stock dividends, stock splits and
similar changes.
(2) Estimated solely for the purpose of calculating the Registration Fee and,
pursuant to Rule 457(h) under the Securities Act of 1933, based upon the
exercise price for shares subject to outstanding options and the average of the
high and low sale prices of Common Stock of the Registrant on The Nasdaq Stock
Market on November 13, 1997 for all other shares.
The Registrant hereby amends this Registration Statement on such date or dates
as may be necessary to delay its effective date until the Registrant shall file
a further amendment which specifically states that this Registration Statement
shall thereafter become effective in accordance with Section 8(a) of the
Securities Act of 1933 or until this Registration Statement shall become
effective on such date as the Commission, acting pursuant to said Section 8(a),
may determine.
SUBJECT TO COMPLETION, DATED NOVEMBER 18, 1997
PROSPECTUS
250,000 Shares
LUNAR
Common Stock
__________________
This Prospectus relates to up to 250,000 shares of Common Stock, par
value $.01 per share ("Common Stock"), of Lunar Corporation, a Wisconsin
corporation (the "Company" or "Lunar"), which may be offered and sold to
permitted transferees of participants ("Participants") in the Lunar Corporation
Amended and Restated Stock Option Plan (the "Plan"), pursuant to nonqualified
stock options ("Stock Options") granted to such Participants under the Plan.
Upon the approval of the committee responsible for administration of the Plan
(the "Committee"), some or all of a Participant's Stock Option may be
transferred by such Participant pursuant to a domestic relations order. Each
transfer must be made in accordance with the grant documents specifying the
terms and conditions for transferring such Stock Option. This Prospectus also
relates to the offer and sale of Common Stock pursuant to such Stock Option to
the beneficiaries of such permitted transferees, or the executors or
administrators of their estates, or other persons duly authorized by law to
administer the estate or assets of such persons.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS
A CRIMINAL OFFENSE.
As of the date of this Prospectus, all Stock Options granted under the Plan
have had an exercise price equal to 100% of the fair market value of a share of
Common Stock on the date of grant. Upon transfer, a Stock Option continues to
be governed by and subject to the terms and limitations of the Plan and the
relevant grant, including provisions relating to exercise price.
INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A
REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE SOLD NOR MAY
OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION STATEMENT BECOMES
EFFECTIVE. THIS PROSPECTUS SHALL NOT CONSTITUTE AN OFFER TO SELL OR THE
SOLICITATION OF AN OFFER TO BUY NOR SHALL THERE BE ANY SALE OF THESE SECURITIES
IN ANY STATE IN WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE UNLAWFUL PRIOR
TO REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS OF ANY SUCH STATE.
The date of this Prospectus is ____________, 1997
TABLE OF CONTENTS
Page
The Company. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Use of Proceeds. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Description of Capital Stock . . . . . . . . . . . . . . . . . . . . . . 2
Description of the Plan and the Stock Options. . . . . . . . . . . . . . 4
Certain Federal Income Tax Consequences. . . . . . . . . . . . . . . . . 6
Legal Matters. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Experts. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Available Information. . . . . . . . . . . . . . . . . . . . . . . . . . 7
Incorporation of Certain Documents By Reference. . . . . . . . . . . . . 7
THE COMPANY
Lunar develops and sells x-ray and ultrasound bone densitometers for
the diagnosis and monitoring of osteoporosis and other metabolic bone diseases.
Lunar also develops and sells medical imaging equipment used by orthopedists
and radiologists for imaging extremities. Lunar is a Wisconsin corporation,
its principal executive offices are located at 313 West Beltline Highway,
Madison, Wisconsin 53713 and its telephone number is (608) 274-2663.
USE OF PROCEEDS
The Company intends to use the net proceeds from the sale of the
Common Stock for general corporate purposes.
DESCRIPTION OF CAPITAL STOCK
The authorized capital stock of the Company consists of 25,000,000
shares of Common Stock, par value $.01 per share. At September 30, 1997,
8,737,535 shares of Common Stock were outstanding and stock options to purchase
1,059,945 shares of Common Stock were outstanding. The following summary
description of the capital stock of the Company is qualified in its entirety by
reference to the Articles of Incorporation and the By-Laws of the Company and
to the Wisconsin Business Corporation Law (the "WBCL").
COMMON STOCK
Holders of Common Stock are entitled to one vote for each share held
on all matters submitted to a vote of shareholders. Holders of Common Stock do
not have cumulative voting rights in the election of directors and have no
preemptive, subscription or redemption rights. All outstanding shares of Common
Stock are, and those offered hereby will be, validly issued, fully paid and
nonassessable, except for certain statutory liabilities which may be imposed by
Section 180.0622 of the WBCL for unpaid employee wages. Section 180.0622 of the
WBCL provides that shares held by shareholders of corporations incorporated in
Wisconsin may be assessed up to their par value to satisfy obligations to
employees for services rendered, but not exceeding six months' service in the
case of any individual employee. The par value of the Company's Common Stock is
$.01 per share. Holders of Common Stock are entitled to suchdividends as may be
declared by the Board of Directors out of funds legally available therefor.
Upon liquidation, dissolution or winding-up of the Company, the assets legally
available for distribution to shareholders are distributable ratably among the
holders of Common Stock at that time outstanding subject to prior distribution
rights of creditors of the Company.
CERTAIN ARTICLES OF INCORPORATION AND BY-LAWS PROVISIONS
Certain provisions of the Articles of Incorporation and the By-Laws
could have anti-takeover effects and may delay, defer or prevent a takeover
attempt that a shareholder might consider in the shareholder's best interest.
These provisions are intended to enhance the likelihood of continuity and
stability in the composition of and in the policies formulated by the Board of
Directors. In addition, these provisions are also intended to ensure that the
Board of Directors will have sufficient time to act in what the Board of
Directors believes to be the best interests of the Company and its shareholders.
Classified Board of Directors. The Articles of Incorporation
provide for a Board of Directors divided into three classes of directors serving
staggered three-year terms. The classification of directors has the effect of
making it more difficult for shareholders to change the composition of the
Board of Directors in a short period of time. The Board currently has six
directors. At least two annual meetings of shareholders, instead of one, will
generally be required to effect a change in a majority of the Board of
Directors.
Number of Directors; Filling Vacancies; Removal. The Articles of
Incorporation and the By-Laws provide that the Board of Directors will consist
of at least six and no more than twelve members as determined by the Board. The
By-Laws provide that the Board of Directors, acting by majority vote of the
directors then in office, may fill any newly created directorships or vacancies
on the Board of Directors except for a vacancy resulting from the removal by
shareholders of a director, in which case the shareholders may fill such
vacancy by the affirmative vote of eighty percent (80%) of the outstanding
shares entitled to vote thereon. The Articles of Incorporation and the By-Laws
provide that a director may be removed only upon the affirmative vote of
eighty percent (80%) of the outstanding shares entitled to vote for the
election of such directors.
CERTAIN WISCONSIN BUSINESS CORPORATION LAW PROVISIONS
Restrictions on Business Combinations. Section 180.1141 of the WBCL
provides that a "resident domestic corporation", such as the Company, may not
engage in a "business combination" with an "interested stockholder" (a person
beneficially owning 10% of the voting power of the outstanding voting stock),
for three years after the date (the "stock acquisition date") the interested
stockholder acquired its 10% or greater interest, unless the business
combination (or acquisition of 10% or greater interest) was approved before the
stock acquisition date by the corporation's board of directors. After the
3-year period, a business combination that was not so approved can be
consummated only if it is approved by the majority of the outstanding voting
shares not held by the interested stockholder or is made at a specified formula
price intended to provide a fair price for the shares held by noninterested
stockholders.
Control Share Voting Restrictions. Section 180.1150 of the WBCL
provides that, absent a contrary provision in the Articles of Incorporation,
the voting power of shares (including shares issuable upon conversion of
convertible securities or upon exercise of options or warrants) of an "issuing
public corporation" (generally defined as a Wisconsin corporation with at least
100 shareholders of record who are Wisconsin residents) held by any person in
excess of 20% of the voting power in the election of directors is limited to
10% of the full voting power of such excess shares unless, at a special meeting
of shareholders called in accordance with certain procedures, the shareholders
of such corporation approve a resolution restoring full voting power to such
shares. The requisite vote for approval of such resolution is the affirmative
vote of a majority of the voting power represented at the meeting and entitled
to vote on the subject matter. Shares of an issuing public corporation held or
acquired from the issuing public corporation or acquired under an agreement
entered into at a time when the issuing public corporation was not an issuing
public corporation are excluded from the application of these provisions. Such
provisions would not apply to the shares held by Dr. Richard Mazess, founder of
the Company.
Limited Liability of Directors. Under Section 180.0828 of the WBCL,
directors of a corporation are not subject to personal liability to the
corporation, its shareholders, or any person asserting rights on behalf thereof
for damages, settlements, fees, fines, penalties or other monetary liabilities
arising from breaches or failures to perform any duty resulting solely from
their status as a directors, unless the person asserting liability proves that
the breach or failure constituted: (I) a willful failure to deal fairly with
the corporation or its shareholders in connection with a matter in which the
director had a material conflict of interest, (ii) a violation of criminal
law, unless the director had reasonable cause to believe his or her conduct was
lawful or had no reasonable cause to believe his or her conduct was unlawful,
(iii) a transaction from which the director derived an improper personal
profit, or (iv) willful misconduct. These provisions pertain only to breaches
of duty by directors as directors and not in any other corporate capacity, such
as officers. As a result of such provisions, shareholders may be unable to
recover monetary damages against directors for actions taken by them which
constitute negligence or gross negligence or which are in violation of their
fiduciary duties, although it may be possible to obtain injunctive or other
equitable relief with respect to such actions. If equitable remedies are found
not to be available to shareholders in any particular case, shareholders may
not have any effective remedy against the challenged conduct.
INDEMNIFICATION OF DIRECTORS AND OFFICERS
Under the Company's By-Laws and the WBCL, directors and officers of
the Company are entitled to mandatory indemnification from the Company against
certain liabilities and expenses (a) to the extent such officers or directors
are successful in the defense of a proceeding and (b) in proceedings in which
the director or officer is not successful in the defense thereof, unless it is
determined the director or officer breached or failed to perform such person's
duties to the Company and such breach or failure constituted: (I) a willful
failure to deal fairly with the Company or its shareholders in connection with
a matter in which the director or officer had a material conflict of interest,
(ii) a violation of criminal law, unless the director or officer had reasonable
cause to believe his or her conduct was lawful or had no reasonable cause to
believe his or her conduct was unlawful, (iii) a transaction from which the
director or officer derived an improper personal profit, or (iv) willful
misconduct. The Company's By-Laws provide that the Company may purchase and
maintain insurance on behalf of an individual who is a director or officer of
the Company against liability asserted against or incurred by such individual
in his or her capacity as a director or officer regardless of whether the
Company is required or authorized to indemnify or allow expenses to the
individual against the same liability under the By-Laws.
DESCRIPTION OF THE PLAN AND THE STOCK OPTIONS
THE PLAN
The purpose of the Plan is to provide incentives to officers, key
employees and consultants of the Company and its subsidiaries and members of
the Board of Directors to contribute to the success and prosperity of the
Company by granting Stock Options to such persons. The maximum number of
shares of Common Stock available under the Plan is 1,500,000. At the 1997
Annual Meeting of Shareholders to be held on November 21, 1997, the Shareholders
will vote on a proposal to increase the number of shares available under the
Plan by 500,000 shares.
The Committee administers the Plan and has the authority, subject to
the terms of the Plan, to establish eligibility guidelines, select officers,
key employees, consultants, and non-employee directors for participation in the
Plan and determine the number of shares of Common Stock subject to a Stock
Option granted thereunder, the exercise price of such shares of Common Stock,
the time and conditions of vesting or exercise, and all other terms and
conditions of the Stock Option.
Only nonqualified stock options may be granted under the Plan. The
option price per share of Common Stock purchasable upon exercise of a Stock
Option is 100% of the fair market value of a share of Common Stock on the date
of grant of such Stock Option. The Committee determines the period of exercise
of a Stock Option and whether a Stock Option will be exercisable in cumulative
or non-cumulative installments or in full at any time.
THE STOCK OPTIONS
At the time of grant, the Committee establishes the exercise price,
the expiration date and the times and installments in which the Stock Options
may be exercised. As of the date of this Prospectus, all Stock Options granted
under the Plan have had expiration dates ten years from the date of grant with
an exercise price equal to 100% of the fair market value of a share of Common
Stock on the date of grant. Such grants generally have provided that the
Stock Options become exercisable in equal annual installments over the
three-year or five-year period following the date of grant. If any change shall
occur in or affect shares of Common Stock or Stock Options on account of a
merger, reorganization, stock dividend, stock split or similar changes, the
Committee shall make adjustments in, among other things, (I) the number of
shares exercisable under each Stock Option and (ii) the exercise price or the
unexercised portion of each Stock Option.
TRANSFERABILITY
The Plan provides that Stock Options are generally not transferable
by a Participant except by will or the laws of descent and distribution and are
exercisable during the Participant's lifetime only by the Participant.
Notwithstanding the foregoing, under certain circumstances, the Committee may
consent to the transfer or transferability of any particular Stock Option in
the manner approved by the Committee. The Committee has determined to allow
the transfer of certain Stock Options pursuant to a domestic relations order.
Any such permitted transferee of a Participant's Stock Options shall be
referred to herein as a "Stock Option Transferee" and such Participant shall
be referred to herein as a "Participant Transferor."
This Prospectus relates to up to 250,000 shares of Common Stock of
the Company which may be offered and sold to Stock Option Transferees pursuant
to Stock Options that may be transferred as described in the immediately
preceding paragraph. This Prospectus also relates to the offer and sale of
Common Stock pursuant to such Stock Options to the beneficiaries of such Stock
Option Transferees or the executors or administrators of their estates, or
other persons duly authorized by law to administer the estate or assets of such
persons. Upon transfer to a Stock Option Transferee, a Stock Option is
governed by and subject to the terms and limitations of the Plan and the
relevant grant, as such grant may be amended by the Committee in consenting to
a transfer of the Stock Option, and, subject to any such amendment, the Stock
Option Transferee is entitled to the same rights as the Participant Transferor
thereunder, as if no transfer had taken place. Accordingly, the rights of the
Stock Option Transferee are subject to the terms and conditions of the original
grant to the Participant Transferor, as amended, including provisions relating
to expiration date, exercisability, exercise price and forfeiture. For
information regarding the terms of a particular Stock Option grant, Stock
Option Transferees may contact the Corporate Secretary at the Company's
principal executive offices. Once a Stock Option has been transferred to a
Stock Option Transferee, it may not be subsequently transferred by the Stock
Option Transferee except with the consent of the Committee or by will or the
laws of descent and distribution.
EXERCISE OF STOCK OPTIONS BY STOCK OPTION TRANSFEREES
A Stock Option may be exercised by a Stock Option Transferee at any
time from the time first set by the Committee in the original grant to the
Participant Transferor until the close of business on the expiration date of
the Stock Option, or the earlier date on which the Stock Option terminates due
to the Participant Transferor's termination of employment or service as
director, as discussed below. Stock Options generally become exercisable in
equal annual installments over the three-year or five-year period following the
date of grant. The exercise price of the shares as to which Stock Options are
exercised shall be paid to the Company at the time of exercise in cash.
A Stock Option will be deemed exercised on the date the Lunar
Corporate Secretary's office has received written notice of exercise of the
Stock Option signed by the Stock Option Transferee specifying the number of
shares of Common Stock with respect to the Stock Option being exercised
(accompanied by a check in satisfaction of the exercise price). The Stock
Option shares will generally be transferred to the Stock Option Transferee as
of the day following the date that (i) the above conditions have been met, (ii)
the funds paid by the Stock Option Transferee in satisfaction of the exercise
price have been received by the Company, and (iii) the Company has received
confirmation that all tax withholding obligations have been satisfied. Any
required income tax withholding must be satisfied by the Stock Option
Transferee as discussed below under the heading "CERTAIN FEDERAL INCOME TAX
CONSEQUENCES". Once the exercise is completed as described above, stock
certificates for the appropriate number of shares will be delivered to the
Stock Option Transferee or his or her estate or beneficiaries, or such shares
shall otherwise be delivered in such manner as the person(s) entitled thereto
may direct.
EFFECT OF TERMINATION OF EMPLOYMENT OR SERVICE
Because Stock Options transferred to Stock Option Transferees
continue to be governed by the terms of the Plan and the original grant, their
exercisability continues to be affected by the Participant Transferor's
employment or service status. If a Participant Transferor terminates
employment or service with the Company for any reason other than death or
retirement after age 60, all outstanding unexercised Stock Options granted to
such Participant Transferor, including those held by a Stock Option Transferee,
may be exercised during the 30-day period following the date of termination of
employment or service, but only to the extent exercisable on such date and in
no event after the expiration dates of such Stock Options. If a Participant
Transferor terminates employment or service by reason of death or retirement
after age 60, all outstanding unexercised Stock Options granted to such
Participant Transferor, including those held by a Stock Option Transferee, may
be exercised during the one-year period following the date of death or date of
termination of employment or service, but only to the extent exercisable on
such date, and in no event after the expiration dates of such Stock Options.
If a Participant Transferor dies during the 30-day period following termination
of employment or service for any reason other than retirement after age 60, or
if a Participant Transferor dies during the one-year period following
termination of employment or service by reason of retirement after age 60, all
outstanding unexercised Stock Options granted to such Participant Transferor,
including those held by a Stock Option Transferee, may be exercised during the
one-year period following the date of death, but only to the extent exercisable
on such date, and in no event after the expiration dates of such Stock Options.
The Company has no obligation to notify any Stock Option Transferee of the
termination of employment of the Participant Transferor.
CHANGE IN CONTROL
In the event of a change in control of the Company, any Stock Option
not previously exercisable in full will become fully exercisable. As more
fully set forth in the Plan, a change in control generally is the acquisition,
subject to certain exceptions, by any person of beneficial ownership of 50% or
more of the Common Stock, a change in the majority of the Board of Directors or
approval by the shareholders of a reorganization, merger, consolidation, or
sale of all or substantially all of the assets of the Company unless certain
conditions are satisfied.
CERTAIN FEDERAL INCOME TAX CONSEQUENCES
Prior to making a transfer of a Stock Option, a Participant should
consult with his or her personal tax advisors concerning the possible federal,
state and local income and other tax consequences of such a transfer. A Stock
Option Transferee should consult with his or her personal tax advisors
concerning the possible federal, state and local income and other tax
consequences of the exercise of a Stock Option. The federal income tax
consequences of a transfer to a former spouse of a Stock Option pursuant to a
domestic relations order and of the exercise of the Stock Option are discussed
below. State and local income tax consequences are not addressed herein.
INCOME TAX CONSEQUENCES FOR PARTICIPANT TRANSFEROR
The Company has been advised by its tax counsel that a Participant
who transfers a Stock Option to a Stock Option Transferee pursuant to a
domestic relations order will not recognize income at the time of the transfer.
As discussed in the following paragraph, where the Participant Transferor and
the Stock Option Transferee both are domiciled in a community property state,
such as Wisconsin, the Stock Option Transferee and not the Participant
Transferor will recognize ordinary income at the time the Stock Option
Transferee exercises the Stock Option.
INCOME TAX CONSEQUENCES FOR STOCK OPTION TRANSFEREE
Tax counsel has also advised the Company that, where the Participant
Transferor and the Stock Option Transferee are both domiciled in a community
property state, such as Wisconsin, upon exercise of a Stock Option that was
transferred pursuant to a domestic relations order, the Stock Option Transferee
will recognize ordinary income in an amount equal to the excess of the fair
market value of the shares purchased on the date of exercise (which will not
necessarily be equal to the price at which such shares are sold, even if sold
on the same day as exercise) over the exercise price. If either the Participant
Transferor or the Stock Option Transferee is not domiciled in a community
property state, the Participant Transferor and Stock Option Transferee should
consult their personal tax advisors. The Company will generally be entitled to
claim a federal income tax deduction at such time and in the same amount that
the Stock Option Transferee recognizes ordinary income. The Internal Revenue
Service has ruled in private letter rulings that the amount required to be
included in income by the Stock Option Transferee is subject to Federal Income
Contributions Act (FICA) and income tax withholding.
INCOME TAX CONSEQUENCES UPON THE SUBSEQUENT SALE OF STOCK
If shares acquired upon exercise of a Stock Option that was
transferred pursuant to a domestic relations order are later sold or exchanged,
then the difference between the sale price and the Stock Option Transferee's
tax basis for the shares will generally be taxable as long-term or short-term
capital gain or loss (assuming that the stock is a capital asset of the
taxpayer) depending upon whether the stock has been held for more than 18
months after the exercise date. The tax basis for the shares in the hands of
the Stock Option Transferee would be the exercise price for the Stock Option
plus the amount of income recognized by the Stock Option Transferee at the time
of exercise.
LEGAL MATTERS
The legality of the Securities offered hereby will be passed upon
for the Company by Charles V. Sweeney, Corporate General Counsel.
EXPERTS
The consolidated financial statements and schedule of Lunar
Corporation as of June 30, 1997 and 1996 and for each of the years in the
three-year period ended June 30, 1997 contained in Lunar's Annual Report on
Form 10-K for the year ended June 30, 1997 have been incorporated by reference
herein in reliance upon the reports of KPMG Peat Marwick LLP, independent
certified public accountants, incorporated by reference herein, and upon the
authority of said firm as experts in accounting and auditing. To the extent
that KPMG Peat Marwick LLP audits and reports on financial statements of the
Company issued at future dates, and consents to the use of their reports
thereon, such financial statements also will be incorporated by reference
herein in reliance upon their reports and said authority.
AVAILABLE INFORMATION
The Company is subject to the informational requirements of the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), and in
accordance therewith files reports, proxy statements and other information with
the Securities and Exchange Commission (the "Commission"). The Company has
filed with the Commission a registration statement on Form S-3 (the
"Registration Statement") under the Securities Act of 1933, as amended (the
"Securities Act"), with respect to the shares of Common Stock offered hereby.
This Prospectus, which constitutes a part of the Registration Statement, does
not contain all information set forth in the Registration Statement and
reference is hereby made to the Registration Statement and the exhibits thereto
for further information with respect to the Company and the shares of Common
Stock offered hereby. Such reports, proxy statements, Registration Statement
and exhibits and other information omitted from this Prospectus can be
inspected and copied at the public reference facilities maintained by the
Commission at 450 Fifth Street, N.W., Room 1024, Washington, D.C. 20549, and at
its Northeast Regional Office located at 7 World Trade Center, Suite 1300, New
York, New York 10048 and Midwest Regional Office located at Citicorp Center,
500 West Madison Street, Suite 1400, Chicago, Illinois 60661-2511. Copies of
such material can be obtained at prescribed rates from the Public Reference
Section of the Commission, 450 Fifth Street, N.W., Washington, D.C. 20549. The
Commission maintains a Web site that contains reports, proxy and information
statements and other information regarding registrants that file electronically
with the Commission at http://www.sec.gov.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents heretofore filed with the Commission by the
Company under the Exchange Act are incorporated herein by reference:
(a) the Annual Report of the Company on Form 10-K for the year
ended June 30, 1997;
(b) the Quarterly Report of the Company on Form 10-Q for the
quarter ended September 30, 1997; and the description of the Common Stock
contained in the Company's Registration Statement on Form 8-A filed under the
Exchange Act, including any amendment or report filed for the purpose of
updating such description.
All documents filed by the Company pursuant to Section 13(a),
13(c), 14 or 15(d) of the Exchange Act subsequent to the date of this Prospectus
and prior to the termination of the offering of the Common Stock contemplated
hereby shall be deemed to be incorporated by reference into this Prospectus and
to be made a part hereof from the respective dates of filing of such documents.
Any statement contained in a document incorporated or deemed to be incorporated
by reference herein shall be deemed to be modified or superseded for purposes of
the Registration Statement and this Prospectus to the extent that a statement
contained herein or in any subsequently filed document which also is or is
deemed to be incorporated by reference herein modifies or supersedes such
statement. Any such statement so modified or superseded shall not be deemed,
except as so modified or superseded, to constitute a part of the Registration
Statement or this Prospectus.
Copies of the above documents (other than exhibits to such documents
unless such exhibits are specifically incorporated by reference into such
documents) may be obtained upon written or oral request without charge from the
Company, 313 West Beltline Highway, Madison, Wisconsin 53713 (telephone number
(608) 274-2663), Attention: Investor Relations.
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution.
The following table sets forth the expenses in connection with the issuance
and distribution of the securities being registered, other than underwriting
discounts and commissions. All of the amounts shown are estimated, except the
SEC registration fee.
SEC registration fee. . . . . . . . . . 1,512.16
Legal fees and expenses . . . . . . . . 10,000.00
Fees of accountants . . . . . . . . . . 2,000.00
----------
13,512.16
==========
Item 15. Indemnification of Directors and Officers.
Under Article IX of the Company's By-Laws, directors and officers of
the Company are entitled to mandatory indemnification from the Company against
certain liabilities and expenses (a) to the extent such officers or directors
are successful in the defense of a proceeding and (b) in proceedings in which
the director or officer is not successful in the defense thereof, unless it is
determined the director or officer breached or failed to perform such person's
duties to the Company and such breach or failure constituted: (I) a willful
failure to deal fairly with the Company or its shareholders in connection with a
matter in which the director or officer had a material conflict of interest,
(ii) a violation of criminal law, unless the director or officer had reasonable
cause to believe his or her conduct was lawful or had no reasonable cause to
believe his or her conduct was unlawful, (iii) a transaction from which the
director or officer derived an improper personal profit, or (iv) willful
misconduct. The Company's By-Laws provide that the Company may purchase and
maintain insurance on behalf of an individual who is a director or officer of
the Company against liability asserted against or incurred by such individual in
his or her capacity as a director or officer regardless of whether the Company
is required or authorized to indemnify or allow expenses to the individual
against the same liability under the By-Laws.
The Wisconsin Business Corporation Law contains provisions for
mandatory indemnification of directors and officers against certain liabilities
and expenses that are similar to those contained in the Company's By-Laws.
Under Section 180.0828 of the Wisconsin Business Corporation Law, directors of
the Company are not subject to personal liability to the Company, its
shareholders or any person asserting rights on behalf thereof for damages,
settlements, fees, fines, penalties or other monetary liabilities arising from
breaches or failures to perform any duty resulting solely from their status as
such directors, except in circumstances paralleling those in clauses (I) through
(iv) in the preceding paragraph. These provisions pertain only to breaches of
duty by directors as directors and not in any other corporate capacity, such as
officers. As a result of such provisions, shareholders may be unable to recover
monetary damages against directors for actions taken by them which constitute
negligence or gross negligence or which are in violation of their fiduciary
duties, although it may be possible to obtain injunctive or other equitable
relief with respect to such actions. If equitable remedies are found not to be
available to shareholders in any particular case, shareholders may not have any
effective remedy against the challenged conduct.
Item 16. Exhibits.
A list of exhibits included as part of this Registration Statements is
set forth in the Exhibit Index appearing elsewhere herein and is incorporated
herein by reference.
Item 17. Undertakings.
(a) The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this registration statement:
(i) To include any prospectus required by Section 10(a)(3) of the
Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events arising
after the effective date of the registration statement (or the most recent
post-effective amendment thereof) which, individually or in the aggregate,
represent a fundamental change in the information set forth in the registration
statement. Notwithstanding the foregoing, any increase or decrease in volume of
securities offered (if the total dollar value of securities offered would not
exceed that which was registered) and any deviation from the low or high end of
the estimated maximum offering range may be reflected in the form of prospectus
filed with the Commission pursuant to Rule 424(b) if, in the aggregate, the
changes in volume and price represent no more than a 20 percent change in the
maximum aggregate offering price set forth in the "Calculation of Registration
Fee" table in the effective registration statement;
(iii) To include any material information with respect to the
plan of distribution not previously disclosed in the registration statement or
any material change to such information in the registration statement; provided,
however, that paragraphs (a)(1)(I) and (a)(1)(ii) do not apply if the
registration statement is on Form S-3, Form S-8 or Form F-3, and the information
required to be included in a post-effective amendment by those paragraphs is
contained in periodic reports filed with or furnished to the Commission by the
registrant pursuant to Section 13 or 15(d) of the Securities Exchange Act of
1934 that are incorporated by reference in the registration statement.
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be deemed to be
a new registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
(3) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the termination of
the offering. (b) The undersigned registrant hereby undertakes that, for
purposes of determining any liability under the Securities Act of 1933, each
filing of the registrant's annual report pursuant to Section 13(a) or Section
15(d) of the Securities Exchange Act of 1934 (and, where applicable, each
filing of an employee benefit plan's annual report pursuant to Section 15(d)
of the Securities Exchange Act of 1934) that is incorporated by reference in the
registration statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.
Insofar as indemnification for liabilities arising under the Securities Act
of 1933 may be permitted to directors, officers and controlling persons of the
registrant pursuant to the foregoing provisions, or otherwise, the registrant
has been advised that in the opinion of the Securities and Exchange Commission
such indemnification is against public policy as expressed in the Act and is,
therefore, unenforceable. In the event that a claim for indemnification against
such liabilities (other than the payment by the registrant of expenses incurred
or paid by a director, officer or controlling person of the registrant in the
successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Act and will be governed by the final adjudication of
such issue.
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
registrant certifies that it has reasonable grounds to believe that it meets all
of the requirements for filing on Form S-3 and has duly caused this registration
statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Madison, State of Wisconsin, on this 14th day of
November, 1997.
LUNAR CORPORATION
By: /s/ Richard B. Mazess
Richard B. Mazess, Ph.D.
President
POWER OF ATTORNEY
KNOW ALL PEOPLE BY THESE PRESENTS, that each person whose signature
appears below constitutes and appoints Richard B. Mazess and Robert A. Beckman,
and each of them, his true and lawful attorney-in-fact and agent, with full
power of substitution and resubstitution for him and in his name, place and
stead, in any and all capacities, to sign any and all amendments (including
post-effective amendments) to this registration statement, and to file the same,
with all exhibits thereto, and other documents in connection therewith, with the
Securities and Exchange Commission, granting unto said attorney-in-fact and
agent full power and authority to do and perform each and every act and thing
requisite and necessary to be done in and about the premises, as fully to all
intents and purposes as he might or could do in person, hereby ratifying and
confirming all that said attorney-in-fact and agent or his substitute may
lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this
registration statement has been signed by the following persons in the
capacities indicated and on the dates indicated.
Name Title Date
/s/ Richard B. Mazess President and November 14, 1997
Richard B. Mazess, Ph.D. Director (Principal
Executive Officer)
/s/ Robert A. Beckman Vice President of November 14, 1997
Robert A. Beckman Finance (Principal
Financial and
Accounting Officer)
/s/ Samuel E. Bradt Director November 14, 1997
Samuel E. Bradt
/s/ John W. Brown Director November 3, 1997
John W. Brown
/s/ Reed Coleman Director November 4, 1997
Reed Coleman
/s/ John J. McDonough Director November 14, 1997
John J. McDonough
/s/ Malcolm R. Powell Director November 3, 1997
Malcolm R. Powell, M.D.
EXHIBIT INDEX
Exhibit
Number
4.1 Articles of Amendment and Restated Articles of Incorporation of Lunar
Corporation, as amended. (1) (Exhibit 3.1)
4.2 By-laws of Lunar Corporation. (2) (Exhibit 3.2)
*5 Opinion of Charles V. Sweeney regarding the legality of the securities
being registered.
*8 Opinion of Sidley & Austin regarding certain tax matters.
*23.1 Consent of KPMG Peat Marwick LLP.
*23.2 Consent of Charles V. Sweeney. (included in Exhibit 5)
*23.3 Consent of Sidley & Austin. (included in Exhibit 8)
*24 Powers of Attorney. (included elsewhere herein)
*99.1 Lunar Corporation Amended and Restated Stock Option Plan.
*99.2 Form of Stock Option Agreements.
*filed herewith
(1) Incorporated by reference to exhibits filed with Registrant's Annual
Report on Form 10-K for the year ended June 30, 1996 (File No. 0-18643).
Parenthetical references to exhibit numbers are to the exhibit numbers on the
Form 10-K.
(2) Incorporated by reference to exhibits filed with Registrant's Form 10-Q
for the quarter ended December 31, 1996 (File No. 0-18643). Parenthetical
references to exhibit numbers are to the exhibit numbers on the Form 10-Q.
November 13, 1997
LUNAR Corporation
313 West Beltline Highway
Madison, WI 53713
Re: LUNAR Corporation 250,000 Shares
of Common Stock, $.01 par value per share
Ladies and Gentlemen:
I am Wisconsin counsel to LUNAR Corporation, a Wisconsin corporation (the
"Company"). I am familiar with the Registration Statement on Form S-3 (the
"Registration Statement") filed by the Company with the Securities and Exchange
Commission under the Securities Act of 1933, as amended, relating to the
registration of 250,000 shares of Common Stock, $.01 par value per share (the
"Shares"), of the Company to be issued to permitted transferees of participants
in the LUNAR Corporation Amended and Restated Stock Option Plan (the "Plan").
I am also familiar with the Articles of Amendment and Restated Articles of
Incorporation and the By-laws of the Company and the proceedings to date with
respect to the proposed issuance and sale of the Shares. In this connection, I
have examined originals or copies of originals certified to my satisfaction, of
such documents, certificates and records, have examined such questions of law
and have satisfied myself as to such matters of fact as I have considered
relevant and necessary as a basis for the opinions set forth herein. I have
assumed the authenticity of all documents submitted to me as originals, the
genuineness of all signatures, the legal capacity of all natural persons and the
conformity with the original documents of any copies thereof submitted to me for
my examination.
Based on the foregoing, I am of the opinion that:
1. The Company is duly incorporated and validly existing under the laws of
the State of Wisconsin.
2. The Shares will, when certificates representing the Shares shall have
been duly executed, countersigned and registered and delivered against
receipt by the Company of the consideration provided in the Plan, be
legally issued, fully paid and nonassessable, except to the extent that
such Shares are assessable as provided in Section 180.0622 of the
Wisconsin Business Corporation Law.
This opinion is limited to the laws of the State of Wisconsin. I do not find
it necessary for the purposes of this opinion to cover, and accordingly I
express no opinion as to, the application of the securities or blue sky laws of
the various states to the issuance and sale of the Shares.
I hereby consent to the filing of this opinion as an Exhibit to the
Registration Statement and to all references to me included in or made a part of
the Registration Statement.
Very truly yours,
/s/ Charles V. Sweeney
Charles V. Sweeney
Corporate General Counsel
[Letterhead of Sidley & Austin]
November 11, 1997
Lunar Corporation
313 West Beltline Highway
Madison, Wisconsin 53713
Ladies and Gentlemen:
We refer to the Registration Statement on Form S-3 (the "Registration
Statement"), including the prospectus (the "Prospectus") contained therein,
filed by Lunar Corporation, a Wisconsin corporation (the "Company"), with the
Securities and Exchange Commission under the Securities Act of 1933, as amended
(the "Securities Act"), relating to the registration of 250,000 Common Shares,
$.01 par value, of the Company which may be offered and sold to permitted
transferees of participants in the Lunar Corporation Amended and Restated Stock
Option Plan.
For purposes of this opinion we have also assumed, with your consent,
the authenticity of all documents submitted to us as originals, the genuineness
of all signatures, the legal capacity of all natural persons and the conformity
with original documents of all copies submitted to us for our examination.
In rendering the opinion expressed below, we have considered the
applicable provisions of the Internal Revenue Code of 1986, as amended (the
"Code"), regulations promulgated thereunder by the United States Treasury
Department (the "Regulations"), pertinent judicial authorities, rulings of the
Internal Revenue Service and such other authorities as we have considered
relevant. It should be noted that the Code, the Regulations and such judicial
decisions, administrative interpretations and other authorities are subject to
change at any time and, in some circumstances, with retroactive effect, and any
such change could affect the opinions stated herein.
Based upon and subject to the foregoing, it is our opinion that the
statements under the caption "Certain Federal Income Tax Consequences" in the
Prospectus, to the extent that they constitute matters of law or legal
conclusions, are correct in all material respects.
We assume no obligation to update or supplement this letter to
reflect any facts or circumstances which may hereafter come to our attention
with respect to the opinions expressed above, including any changes in
applicable law which may hereafter occur.
We hereby consent to the filing of this letter as an exhibit to the
Registration Statement and to all references to our Firm included in or made a
part of the Registration Statement.
Very truly yours,
Sidley & Austin
Consent of KPMG Peat Marwick LLP
The Board of Directors
Lunar Corporation:
We consent to incorporation by reference in the registration statement on Form
S-3 of Lunar Corporation of our reports dated August 2, 1997 relating to the
consolidated balance sheets of Lunar Corporation and subsidiaries as of June
30, 1997 and 1996, and the related consolidated statements of income,
shareholders' equity, and cash flows for each of the years in the three-year
period ended June 30, 1997, and related schedule, which reports appear in the
June 30, 1997 annual report on Form 10-K of Lunar Corporation.
KPMG Peat Marwick LLP
Chicago, Illinois
November 13, 1997
LUNAR CORPORATION
AMENDED AND RESTATED
STOCK OPTION PLAN
1. PLAN. To provide incentives to officers, key employees and consultants
of Lunar Corporation (the "Company"), its subsidiaries, and any other entity
(collectively "subsidiaries") designated by the Board of Directors of the
Company(the "Board"), and members of the Board to contribute to the success and
prosperity of the Company, based upon the ownership of the common stock, par
value $.01, of the Company ("Common Stock"), the Committee hereinafter
designated, may grant nonqualified stock options to officers, key employees,
consultants and eligible members of the Board on the terms and subject to the
conditions stated in this Plan.
2. ELIGIBILITY. Officers, key employees and consultants of the Company
and its subsidiaries and members of the Board who are not employees of the
Company ("non-employee directors") shall be eligible, upon selection by the
Committee, to receive stock options as the Committee, in its discretion, shall
determine.
3. SHARES ISSUABLE. The maximum number of shares of Common Stock to be
issued after the effective date of this Plan pursuant to all grants of stock
options hereunder shall be 1,000,000, subject to adjustment in accordance with
Section 5. Shares of Common Stock subject to a stock option granted hereunder,
which are not issued by reason of the expiration, cancellation or other
termination of such stock option, shall again be available for future grants of
stock options under this Plan.
Shares of Common Stock to be issued may be authorized and unissued shares
of Common Stock, treasury stock, or a combination thereof.
To the extent required by Section 162(m) of the Internal Revenue Code of
1986, as amended (the "Code"), and the rules and regulations thereunder, the
maximum number of shares of Common Stock with respect to which options may be
granted during any calendar year to any person shall be 100,000, subject to
adjustment as provided in Section 5.
4. ADMINISTRATION OF THE PLAN. This Plan shall be administered by a
committee designated by the Board (the "Committee") consisting of two or more
members of the Board, each of whom shall be a "Non-Employee Director" within the
meaning of Rule 16b-3 under the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), and an "outside director" within the meaning of Section 162(m)
of the Code.
The Committee shall, subject to the terms of this Plan, establish
eligibility guidelines, select officers, key employees, consultants and
non-employee directors for participation in this Plan and determine the number
of shares of Common Stock subject to a stock option granted hereunder, the
exercise price for such shares of Common Stock, the time and conditions of
vesting or exercise and all other terms and conditions of the stock option,
including, without limitation, the form of the option agreement. The Committee
may establish rules and regulations for the administration of the Plan,
interpret the Plan and impose, incidental to the grant of a stock option,
conditions with respect to the grant or award of stock options or competitive
employment or other activities not inconsistent with or conflicting with this
Plan. All such rules, regulations and interpretations relating to this Plan
adopted by the Committee shall be conclusive and binding on all parties. All
grants of stock options under this Plan shall be evidenced by written agreements
between the Company and the optionees, and no such grant shall be valid until so
evidenced.
5. CHANGES IN CAPITALIZATION. Appropriate adjustments shall be made by
the Committee in the maximum number of shares to be issued under the Plan and
the maximum number of shares which are subject to any stock option granted
hereunder, and the exercise price therefor, to give effect to any stock splits,
stock dividends and other relevant changes in the capitalization of the Company
occurring after the effective date of this Plan (which shall not include the
sale by the Company of shares of Common Stock or securities convertible into
shares of Common Stock).
6. EFFECTIVE DATE AND TERM OF PLAN. This Plan shall be submitted to the
shareholders of the Company for approval and, if approved, shall become
effective on the date thereof. This Plan shall terminate ten years after it
becomes effective unless terminated prior thereto by action of the Board. No
further grants shall be made under this Plan after termination, but termination
shall not affect the rights of any optionee under any grants made prior to
termination.
7. AMENDMENTS. This Plan may be amended by the Board in any respect,
except that no amendment may be made without shareholder approval if such
amendment would (a) increase the maximum number of shares of Common Stock
available for issuance under this Plan (other than as provided in Section 5) or
(b) otherwise require shareholder approval.
8. EXISTING STOCK OPTIONS. Stock options granted by the Company prior to
the date of shareholder approval of this Plan shall continue in effect in
accordance with their terms.
9. GRANTS OF STOCK OPTIONS. Options to purchase shares of Common Stock
may be granted hereunder to such eligible officers, key employees, consultants,
and non-employee directors as may be selected by the Committee.
10. OPTION PRICE. The option price per share of Common Stock purchasable
upon exercise of an option granted hereunder shall be determined by the
Committee; PROVIDED, HOWEVER, that the option price per share of Common Stock
purchasable upon exercise of an option granted under this Plan shall be 100% of
the fair market value of a share of Common Stock on the date of grant of such
option. For purposes hereof, "fair market value" shall be determined by the
Committee.
11. STOCK OPTION PERIOD. Each stock option granted hereunder may be
granted at any time on or after the effective date, and prior to the
termination, of this Plan. The Committee shall determine whether such stock
option shall become exercisable in cumulative or non-cumulative installments or
in full at any time. An exercisable stock option may be exercised in whole or
in part with respect to whole shares of Common Stock only. The period for the
exercise of each stock option shall be determined by the Committee.
12. EXERCISE OF STOCK OPTIONS. (a) Upon exercise, the option price may be
paid in cash, in shares of Common Stock having a fair market value on the date
of exercise equal to the option price, or in a combination thereof. The Company
may arrange or approve of a cashless option exercise procedure which complies
with the provisions of Section 16 of the Exchange Act and the rules and
regulations thereunder.
(b) An option may be exercised during an optionee's continued employment
with the Company or one of its subsidiaries, or service on the Board, as the
case may be, and, except in the event of such optionee's death, within a period
of 30 days following termination of such employment or service, but only to the
extent exercisable and within the term of such option at the time of the
termination of such employment or service; PROVIDED, HOWEVER, that if employment
of the optionee by the Company or one of its subsidiaries or service on the
Board shall have terminated by reason of retirement after age 60, then the
option may be exercised within a period not in excess of one year following such
termination of employment or service on the Board, but only to the extent
exercisable and within the term of such option at the time of such termination
of employment or service.
(c) No option shall be transferable except that (1) in the event of the
death of an optionee (i) during employment or service on the Board, as the case
may be, (ii) within a period of one year after termination of employment or
service on the Board, as the case may be, by reason of retirement after age 60
at a time when the option is otherwise exercisable or (iii) within 30 days after
termination of employment or service on the Board, as the case may be, for any
other reason, outstanding stock options may be exercised, but only to the extent
exercisable and within the term of such option prior to the application of this
Section 12, by the executor, administrator, personal representative, beneficiary
or similar person of such deceased optionee within one year of the death of such
optionee in the case of clauses (i) and (ii) or within 90 days of the death of
such optionee in the case of clause (iii) and (2) the Committee may consent to
the transfer or transferability of any particular option in the manner approved
by the Committee.
13. ACCELERATION OF OPTIONS UPON A CHANGE IN CONTROL. The following
provisions shall apply in the event of a "Change in Control":
(a) In the event of a Change in Control, any stock options not previously
exercisable in full shall become fully exercisable.
(b) For purposes hereof, "Change in Control" means:
(1) The acquisition by any individual, entity or group (a "Person"),
including any "person" within the meaning of Section 13(d)(3) or 14(d)(2) of the
Exchange Act, of beneficial ownership within the meaning of Rule 13d-3
promulgated under the Exchange Act, of 50% or more of the then outstanding
shares of Common Stock (the "Outstanding Common Stock"); PROVIDED, HOWEVER, that
the following acquisitions shall not constitute a Change in Control: (A) any
acquisition by the Company, (B) any acquisition by an employee benefit plan (or
related trust) sponsored or maintained by the Company or any corporation
controlled by the Company, (C) any acquisition by an underwriter or underwriters
as part of a BONA FIDE public distribution of securities of the Company or (D)
any acquisition by any Person which beneficially owned as of the effective date
of this Plan, 30% or more of the outstanding Common Stock; and PROVIDED FURTHER
that, for purposes of clause (A), if any Person (other than the Company or any
employee benefit plan (or related trust) sponsored or maintained by the Company
or any corporation controlled by the Company) shall become the beneficial owner
of 50% or more of the outstanding Common Stock by reason of an acquisition by
the Company and such Person shall, after such acquisition by the Company, become
the beneficial owner of any additional shares of the Outstanding Common Stock
and such beneficial ownership is publicly announced, such additional beneficial
ownership shall constitute a Change in Control;
(2) Individuals who, as of the date hereof, constitute the Board (the
"Incumbent Board") cease for any reason to constitute at least a majority of
such Board; PROVIDED, HOWEVER, that any individual who becomes a director of the
Company subsequent to the date hereof whose election, or nomination for election
by the Company's shareholders, was approved by the vote of at least a majority
of the directors then comprising the Incumbent Board shall be deemed to have
been a member of the Incumbent Board; and PROVIDED FURTHER, that no individual
who was initially elected as a director of the Company as a result of an actual
or threatened election contest, as such terms are used in Rule 14a-11 of
Regulation 14A promulgated under the Exchange Act, or any other actual or
threatened solicitation of proxies or consents by or on behalf of any Person
other than the Board shall be deemed to have been a member of the Incumbent
Board;
(3) Approval by the shareholders of the Company of a reorganization, merger
or consolidation unless, in any such case, immediately after such
reorganization, merger or consolidation, (i) more than 50% of the then
outstanding shares of common stock of the corporation resulting from such
reorganization, merger or consolidation and more than 50% of the combined voting
power of the then outstanding securities of such corporation entitled to vote
generally in the election of directors is then beneficially owned, directly or
indirectly, by all or substantially all of the individuals or entities who were
the beneficial owners, respectively, of the Outstanding Common Stock immediately
prior to such reorganization, merger or consolidation and in substantially the
same proportions relative to each other as their ownership, immediately prior to
such reorganization, merger or consolidation, of the Outstanding Common Stock,
(ii) no Person (other than the Company, any employee plan (or related trust)
sponsored or maintained by the Company or the corporation resulting from such
reorganization, merger or consolidation (or any corporation controlled by the
Company) and any Person which beneficially owned, immediately prior to such
reorganization, merger or consolidation, directly or indirectly, 30% or more of
the Outstanding Common Stock) beneficially owns, directly or indirectly, 50% or
more of the then outstanding shares of common stock of such corporation or 50%
or more of the combined voting power of the then outstanding securities of such
corporation entitled to vote generally in the election of directors and (iii) at
least a majority of the members of the Board of directors of the corporation
resulting from such reorganization, merger or consolidation were members of the
Incumbent Board at the time of the execution of the initial agreement or action
of the Board providing for such reorganization, merger or consolidation; or
(4) Approval by the shareholders of the Company of (i) a plan of complete
liquidation or dissolution of the Company or (ii) the sale or other disposition
of all or substantially all of the assets of the Company other than to a
corporation with respect to which, immediately after such sale or other
disposition, (A) more than 50% of the then outstanding shares of common stock
thereof and more than 50% of the combined voting power of the then outstanding
securities thereof entitled to vote generally in the election of directors is
then beneficially owned, directly or indirectly, by all or substantially all of
the individuals and entities who were the beneficial owners, respectively, of
the Outstanding Common Stock immediately prior to such sale or other disposition
and in substantially the same proportions relative to each other as their
ownership, immediately prior to such sale or other disposition, of the
Outstanding Common Stock, (B) no Person (other than the Company, any employee
benefit plan (or related trust) sponsored or maintained by the Company or such
corporation (or any corporation controlled by the Company) and any Person which
beneficially owned, immediately prior to such sale or other disposition,
directly or indirectly, 30% or more of the Outstanding Company Common Stock)
beneficially owns, directly or indirectly, 50% or more of the then outstanding
shares of common stock thereof or 50% or more of the combined voting power of
the then outstanding securities thereof entitled to vote generally in the
election of directors and (C) at least a majority of the members of the Board of
directors thereof were members of the Incumbent Board at the time of the
execution of the initial agreement or action of the Board providing for such
sale or other disposition.
LUNAR CORPORATION
NON-QUALIFIED STOCK OPTION
Lunar Corporation (the "Company") hereby irrevocably grants to ? (the
"Employee") an option to purchase from time to time all or any part of a total
of ? common shares of the Company, at a price of $? per share, upon the terms
and conditions set forth below.
This option is granted as of ? under the Lunar Corporation Amended and
Restated Stock Option Plan (herein called the "Plan") in consideration for
employee's agreement that any dispute with the company will be submitted
exclusively to arbitration according to the procedure described in Attachment
A hereto; and for the purpose of furnishing to the Employee an appropriate
incentive to improve operations and increase profits, and encourage the
Employee to continue employment with the Company and its subsidiaries.
The terms and conditions of the option are as follows:
1. This option may, but need not, be exercised in installments, but may
be exercised only to the extent, and within the time periods, described
below. During the lifetime of the Employee, it may be exercised only by
the Employee and (except as provided below) only while in the employ of
the Company or any of its subsidiaries.
2. The option may be exercised only after one year following the
granting date. Termination of employment in this one-year period will
terminate all rights under the option. After one year from the granting
date, one-fifth of the total number of shares covered by this option may
be exercised; after two years from the granting date, two-fifths of the
total number of shares covered by this option may be exercised; after
three years from the granting date, three-fifths of the total number of
shares covered by this option may be exercised; after four years from the
granting date, four-fifths of the total number of shares covered by this
option may be exercised; and after five years, this option shall be
exercisable in full. The right to purchase shall cumulate so that shares
may be purchased at any time after becoming eligible for purchase until
termination of the option.
3. Notwithstanding the foregoing provisions of this paragraph 2, this
option shall become fully exercisable in the event of a "Change in
Control" of the Company. A Change in Control is more fully defined in
the Plan Document, but includes:
(i) The sale or other disposition by the Company of all or substantially
all of its assets to a person, firm or other entity not controlling,
controlled by or under common control with the Company;
(ii) The sale or other disposition (including a merger or consolidation)
of capital stock of the Company if, as a consequence thereof,
capital stock representing more than 50% of the Company's total
voting power is sold or disposed of, in one or a series of related
transactions, to a person, firm or other entity not controlling,
controlled by, or under common control with the Company.
4. If employment with the Company terminates at a time when the Employee
is entitled to exercise all or a part of the option, for any reason other
than death, the option shall expire as of thirty (30) days after written
notice of termination; provided that if the termination of employment is
by reason of retirement (under a pension or retirement plan of the
Company or subsidiary), this option may be exercised by the Employee
within twelve months after the date of retirement but only to the extent
exercisable on said date of retirement. A leave of absence approved in
writing by the Human Resources Manager and the President shall not be
termination of employment for purposes of the Plan.
5. In the event of death of the Employee during employment or after
retirement at a time when this option is otherwise exercisable, the
option may be exercised within twelve months after such death, and only:
a. By the executor or administrator of the estate of the Employee
or the person or persons to whom rights under the option have
passed by will or the laws of descent and distribution; and
b. To the extent that the Employee was entitled to do so at the
date of death.
6. The option may not, under any circumstances, be exercised after
expiration of ten (10) years from the granting date.
7. No fractional share may be purchased under this option except in
combination with a fraction or fractions under another option or options
granted under the Program, and then only to the extent that such
combination equals a full share.
8. Nothing herein confers upon the Employee any right to continue in the
employ of the Company or of any subsidiary.
9. This option shall not be transferable or assignable, in whole or in
part, except (a) by will or by the laws of descent and distribution or
(b) as may be approved by the Committee. Subject to the foregoing, this
option may not be assigned, transferred (except as aforesaid), pledged,
or hypothecated in any way, whether by operation of law or otherwise, and
shall not be subject to execution, attachment, or similar process. Any
attempt at assignment, transfer, pledge, hypothecation, or other
disposition of this option contrary to the provisions hereof, and the
levy of any attachment or similar process upon this option, shall be null
and void and without effect.
10. The shares of common stock issuable to Optionee upon exercise of
this option ("Option Stock") are expressly subject to the terms of the
Bylaws of the corporation as may be amended by the Shareholders from time
to time. No transfer of Option Stock may be made except in accordance
with the provisions of the Bylaws. By accepting this option, Optionee
hereby agrees that, as an express condition to receiving shares of common
stock issuable upon exercise of this option, Optionee and his spouse will
execute whatever documents the Company requires so as to bind the
Optionee and his spouse, and the shares of common stock issuable upon
exercise of this option, to the terms of the Bylaws.
11. All terms and conditions of this option agreement are subject to and
shall be interpreted according to the terms of the Lunar Corporation
Amended and Restated Stock Option Plan (attached hereto).
12. Prior to the exercise of this option and as a condition to the
Company's obligation to deliver shares upon such exercise, the Optionee
shall make arrangements satisfactory to the Company for the payment of
any applicable federal or other withholding taxes payable as a result
thereof.
13. The option may be exercised only by delivering to the Secretary or
other designated employee of the Company a written notice of exercise,
specifying the number of common shares with respect to which the option
is then being exercised, and accompanied by payment of the full purchase
price of the shares being purchased in cash, or by the surrender of other
common shares of the Company held by the Employee having a then fair
market value equal to the purchase price, or a combination thereof, plus
payment in cash of the full amount of any taxes which the Company
believes are required to be withheld and paid with respect to such
exercise, and in the event the option is being exercised by a person or
persons other than the Employee, such appropriate tax clearance, proof of
the right of such person or persons to exercise the option, and other
pertinent data as the Company may deem necessary.
14. The Company shall issue a certificate or certificates for shares
purchased upon exercise of the option; however, the Company shall not be
required to issue or deliver any certificate for shares purchased pending
compliance with all applicable federal and state securities and other
laws (including any registration requirements) and compliance with rules
and practices of any stock exchange upon which the Company's common
shares are listed.
15. In the event that there is any change in the number of issued common
shares of the Company without new consideration to the Company (such as
by stock dividends or stock split-ups), then (i) the number of shares at
the time unexercised under this option shall be changed in proportion to
such change in issued shares; and (ii) the option price for the
unexercised portion of the option granted shall be adjusted so that the
aggregate consideration payable to the Company upon the purchase of all
shares not theretofore purchased shall not be changed.
If the outstanding common shares of the Company shall be combined, or be
changed into another kind of stock of the Company or into securities of
another corporation, whether through recapitalization, reorganization,
sale, merger, consolidation, etc., the Company shall cause adequate
provision to be made whereby the person or persons entitled to exercise
this option shall thereafter be entitled to receive, upon due exercise of
any portion of the option, the securities equivalent to those which that
person would have been entitled to receive for common shares acquired
through exercise of the same portion of such option immediately prior to
the effective date of such recapitalization, reorganization, sale,
merger, consolidation, etc. If appropriate, due adjustment shall be made
in the per-share or per-unit price of the securities purchased on
exercise of this option following said recapitalization, reorganization,
sale, merger, consolidation, etc.
16. Upon written request, the Company agrees to furnish the Optionee a
copy of its annual financial statements within 120 days after the end of
each fiscal year.
17. Neither this option, shares issued upon its exercise, any excess of
market value over option price, nor any other rights, benefits, values,
or interest resulting from the granting of this option shall be
considered as compensation for purposes of any pension or retirement
plan, insurance plan, investment or stock purchase plan, or any other
employee benefit plan of the Company or any of its subsidiaries.
18. Every notice or other communication relating to this Agreement shall
be in writing and shall be mailed to or delivered to the party for whom
it is intended in each case properly addressed, if to the Company at its
principal place of business, Attention: Corporate President, or if
mailed or delivered to the Optionee at his address set forth below his
signature to this Agreement (or to such other address as may hereafter be
designated in writing by either party to this Agreement to the other).
IN WITNESS WHEREOF, the Company has caused this option to be
executed by its duly authorized officers as of the granting date
above set forth.
_________________________________________________
President and Date
Chief Executive Officer
_________________________________________________
Attest
_________________________________________________
Secretary Date
_________________________________________________
Optionee: Date
Address:
