þ | ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
o | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
DELAWARE | 01-0393723 | |
(State or other jurisdiction of incorporation | (IRS Employer Identification No.) | |
or organization) | ||
ONE IDEXX DRIVE, WESTBROOK, MAINE | 04092 | |
(Address of principal executive offices) | (ZIP Code) |
Title of each class | Name of each exchange on which registered | |
Common Stock, $0.10 par value per share | NASDAQ Global Market |
Large accelerated filer þ | Accelerated filer o | Non-accelerated filer o | Smaller reporting company o | |||
(Do not check if a smaller reporting company) |
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Financial Statements and Supplementary Data Index to Consolidated Financial Statements | F-1 | |||||||
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Exhibit 31.1 | ||||||||
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Exhibit 32.1 | ||||||||
Exhibit 32.2 |
2
| Point-of-care veterinary diagnostic products, comprising rapid assays and instruments and consumables; | ||
| Laboratory and consulting services used by veterinarians; | ||
| Information products and services and digital radiography systems used by veterinarians; | ||
| Veterinary pharmaceutical products; | ||
| Diagnostic and health-monitoring products for production animals; | ||
| Products that test water for certain microbiological contaminants; | ||
| Products that test milk for antibiotic residues; and | ||
| Point-of-care electrolytes and blood gas analyzers used in the human medical diagnostics market. |
3
4
5
6
7
| An exclusive license from the Regents of the University of California to patents concerning diagnostic products for FIV that expire in 2009; and other patents covering various reagents, kits and/or immunoassays for detecting FIV antibodies that expire beginning in 2014; | ||
| Exclusive licenses from Tulane University and the University of Texas to patents and patent applications relating to the detection of Lyme disease that expire beginning in 2019; | ||
| A patent concerning the Colilert ® -18 product that expires in 2014; | ||
| A patent concerning the Quanti-Tray ® product that expires in 2014; | ||
| A patent that relates to certain methods and kits for simultaneously detecting antigens and antibodies, which covers certain of our SNAP ® products, including our SNAP ® Combo FIV/FELV and canine SNAP ® 3Dx ® and 4Dx ® combination tests, that expires in 2014; | ||
| An exclusive license from Boehringer Ingelheim to certain patents covering reagents and methods for detecting the PRRS virus that expire beginning in 2012; | ||
| An exclusive license from Cornell University to patents covering methods for detecting BVDV that expire beginning in 2017. |
8
| Veterinary diagnostic products and food and water testing products . We compete primarily on the basis of the ease of use, speed, accuracy, quality of the information provided, and other performance characteristics of our products and services (including unique tests), the breadth of our product line and services, the effectiveness of our sales and distribution channels, the quality of our technical and customer service, and our pricing relative to the value of our products. |
9
| Veterinary laboratory and consulting services . In this market, we compete primarily on the basis of quality, consistency of service levels, technology, and our pricing relative to the value of our services. We compete in most geographic locations in the U.S. with Antech Diagnostics, a unit of VCA Antech, Inc. | ||
| Veterinary pharmaceuticals . We compete primarily on the basis of the performance characteristics of our products. | ||
| Practice Information Management and Digital Radiography Systems . We compete primarily on the basis of functionality, connectivity to equipment and other systems, performance characteristics, effectiveness of our customer service, information handling capabilities, advances in technologies, and our pricing relative to the value of our products and services. | ||
| Electrolyte and Blood Gas Analyzers for the human medical diagnostics point-of-care market . In this market we compete primarily with large human medical diagnostics companies such as Radiometer A/S, Siemens Medical Solutions Diagnostics, Instrumentation Laboratory, Abbott Diagnostics, and Roche Diagnostics. We compete primarily on the basis of ease of use, menu, convenience, international distribution and service, instrument reliability, and our pricing relative to the value of our products. |
10
| Developing, manufacturing and marketing innovative new products with new features, functions and capabilities, including in-house laboratory analyzers such as Catalyst Dx and SNAPshot Dx, rapid assay and other specialized diagnostic tests and services, water testing products, production animal diagnostic products, and companion animal veterinary pharmaceuticals, as well as improving and enhancing existing products; | ||
| Developing and implementing new technology and licensing strategies; and identifying, completing and integrating acquisitions that enhance our existing businesses or create new business areas for us; |
11
| Increasing the value to our customers of our companion animal products and services by enhancing the integration of these products, including the interoperability among the IDEXX VetLab ® instrument suite, Cornerstone ® practice information management system, IDEXX VetLab ® Station, IDEXX-PACS software and IDEXX Reference Laboratories; | ||
| Expanding our market by expanding the installed base of our instrumentation through customer acquisition and retention and increasing use of our products by our customers; and | ||
| Strengthening our sales and marketing activities both within the U.S. and in geographies outside of the U.S. |
12
13
14
15
| 40,000 square feet of office and laboratory space located in the U.S., used for our Veterinary Reference Laboratory and Consulting Services business | ||
| 23,000 square feet of office and laboratory space located in the U.K., used for our Veterinary Reference Laboratory and Consulting Services business | ||
| 13,125 square feet of office and laboratory space located in Canada, used for our Veterinary Reference Laboratory and Consulting Services business |
| 308,000 total square feet of office and laboratory space located throughout the world, used for our Veterinary Reference Laboratory and Consulting Services business | ||
| 135,000 square feet of office space in Maine for Corporate, Customer Service and IT support services | ||
| 97,500 square feet of industrial space in Tennessee for distribution and warehousing | ||
| 60,000 square feet of office and manufacturing space in Georgia related to our OPTI Medical Systems business | ||
| 75,000 square feet of industrial space in the Netherlands for distribution and warehousing | ||
| 46,000 square feet of office space in the Netherlands which serves as our European headquarters | ||
| 43,000 square feet of office and manufacturing space in Wisconsin related to our Practice Information Systems and Services business | ||
| 32,700 total square feet of office and manufacturing space in France and Switzerland related to our Production Animal business | ||
| 21,000 square feet of office and research and development space in North Carolina related to our Veterinary Pharmaceuticals business | ||
| 7,600 square feet of office and manufacturing space in the U.K. related to our Water business |
16
17
18
Name
Age
Title
51
Chairman of the Board of Directors, President and Chief Executive
Officer
64
Senior Vice President and Chief Scientific Officer
46
Corporate Vice President, General Counsel and Secretary
39
Corporate Vice President
60
Corporate Vice President
49
Corporate Vice President
58
Corporate Vice President
54
Corporate Vice President
44
Corporate Vice President
52
Corporate Vice President, Chief Financial Officer and
Treasurer
40
Corporate Vice President
Table of Contents
Table of Contents
19
20
21
22
23
24
25
26
27
28
29
30
31
32
33
34
35
36
37
38
39
40
41
42
43
44
45
46
47
48
49
50
51
52
53
F-1
F-2
F-3
F-4
F-5
F-6
F-7
F-8
F-9
F-10
F-11
F-12
F-13
F-14
F-15
F-16
F-17
F-18
F-19
F-20
F-21
F-22
F-23
F-24
F-25
F-26
F-27
F-28
F-29
F-30
F-31
F-32
F-33
F-34
F-35
F-36
F-37
ITEM 5.
MARKET FOR THE REGISTRANTS COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER
PURCHASES OF EQUITY SECURITIES
Calendar Year
High
Low
$
44.08
$
39.10
47.97
42.96
57.94
47.38
64.22
53.71
$
43.18
$
35.50
42.75
37.07
47.18
36.35
47.58
39.60
Total Number of
Shares Purchased as
Maximum Number of
Part of Publicly
Shares that May Yet Be
Total Number of
Average Price
Announced Plans or
Purchased Under the
Shares Purchased
Paid per Share
Programs
Plans or Programs
Period
(a)
(b)
(c)
(d)
9,600
$
54.83
9,600
3,160,700
139,986
61.22
139,986
3,020,714
168,683
59.66
168,460
2,852,254
318,269
$
60.20
318,046
2,852,254
Table of Contents
December 31, 2007
Number of Securities
Remaining Available for
Number of Securities
Weighted Average
Future Issuance Under Equity
to be Issued Upon Exercise
Exercise Price of
Compensation Plans
of Outstanding Options,
Outstanding Options,
(Excluding Securities
Warrants and Rights
Warrants and Rights
Reflected in Column (a))
Plan Category
(a)
(b)
(c)
5,943,939
(1)
$
22.07
3,437,459
(2)
(1)
Consists of shares of common stock subject to outstanding options, restricted stock units and
deferred stock units under the following compensation plans: 1991 stock option plan (1,170,527
shares), 1998 stock incentive plan (1,696,602 shares), 2000 director option plan (55,250
shares) and 2003 stock incentive plan (3,021,560 shares). Excludes 143,171 shares issuable
under the 1997 employee stock purchase plan in connection with the current and future offering
periods.
(2)
Includes 3,294,288 shares available for issuance under our 2003 stock incentive plan. The
2003 stock incentive plan provides for the issuance of incentive stock options, nonqualified
stock options, stock appreciation rights, restricted stock unit awards and other stock unit
awards. Also includes 143,171 shares issuable under our 1997 employee stock purchase plan in
connection with the current and future offering periods. No new grants may be made under the
other plans listed in footnote (1) except for the 2003 stock incentive plan.
Table of Contents
12/31/2002
12/31/2003
12/31/2004
12/30/2005
12/29/2006
12/31/2007
$
100.00
$
140.93
$
166.26
$
219.18
$
241.47
$
357.06
100.00
145.03
166.71
196.36
194.09
218.39
100.00
131.31
160.73
178.35
193.56
229.83
100.00
149.52
162.72
166.18
182.57
197.98
Table of Contents
For the Years Ended December 31,
(in thousands, except per share data)
2007
2006
2005
2004
2003
$
922,555
$
739,117
$
638,095
$
549,181
$
475,992
459,033
359,588
315,195
270,164
245,688
463,522
379,529
322,900
279,017
230,304
151,882
115,882
101,990
85,710
71,846
108,119
82,097
64,631
49,870
45,752
67,338
53,617
40,948
35,402
32,319
136,183
127,933
115,331
108,035
80,387
(1,340
)
2,817
3,141
3,068
2,867
134,843
130,750
118,472
111,103
83,254
40,829
37,224
40,670
33,165
26,278
(152
)
(452
)
(394
)
(114
)
$
94,014
$
93,678
$
78,254
$
78,332
$
57,090
$
1.53
$
1.49
1.20
$
1.14
$
0.83
1.46
1.42
1.15
1.09
0.79
61,560
62,866
65,043
68,428
68,542
64,455
65,907
68,109
71,601
71,862
$
$
$
$
$
$
60,360
$
96,666
132,731
156,959
255,787
82,271
177,520
192,679
201,640
270,244
702,179
559,560
490,676
514,237
521,875
78,683
7,125
551
1,810
494
438,323
409,861
369,010
397,660
413,292
(1)
Share and per share amounts originally reported for 2006, 2005, 2004 and 2003 have been
adjusted as appropriate to reflect the effect of a two-for-one stock split, which was effected
in the form of a common stock dividend distributed on November 26, 2007.
Table of Contents
ITEM 7.
MANAGEMENTS DISCUSSION AND ANALYSES OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Table of Contents
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Table of Contents
Table of Contents
program design and award levels;
forecasted purchasing patterns of those enrolled in the program based on historical
experience with similar programs, current sales trends and market analyses;
inventory levels of eligible products in the distribution channel; and
estimated number of participants that will ultimately reach volume purchase
thresholds.
For the Years Ended December 31,
2007
2006
2005
$
10,399
$
7,145
$
3,862
6,623
5,089
4,780
(228
)
112
21
4,703
5,010
5,145
4,855
3,099
1,468
(14,398
)
(10,056
)
(8,131
)
$
11,954
$
10,399
$
7,145
$
1,429
$
1,422
$
2,176
4,334
4,936
5,070
95
81
(38
)
(641
)
(4,703
)
(5,010
)
(5,145
)
$
1,155
$
1,429
$
1,422
$
2,184
$
1,416
$
1,678
6,031
5,236
2,054
(85
)
(169
)
7
(4,855
)
(3,099
)
(1,468
)
(1,357
)
(1,228
)
(821
)
80
28
(34
)
$
1,998
$
2,184
$
1,416
(1)
SNAP
®
up the Savings and certain other customer program liabilities are settled through the
issuance of Practice Developer
®
points.
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Table of Contents
For the
For the
Year Ended
Year Ended
December 31,
December 31,
2007
2006
29
%
30
%
5.0
5.0
4.7
%
4.6
%
Table of Contents
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For the Year Ended December 31,
Percentage
Change Net of
Percentage
Percentage
Acquisitions
Net Revenue
Dollar
Percentage
Change from
Change from
and Currency
(dollars in thousands)
2007
2006
Change
Change
Currency (1)
Acquisitions (2)
Effect
$
752,463
$
606,319
$
146,144
24.1
%
2.7
%
6.0
%
15.4
%
66,235
58,466
7,769
13.3
%
3.5
%
9.8
%
75,085
58,940
16,145
27.4
%
7.4
%
12.4
%
7.6
%
28,772
15,392
13,380
86.9
%
3.4
%
82.7
%
0.8
%
$
922,555
$
739,117
$
183,438
24.8
%
3.2
%
7.6
%
14.0
%
(1)
Represents the percentage change in revenue attributed to the effect of changes in currency
rates from the year ended December 31, 2006 to the year ended December 31, 2007.
(2)
Represents the percentage change in revenue attributed to incremental revenues during the
year ended December 31, 2007 compared to the year ended December 31, 2006 from businesses
acquired subsequent to January 1, 2006.
For the Year Ended December 31,
Percentage
Change Net of
Percentage
Percentage
Acquisitions
Net Revenue
Dollar
Percentage
Change from
Change from
and Currency
(dollars in thousands)
2007
2006
Change
Change
Currency (1)
Acquisitions (2)
Effect
$
289,271
$
242,312
$
46,959
19.4
%
3.5
%
15.9
%
132,500
114,536
17,964
15.7
%
0.8
%
1.5
%
13.4
%
255,193
187,114
68,079
36.4
%
3.4
%
18.4
%
14.6
%
53,385
44,427
8,958
20.2
%
1.5
%
18.7
%
22,114
17,930
4,184
23.3
%
23.3
%
$
752,463
$
606,319
$
146,144
24.1
%
2.7
%
6.0
%
15.4
%
(1)
Represents the percentage change in revenue attributed to the effect of changes in currency
rates from the year ended December 31, 2006 to the year ended December 31, 2007.
(2)
Represents the percentage change in revenue attributed to incremental revenues during the
year ended December 31, 2007 compared to the year ended December 31, 2006 from businesses
acquired subsequent to January 1, 2006.
Table of Contents
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Table of Contents
For the Year Ended December 31,
Gross Profit
Percent of
Percent of
Dollar
Percentage
(dollars in thousands)
2007
Revenue
2006
Revenue
Change
Change
$
363,240
48.3
%
$
297,999
49.1
%
$
65,241
21.9
%
41,656
62.9
%
38,441
65.7
%
3,215
8.4
%
46,728
62.2
%
38,654
65.6
%
8,074
20.9
%
11,377
39.5
%
6,106
39.7
%
5,271
86.3
%
521
N/A
(1,671
)
N/A
2,192
N/A
$
463,522
50.2
%
$
379,529
51.3
%
$
83,993
22.1
%
Table of Contents
For the Year Ended December 31,
Operating Expenses
Percent of
Percent of
Dollar
Percentage
(dollars in thousands)
2007
Revenue
2006
Revenue
Change
Change
$
261,877
34.8
%
$
197,239
32.5
%
$
64,638
32.8
%
14,809
22.4
%
12,679
21.7
%
2,130
16.8
%
31,272
41.6
%
22,482
38.1
%
8,790
39.1
%
11,452
39.8
%
4,254
27.6
%
7,198
169.2
%
7,929
N/A
14,942
N/A
(7,013
)
(46.9
%)
$
327,339
35.5
%
$
251,596
34.0
%
$
75,743
30.1
%
Operating Income
Percent of
Percent of
Dollar
Percentage
(dollars in thousands)
2007
Revenue
2006
Revenue
Change
Change
$
101,363
13.5
%
$
100,760
16.6
%
$
603
.6
%
26,847
40.5
%
25,762
44.1
%
1,085
4.2
%
15,456
20.6
%
16,172
27.4
%
(716
)
(4.4
%)
(75
)
(0.3
%)
1,852
12.0
%
(1,927
)
(104.0
%)
(7,408
)
N/A
(16,613
)
N/A
9,205
55.4
%
$
136,183
14.8
%
$
127,933
17.3
%
$
8,250
6.4
%
For the Year Ended December 31,
Operating Expenses
Percent of
Percent of
Dollar
Percentage
(dollars in thousands)
2007
Revenue
2006
Revenue
Change
Change
$
128,593
17.1
%
$
98,748
16.3
%
$
29,845
30.2
%
87,179
11.6
%
60,267
9.9
%
26,912
44.7
%
46,105
6.1
%
38,224
6.3
%
7,881
20.6
%
$
261,877
34.8
%
$
197,239
32.5
%
$
64,638
32.8
%
Table of Contents
For the Year Ended December 31,
Operating Expenses
Percent of
Percent of
Dollar
Percentage
(dollars in thousands)
2007
Revenue
2006
Revenue
Change
Change
$
6,791
10.3
%
$
5,465
9.3
%
$
1,326
24.3
%
5,532
8.4
%
5,167
8.8
%
365
7.1
%
2,486
3.8
%
2,047
3.5
%
439
21.4
%
$
14,809
22.4
%
$
12,679
21.7
%
$
2,130
16.8
%
For the Year Ended December 31,
Operating Expenses
Percent of
Percent of
Dollar
Percentage
(dollars in thousands)
2007
Revenue
2006
Revenue
Change
Change
$
12,234
16.3
%
$
8,162
13.8
%
$
4,072
49.9
%
11,347
15.1
%
9,258
15.7
%
2,089
22.6
%
7,691
10.2
%
5,062
8.6
%
2,629
51.9
%
$
31,272
41.6
%
$
22,482
38.1
%
$
8,790
39.1
%
Table of Contents
Table of Contents
For the Year Ended December 31,
Percentage
Change Net of
Percentage
Percentage
Acquisitions
Net Revenue
Dollar
Percentage
Change from
Change from
and Currency
(dollars in thousands)
2006
2005
Change
Change
Currency (1)
Acquisitions (2)
Effect
$
606,319
$
520,830
$
85,489
16.4
%
0.3
%
2.4
%
13.7
%
58,466
56,760
1,706
3.0
%
0.8
%
2.2
%
58,940
44,945
13,995
31.1
%
0.9
%
30.2
%
15,392
15,560
(168
)
(1.1
%)
(0.1
%)
(1.0
%)
$
739,117
$
638,095
$
101,022
15.8
%
0.4
%
1.8
%
13.6
%
(1)
Represents the percentage change in revenue attributed to the effect of changes in currency
rates from the year ended December 31, 2005 to the year ended December 31, 2006.
(2)
Represents the percentage change in revenue attributed to incremental revenues during the
year ended December 31, 2006 compared to the year ended December 31, 2005 from businesses
acquired subsequent to January 1, 2005.
For the Year Ended December 31,
Percentage
Change Net of
Percentage
Percentage
Acquisitions
Net Revenue
Dollar
Percentage
Change from
Change from
and Currency
(dollars in thousands)
2006
2005
Change
Change
Currency (1)
Acquisitions (2)
Effect
$
242,312
$
217,537
$
24,775
11.4
%
0.5
%
10.9
%
114,536
100,255
14,281
14.2
%
(0.1
%)
1.6
%
12.7
%
187,114
156,425
30,689
19.6
%
0.2
%
4.5
%
14.9
%
44,427
32,589
11,838
36.3
%
0.9
%
11.5
%
23.9
%
17,930
14,024
3,906
27.9
%
27.9
%
$
606,319
$
520,830
$
85,489
16.4
%
0.3
%
2.4
%
13.7
%
(1)
Represents the percentage change in revenue attributed to the effect of changes in currency
rates from the year ended December 31, 2006 to the year ended December 31, 2005.
(2)
Represents the percentage change in revenue attributed to incremental revenues during the
year ended December 31, 2006 compared to the year ended December 31, 2005 from businesses
acquired subsequent to January 1, 2005.
Table of Contents
Table of Contents
For the Year Ended December 31,
Gross Profit
Percent of
Percent of
Dollar
Percentage
(dollars in thousands)
2006
Revenue
2005
Revenue
Change
Change
$
297,999
49.1
%
$
250,409
48.1
%
$
47,590
19.0
%
38,441
65.7
%
38,277
67.4
%
164
0.4
%
38,654
65.6
%
27,788
61.8
%
10,866
39.1
%
6,106
39.7
%
6,426
41.3
%
(320
)
(5.0
%)
(1,671
)
N/A
N/A
(1,671
)
N/A
$
379,529
51.3
%
$
322,900
50.6
%
$
56,629
17.5
%
Table of Contents
For the Year Ended December 31,
Operating Expenses
Percent of
Percent of
Dollar
Percentage
(dollars in thousands)
2006
Revenue
2005
Revenue
Change
Change
$
197,239
32.5
%
$
167,439
32.1
%
$
29,800
17.8
%
12,679
21.7
%
12,303
21.7
%
376
3.1
%
22,482
38.1
%
20,471
45.5
%
2,011
9.8
%
4,254
27.6
%
3,849
24.7
%
405
10.5
%
14,942
N/A
3,507
N/A
11,435
326.1
%
$
251,596
34.0
%
$
207,569
32.5
%
$
44,027
21.2
%
Operating Income
Percent of
Percent of
Dollar
Percentage
(dollars in thousands)
2006
Revenue
2005
Revenue
Change
Change
$
100,760
16.6
%
$
82,970
15.9
%
$
17,790
21.4
%
25,762
44.1
%
25,974
45.8
%
(212
)
(0.8
%)
16,172
27.4
%
7,317
16.3
%
8,855
121.0
%
1,852
12.0
%
2,577
16.6
%
(725
)
(28.1
%)
(16,613
)
N/A
(3,507
)
N/A
(13,106
)
(373.7
%)
$
127,933
17.3
%
$
115,331
18.1
%
$
12,602
10.9
%
For the Year Ended December 31,
Operating Expenses
Percent of
Percent of
Dollar
Percentage
(dollars in thousands)
2006
Revenue
2005
Revenue
Change
Change
$
98,748
16.3
%
$
87,421
16.8
%
$
11,327
13.0
%
60,267
9.9
%
50,194
9.6
%
10,073
20.1
%
38,224
6.3
%
29,824
5.7
%
8,400
28.2
%
$
197,239
32.5
%
$
167,439
32.1
%
$
29,800
17.8
%
Table of Contents
For the Year Ended December 31,
Operating Expenses
Percent of
Percent of
Dollar
Percentage
(dollars in thousands)
2006
Revenue
2005
Revenue
Change
Change
$
5,465
9.3
%
$
5,319
9.4
%
$
146
2.7
%
5,167
8.8
%
4,822
8.5
%
345
7.2
%
2,047
3.5
%
2,162
3.8
%
(115
)
(5.3
%)
$
12,679
21.7
%
$
12,303
21.7
%
$
376
3.1
%
For the Year Ended December 31,
Operating Expenses
Percent of
Percent of
Dollar
Percentage
(dollars in thousands)
2006
Revenue
2005
Revenue
Change
Change
$
8,162
13.8
%
$
7,280
16.2
%
$
882
12.1
%
9,258
15.7
%
8,146
18.1
%
1,112
13.7
%
5,062
8.6
%
5,045
11.2
%
17
0.3
%
$
22,482
38.1
%
$
20,471
45.5
%
$
2,011
9.8
%
Table of Contents
Table of Contents
For the Three Months
Ended December 31,
2007
2006
39
38
2.3
1.9
We have agreements with certain suppliers that require us to make minimum annual
inventory purchases, in some cases in order to retain exclusive distribution rights,
and we have other agreements with suppliers that provide for lower pricing based on
annual purchase volumes. We may place a higher volume of purchase orders for inventory
during the fourth quarter in order to meet our minimum commitments or realize volume
pricing discounts and we receive that inventory in the fourth or first quarters and pay
in the first quarter. The specific facts and circumstances that we consider in
determining the timing and level of inventory purchases throughout the year related to
these agreements may yield inconsistent cash flows from operations, most typically in
the first and fourth quarters.
We have management and non-management employee incentive programs that provide for
the payment of annual bonuses in the first quarter following the year for which the
bonuses were earned.
In the U.S., we pay our final income tax payments for each fiscal year on March
15
th
of the following year, in addition to paying our first quarter payment
for the current fiscal year. Our method of depositing estimated taxes delays a portion
of the payment relating to the preceding year until this final payment date and, as a
result, tax payments are higher in the first quarter of each year.
Table of Contents
Table of Contents
Table of Contents
(in thousands)
Total
2008
20092010
20112012
After 2012
$
7,998
$
1,091
$
2,181
$
2,181
$
2,545
54,549
9,498
15,731
11,076
18,244
262,575
238,991
23,584
10,926
2,136
3,018
2,932
2,840
3,621
2,921
700
$
339,669
$
254,637
$
45,214
$
16,189
$
23,629
(1)
Long-term debt amounts include interest payments associated with long-term debt.
(2)
Purchase obligations include agreements to purchase goods or services that are enforceable
and legally binding that specify all significant terms, including fixed or minimum quantities,
pricing, and approximate timing of purchase transactions.
Of this amount, $225.2
million represents amounts committed under purchase orders and $35.4 million represents our
minimum purchase obligation under our VetTest
®
supply agreement with Ortho.
(3)
Other long-term liabilities are liabilities that are reflected on our consolidated balance
sheet in this Annual Report on Form 10-K and include warranty obligations and commitments for
additional acquisition purchase price payments. These liabilities do not reflect unrecognized
tax benefits of $5.1 million as the timing of recognition is uncertain. Refer to Note 11 of
the consolidated financial statements for the year ended December 31, 2007 included in this
Annual Report on Form 10-K for additional discussion on unrecognized tax benefits.
Table of Contents
ITEM 9.
CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE
Pertain to the maintenance of records that in reasonable detail accurately and
fairly reflect the transactions and dispositions of the assets of the Company;
Provide reasonable assurance that transactions are recorded as necessary to permit
preparation of financial statements in accordance with generally accepted accounting
principles, and that receipts and expenditures of the company are being made only in
accordance with authorizations of management and directors of the Company; and
Provide reasonable assurance regarding prevention or timely detection of
unauthorized acquisition, use or disposition of the companys assets that could have a
material effect on the financial statements.
Table of Contents
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The financial statements set forth in the
Index to Consolidated Financial Statements
and the Consolidated Financial Statement
Schedule are filed as a part of this Annual
Report on Form 10-K commencing on page F-1.
The exhibits listed in the accompanying
Exhibit Index are filed as part of this
Annual Report on Form 10-K and incorporated
by reference herein.
Table of Contents
IDEXX LABORATORIES, INC.
By:
/s/ Jonathan W. Ayers
Date: February 27, 2008
Jonathan W. Ayers
President and Chief Executive Officer
SIGNATURE
TITLE
DATE
/s/ Jonathan W. Ayers
President, Chief Executive Officer and Chairman
of the Board of Directors
February 27, 2008
/s/ Merilee Raines
Corporate Vice President,
Chief
Financial Officer and Treasurer
(Principal Financial and Accounting Officer)
February 27, 2008
/s/ Thomas Craig
Director
February 27, 2008
Thomas Craig
/s/ Errol B. De Souza, PhD
Director
February 27, 2008
/s/ William T. End
Director
February 27, 2008
/s/ Rebecca M. Henderson, PhD
Director
February 27, 2008
/s/ Barry C. Johnson, PhD
Director
February 27, 2008
/s/ Brian P. McKeon
Director
February 27, 2008
/s/ Robert J. Murray
Director
February 27, 2008
Table of Contents
AND
CONSOLIDATED FINANCIAL STATEMENT SCHEDULE
Page No.
F-2
F-3
F-4
F-5
F-6
F-7
F-37
Table of Contents
Boston, Massachusetts
February 27, 2008
Table of Contents
(
in thousands, except per share amounts
)
December 31,
2007
2006
$
60,360
$
61,666
35,000
108,384
81,389
98,804
95,996
23,606
16,884
14,509
11,328
305,663
302,263
141,852
99,628
236,414
148,179
18,250
9,490
254,664
157,669
$
702,179
$
559,560
$
32,510
$
24,374
29,182
24,870
44,753
33,368
18,206
18,465
15,107
14,012
72,236
720
678
10,678
8,976
223,392
124,743
14,697
7,154
5,727
6,447
194
6,210
6,834
13,830
4,327
40,464
24,956
9,450
9,324
514,773
475,331
2,201
1,852
585,862
490,614
22,705
10,566
(696,668
)
(577,826
)
438,323
409,861
$
702,179
$
559,560
Table of Contents
(
in thousands, except per share amounts
)
For the Years Ended December 31,
2007
2006
2005
$
632,186
$
525,352
$
460,495
290,369
213,765
177,600
922,555
739,117
638,095
260,296
215,314
194,252
198,737
144,274
120,943
459,033
359,588
315,195
463,522
379,529
322,900
151,882
115,882
101,990
108,119
82,097
64,631
67,338
53,617
40,948
136,183
127,933
115,331
(4,179
)
(462
)
(96
)
2,839
3,279
3,237
134,843
130,750
118,472
40,829
37,224
40,670
(152
)
(452
)
$
94,014
$
93,678
$
78,254
$
1.53
$
1.49
$
1.20
$
1.46
$
1.42
$
1.15
61,560
62,866
65,043
64,455
65,907
68,109
Table of Contents
(
in thousands, except per share amounts
)
Accumulated
Common Stock
Additional
Other
Total
Number of
$ 0.10
Paid-in
Deferred
Retained
Comprehensive
Treasury
Stockholders
Shares
Par Value
Capital
Stock Units
Earnings
Income (Loss)
Stock
Equity
90,435
$
9,044
$
406,295
$
665
$
318,682
$
11,301
$
(348,327
)
$
397,660
78,254
78,254
23
23
3,403
3,403
(13,861
)
(13,861
)
67,819
(123,769
)
(123,769
)
1,442
144
26,505
26,649
651
651
91,877
9,188
432,800
1,316
396,936
866
(472,096
)
369,010
93,678
93,678
46
46
(1,873
)
(1,873
)
11,527
11,527
103,378
(105,730
)
(105,730
)
1,361
136
31,894
32,030
4
123
(123
)
659
659
10,514
10,514
93,242
9,324
475,331
1,852
490,614
10,566
(577,826
)
409,861
(260
)
1,234
974
94,014
94,014
(182
)
(182
)
19
19
12,302
12,302
106,153
(118,842
)
(118,842
)
1,231
123
31,565
31,688
31
3
29
(32
)
381
381
8,108
8,108
94,504
$
9,450
$
514,773
$
2,201
$
585,862
$
22,705
$
(696,668
)
$
438,323
Table of Contents
(in thousands)
For the Years Ended December 31,
2007
2006
2005
$
94,014
$
93,678
$
78,254
41,100
29,816
24,369
(166
)
10,138
350
(152
)
(452
)
614
1,070
121
(9,074
)
(6,135
)
(4,477
)
8,776
10,842
184
(9,267
)
(9,407
)
7,808
(25,535
)
(6,583
)
(9,300
)
(5,230
)
(25,679
)
7,433
(8,558
)
158
(2,244
)
5,851
4,352
4,901
31,924
17,882
10,184
537
(366
)
(229
)
135,124
109,826
116,552
(79,810
)
(63,619
)
35,000
110,465
107,880
(65,138
)
(32,331
)
(24,199
)
(12,084
)
2,751
(1,106
)
(1,720
)
(2,615
)
(89,884
)
(25,220
)
(7,604
)
(121,128
)
(40,700
)
12,594
72,389
(2,397
)
(877
)
(2,057
)
(118,387
)
(105,711
)
(123,769
)
20,941
20,922
18,841
9,267
9,407
(18,187
)
(76,259
)
(106,985
)
2,885
1,648
(2,166
)
(1,306
)
(5,485
)
19,995
61,666
67,151
47,156
$
60,360
$
61,666
$
67,151
$
4,142
$
498
$
40
$
36,662
$
36,100
$
34,346
$
455
$
18
$
22
$
1,707
$
3,850
Table of Contents
Table of Contents
Asset Classification
Estimated
Useful Life
15 years
1540 years
Shorter of life of
lease or useful life
35 years
37 years
Estimated
Asset Classification
Useful Life
815 years
215 years
215 years
210 years
Table of Contents
For the Years Ended December 31,
2007
2006
$
1,978
$
3,159
2,133
1,625
86
(38
)
(474
)
(2,492
)
(2,332
)
1,667
1,978
194
$
1,667
$
1,784
Table of Contents
We recognize revenue at the time of shipment to U.S. distributors for substantially
all products sold through distributors as title and risk of loss pass to these
customers on delivery to the common carrier. Our distributors do not have the right to
return products. We recognize revenue for the remainder of our customers when the
product is delivered to the customer except as noted below.
We recognize revenue from the sales of instruments, noncancelable software licenses
and hardware systems upon installation (and completion of training if applicable) and
the customers acceptance of the instrument or system because at this time we have no
significant further obligations.
We recognize service revenue at the time the service is performed.
We recognize revenue associated with extended maintenance agreements over the life
of the contracts using the straight-line method, which approximates the expected timing
in which applicable services are performed. Amounts collected in advance of revenue
recognition are recorded as a current or long-term liability based on the time from the
balance sheet date to the future date of revenue recognition.
We recognize revenue on certain instrument systems under rental programs over the
life of the rental agreement using the straight-line method. Amounts collected in
advance of revenue recognition are recorded as a current or long-term liability based
on the time from the balance sheet date to the future date of revenue recognition.
We recognize revenue on certain instruments and practice information management
systems sales, where the product includes software that is considered more than
incidental to the utility and value of the product, by allocating the revenue to each
element of the sale based on relative fair values of the elements including
post-contract support. We recognize revenue for the instrument or system on
installation and customer acceptance and recognize revenue equal to the fair value of
the software update rights and post-contract support over the support period.
Shipping costs reimbursed by the customer are included in revenue.
Table of Contents
Table of Contents
Table of Contents
Currency Sold
U.S. Dollar Equivalent
2007
2006
$
60,965
$
47,918
24,198
20,650
17,000
12,974
1,188
6,262
4,451
5,414
4,560
$
115,027
$
90,553
Currency Purchased
U.S. Dollar Equivalent
2007
2006
$
6,604
$
6,689
436
65
$
7,040
$
6,754
Table of Contents
December 31,
2007
2006
$
(182
)
$
(1,301
)
(1,320
)
24,188
11,886
$
22,705
$
10,566
Table of Contents
Table of Contents
Table of Contents
For the Year Ended December 31,
2007
2006
$
710
$
1,671
7,851
8,986
8,561
10,657
(1,968
)
(1,845
)
(313
)
(57
)
(2,281
)
(1,902
)
$
6,280
$
8,755
$
0.10
$
0.14
$
0.10
$
0.13
For the Year Ended
December 31, 2005
$
78,254
(8,701
)
$
69,553
$
1.20
1.07
1.15
1.02
Table of Contents
For the Years Ended December 31,
2007
2006
2005
$
20,941
$
20,922
$
18,841
$
11,103
$
10,692
$
7,808
Table of Contents
Weighted
Average
Weighted
Remaining
Aggregate
Number of
Average
Contractual
Intrinsic Value
Options (000)
Exercise Price
Term
($000)
6,275
$
19.01
553
44.85
(1,176
)
15.62
(141
)
29.27
(3
)
13.84
5,508
$
22.07
5.1
$
201,379
3,559
$
16.54
4.4
$
149,768
5,388
$
21.71
5.0
$
198,943
Table of Contents
For the Six Months
Ended June 30, 2005
33.0
%
0.5
3.4
%
None
For the Year Ended December 31,
2007
2006
2005
61
62
77
$
7.47
$
6.24
$
6.16
Table of Contents
Weighted
Average
Number
Remaining
Aggregate
of Units
Contractual
Intrinsic Value
(000)
Term
($000)
172
243
(44
)
(18
)
353
1.9
$
20,549
353
1.9
20,549
Table of Contents
December 31,
2007
2006
$
35,537
$
33,199
16,425
13,804
46,842
48,993
$
98,804
$
95,996
December 31,
2007
2006
$
7,754
$
6,062
54,072
50,105
16,737
11,454
92,139
72,146
61,472
43,632
23,002
8,139
255,176
191,538
113,324
91,910
$
141,852
$
99,628
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December 31,
Description
2007
2006
$
6,644
$
3,253
495
3,121
11,111
3,116
$
18,250
$
9,490
December 31, 2007
December 31, 2006
Accumulated
Accumulated
Cost
Amortization
Cost
Amortization
$
10,895
$
4,003
$
10,491
$
2,932
27,838
10,428
18,743
7,660
57,907
8,011
25,955
3,496
6,416
2,299
3,521
1,269
$
103,056
$
24,741
$
58,710
$
15,357
Table of Contents
Amortization
Expense
$
9,940
9,172
8,654
8,049
7,427
December 31,
December 31,
2007
2006
$
131,004
$
80,752
17,566
17,282
9,529
6,792
$
158,099
$
104,826
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Years Ending December 31,
Amount
$
720
765
813
864
917
2,368
$
6,447
Table of Contents
$
9,813
(3,932
)
1,126
(1,710
)
(293
)
82
$
5,086
For the Years Ended December 31,
2007
2006
2005
$
92,554
$
100,445
$
85,401
42,289
30,457
33,523
$
134,843
$
130,902
$
118,924
Table of Contents
For the Years Ended December 31,
2007
2006
2005
$
38,077
$
35,409
$
30,070
3,398
5,512
4,680
8,429
2,438
10,397
49,904
43,359
45,147
(8,507
)
(4,064
)
(3,020
)
754
(555
)
(277
)
(1,322
)
(1,516
)
(1,180
)
(9,075
)
(6,135
)
(4,477
)
$
40,829
$
37,224
$
40,670
For the Years Ended December 31,
2007
2006
2005
35.0
%
35.0
%
35.0
%
1.4
2.3
2.4
(4.7
)
(4.5
)
(1.9
)
(1.0
)
(0.6
)
(0.5
)
(0.6
)
(1.3
)
(0.4
)
(0.5
)
(1.5
)
(0.3
)
(0.5
)
0.5
1.4
(2.2
)
0.4
30.3
%
28.4
%
34.2
%
Table of Contents
2007
2006
Current
Long-Term
Current
Long-Term
$
11,345
$
1,484
$
9,188
$
583
401
2,805
1,914
2,482
1,989
7,348
3,409
1,998
1,475
596
3,413
784
1,750
93
191
20
5
167
4,179
4,019
732
659
23,669
13,179
16,943
9,238
(203
)
(4,038
)
(59
)
(4,015
)
23,466
9,141
16,884
5,223
(380
)
(774
)
(804
)
(297
)
(15,867
)
(7,920
)
(121
)
(107
)
(147
)
(121
)
(17,051
)
(107
)
(9,138
)
$
23,345
(7,910
)
$
16,777
$
(3,915
)
Table of Contents
For the Years Ended December 31,
2007
2006
2005
61,481
62,806
64,998
79
60
45
61,560
62,866
65,043
61,560
62,866
65,043
2,807
3,014
3,066
77
16
11
11
64,455
65,907
68,109
For the Years Ended December 31,
2007
2006
2005
492
277
$
44.66
$
38.33
$
4
4
December 31,
2007
2006
$
58.63
$
39.65
5,508
6,276
5,508
6,276
Table of Contents
Years Ending December 31,
Amount
$
9,498
8,461
7,270
5,868
5,208
18,244
$
54,549
Table of Contents
Table of Contents
Table of Contents
For the Years Ended December 31,
2007
2006
2005
2,588
2,675
3,986
$
118,842
$
105,730
$
123,769
$
45.93
$
39.51
$
31.05
Table of Contents
For the Years Ended December 31,
Unallocated
Consolidated
CAG
Water
PAS
Other
Amounts
Total
$
752,463
$
66,235
$
75,085
$
28,772
$
$
922,555
$
101,363
$
26,847
$
15,456
(75
)
$
(7,408
)
$
136,183
(1,340
)
134,843
40,829
$
94,014
$
34,813
$
1,116
$
4,116
$
1,055
$
$
41,100
483,142
38,178
51,719
18,321
110,819
702,179
61,698
1,400
3,896
2,626
69,620
$
606,319
$
58,466
$
58,940
$
15,392
$
$
739,117
$
100,760
$
25,762
$
16,172
$
1,852
$
(16,613
)
$
127,933
2,817
130,750
37,224
(152
)
$
93,678
$
25,643
$
647
$
3,456
$
70
$
$
29,816
353,585
35,042
38,516
4,184
128,233
559,560
49,448
2,345
2,352
13
54,158
$
520,830
$
56,760
$
44,945
$
15,560
$
$
638,095
$
82,970
$
25,974
$
7,317
$
2,577
$
(3,507
)
$
115,331
3,141
118,472
40,670
(452
)
$
78,254
$
21,236
$
447
$
2,667
$
19
$
$
24,369
266,207
29,685
34,107
3,981
156,696
490,676
23,402
119
1,172
139
24,832
(1)
Expenditures for long-lived assets exclude expenditures for intangible assets. See Note 3 for
information regarding acquisitions of goodwill and other intangible assets in connection with
business acquisitions. Expenditures for long-lived assets for the year ended December 31, 2007
include $1.7 million, $1.5 million and $1.3 million for property acquired in connection with
PAS, Other operating segments and CAG business acquisitions, respectively. Expenditures for
long-lived assets for the year ended December 31, 2006 include $2.5 million for property
acquired in connection with CAG business acquisitions and $19.0 million related to the
purchase of our Westbrook, Maine headquarters facility, of which $7.5 million was financed
through the assumption of a mortgage. Expenditures for long-lived assets for the year ended
December 31, 2005 include $0.6 million for property acquired in connection with CAG business
acquisitions.
Table of Contents
For the Years Ended December 31,
2007
2006
2005
$
289,271
$
242,312
$
217,537
132,500
114,536
100,255
255,193
187,114
156,425
53,385
44,427
32,589
22,114
17,930
14,024
752,463
606,319
520,830
66,235
58,466
56,760
75,085
58,940
44,945
28,772
15,392
15,560
$
922,555
$
739,117
$
638,095
For the Years Ended December 31,
2007
2006
2005
$
552,134
$
478,172
$
418,565
55,884
22,070
18,428
11,777
6,076
6,235
619,795
506,318
443,228
60,831
53,296
46,419
54,538
45,391
38,994
43,398
26,884
19,300
82,204
62,251
49,468
240,971
187,822
154,181
25,216
19,271
17,531
22,506
17,378
15,618
14,067
8,328
7,537
61,789
44,977
40,686
$
922,555
$
739,117
$
638,095
Table of Contents
December 31,
2007
2006
2005
$
112,712
$
77,648
$
50,276
5,513
2,434
174
118,225
80,082
50,450
8,713
8,655
6,959
3,677
3,203
2,865
3,770
3,585
1,984
2,578
782
78
2,457
1,398
1,588
438
318
80
21,633
17,941
13,554
496
468
386
1,187
839
715
311
298
592
1,994
1,605
1,693
$
141,852
$
99,628
$
65,697
For the Quarters Ended
March 31,
June 30,
September 30,
December 31,
$
211,155
$
237,046
$
229,385
$
244,969
108,579
114,221
118,478
122,244
30,877
32,467
36,097
36,742
21,027
21,664
25,795
25,528
$
0.34
$
0.35
$
0.42
$
0.42
$
0.32
$
0.34
$
0.40
$
0.40
$
168,164
$
191,364
$
187,380
$
192,209
86,025
99,036
98,199
96,269
26,975
37,026
34,462
29,470
18,273
25,780
24,953
24,672
$
0.29
$
0.41
$
0.40
$
0.39
$
0.27
$
0.39
$
0.38
$
0.38
Table of Contents
(
in thousands
)
Balance at
Charges to
Write-Offs/
Balance at
Beginning
Costs and
Cash
End
of Year
Expenses
Payments
of Year
$
1,494
$
121
$
394
$
1,221
1,221
1,070
508
1,783
1,783
614
655
1,742
$
4,943
$
541
$
588
$
4,896
4,896
(88
)
734
4,074
4,074
545
378
4,241
Table of Contents
Exhibit No.
Description
3.1
3.2
4.3
10.1
10.2*
10.3*
10.4*
10.5*
10.6*
10.7*
10.8*
10.9
10.10
10.11
10.12
10.13
10.14
Table of Contents
Exhibit No.
Description
10.15
10.16
10.17
10.18
10.19
10.20
10.21
10.22
10.23
10.24
10.25
10.26
10.27
10.28
10.29
10.30
Table of Contents
Exhibit No.
Description
21
23
31.1
31.2
32.1
32.2
*
ORTHO-CLINICAL DIAGNOSTICS, INC. | IDEXX OPERATIONS, INC. | |||||||
|
||||||||
By:
|
/s/ Tony Zezzo | By: | /s/ William C. Wallen | |||||
|
||||||||
|
Name: Tony Zezzo | Name: William C. Wallen | ||||||
|
Title: V.P. North America Sales | Title: Chief Scientific Officer |
The foregoing Amendment No. 2 to the Agreement
dated as of October 16, 2003 between IDEXX
Operations, Inc. and Ortho-Clinical Diagnostics,
Inc. is hereby consented to and acknowledged by:
IDEXX LABORATORIES, INC., solely as guarantor pursuant to Section 30 of the Agreement |
||||
By: | /s/ William C. Wallen | |||
Name: | William C. Wallen | |||
Title: | Chief Scientific Officer | |||
ORTHO-CLINICAL DIAGNOSTICS, INC. | IDEXX OPERATIONS, INC. | |||||||
|
||||||||
By:
|
/s/ Tony Zezzo | By: | /s/ Irene C. Kerr | |||||
|
||||||||
|
Name: Tony Zezzo | Name: Irene C. Kerr | ||||||
|
Title: V.P. Americas | Title: President |
The foregoing Amendment No. 3 to the Agreement
dated as of October 16, 2003 between IDEXX
Operations, Inc. and Ortho-Clinical
Diagnostics, Inc. is hereby consented to and
acknowledged by:
IDEXX LABORATORIES, INC., solely as guarantor pursuant to Section 30 of the Agreement |
||||
By: | /s/ Jonathan W. Ayers | |||
Name: | Jonathan W. Ayers | |||
Title: | President and CEO | |||
ORTHO-CLINICAL DIAGNOSTICS, INC. | IDEXX EUROPE B.V. | |||||||
|
||||||||
By:
|
/s/ Tony Zezzo | By: | /s/ Conan R. Deady | |||||
|
||||||||
|
Name: Tony Zezzo | Name: Conan R. Deady | ||||||
|
Title: V.P. Americas | Title: Director |
The foregoing Amendment No. 2 to the Agreement
dated as of October 17, 2003 between IDEXX
Europe B.V. and Ortho-Clinical Diagnostics,
Inc. is hereby consented to and acknowledged
by:
IDEXX LABORATORIES, INC., solely as guarantor pursuant to Section 30 of the Agreement |
||||
By: | /s/ Jonathan W. Ayers | |||
Name: | Jonathan W. Ayers | |||
Title: | President and CEO | |||
2
3
4
5
6
Exhibit 10.20
IDEXX LABORATORIES, INC.
2003 STOCK INCENTIVE PLAN
(Adjusted to reflect 2-for-1 stock split effective November 5, 2007)
SECTION 1. PURPOSE. The purposes of the 2003 Stock Incentive Plan (the Plan) are to encourage selected employees and Directors of IDEXX Laboratories, Inc., a Delaware corporation (the Company), and its Affiliates to acquire a vested interest in the growth and performance of the Company, to generate an increased incentive to contribute to the Companys future success and prosperity, thus enhancing the value of the Company for the benefit of stockholders, and to enhance the ability of the Company and its Affiliates to attract and retain individuals of exceptional talent upon whom, in large measure, the sustained progress, growth and profitability of the Company depends.
SECTION 2. DEFINITIONS. As used in the Plan, the following terms shall have the meanings set forth below:
(a) Affiliate shall mean (i) any Person that directly, or through one or more intermediaries, controls, or is controlled by, or is under common control with, the Company or (ii) any entity in which the Company has a significant equity interest, as determined by the Board.
(b) Award shall mean any Option, Stock Appreciation Right, Restricted Stock Award, dividend equivalent, Other Stock Unit Award or any other right, interest or option relating to Shares or other property granted pursuant to the provisions of the Plan.
(c) Award Agreement shall mean any agreement, contract or other instrument or document evidencing any Award granted by the Board hereunder, in such form (written, electronic or otherwise) as the Board shall determine, which may, but need not, be executed or acknowledged by both the Company and the Participant.
(d) Board shall mean the Board of Directors of the Company.
(e) Change in Control shall mean the occurrence of any of the following events:
(i) an acquisition by any individual, entity or group (within the meaning of Section 13(d)(3) or 14(d)(2) of the Exchange Act) (an Entity) of beneficial ownership (within the meaning of Rule 13d-3 promulgated under the Exchange Act) of 30% or more of either (A) the then outstanding Shares (the Outstanding Company Common Stock) or (B) the combined voting power of the then outstanding voting securities of the Company entitled to vote generally in the election of directors (the Outstanding Company Voting Securities); excluding, however, the following: (1) any acquisition directly from the Company, other than an acquisition by virtue of the exercise of a conversion privilege unless the security being so converted was itself acquired directly from the Company, (2) any acquisition by the Company, (3) any acquisition by any employee benefit plan (or related trust) sponsored or maintained by the Company or any corporation controlled by the Company, or (4) any acquisition by any corporation pursuant to a transaction that complies with clauses (A), (B) and (C) of Section 2(e)(iii);
(ii) a change in the composition of the Board on the Plans effective date such that the individuals who, as of the effective date, constitute the Board (such Board shall be hereinafter referred to as the Incumbent Board) cease for any reason to constitute at least a majority of the Board; provided , however , that for purposes of this definition, any individual who becomes a member of the Board subsequent to the effective date, whose election, or nomination for election, by the Companys stockholders was approved by a vote of at least a majority of those individuals who are members of the Board and who were also members of the Incumbent Board (or deemed to be such pursuant to this proviso) shall be considered as though such individual were a member of the Incumbent Board; and provided further , however , that any such individual whose initial assumption of office occurs as a result of or in connection with either an actual or threatened solicitation with respect to the election of directors (as such terms are used in Rule 14a-12(c) of Regulation 14A promulgated under the Exchange Act) or other actual or threatened solicitation of proxies or consents by or on behalf of an Entity other than the Board shall not be so considered as a member of the Incumbent Board;
1
(iii) the consummation of a merger, reorganization or consolidation or sale or other disposition of all or substantially all of the assets of the Company (each, a Corporate Transaction), excluding however, any Corporate Transaction pursuant to which (A) all or substantially all of the individuals and entities who are the beneficial owners, respectively, of the Outstanding Company Common Stock and Outstanding Company Voting Securities immediately prior to such Corporate Transaction will beneficially own, directly or indirectly, more than 60% of, respectively, the outstanding shares of common stock, and the combined voting power of the then outstanding voting securities entitled to vote generally in the election of directors, as the case may be, of the corporation resulting from such Corporate Transaction (including, without limitation, a corporation or other Person that as a result of such transaction owns the Company or all or substantially all of the Companys assets either directly or through one or more subsidiaries (a Parent Company)) in substantially the same proportions as their ownership, immediately prior to such Corporate Transaction, of the Outstanding Company Common Stock and Outstanding Company Voting Securities, as the case may be, (B) no Entity (other than the Company, any employee benefit plan (or related trust) of the Company, such corporation resulting from such Corporate Transaction or, if reference was made to equity ownership of any Parent Company for purposes of determining whether clause (A) above is satisfied in connection with the applicable Corporate Transaction, such Parent Company) will beneficially own, directly or indirectly, 30% or more of, respectively, the outstanding shares of common stock of the corporation resulting from such Corporate Transaction or the combined voting power of the outstanding voting securities of such corporation entitled to vote generally in the election of directors unless such ownership resulted solely from ownership of securities of the Company prior to the Corporate Transaction, and (C) individuals who were members of the Incumbent Board will immediately after the consummation of the Corporate Transaction constitute at least half of the members of the board of directors of the corporation resulting from such Corporate Transaction (or, if reference was made to equity ownership of any Parent Company for purposes of determining whether clause (A) above is satisfied in connection with the applicable Corporate Transaction, of the Parent Company); or
(iv) the approval by the stockholders of the Company of a complete liquidation or dissolution of the Company.
(f) Code shall mean the Internal Revenue Code of 1986, as amended from time to time, and any successor thereto.
(g) Compensation Committee shall mean the Compensation Committee of the Board, or any successor to such committee, composed of no fewer than two directors, each of whom is a non-employee Director within the meaning of Rule 16b-3(b)(3) of the Exchange Act, an outside director within the meaning of Section 162(m) of the Code, or any successor provision thereto, and independent under the rules of the NASDAQ Global Market.
(h) Company shall mean IDEXX Laboratories, Inc., a Delaware corporation.
(i) Covered Employee shall mean a covered employee within the meaning of Section 162(m)(3) of the Code, or any successor provision thereto.
(j) Director shall mean a member of the Board who is not an Employee.
(k) Employee shall mean any employee of the Company or any Affiliate.
(l) Exchange Act shall mean the Securities Exchange Act of 1934, as amended.
(m) Fair Market Value shall mean, with respect to any property other than Shares, the market value of such property determined by such methods or procedures as shall be established from time to time by the Board. Unless otherwise determined by the Board, the Fair Market Value of Shares as of any date shall be the last reported sales price for the Shares as reported on the NASDAQ Global Market (or on any national securities exchange on the Shares are then listed) for that date or, if no such price is reported for that date, the last reported sales price on the next preceding date for which such price was reported.
2
2
(n) Incentive Stock Option shall mean an Option granted under Section 6 that is intended to meet the requirements of Section 422 of the Code or any successor provision thereto.
(o) Nonstatutory Stock Option shall mean an Option granted under Section 6 that is not intended to be an Incentive Stock Option.
(p) Option shall mean any right granted to a Participant under the Plan allowing such Participant to purchase Shares at such price or prices and during such period or periods as the Board shall determine.
(q) Other Stock Unit Award shall mean any right granted to a Participant by the Board pursuant to Section 9.
(r) Participant shall mean an Employee or Director who is selected by the Board to receive an Award under the Plan.
(s) Person shall mean any individual, corporation, partnership, association, limited liability company, joint-stock company, trust, unincorporated organization or government or political subdivision thereof.
(t) Prior Plans shall mean the Companys 1991 Stock Option Plan, 1998 Stock Incentive Plan and the 2000 Director Option Plan.
(u) Restricted Stock shall mean any Share issued with the restriction that the holder may not sell, transfer, pledge or assign such Share and with such other restrictions as the Board, in its sole discretion, may impose (including, without limitation, any restriction on the right to vote such Share, and the right to receive any cash dividends), which restrictions may lapse separately or in combination at such time or times, in installments or otherwise, as the Board may deem appropriate.
(v) Restricted Stock Award shall mean an award of Restricted Stock under Section 8.
(w) Shares shall mean the shares of common stock of the Company, par value $.10 per share.
(x) Stock Appreciation Right shall mean any right granted to a Participant pursuant to Section 7 to receive, upon exercise by the Participant, the excess of (i) the Fair Market Value of one Share on the date of exercise over (ii) the grant price of the right on the date of grant, as specified by the Board in its sole discretion, which, except in the case of Substitute Awards or in connection with an adjustment provided in Section 4(c), shall not be less than the Fair Market Value of one Share on such date of grant of the right. Any payment by the Company in respect of such right may be made in cash, Shares, other property, or any combination thereof, as the Board, in its sole discretion, shall determine.
(y) Subsidiary shall mean any corporation (other than the Company) in an unbroken chain of corporations beginning with the Company if, at the time of the granting of the Award, each of the corporations other than the last corporation in the unbroken chain owns stock possessing 50% or more of the total combined voting power of all classes of stock in one of the other corporations in the chain.
(z) Substitute Awards shall mean Awards granted or Shares issued by the Company in assumption of, or in substitution or exchange for, awards previously granted, or the right or obligation to make future awards, by a company acquired by the Company or with which the Company combines.
3
3
SECTION 3. ADMINISTRATION.
(a) The Plan will be administered by the Board. The Board shall have authority to grant Awards and to adopt, amend and repeal such administrative rules, guidelines and practices relating to the Plan as it shall deem advisable. The Board may correct any defect, supply any omission or reconcile any inconsistency in the Plan or any Award in the manner and to the extent it shall deem expedient to carry the Plan into effect and it shall be the sole and final judge of such expediency. All decisions by the Board shall be made in the Boards sole discretion and shall be final and binding on all persons having or claiming any interest in the Plan or in any Award. No director or person acting pursuant to the authority delegated by the Board shall be liable for any action or determination relating to or under the Plan made in good faith.
(b) To the extent permitted by applicable law, the Board may delegate any or all of its powers under the Plan to one or more committees or subcommittees of the Board (a Committee), at least one of which shall be the Compensation Committee. All references in the Plan to the Board shall mean the Board or a Committee of the Board or the executive officers referred to in Section 3(c) to the extent that the Boards powers or authority under the Plan have been delegated to such Committee or executive officers.
(c) To the extent permitted by applicable law, the Board may delegate to one or more executive officers of the Company the power to grant Awards to employees or officers of the Company or any of its present or future subsidiary corporations and to exercise such other powers under the Plan as the Board may determine, provided that the Board shall fix the terms of the Awards to be granted by such executive officers (including the exercise price of such Awards, which may include a formula by which the exercise price will be determined) and the maximum number of shares subject to Awards that the executive officers may grant; provided further , however , that no executive officer shall be authorized to grant Awards to any executive officer of the Company (as defined by Rule 3b-7 under the Exchange Act) or to any officer of the Company (as defined by Rule 16a-1 under the Exchange Act).
SECTION 4. SHARES SUBJECT TO THE PLAN.
(a) Subject to adjustment as provided in Section 4(c), a total of 6,300,000 Shares shall be authorized for issuance under the Plan. Any Shares that are subject to Awards of Options or Stock Appreciation Rights shall be counted against this limit as one (1) Share for every one (1) Share granted. Any Shares that are subject to Awards other than Options or Stock Appreciation Rights shall be counted against this limit as 2.1 Shares for every one (1) Share granted. If any Shares subject to an Award or to an award under the Prior Plans are forfeited or if any Award or award under the Prior Plans based on Shares is settled for cash or expires, the Shares subject to such Award shall, to the extent of such forfeiture, cash settlement or expiration, again be available for Awards under the Plan. Notwithstanding anything to the contrary contained herein, the following Shares shall not be added to the Shares authorized for grant under paragraph (a) of this Section: (i) Shares tendered by the Participant or withheld by the Company in payment of the purchase price of an Option, (ii) Shares tendered by the Participant or withheld by the Company to satisfy any tax withholding obligation with respect to an Award, and (iii) Shares subject to a Stock Appreciation Right that are not issued in connection with the stock settlement of the Stock Appreciation Right on exercise thereof. Substitute Awards shall not reduce the Shares authorized for issuance under the Plan or authorized for grant to a Participant in any calendar year under Section 11(e). In the event that a company acquired by the Company or with which the Company combines has shares available under a pre-existing plan not adopted in contemplation of such acquisition or combination, the shares available for grant pursuant to the terms of such pre-existing plan (as adjusted, to the extent appropriate, using the exchange ratio or other adjustment or valuation ratio or formula used in such acquisition or combination to determine the consideration payable to the holders of common stock of the entities party to such acquisition or combination) may be used for Awards (other than Incentive Stock Options) under the Plan and shall not reduce the Shares authorized for issuance under the Plan; provided that Awards using such available shares shall not be made after the date awards or grants could have been made under the terms of the pre-existing plan, absent the acquisition or combination, and shall only be made to individuals who were not Employees or Directors of the Company or an Affiliate prior to such acquisition or combination. Any Shares that again become available for grant pursuant to this Section shall be added back as (i) one (1) Share if such Shares were subject to Options or Stock Appreciation Rights granted under the Plan or options or stock appreciation rights granted under the Prior Plans, and (ii) as 2.1 Shares if such Shares were subject to Awards other than Options or Stock Appreciation Rights granted under the Plan or the Prior Plans.
4
4
(b) Any Shares issued hereunder may consist, in whole or in part, of authorized and unissued shares, treasury shares or shares purchased in the open market or otherwise.
(c) In the event of any merger, reorganization, consolidation, recapitalization, stock dividend, extraordinary cash dividend, stock split, reverse stock split, spin-off or similar transaction or other change in corporate structure affecting the Shares, the Board shall make appropriate and equitable adjustments and other substitutions to the Plan and to Awards, including, without limitation, such adjustments in the aggregate number, class and kind of securities that may be delivered under the Plan, in the aggregate or to any one Participant, in the number, class, kind and option or exercise price of securities subject to outstanding Options, Stock Appreciation Rights or other Awards granted under the Plan, and in the number, class and kind of securities subject to Awards granted under the Plan (including, if the Board deems appropriate, the substitution of similar options to purchase the shares of, or other awards denominated in the shares of, another company) as the Board may determine in its sole discretion; provided , however , that the number of Shares subject to any Award shall always be a whole number.
SECTION 5. ELIGIBILITY. Any Employee or Director shall be eligible to be selected as a Participant; provided, however, that Incentive Stock Options shall only be awarded to Employees of the Company or a Subsidiary of the Company.
SECTION 6. STOCK OPTIONS. Options may be granted hereunder to Participants either alone or in addition to other Awards granted under the Plan. Any Option granted under the Plan shall be evidenced by an Award Agreement in such form as the Board may from time to time approve. Any such Option shall be subject to the following terms and conditions and to such additional terms and conditions, not inconsistent with the provisions of the Plan, as the Board shall deem desirable:
(a) OPTION PRICE. The purchase price per Share purchasable under an Option shall not be less than the Fair Market Value of the Share on the date of the grant, except in the case of Substitute Awards or in connection with an adjustment provided for in Section 4(c).
(b) OPTION PERIOD. The term of each Option shall be fixed by the Board in its sole discretion; provided that no Option shall be exercisable after the expiration of ten years from the date the Option is granted.
(c) EXERCISABILITY. Options shall be exercisable at such time or times as determined by the Board at or subsequent to grant.
(d) METHOD OF EXERCISE. Subject to the other provisions of the Plan, any Option may be exercised by the Participant in whole or in part at such time or times, and the Participant may make payment of the option price in such form or forms, including, without limitation: (i) payment by delivery of cash; (ii) delivery of other consideration (including, where permitted by law and the Board, Awards) having a Fair Market Value on the exercise date equal to the total option price; (iii) to the extent permitted by the Board, in its sole discretion, by delivery of an irrevocable and unconditional undertaking by a creditworthy broker to deliver promptly to the Company sufficient funds to pay the exercise price and any required tax withholding, or delivery by the Participant to the Company of a copy of irrevocable and unconditional instructions to a creditworthy broker to deliver promptly to the Company cash or a check sufficient to pay the exercise price and any required tax withholding; or (iv) by any combination of cash and other consideration as the Board may specify in the applicable Award Agreement.
(e) INCENTIVE STOCK OPTIONS. In accordance with rules and procedures established by the Board, and except as otherwise provided in Section 10 or any other provision of the Plan permitting or providing for acceleration of options, the aggregate Fair Market Value (determined as of the time of grant) of the Shares with respect to which Incentive Stock Options held by any Participant which are exercisable for the first time by such Participant during any calendar year under the Plan (and under any other employee benefit plans of the Company or any Subsidiary) shall not exceed $100,000 or, if different, the maximum limitation in effect at the time of grant under Section 422 of the Code, or any successor provision, and any regulations promulgated thereunder. Incentive Stock Options shall be granted only to Participants who are Employees of the Company or a Subsidiary of the Company. The terms of any Incentive Stock Option granted hereunder shall comply in all respects with the provisions of Section 422 of the Code or any successor provision, and any regulations promulgated thereunder; provided, however that the Company shall have no liability to a Participant or to any other person in the event that an option that is intended to be an Incentive Stock Option is not an Incentive Stock Option. Subject to adjustment as provided in Section 4(c), the aggregate number of Shares with respect to which Incentive Stock Options may be issued under the Plan shall not exceed 6,300,000.
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SECTION 7. STOCK APPRECIATION RIGHTS. Stock Appreciation Rights may be granted hereunder to Participants either alone (freestanding) or in addition to other Awards granted under the Plan and may, but need not, relate to a specific Option granted under Section 6. The provisions of Stock Appreciation Rights need not be the same with respect to each recipient. Any Stock Appreciation Right related to a Nonstatutory Stock Option may be granted at the same time such Option is granted. Any Stock Appreciation Right related to an Incentive Stock Option must be granted at the same time such Option is granted. In the case of any Stock Appreciation Right related to any Option, the Stock Appreciation Right or applicable portion thereof shall terminate and no longer be exercisable upon the termination or exercise of the related Option, except that a Stock Appreciation Right granted with respect to less than the full number of Shares covered by a related Option shall not be reduced until the exercise or termination of the related Option exceeds the number of Shares not covered by the Stock Appreciation Right. Any Option related to any Stock Appreciation Right shall no longer be exercisable to the extent the related Stock Appreciation Right has been exercised. The Board may impose such conditions or restrictions on the exercise of any Stock Appreciation Right, as it shall deem appropriate; provided that a freestanding Stock Appreciation Right shall not have an exercise price less than Fair Market Value on the date of grant or a term of greater than ten years.
SECTION 8. RESTRICTED STOCK.
(a) ISSUANCE. A Restricted Stock Award shall be subject to restrictions imposed by the Board during a period of time specified by the Board (the Restriction Period). Restricted Stock Awards may be issued hereunder to Participants, for no cash consideration or for such minimum consideration as may be required by applicable law, either alone or in addition to other Awards granted under the Plan. The provisions of Restricted Stock Awards need not be the same with respect to each recipient.
(b) REGISTRATION. Any Restricted Stock issued hereunder may be evidenced in such manner, as the Board, in its sole discretion, shall deem appropriate, including, without limitation, book entry registration or issuance of a stock certificate or certificates. In the event any stock certificates are issued in respect of Shares of Restricted Stock awarded under the Plan, such certificates shall be registered in the name of the Participant and shall bear an appropriate legend referring to the terms, conditions and restrictions applicable to such Award. Unless otherwise determined by the Board, such certificates shall be deposited by the Participant, together with a stock power endorsed in blank, with the Company or its designee.
(c) FORFEITURE. Except as otherwise determined by the Board at the time of grant or thereafter, upon termination of employment for any reason during the Restriction Period, all Shares of Restricted Stock still subject to restriction shall be forfeited by the Participant (or repurchased by the Company at their issue price) and reacquired by the Company. Unrestricted Shares, evidenced in such manner as the Board shall deem appropriate, shall be issued to the grantee promptly after expiration of the period of forfeiture, as determined or modified by the Board.
SECTION 9. OTHER STOCK UNIT AWARDS.
(a) STOCK AND ADMINISTRATION. Other Awards of Shares and other Awards that are valued in whole or in part by reference to, or are otherwise based on, Shares or other property (Other Stock Unit Awards) may be granted hereunder to Participants, either alone or in addition to other Awards granted under the Plan. Such Other Stock Unit Awards shall also be available as a form of payment in the settlement of other Awards granted under the Plan or as payment in lieu of compensation to which such recipient otherwise is entitled. Other Stock Unit Awards may be paid in Shares or cash, as the Board shall determine, in its sole discretion. Subject to the provisions of the Plan, the Board shall have sole and complete authority to determine the Employees of the Company and its Affiliates and Directors to whom and the time or times at which such Awards shall be made, the number of Shares to be granted pursuant to such Awards, and all other conditions of the Awards. The provisions of Other Stock Unit Awards need not be the same with respect to each recipient.
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(b) TERMS AND CONDITIONS. Subject to the provisions of the Plan and any applicable Award Agreement, Awards and Shares subject to Awards made under this Section 9 may not be sold, assigned, transferred, pledged or otherwise encumbered prior to the date on which the Shares are issued, or, if later, the date on which any applicable restriction, performance or deferral period lapses. Shares (including securities convertible into Shares) subject to Awards granted under this Section 9 may be issued for no cash consideration or for such minimum consideration as may be required by applicable law. Shares (including securities convertible into Shares) purchased pursuant to a purchase right awarded under this Section 9 shall be purchased for such consideration as the Board shall determine in its sole discretion, which, except in the case of Substitute Awards, shall not be less than the Fair Market Value of such Shares or other securities as of the date such purchase right is awarded.
SECTION 10. CHANGE IN CONTROL PROVISIONS.
(a) IMPACT OF EVENT. Subject to Section 10(a)(v) and notwithstanding any other provision of the Plan to the contrary, unless the Board shall determine otherwise at the time of grant with respect to a particular Award, in the event of a Change in Control:
(i) any Options and Stock Appreciation Rights outstanding as of the date such Change in Control is determined to have occurred, and which are not then exercisable and vested, shall become immediately exercisable and vested as to 25% of the number of shares to which such Options and Stock Appreciation Rights would otherwise not then be exercisable, and the number of shares as to which such Options and Stock Appreciation Rights shall become exercisable and vested on each vesting date set forth in the applicable agreement shall be reduced by 25%;
(ii) the restrictions and deferral limitations applicable to any Restricted Stock Award shall immediately lapse as to 25% of the remaining number of shares subject to such Award as to which such restrictions and deferral limitations are then in effect, and the number of shares subject to such Restricted Stock Award as to which such restrictions and deferral limitations terminate on each subsequent vesting date shall be reduced by 25%;
(iii) the restrictions, deferral limitations and other conditions applicable to any Other Stock Unit Awards or any other Awards shall immediately lapse as to 25% of the remaining number of shares subject to Other Stock Unit Awards or other Awards as to which such restrictions, deferral limitations and other conditions are then in effect, and the number of shares subject to such Other Stock Unit Awards or other Awards as to which such restrictions, deferral limitations and other conditions terminate on each subsequent vesting date shall be reduced by 25%; and
(iv) in the event of an involuntary termination of a Participants employment or directorship by the successor company without Cause (as defined below) during the 24-month period following such Change in Control, then each Award held by such Participant at the time of the Change in Control shall immediately become fully exercisable and vested to the full extent of the original grant and all restrictions and deferral limitation shall lapse. Cause shall mean: (A) the failure of the Participant to perform substantially the Participants duties with the Company (other than any such failure resulting from incapacity due to physical or mental illness), which failure is not cured within 30 days after a written demand for substantial performance is delivered to the Participant by the Participants manager or the Board which specifically identifies the manner in which such manager or the Board, as applicable, believes that the Participant has not substantially performed the Participants duties, (B) or the engaging by the Participant in illegal conduct or gross misconduct which is injurious to the Company.
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(v) Notwithstanding the foregoing, if in the event of a Corporate Transaction the successor company does not assume or substitute for an Option, Stock Appreciation Right, Share of Restricted Stock or Other Stock Unit Award not granted pursuant to Section 11, then each outstanding Option, Stock Appreciation Right, Share of Restricted Stock or Other Stock Unit Award shall not be accelerated as described in Sections 10(a)(i), (ii) and (iii), but rather shall be accelerated with respect to 100% of such Awards. For the purposes of this Section 10(a)(v), an Option, Stock Appreciation Right, Share of Restricted Stock or Other Stock Unit Award shall be considered assumed or substituted for if following the Corporate Transaction the award confers the right to purchase or receive, for each Share subject to the Option, Stock Appreciation Right, Restricted Stock Award or Other Stock Unit Award immediately prior to the Corporate Transaction, the consideration (whether stock, cash or other securities or property) received in the Corporate Transaction by holders of Shares for each Share held on the effective date of the transaction (and if holders were offered a choice of consideration, the type of consideration chosen by the holders of a majority of the outstanding shares); provided , however , that if such consideration received in the Corporate Transaction is not solely common stock of the successor company, the Board may, with the consent of the successor company, provide that the consideration to be received upon the exercise or vesting of an Option, Stock Appreciation Right, Restricted Stock Award or Other Stock Unit Award, for each Share subject thereto, will be solely common stock of the successor company substantially equal in fair market value to the per share consideration received by holders of Shares in the Corporate Transaction. The determination of such substantial equality of value of consideration shall be made by the Board in its sole discretion and its determination shall be conclusive and binding.
(b) CHANGE IN CONTROL CASH-OUT. Notwithstanding any other provision of the Plan, in the event of a Change in Control the Board may, in its discretion, provide that each Option or Stock Appreciation Right shall, upon the occurrence of a Change in Control, be cancelled in exchange for a payment in an amount equal to the amount by which the fair market value per Share immediately prior to the Change in Control exceeds the purchase price per Share under the Option or Stock Appreciation Right (the spread) multiplied by the number of Shares granted under the Option or Stock Appreciation Right.
SECTION 11. CODE SECTION 162(m) PROVISIONS.
(a) Notwithstanding any other provision of the Plan, if the Compensation Committee determines at the time Restricted Stock or an Other Stock Unit Award is granted to a Participant who is then an officer, that such Participant is, or is likely to be as of the end of the tax year in which the Company would claim a tax deduction in connection with such Award, a Covered Employee, then the Compensation Committee may provide that this Section 11 is applicable to such Award.
(b) If Restricted Stock or an Other Stock Unit Award is subject to this Section 11, then the lapsing of restrictions thereon and the distribution of cash or Shares pursuant thereto, as applicable, shall be subject to the achievement of one or more objective performance goals established by the Compensation Committee, which shall be based on the attainment of specified levels of one or any combination of the following: earnings before interest, taxes, depreciation and amortization (EBITDA), net cash provided by operating activities, free cash flow, earnings per share, earnings per share from continuing operations, operating income, revenues, operating margins, return on operating assets, return on equity, economic value added, stock price appreciation, total stockholder return, cost control, strategic initiatives, market share, before- or after-tax income, or return on invested capital of the Company or the Affiliate or division of the Company for or within which the Participant is primarily employed. Such performance goals also may be based on the achievement of specified levels of Company performance (or performance of an applicable Affiliate or division of the Company) under one or more of the measures described above relative to the performance of other corporations. Such performance goals may be applied by excluding the impact of charges for restructurings, discontinued operations, extraordinary items, and other unusual or non-recurring items, and the cumulative effects of accounting changes, each as defined by generally accepted accounting principles. Such performance goals shall be set by the Compensation Committee within the time period prescribed by, and shall otherwise comply with the requirements of, Section 162(m) of the Code, or any successor provision thereto, and the regulations thereunder.
(c) Notwithstanding any provision of the Plan other than Section 10, with respect to any Restricted Stock or Other Stock Unit Award that is subject to this Section 11, the Compensation Committee may adjust downwards, but not upwards, the amount payable pursuant to such Award, and the Compensation Committee may not waive the achievement of the applicable performance goals except, in its sole discretion, in the case of the death or disability of the Participant
(d) The Compensation Committee shall have the power to impose such other restrictions on Awards subject to this Section 11 as it may deem necessary or appropriate to ensure that such Awards satisfy all requirements for performance-based compensation within the meaning of Section 162(m)(4)(C) of the Code, or any successor provision thereto.
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(e) Notwithstanding any provision of the Plan other than Section 4(c), no Participant may be granted Awards during any year with respect to more than 1,200,000 Shares. For purposes of the foregoing limit, the combination of an Option in tandem with a Stock Appreciation Right shall be treated as a single Award. The per Participant limit described in this Section 11(e) shall be construed and applied consistently with Section 162(m) of the Code or any successor provision thereto, and the regulations thereunder (Section 162(m)).
SECTION 12. AMENDMENTS AND TERMINATION. The Board may amend, alter, suspend, discontinue or terminate the Plan or any portion thereof at any time; provided , however , that no amendment or alteration, shall be made without (a) stockholder approval if such approval is necessary to qualify for or comply with any tax or regulatory requirement for which or with which the Board deems it necessary or desirable to qualify or comply, (b) the consent of the affected Participant, if such action would impair the rights of such Participant under any outstanding Award, or (c) stockholder approval if such amendment or alteration is material, including, without limitation, any amendment or alteration that (i) would reduce the exercise price of outstanding Options or Stock Appreciation Rights or cancel or amend outstanding Options or Stock Appreciation Rights for the purpose of repricing, replacing or regranting such Options or Stock Appreciation Rights with an exercise price that is less than the exercise price of the original Options or Stock Appreciation Rights, or in exchange for cash or another Award, (ii) materially increases the benefits accruing to Participants, (iii) materially increases the number of Shares that may be issued under the Plan, except for any increase permitted under Section 4(a) or 4(c) of the Plan, (iv) materially modifies the requirements for eligibility to participate in the Plan, or (v) expands the types of Awards issuable under the Plan. Notwithstanding anything to the contrary herein, the Board may amend the Plan in such manner as may be necessary so as to have the Plan conform to local rules and regulations in any jurisdiction outside the United States.
The Board may amend the terms of any Award theretofore granted, prospectively or retroactively, including to provide that any Award shall become immediately exercisable in full or in part, free of some or all restrictions or conditions, or otherwise realizable in full or in part, as the case may be; provided , however , that no such amendment shall (a) impair the rights of any Participant without his or her consent, (b) except for adjustments made pursuant to Section 4(c) or in connection with Substitute Awards, reduce the exercise price of outstanding Options or Stock Appreciation Rights or cancel or amend outstanding Options or Stock Appreciation Rights for the purpose of repricing, replacing or regranting such Options or Stock Appreciation Rights with an exercise price that is less than the exercise price of the original Options or Stock Appreciation Rights, or in exchange for cash or another Award, without stockholder approval, or (c) require the exchange of Options or Stock Appreciation Rights for cash Notwithstanding the foregoing, any adjustments made pursuant to Section 4(c) shall not be subject to these restrictions.
SECTION 13. GENERAL PROVISIONS.
(a) Notwithstanding any other provision of the Plan, except under certain circumstances in connection with a Participants hire or termination or in the event of a Change in Control, no Award issued to an Employee (except in lieu of compensation to which such Employee is otherwise entitled) shall vest less than one year from the date of grant.
(b) Awards shall not be sold, assigned, transferred, pledged or otherwise encumbered by the person to whom they are granted, either voluntarily or by operation of law, except by will or the laws of descent and distribution, and, during the life of the Participant, shall be exercisable only by the Participant; provided, however, that, if so determined by the Board, a Participant may, in the manner established by the Board, designate a beneficiary to exercise the rights of the Participant with respect to any Award upon the death of the Participant; and provided , further , that an Award so assigned or transferred shall be subject to all the terms and conditions of the Plan and the instrument evidencing the Award. Each Award shall be exercisable, during the Participants lifetime, only by the Participant or, if permissible under applicable law, by the Participants guardian or legal representative. References to a Participant, to the extent relevant in the context, shall include references to authorized transferees.
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(c) No Employee or Participant shall have any claim to be granted any Award under the Plan, and there is no obligation for uniformity of treatment of Employees or Participants under the Plan.
(d) The prospective recipient of any Award under the Plan shall not, with respect to such Award, be deemed to have become a Participant, or to have any rights with respect to such Award, until and unless such recipient shall have received an agreement or other instrument (written, electronic or otherwise) evidencing the Award, which may, but need not, be executed or acknowledged by both the Company and the Participant, and delivered a copy thereof to the Company, and otherwise complied with the then applicable terms and conditions.
(e) Nothing in the Plan or any Award granted under the Plan shall be deemed to constitute an employment or service contract or confer or be deemed to confer on any Participant any right to continue in the employ or service of, or to continue any other relationship with, the Company or any Affiliate or limit in any way the right of the Company or any Affiliate to terminate a Participants employment or service or other relationship at any time, with or without cause.
(f) Except as provided in Section 11, the Board shall be authorized to make adjustments in performance award criteria or in the terms and conditions of other Awards in recognition of unusual or nonrecurring events affecting the Company or its financial statements or changes in applicable laws, regulations or accounting principles. The Board may correct any defect, supply any omission or reconcile any inconsistency in the Plan or any Award in the manner and to the extent it shall deem desirable to carry it into effect. In the event that the Company shall assume outstanding employee benefit awards or the right or obligation to make future such awards in connection with the acquisition of or combination with another corporation or business entity, the Board may, in its discretion, make such adjustments in the terms of Awards under the Plan as it shall deem appropriate.
(g) The Board shall have full power and authority to determine whether, to what extent and under what circumstances any Award shall be canceled or suspended.
(h) All certificates for Shares delivered under the Plan pursuant to any Award shall be subject to such stock-transfer orders and other restrictions as the Board may deem advisable under the rules, regulations and other requirements of the Securities and Exchange Commission, any stock exchange upon which the Shares are then listed, and any applicable federal or state securities law, and the Board may cause a legend or legends to be put on any such certificates to make appropriate reference to such restrictions.
(i) No Award granted hereunder shall be construed as an offer to sell securities of the Company, and no such offer shall be outstanding, unless and until the Board in its sole discretion has determined that any such offer, if made, would comply with all applicable requirements of the U.S. federal securities laws and any other laws to which such offer, if made, would be subject.
(j) No Award shall provide for deferral of compensation that does not comply with Section 409A of the Code, unless the Board, at the time of grant, specifically provides that the Award is not intended to comply with Section 409A of the Code. The Company shall have no liability to a Participant, or any other party, if an Award that is intended to be exempt from, or compliant with, Section 409A is not so exempt or compliant or for any action taken by the Board. Subject to the provisions of the Plan and any Award Agreement, the recipient of an Award (including, without limitation, any deferred Award) may, if so determined by the Board, be entitled to receive, currently or on a deferred basis, cash dividends, or cash payments in amounts equivalent to cash dividends on Shares (dividend equivalents) with respect to the number of Shares covered by the Award, as determined by the Board, in its sole discretion, and the Board may provide that such amounts (if any) shall be deemed to have been reinvested in additional Shares or otherwise reinvested.
(k) Except as otherwise required in any applicable Award Agreement or by the terms of the Plan, recipients of Awards under the Plan shall not be required to make any payment or provide consideration other than the rendering of services.
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(l) The Company shall be authorized to withhold from any Award granted or payment due under the Plan the amount of withholding taxes due in connection with an Award or payment hereunder and to take such other action as may be necessary in the opinion of the Company to satisfy all Company obligations for the payment of such taxes. The Board shall be authorized to establish procedures for election by Participants to satisfy such obligation for the payment of such taxes by directing the Company to retain Shares (not exceeding the minimum required tax withholding obligations if such a limitation is necessary to avoid a charge to the Company for financial reporting purposes) otherwise deliverable in connection with the Award.
(m) Nothing contained in the Plan shall prevent the Board from adopting other or additional compensation arrangements, subject to stockholder approval if such approval is required; and such arrangements may be either generally applicable or applicable only in specific cases.
(n) The validity, construction and effect of the Plan and any rules and regulations relating to the Plan shall be determined in accordance with the laws of the State of Delaware and applicable federal law, without regard to applicable conflicts of laws.
(o) If any provision of the Plan is or becomes or is deemed invalid, illegal or unenforceable in any jurisdiction, or would disqualify the Plan or any Award under any law deemed applicable by the Board, such provision shall be construed or deemed amended to conform to applicable laws or if it cannot be construed or deemed amended without, in the determination of the Board, materially altering the intent of the Plan, it shall be stricken and the remainder of the Plan shall remain in full force and effect.
(q) Awards may be granted to Participants who are foreign nationals or employed outside the United States, or both, on such terms and conditions different from those applicable to Awards to Employees employed in the United States as may, in the judgment of the Board, be necessary or desirable in order to recognize differences in local law or tax policy. The Board also may impose conditions on the exercise or vesting of Awards in order to minimize the Companys obligation with respect to tax equalization for Employees on assignments outside their home country.
SECTION 14. EFFECTIVE DATE OF PLAN. The Plan shall be effective as of May 21, 2003.
SECTION 15. TERM OF PLAN. The Plan shall terminate on the tenth anniversary of the effective date, unless sooner terminated by the Board pursuant to Section 12, but Awards previously granted may extend beyond that date; provided , however , that no Incentive Stock Options may be granted more than ten years after the later of (i) the adoption of the Plan by the Board and (ii) the adoption by the Board of any amendment to the Plan that constitutes the adoption of a new plan for purposes of Section 422 of the Code.
Adopted by the Board of Directors on February 25, 2003, subject to stockholder approval.
Approved by the stockholders on May 21, 2003.
Amended by the Board of Directors on July 16, 2003.
Amended by the Board of Directors on October 12, 2005.
Amended by the Board of Directors on February 14, 2007, subject to stockholder approval.
Approved by the stockholders on May 9, 2007.
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Exhibit 10.22
IDEXX LABORATORIES, INC.
1997 EMPLOYEE STOCK PURCHASE PLA
N
(Adjusted to reflect 2-for-1 stock split effective November 5, 2007)
(As of February 3, 2005)
The purpose of this Plan is to provide eligible employees of IDEXX Laboratories, Inc. (the Company) and certain of its subsidiaries with opportunities to purchase shares of the Companys common stock, $.10 par value (the Common Stock), commencing on July 1, 1997. The Plan was initially adopted by the Companys Board of Directors (the Board) on February 26, 1997 and approved by stockholders at a meeting held May 21, 1997. The Board amended the Plan, subject to stockholder approval, on February 25, 2003 to increase the number of shares of Common Stock authorized for issuance under the Plan from Eight Hundred Forty Thousand (840,000) shares to One Million Two Hundred Forty Thousand (1,240,000) shares. The stockholders approved such increase in shares at the Companys Annual Meeting held May 21, 2003.
1. Administration . The Plan will be administered by the Compensation Committee of the Companys Board of Directors (the Committee). The Committee has authority to make rules and regulations for the administration of the Plan and its interpretation and decisions with regard thereto shall be final and conclusive.
2. Eligibility . Participation in the Plan will neither be permitted nor denied contrary to the requirements of Section 423 of the Internal Revenue Code of 1986, as amended (the Code), and regulations promulgated thereunder. All employees of the Company, including Directors who are employees, and all employees of any subsidiary of the Company (as defined in Section 424(f) of the Code) designated by the Committee from time to time (a Designated Subsidiary), are eligible to participate in any one or more of the offerings of Options (as defined in Section 9) to purchase Common Stock under the Plan provided that:
(a) they are regularly employed by the Company or a Designated Subsidiary for more than 20 hours a week and for more than five months in a calendar year; and
(b) they have been employed by the Company or a Designated Subsidiary for at least one month prior to enrolling in the Plan; and
(c) they are employees of the Company or a Designated Subsidiary on the first day of the applicable Plan Period (as defined below).
No employee may be granted an option hereunder if such employee, immediately after the option is granted, owns 5% or more of the total combined voting power or value of the stock of the Company or any subsidiary. For purposes of the preceding sentence, the attribution rules of Section 424(d) of the Code shall apply in determining the stock ownership of an employee, and all stock which the employee has a contractual right to purchase shall be treated as stock owned by the employee.
3. Offerings . The Company will make one or more offerings (Offerings) to employees to purchase stock under this Plan. Offerings will begin each January 1, April 1, July 1 and October 1, or the first business day thereafter (the Offering Commencement Dates). Each Offering Commencement Date will begin a three-month period (a Plan Period) during which payroll deductions will be made and held for the purchase of Common Stock at the end of the Plan Period. The Committee may, at its discretion, choose a different Plan Period of twelve (12) months or less for subsequent Offerings.
4. Participation . An employee eligible on the Offering Commencement Date of any Offering may participate in such Offering by completing and forwarding a payroll deduction authorization form to the employees appropriate payroll office prior to the applicable Offering Commencement Date, but not later than the deadline established by the Committee. The form will authorize a regular payroll deduction from the Compensation received by the employee during the Plan Period. Unless an employee files a new form or withdraws from the Plan, his deductions and purchases will continue at the same rate for future Offerings under the Plan as long as the Plan remains in effect. The term Compensation generally means the amount of money reportable on the employees Federal Income Tax Withholding Statement, excluding allowances and reimbursements for expenses such as relocation allowances for travel expenses, income or gains on the exercise of Company stock options or stock appreciation rights, and similar items, whether or not shown on the employees Federal Income Tax Withholding Statement, but including, in the case of salespersons, sales commissions to the extent determined by the Committee. The Committee will determine eligible Compensation in a uniform and non-discriminatory manner.
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5. Deductions . The Company will maintain payroll deduction accounts for all participating employees. With respect to any Offering made under this Plan, an employee may authorize a payroll deduction at the rate of 1%, 2%, 3%, 4% or 5% of Compensation with any change in compensation during the Plan Period to result in an automatic corresponding change in the dollar amount withheld.
No employee may be granted an Option (as defined in Section 9) which permits his rights to purchase Common Stock under this Plan and any other stock purchase plan of the Company and its subsidiaries, to accrue at a rate which exceeds $25,000 of the fair market value of such Common Stock (determined at the Offering Commencement Date of the Plan Period) for each calendar year in which the Option is outstanding at any time.
6. No Deduction Changes . Except as provided in Section 8 below with respect to withdrawals from participating in an Offering, an employee may not increase or decrease his payroll deduction during a Plan Period.
7. Interest . Interest will not be paid on any employee accounts, except to the extent that the Committee, in its sole discretion, elects to credit employee accounts with interest at such per annum rate as it may from time to time determine.
8. Withdrawal of Funds . An employee may at any time up to the payroll data submission deadline for the last pay date in a Plan Period and for any reason permanently draw out the balance accumulated in the employees account and thereby withdraw from participation in an Offering. Partial withdrawals are not permitted. The employee may not begin participation again during the remainder of the Plan Period. The employee may participate in any subsequent Offering in accordance with terms and conditions established by the Committee.
9. Purchase of Shares . On the Offering Commencement Date of each Plan Period, subject to the limitations described in section 5, the Company will grant to each eligible employee who is then a participant in the Plan an option (Option) to purchase on the last business day of such Plan Period (the Exercise Date), at the Option Price hereinafter provided for, the number of whole shares of Common Stock of the Company determined by dividing the employees accumulated payroll deductions by the Option Price.
The purchase price (the Option Price) for each share purchased will be 85% of the closing price of the Common Stock on the Exercise Date. Such closing price shall be (a) the closing price on any national securities exchange on which the Common Stock is listed, (b) the closing price of the Common Stock on the Nasdaq Stock Market or (c) the average of the closing bid and asked prices in the over-the-counter-market, whichever is applicable, as published in The Wall Street Journal . If no sales of Common Stock were made on such a day, the price of the Common Stock for purposes of clauses (a) and (b) above shall be the reported price for the closest trading day within the Plan Period on which sales were made.
Each employee who continues to be a participant in the Plan on the Exercise Date shall be deemed to have exercised his Option at the Option Price on such date and shall be deemed to have purchased from the Company the number of full shares of Common Stock reserved for the purpose of the Plan that his accumulated payroll deductions on such date will pay for, but not in excess of, the maximum number determined in the manner set forth above.
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Any balance remaining in an employees payroll deduction account at the end of a Plan Period will be automatically refunded to the employee.
10. Issuance of Certificates . Certificates representing shares of Common Stock purchased under the Plan may be issued only in the name of the employee, in the name of the employee and another person of legal age as joint tenants with rights of survivorship, or (in the Companys sole discretion) in the street name of a brokerage firm, bank or other nominee holder designated by the employee.
11. Rights on Retirement, Death or Termination of Employment . In the event of a participating employees termination of employment prior to the last business day of a Plan Period, no payroll deduction shall be taken from any pay due and owing to an employee and the balance in the employees account shall be paid to the employee or, in the event of the employees death, (a) to a beneficiary previously designated in a revocable notice signed by the employee (with any spousal consent required under state law) or (b) in the absence of such a designated beneficiary, to the executor or administrator of the employees estate or (c) if no such executor or administrator has been appointed to the knowledge of the Company, to such other person(s) as the Company may, in its discretion, designate. If, prior to the last business day of the Plan Period, the Designated Subsidiary by which an employee is employed shall cease to be a subsidiary of the Company, or if the employee is transferred to a subsidiary of the Company that is not a Designated Subsidiary, the employee shall be deemed to have terminated employment for the purposes of this Plan.
12. Optionees Not Stockholders . Neither the granting of an Option to an employee nor the deductions from his pay shall constitute such employee a stockholder of the shares of Common Stock covered by an Option under this Plan until such shares have been purchased by and issued to him.
13. Rights Not Transferable . Rights under this Plan are not transferable by a participating employee other than by will or the laws of descent and distribution, and are exercisable during the employees lifetime only by the employee.
14. Application of Funds . All funds received or held by the Company under this Plan may be combined with other corporate funds and may be used for any corporate purpose.
15. Adjustment in Case of Changes Affecting Common Stock . In the event of a subdivision of outstanding shares of Common Stock, or the payment of a dividend in Common Stock, the number of shares approved for this Plan, and the share limitation set forth in Section 9, shall be increased proportionately, and such other adjustment shall be made as may be deemed equitable by the Committee. In the event of any other change affecting the Common Stock, such adjustment shall be made as may be deemed equitable by the Committee to give proper effect to such event.
16. Merger . If the Company shall at any time merge or consolidate with another corporation and the holders of the capital stock of the Company immediately prior to such merger or consolidation continue to hold at least 80% by voting power of the capital stock of the surviving corporation (Continuity of Control), the holder of each Option then outstanding will thereafter be entitled to receive at the next Exercise Date upon the exercise of such Option for each share as to which such Option shall be exercised the securities or property which a holder of one share of the Common Stock was entitled to upon and at the time of such merger, and the Committee shall take such steps in connection with such merger as the Committee shall deem necessary to assure that the provisions of Section 15 shall thereafter be applicable, as nearly as reasonably may be, in relation to the said securities or property as to which such holder of such Option might thereafter be entitled to receive thereunder.
In the event of a merger or consolidation of the Company with or into another corporation which does not involve Continuity of Control, or of a sale of all or substantially all of the assets of the Company while unexercised Options remain outstanding under the Plan, (a) subject to the provisions of clauses (b) and (c), after the effective date of such transaction, each holder of an outstanding Option shall be entitled, upon exercise of such Option, to receive in lieu of shares of Common Stock, shares of such stock or other securities as the holders of shares of Common Stock received pursuant to the terms of such transaction; or (b) all outstanding Options may be cancelled by the Committee as of a date prior to the effective date of any such transaction and all payroll deductions shall be paid out to the participating employees; or (c) all outstanding Options may be cancelled by the Committee as of the effective date of any such transaction, provided that notice of such cancellation shall be given to each holder of an Option, and each holder of an Option shall have the right to exercise such Option in full based on payroll deductions then credited to his account as of a date determined by the Committee, which date shall not be less than ten (10) days preceding the effective date of such transaction.
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17. Amendment of the Plan . The Board may at any time, and from time to time, amend this Plan in any respect, except that (a) if the approval of any such amendment by the shareholders of the Company is required by Section 423 of the Code, such amendment shall not be effected without such approval, and (b) in no event may any amendment be made which would cause the Plan to fail to comply with Section 423 of the Code.
18. Insufficient Shares . In the event that the total number of shares of Common Stock specified in elections to be purchased under any Offering plus the number of shares purchased under previous Offerings under this Plan exceeds the maximum number of shares issuable under this Plan, the Committee will allot the shares then available on a pro rata basis.
19. Termination of the Plan . This Plan may be terminated at any time by the Board. Upon termination of this Plan all amounts in the accounts of participating employees shall be promptly refunded.
20. Governmental Regulations . The Companys obligation to sell and deliver Common Stock under this Plan is subject to listing on a national stock exchange or quotation on the NASDAQ National Market and the approval of all governmental authorities required in connection with the authorization, issuance or sale of such stock.
The Plan shall be governed by Delaware law except to the extent that such law is preempted by federal law.
21. Issuance of Shares . Shares may be issued upon exercise of an Option from authorized but unissued Common Stock, from shares held in the treasury of the Company, or from any other proper source.
22. Notification upon Sale of Shares . Each employee agrees, by entering the Plan, to promptly give the Company notice of any disposition of shares purchased under the Plan where such disposition occurs within two years after the date of grant of the Option pursuant to which such shares were purchased.
23. Effective Date and Approval of Shareholders . The Plan shall take effect on July 1, 1997 subject to approval by the shareholders of the Company as required by Section 423 of the Code, which approval must occur within twelve months of the adoption of the Plan by the Board.
Adopted by the Board of Directors on February 26, 1997
Approved by the Stockholders on May 21, 1997
Amended by the Board of Directors on February 25, 2003
Approved by the Stockholders on May 21, 2003
Amended by the Board of Directors on July 16, 2003
Amended by the Board of Directors on February 3, 2005
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(i) |
the Participants Separation from Service;
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(ii) |
the date the Participant becomes Disabled;
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(iii) |
the Participants date of death;
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(iv) |
the time(s) specified by the Participant in his or her deferral
election, subject to such requirements as the Plan Administrator may impose
consistent with Code Section 409A;
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(v) |
a Change in Control of the Company; or
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(vi) |
the occurrence of an Unforeseeable Emergency.
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5
6
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(as of December 31, 2007)
Legal Entity Name
Jurisdiction of Incorporation
Delaware, U.S.
Switzerland
United Kingdom
Delaware, U.S.
Massachusetts, U.S.
The Netherlands
Germany
Germany
The Netherlands
Canada (Nova Scotia)
Canada (Nova Scotia)
Canada
Canada (Ontario)
Italy
Japan
United Kingdom
New Zealand
Australia
South Africa
Mexico
Spain
Poland
Belgium
Taiwan R.O.C.
Delaware, U.S.
Delaware, U.S.
Maine, U.S.
Delaware, U.S.
Canada
France
Switzerland
United Kingdom
France
France
Delaware, U.S.
Germany
North Carolina, U.S.
New York
Denmark
United Kingdom
Germany
Austria
1) | I have reviewed this report on Form 10-K for the year ended December 31, 2007 of IDEXX Laboratories, Inc.; | |
2) | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; | |
3) | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; | |
4) | The registrants other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: |
a) | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; | ||
b) | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; | ||
c) | Evaluated the effectiveness of the registrants disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report, based on such evaluation; and | ||
d) | Disclosed in this report any change in the registrants internal control over financial reporting that occurred during the registrants most recent fiscal quarter (the registrants fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrants internal control over financial reporting; and |
5) | The registrants other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrants auditors and the audit committee of the registrants board of directors (or persons performing the equivalent functions): |
a) | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrants ability to record, process, summarize and report financial information; and | ||
b) | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrants internal control over financial reporting. |
Date: February 27, 2008 | /s/ Jonathan W. Ayers | |||
Jonathan W. Ayers, Chairman, | ||||
President and Chief Executive Officer | ||||
1) | I have reviewed this report on Form 10-K for the year ended December 31, 2007 of IDEXX Laboratories, Inc.; | |
2) | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; | |
3) | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; | |
4) | The registrants other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: |
a) | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; | ||
b) | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; | ||
c) | Evaluated the effectiveness of the registrants disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report, based on such evaluation; and | ||
d) | Disclosed in this report any change in the registrants internal control over financial reporting that occurred during the registrants most recent fiscal quarter (the registrants fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrants internal control over financial reporting; and |
5) | The registrants other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrants auditors and the audit committee of registrants board of directors (or persons performing the equivalent functions): |
a) | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrants ability to record, process, summarize and report financial information; and | ||
b) | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrants internal control over financial reporting. |
Date: February 27, 2008 | /s/ Merilee Raines | |||
Merilee Raines | ||||
Corporate Vice President and Chief Financial Officer | ||||
(1) |
The Report fully complies with the requirements of Section 13(a) or 15(d) of the
Securities Exchange Act of 1934; and
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(2) |
The information contained in the Report fairly presents, in all material respects, the
financial condition and results of operations of the Company.
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/s/ Jonathan W. Ayers | |
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February 27, 2008
|
Jonathan W. Ayers, Chairman, | |
|
President and Chief Executive Officer |
(1) |
The Report fully complies with the requirements of Section 13(a) or 15(d) of the
Securities Exchange Act of 1934; and
|
||
(2) |
The information contained in the Report fairly presents, in all material respects, the
financial condition and results of operations of the Company.
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/s/ Merilee Raines | |
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February 27, 2008
|
Merilee Raines | |
|
Corporate Vice President and | |
|
Chief Financial Officer |