As filed with the Securities and Exchange Commission on January 5, 2005
Registration No. 333-
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UNITED STATES SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM S-8
REGISTRATION STATEMENT
UNDER THE SECURITIES ACT OF 1933
DATA I/O CORPORATION
(Exact name of registrant as specified in its charter)
Washington 91-0864123
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
10525 Willows Road N.E.
Redmond, Washington 98052
Address of Principal Executive Offices
DATA I/O CORPORATION 2000 STOCK COMPENSATION INCENTIVE PLAN, AS AMENDED
(Full title of the plan)
Joel S. Hatlen
Vice President, Chief Financial Officer, Secretary and Treasurer
10525 Willows Road N.E.
Redmond, Washington 98052
(Name and address of agent for service)
(425) 881-6444
(Telephone number, including area code, of agent for service)
CALCULATION OF REGISTRATION FEE
=================================================================================================================================
Title of Each Class of Amount to Proposed Maximum Proposed Maximum Amount of
Securities to be Registered be Registered Offering Price Per Aggregate Offering Registration Fee
Share Price
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Common Shares subject to
outstanding options under the 2000
Stock Compensation Incentive Plan 985,863 $2.21(1) $2,178,757 $256(1)
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Common Shares not subject to
outstanding options under the 2000
Stock Compensation Incentive Plan 442,923 $3.29(2) $1,457,217 $172(2)
=================================================================================================================================
(1) Based on the average exercise price of options granted under the 2000 Stock
Compensation Incentive Plan, as amended, outstanding as of the date of the
filing of this registration statement.
(2) The proposed maximum offering price per share and the registration fee were
calculated in accordance with Rule 457(c) and (h) based on the average of
the high and low prices for shares of the registrant's common stock on
January 4, 2005, as quoted by Nasdaq SmallCap Market. The closing price for
shares of the registrant's common stock on January 4, 2005, as quoted by
Nasdaq SmallCap Market, was $3.30.
Page 1 of 6 pages.
Exhibit Index begins at page 6.
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PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
Item 3. Incorporation of Documents by Reference.
The following documents, which have been filed with the Securities and Exchange
Commission (the "Commission") by Data I/O Corporation, a Washington corporation
(the "Company"), are incorporated by reference in this Registration Statement,
as of their respective dates:
(a) the Company's Annual Report on Form 10-K for the fiscal year ended December
31, 2003;
(b) the Company's Quarterly Reports on Form 10-Q for the quarters ended March
31, 2004, June 30, 2004 and September 30, 2004;
(c) the Company's Current Report on Form 8-K filed on February 18, 2004, April
26, 2004, August 5, 2004, October 25, 2004, and December 23, 2004;
(c) the description of the Company's Common Stock, no par value per share, as
contained in Item 1 of the Registration Statement on Form 8-A filed on
April 29, 1982 including any amendment or report filed for the purpose of
updating such description filed for the purpose of updating such
description.
All documents filed by the Company pursuant to Sections 13(a), 13(c), 14 and
15(d) of the Securities Exchange Act of 1934, as amended, subsequent to the date
hereof and prior to the filing of a post-effective amendment which indicates
that all securities offered hereby have been sold or which deregisters all
securities remaining unsold shall be deemed to be incorporated by reference
herein and to be a part hereof from the respective dates of filing of such
documents.
Item 4. Description of Securities.
Not applicable.
Item 5. Interests of Named Experts and Counsel.
Not applicable.
Item 6. Indemnification of Directors and Officers.
The Company's articles of incorporation and bylaws limit the liability of the
Company's directors to the fullest extent permitted by the Washington business
corporation act (the "WBCA") as it currently exists or as it may be amended in
the future. Consequently, subject to the WBCA, no director will be personally
liable to the Company or its shareholders for monetary damages resulting from
his or her conduct as a director, except liability for:
o acts or omissions involving intentional misconduct or knowing violations of
law;
o unlawful distributions; or
o transactions from which the director personally receives a benefit in money,
property or services to which the director is not legally entitled.
The Company's articles of incorporation also provide that the Company may
indemnify any individual made a party to a proceeding because that individual is
or was a director or officer of the Company, and this right to indemnification
will continue as to an individual who has ceased to be a director or officer and
will inure to the benefit of his or her heirs, executors or administrators. Any
subsequent repeal of or modification to the Company's articles of incorporation
will not adversely affect any right of a director or officer of ours who is or
was a director or officer at the time of such repeal or modification. To the
extent the provisions of the Company's articles of incorporation provide for
indemnification of directors or officers for liabilities arising under the
Securities Act of 1933, as amended (the "Securities Act"), those provisions are,
in the opinion of the Commission, against public policy as expressed in the
Securities Act and therefore unenforceable.
The Company's articles of incorporation and bylaws provide that the Company will
indemnify its directors and officers and may indemnify its other employees and
agents to the fullest extent permitted by law. The Company's directors, officers
and employees also may be indemnified against liability they may incur for
serving in that capacity pursuant to a liability insurance policy maintained by
the Company for such purpose.
Item 7. Exemption from Registration Claimed.
Not applicable.
Item 8. Exhibits.
Exhibit Number Exhibit
4.1 Data I/O Corporation 2000 Stock Compensation Incentive Plan, as
amended
5.1 Opinion of Dorsey & Whitney LLP
23.1 Consent of Grant Thornton, an independent registered public
accounting firm
23.2 Consent of Dorsey & Whitney LLP (Included in Exhibit 5.1)
24.1 Power of Attorney (See signature pages of this Registration
Statement)
Signatures
The Registrant. Pursuant to the requirements of the Securities Act of 1933, the
registrant certifies that it has reasonable grounds to believe that it meets all
of the requirements for filing on Form S-8 and has duly caused this Registration
Statement or amendment to be signed on its behalf by the undersigned, thereunto
duly authorized, in Redmond, Washington, on January 5, 2005.
DATA I/O CORPORATION
By:/s/ Joel S. Hatlen
Vice President, Chief Financial Officer,
Secretary and Treasurer
Power of Attorney
Each person whose signature appears below constitutes and appoints each of
Fredrick R. Hume and Joel S. Hatlen as his or her attorney-in-fact and agent,
with the full power of substitution and resubstitution, for them in any and all
capacities, to sign any and all amendments (including post-effective amendments)
to this Registration Statement, and to file the same, with exhibits thereto and
other documents in connection therewith, with the Securities and Exchange
Commission, hereby ratifying and confirming all that said attorneys-in-fact, or
their substitute or substitutes, may do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended, this
Registration Statement has been signed by the following persons in the
capacities and on the date indicated.
Signature Title Date
/s/ Fredrick R. Hume Chief Executive Officer, January 5, 2005
President and a director
(Principal Executive Officer)
/s/ Joel S. Hatlen Vice President of Finance, January 5, 2005
Chief Financial Officer
Secretary and Treasurer
(Principal Financial Officer
and Accounting Officer
January 5, 2005
/s/ Glen F. Ceiley Director
/s/ Daniel A. DiLeo Director January 5, 2005
/s/ Paul A. Gary Director January 5, 2005
/s/ Edward D. Lazowska Director January 5, 2005
/s/ Steven M. Quist Director January 5, 2005
/s/ William R. Walker Director January 5, 2005
Exhibit Index
Exhibit Exhibit
Number
4.1 Data I/O Corporation 2000 Stock Compensation Incentive Plan,
as amended
5.1 Opinion of Dorsey & Whitney LLP
23.1 Consent of Grant Thornton, an independent registered public
accounting firm
23.2 Consent of Dorsey & Whitney LLP (included in Exhibit 5.1)
24.1 Power of Attorney (see signature pages of this Registration
Statement)
EXHIBIT 4.1
DATA I/O CORPORATION
2000 STOCK COMPENSATION INCENTIVE PLAN
1. PURPOSES
1.1 The purpose of the Data I/O Corporation 2000 Stock Compensation
Incentive Plan (the "Plan") is to enhance the long-term shareholder
value of Data I/O Corporation, a Washington corporation (the
"Company"), by offering opportunities to employees, persons to whom
offers of employment have been extended, directors, officers,
consultants, agents, advisors and independent contractors of Data I/O
and its Subsidiaries (as defined in Section 2) to participate in Data
I/O's growth and success, and to encourage them to remain in the
service of Data I/O and its Subsidiaries and to acquire and maintain
stock ownership in Data I/O.
2. DEFINITIONS
For purposes of the Plan, the following terms shall be defined as set forth
below:
2.1 Acquired Entities.
"Acquired Entities" has the meaning given in Section 6.2.
2.2 Acquisition Transaction.
"Acquisition Transaction" has the meaning given in Section 6.2.
2.3 Award.
"Award" means a grant made to a Participant pursuant to the Plan,
including, without limitation, grants of Options, Stock Appreciation Rights,
Stock Awards, Other Stock-Based Awards or any combination of the foregoing.
2.4 Board.
"Board" means the Board of Directors of Data I/O.
2.5 Cause.
"Cause" means dishonesty, fraud, misconduct, disclosure of confidential
information, conviction of, or a plea of guilty or no contest to, a felony under
the laws of the United States or any state thereof, habitual absence from work
for reasons other than illness, intentional conduct which causes significant
injury to Data I/O, habitual abuse of alcohol or a controlled substance, in each
case as determined by the Plan Administrator, and its determination shall be
conclusive and binding.
2.6 Change in Control.
"Change in Control" means (i) the consummation of a merger or consolidation
of Data I/O with or into another entity or any other corporate reorganization,
if more than 50% of the combined voting power of the continuing or surviving
entity's securities outstanding immediately after such merger, consolidation or
other reorganization is owned by persons who were not shareholders of Data I/O
immediately prior to such merger, consolidation or other reorganization or (ii)
the sale, transfer or other disposition of all or substantially all of Data
I/O's assets. A transaction shall not constitute a Change in Control if its sole
purpose is to change the state of Data I/O's incorporation or to create a
holding company that will be owned in substantially the same proportions by the
persons who held Data I/O's securities immediately before such transaction.
2.7 Code.
"Code" means the Internal Revenue Code of 1986, as amended from time to
time.
2.8 Common Stock.
"Common Stock" means the common stock, no par value, of Data I/O.
2.9 Disability.
"Disability" means a medically determinable mental or physical impairment
or condition of the Holder which is expected to result in death or which has
lasted or is expected to last for a continuous period of twelve (12) months or
more and which causes the Holder to be unable, in the opinion of the Plan
Administrator on the basis of evidence acceptable to it, to perform his or her
duties for Data I/O and, in the case of a determination of Disability for
purposes of determining the exercise period for an Incentive Stock Option, to be
engaged in any substantial gainful activity. Upon making a determination of
Disability, the Plan Administrator shall, for purposes of the Plan, determine
the date of the Holder's termination of employment, service or contractual
relationship.
2.10 Exchange Act.
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
2.11 Fair Market Value.
"Fair Market Value" shall be as established in good faith by the Plan
Administrator or (a) if the Common Stock is listed on the NASDAQ Market, the
mean between the high and low selling prices for the Common Stock as reported by
the NASDAQ Market for a single trading day or (b) if the Common Stock is listed
on the New York Stock Exchange or the American Stock Exchange, the mean between
the high and low selling prices for the Common Stock as such prices are
officially quoted in the composite tape of transactions on such exchange for a
single trading day. If there is no such reported price for the Common Stock for
the date in question, then such price on the last preceding date for which such
price exists shall be determinative of Fair Market Value.
2.12 Grant Date.
"Grant Date" means the date the Plan Administrator adopted the granting
resolution or a later date designated in a resolution of the Plan Administrator
as the date an Award is to be granted.
2.13 Holder.
"Holder" means the Participant to whom an Award is granted or the personal
representative of a Holder who has died.
2.14 Incentive Stock Option.
"Incentive Stock Option" means an Option to purchase Common Stock granted
under Section 7 with the intention that it qualify as an "incentive stock
option" as that term is defined in Section 422 of the Code.
2.15 Involuntary Termination.
"Involuntary Termination" means termination of the Holder's service to Data
I/O (or the parent or subsidiary company employing such Holder) or the other
party to the transaction constituting a Change in Control by reason of (i) the
involuntary discharge of such Holder by Data I/O (or the parent or subsidiary
company employing such Holder) or the other party to the transaction
constituting a Change in Control for reasons other than Cause or (ii) the
voluntary resignation of the Holder following (A) a change in such Holder's
position with Data I/O (or its successor or the parent or subsidiary company
that employs such Holder) or the other party to the transaction constituting a
Change in Control that materially reduces such Holder's level of authority or
responsibility or (B) a reduction in such Holder's compensation (including base
salary, fringe benefits and participation in bonus or incentive programs based
on corporate performance) by more than 20%.
2.16 Nonqualified Stock Option.
"Nonqualified Stock Option" means an Option to purchase Common Stock
granted under Section 7 other than an Incentive Stock Option.
2.17 Option.
"Option" means the right to purchase Common Stock granted under Section 7.
2.18 Option Shares.
"Option Shares" means the shares of Common Stock issuable upon a Holder's
exercise of an Option granted under the Plan.
2.19 Other Stock-Based Award.
"Other Stock-Based Award" means an Award granted under Section 11.
2.20 Participant.
"Participant" means an individual who is a Holder of an Award or, as the
context may require, any employee, director (including directors who are not
employees), officer, consultant, agent, advisor or independent contractor of
Data I/O or a Subsidiary who has been designated by the Plan Administrator as
eligible to participate in the Plan.
2.21 Plan Administrator.
"Plan Administrator" means the Board or any committee designated to
administer the Plan under Section 3.1.
2.22 Qualifying Award.
"Qualifying Award" means an Option or an Award that is held by a person who
had been an employee, director, consultant or agent to Data I/O for at least 180
days as of the effective date of a Change in Control.
2.23 Qualifying Shares.
"Qualifying Shares" means shares of Common Stock issued pursuant to a
Qualifying Award which are subject to the right of Data I/O to repurchase some
or all of such shares at the original purchase price (if any) upon termination
of the Holder's services to Data I/O.
2.24 Restricted Stock.
"Restricted Stock" means shares of Common Stock granted pursuant to a Stock
Award under Section 10, the rights of ownership of which are subject to
restrictions prescribed by the Plan Administrator.
2.25 Securities Act.
"Securities Act" means the Securities Act of 1933, as amended.
2.26 Stock Appreciation Right.
"Stock Appreciation Right" means an Award granted under Section 9.
2.27 Stock Award.
"Stock Award" means an Award granted under Section 10.
2.28 Subsidiary.
"Subsidiary," except as expressly provided otherwise, means any entity that
is directly or indirectly controlled by Data I/O or in which Data I/O has a
significant ownership interest, as determined by the Plan Administrator, and any
entity that may become a direct or indirect parent of Data I/O.
2.29 Unvested Portion.
"Unvested Portion" means the portion of a Qualifying Award or Qualifying
Shares that is/are unvested as of the effective date of a Change in Control.
2.30 Vested Portion.
"Vested Portion" means the portion of a Qualifying Award or Qualifying
Shares that is/are vested as of the effective date of a Change in Control.
3. ADMINISTRATION
3.1 Plan Administrator.
The Plan shall be administered by the Board or a committee or committees
(which term includes subcommittees) appointed by, and consisting of two or more
members of, the Board. Any such committee shall have the powers and authority
vested in the Board hereunder (including the power and authority to interpret
any provision of the Plan or of any Award). The Board, or any committee thereof
appointed to administer the Plan, is referred to herein as the "Plan
Administrator." If and so long as the Common Stock is registered under Section
12(b) or 12(g) of the Exchange Act, the Board shall consider in selecting the
Plan Administrator and the membership of any committee acting as Plan
Administrator for any persons subject or likely to become subject to Section 16
under the Exchange Act the provisions regarding (a) "outside directors" as
contemplated by Section 162(m) of the Code and (b) "Non-Employee Directors" as
contemplated by Rule 16b-3 under the Exchange Act. The Board or Plan
Administrator may delegate the responsibility for administering the Plan with
respect to designated classes of eligible Participants to one or more senior
executive officers or committees thereof, the members of which need not be
members of the Board, subject to such limitations as the Board deems
appropriate. Committee members shall serve for such term as the Board may
determine, subject to removal by the Board at any time.
3.2 Administration and Interpretation by the Plan Administrator.
Except for the terms, conditions and limitations explicitly set forth in
the Plan, the Plan Administrator shall have exclusive authority, in its absolute
discretion, to determine all matters relating to Awards under the Plan,
including the selection of individuals to be granted Awards, the type of Awards,
the number of shares of Common Stock subject to an Award, all terms, conditions,
restrictions and limitations, if any, of an Award and the terms of any
instrument that evidences the Award. The Plan Administrator shall also have
exclusive authority to interpret the Plan and may from time to time adopt,
change and rescind rules and regulations of general application for the Plan's
administration. This authority shall include the sole authority to correct any
defect, supply any omission or reconcile any inconsistency in this Plan and make
all other determinations necessary or advisable for the administration of the
Plan and do everything necessary or appropriate to administer the Plan. The Plan
Administrator's interpretation of the Plan and its rules and regulations, and
all actions taken and determinations made by the Plan Administrator pursuant to
the Plan, shall be conclusive and binding on all parties involved or affected.
The Plan Administrator may delegate administrative duties to such of Data I/O's
officers as it so determines.
4. STOCK SUBJECT TO THE PLAN
4.1 Authorized Number of Shares.
As of March 10, 2000, Data I/O has outstanding options with respect to
1,215,000 shares of Common Stock and 270,499 shares of Common Stock available
for additional grants under its 2000 Stock Option Plan (the "2000 Plan") and its
1986 Stock Option Plan ("1986 Plan"). Subject to adjustment from time to time as
provided in Section 14.1, Awards of the authorized but unissued shares of Common
Stock under the 1986 Plan, or shares of Common Stock that become available under
the 1986 Plan as a result of the expiration or termination of options, may be
granted under this Plan. Awards for an additional 300,000 shares of Common Stock
shall also be available for issuance under the Plan. Shares issued under the
Plan shall be drawn from authorized and unissued shares. See also Section 18 for
Plan amendments.
4.2 Limitations.
(a) Subject to adjustment from time to time as provided in Section 14.1,
not more than 200,000 shares of Common Stock may be made subject to Awards under
the Plan to any individual Participant in the aggregate in any one (1) calendar
year, except that Data I/O may make additional one-time grants to newly hired
Participants of up to 100,000 shares per such Participant; such limitation shall
be applied in a manner consistent with the requirements of, and only to the
extent required for compliance with, the exclusion from the limitation on
deductibility of compensation under Section 162(m) of the Code.
(b) Subject to adjustment from time to time as provided in Section 14.1,
not more than 100,000 shares of Common Stock may be made subject to Awards to
any non-employee director in the aggregate in any one calendar year.
4.3 Reuse of Shares.
Any shares of Common Stock that have been made subject to an Award that
cease to be subject to the Award (other than by reason of exercise or payment of
the Award to the extent it is exercised for or settled in shares) and any shares
repurchased by Data I/O from a Holder upon exercise of a right of repurchase
shall again be available for issuance in connection with future grants of Awards
under the Plan; provided, however, that any such shares shall be counted in
accordance with the requirements of Section 162(m) of the Code of Ethics if and
to the extent applicable. Shares that are subject to tandem Awards shall be
counted only once. Also, upon a stock-for-stock exercise only the net number of
shares will be deemed to have been used under this Plan.
5. ELIGIBILITY
Awards may be granted under the Plan to those officers, directors and key
employees of Data I/O and its Subsidiaries as the Plan Administrator from time
to time selects. Awards may also be made to consultants, agents, advisors and
independent contractors who provide services to Data I/O and its Subsidiaries.
6. AWARDS
6.1 Form and Grant of Awards.
The Plan Administrator shall have the authority, in its sole discretion, to
determine the type or types of Awards to be made under the Plan. Such Awards may
include, but are not limited to, Incentive Stock Options, Nonqualified Stock
Options, Stock Appreciation Rights, Stock Awards and Other Stock-Based Awards.
Awards may be granted singly, in combination or in tandem so that the settlement
or payment of one automatically reduces or cancels the other. Awards may also be
made in combination or in tandem with, in replacement of, as alternatives to, or
as the payment form for, grants or rights under any other employee or
compensation plan of Data I/O.
6.2 Acquired Company Awards.
Notwithstanding anything in the Plan to the contrary, the Plan
Administrator may grant Awards under the Plan in substitution for awards issued
under other plans, or assume under the Plan awards issued under other plans, if
the other plans are or were plans of other acquired entities ("Acquired
Entities") (or the parent of the Acquired Entity) and the new Award is
substituted, or the old Award is assumed, by reason of a merger, consolidation,
acquisition of property or of stock, reorganization or liquidation (an
"Acquisition Transaction"). If a written agreement pursuant to which an
Acquisition Transaction is completed is approved by the Board and said agreement
sets forth the terms and conditions of the substitution for or assumption of
outstanding awards of the Acquired Entity, said terms and conditions shall be
deemed to be the action of the Plan Administrator without any further action by
the Plan Administrator, except as may be required for compliance with Rule 16b-3
under the Exchange Act, and the persons holding such Awards shall be deemed to
be Participants and Holders.
7. AWARDS OF OPTIONS
7.1 Grant of Options.
The Plan Administrator is authorized under the Plan, in its sole
discretion, to issue Options as Incentive Stock Options or as Nonqualified Stock
Options, which shall be appropriately designated.
7.2 Option Exercise Price.
The exercise price for shares purchased under an Option shall be as
determined by the Plan Administrator, but shall not be less than 100% of the
Fair Market Value of the Common Stock on the Grant Date with respect to
Incentive Stock Options.
7.3 Term of Options.
The term of each Option shall be as established by the Plan Administrator
or, if not so established, shall be six (6) years from the Grant Date.
7.4 Exercise of Options.
The Plan Administrator shall establish and set forth in each instrument
that evidences an Option the time at which or the installments in which the
Option shall become exercisable, which provisions may be waived or modified by
the Plan Administrator at any time. If not so established in the instrument
evidencing the Option or otherwise set at the time of grant, the Option will be
subject to the following: (a) 25% of the Option shall vest and become
exercisable on each anniversary of the Grant Date such that the Option shall be
fully vested on the fourth anniversary of the Grant Date; (b) in no event shall
any additional Option Shares vest after termination of Holder's employment by or
service to Data I/O; and (c) the Plan Administrator may waive or modify the
foregoing schedule at any time.
To the extent that the right to purchase shares has accrued thereunder, an
Option may be exercised from time to time by written notice to Data I/O, in
accordance with procedures established by the Plan Administrator, setting forth
the number of shares with respect to which the Option is being exercised and
accompanied by payment in full as described in Section 7.5. An Option may not be
exercised as to less than 100 shares at any one time (or the lesser number of
remaining shares covered by the Option).
7.5 Payment of Exercise Price.
The exercise price for shares purchased under an Option shall be paid in
full to Data I/O by delivery of consideration equal to the product of the Option
exercise price and the number of shares purchased. Such consideration must be
paid in cash or check (unless, at the time of exercise, the Plan Administrator
determines not to accept a personal check), except that the Plan Administrator,
in its sole discretion, may, either at the time the Option is granted or at any
time before it is exercised and subject to such limitations as the Plan
Administrator may determine, authorize payment in cash and/or one or more of the
following alternative forms: (a) tendering (either actually or, if and so long
as the Common Stock is registered under Section 12(b) or 12(g) of the Exchange
Act, by attestation) Common Stock already owned by the Holder for at least six
months (or any shorter period necessary to avoid a charge to Data I/O's earnings
for financial reporting purposes) having a Fair Market Value on the day prior to
the exercise date equal to the aggregate Option exercise price; (b) a promissory
note delivered pursuant to Section 12; (c) if and so long as the Common Stock is
registered under Section 12(b) or 12(g) of the Exchange Act, delivery of a
properly executed exercise notice, together with irrevocable instructions, to
(i) a third party designated by Data I/O to deliver promptly to Data I/O the
aggregate amount of sale or loan proceeds to pay the Option exercise price and
any withholding tax obligations that may arise in connection with the exercise
and (ii) Data I/O to deliver the certificates for such purchased shares directly
to such third party, all in accordance with the regulations of the Federal
Reserve Board; or (d) such other consideration as the Plan Administrator may
permit.
7.6 Post-Termination Exercises.
The Plan Administrator may establish and set forth in each instrument that
evidences an Option whether the Option will continue to be exercisable, and the
terms and conditions of such exercise, if a Holder ceases to be employed by, or
to provide services to, Data I/O or its Subsidiaries, which provisions may be
waived or modified by the Plan Administrator at any time.
If not so established in the instrument evidencing the Option, the Option
will be exercisable according to the following terms and conditions, which may
be waived or modified by the Plan Administrator at any time.
In case of termination of the Holder's employment or services other than by
reason of death or Cause, the Option shall be exercisable, to the extent of the
number of shares purchasable by the Holder at the date of such termination, only
(a) within one (1) year if the termination of the Holder's employment or
services are coincident with Disability or (b) within three (3) months after the
date the Holder ceases to be an employee, director, officer, consultant, agent,
advisor or independent contractor of Data I/O or a Subsidiary if termination of
the Holder's employment or services is for any reason other than death or
Disability, but in no event later than the remaining term of the Option. Any
Option exercisable at the time of the Holder's death may be exercised, to the
extent of the number of shares purchasable by the Holder at the date of the
Holder's death, by the personal representative of the Holder's estate entitled
thereto at any time or from time to time within one (1) year after the date of
death, but in no event later than the remaining term of the Option. In case of
termination of the Holder's employment or services for Cause, the Option shall
automatically terminate upon first discovery by Data I/O of any reason for such
termination and the Holder shall have no right to purchase any Shares pursuant
to such Option, unless the Plan Administrator determines otherwise. If a
Holder's employment or services with Data I/O are suspended pending an
investigation of whether the Holder shall be terminated for Cause, all the
Holder's rights under any Option likewise shall be suspended during the period
of investigation.
A transfer of employment or services between or among Data I/O and its
Subsidiaries shall not be considered a termination of employment or services.
The effect of a Company-approved leave of absence or short-term break in service
on the terms and conditions of an Option shall be determined by the Plan
Administrator, in its sole discretion.
8. INCENTIVE STOCK OPTION LIMITATIONS
To the extent required by Section 422 of the Code, Incentive Stock Options
shall be subject to the following additional terms and conditions:
8.1 Dollar Limitation.
To the extent the aggregate Fair Market Value (determined as of the Grant
Date) of Common Stock with respect to which Incentive Stock Options are
exercisable for the first time during any calendar year (under the Plan and all
other stock option plans of Data I/O) exceeds $100,000, such portion in excess
of $100,000 shall be treated as a Nonqualified Stock Option. In the event the
Participant holds two (2) or more such Options that become exercisable for the
first time in the same calendar year, such limitation shall be applied on the
basis of the order in which such Options were granted.
8.2 10% Shareholders.
If a Participant owns more than 10% of the total voting power of all
classes of Data I/O's stock, then the exercise price per share of an Incentive
Stock Option shall not be less than 110% of the Fair Market Value of the Common
Stock on the Grant Date and the Option term shall not exceed five (5) years. The
determination of 10% ownership shall be made in accordance with Section 422 of
the Code.
8.3 Eligible Employees.
Individuals who are not employees of Data I/O or one of its parent
corporations or subsidiary corporations may not be granted Incentive Stock
Options. For purposes of this Section 8.3, "parent corporation" and "subsidiary
corporation" shall have the meanings attributed to those terms for purposes of
Section 422 of the Code.
8.4 Term.
The term of an Incentive Stock Option shall not exceed ten (10) years.
8.5 Exercisability.
To qualify for Incentive Stock Option tax treatment, an Option designated
as an Incentive Stock Option must be exercised within three (3) months after
termination of employment for reasons other than death, except that, in the case
of termination of employment due to total Disability, such Option must be
exercised within one (1) year after such termination. Employment shall not be
deemed to continue beyond the first 90 days of a leave of absence unless the
Participant's reemployment rights are guaranteed by statute or contract.
8.6 Taxation of Incentive Stock Options.
In order to obtain certain tax benefits afforded to Incentive Stock Options
under Section 422 of the Code, the Participant must hold the shares issued upon
the exercise of an Incentive Stock Option for two (2) years after the Grant Date
of the Incentive Stock Option and one (1) year from the date the shares are
transferred to the Participant. A Participant may be subject to the alternative
minimum tax at the time of exercise of an Incentive Stock Option. The
Participant shall give Data I/O prompt notice of any disposition of shares
acquired by the exercise of an Incentive Stock Option prior to the expiration of
such holding periods.
8.7 Promissory Notes.
The amount of any promissory note delivered pursuant to Section 12 in
connection with an Incentive Stock Option shall bear interest at a rate
specified by the Plan Administrator but in no case less than the rate required
to avoid imputation of interest (taking into account any exceptions to the
imputed interest rules) for federal income tax purposes.
8.8 Incorporation of Other Provisions.
With respect to Incentive Stock Options, if this Plan does not contain any
provision required to be included herein under Section 422 of the Code, such
provision shall be deemed to be incorporated herein with the same force and
effect as if such provision had been set out in full herein; provided, however,
that to the extent any Option that is intended to qualify as an Incentive Stock
Option cannot so qualify, the Option, to that extent, shall be deemed to be a
Nonqualified Stock Option for all purposes of this Plan.
9. STOCK APPRECIATION RIGHTS
9.1 Grant of Stock Appreciation Rights.
The Plan Administrator may grant a Stock Appreciation Right separately or
in tandem with a related Option.
9.2 Tandem Stock Appreciation Rights.
A Stock Appreciation Right granted in tandem with a related Option will
give the Holder the right to surrender to Data I/O all or a portion of the
related Option and to receive an appreciation distribution (in shares of Common
Stock or cash or any combination of shares and cash, as the Plan Administrator,
in its sole discretion, shall determine at any time) in an amount equal to the
excess of the Fair Market Value for the date the Stock Appreciation Right is
exercised over the exercise price per share of the right, which shall be the
same as the exercise price of the related Option. A tandem Stock Appreciation
Right will have the same other terms and provisions as the related Option. Upon
and to the extent a tandem Stock Appreciation Right is exercised, the related
Option will terminate.
9.3 Stand-Alone Stock Appreciation Rights.
A Stock Appreciation Right granted separately and not in tandem with an
Option will give the Holder the right to receive an appreciation distribution in
an amount equal to the excess of the Fair Market Value for the date the Stock
Appreciation Right is exercised over the exercise price per share of the right.
A stand-alone Stock Appreciation Right will have such terms as the Plan
Administrator may determine, except that the term of the right, if not otherwise
established by the Plan Administrator, shall be ten (10) years from the Grant
Date.
9.4 Exercise of Stock Appreciation Rights.
Unless otherwise provided by the Plan Administrator in the instrument that
evidences the Stock Appreciation Right, the provisions of Section 7.6 relating
to the termination of a Holder's employment or services shall apply equally, to
the extent applicable, to the Holder of a Stock Appreciation Right.
10. STOCK AWARDS
10.1 Grant of Stock Awards.
The Plan Administrator is authorized to make Awards of Common Stock or of
rights to receive shares of Common Stock to Participants on such terms and
conditions and subject to such restrictions, if any (which may be based on
continuous service with Data I/O or the achievement of performance goals related
to (i) sales, gross margin, operating profits or profits, (ii) growth in sales,
gross margin, operating profits or profits, (iii) return ratios related to
sales, gross margin, operating profits or profits, (iv) cash flow, (v) asset
management (including inventory management), or (vi) total shareholder return,
where such goals may be stated in absolute terms or relative to comparison
companies), as the Plan Administrator shall determine, in its sole discretion,
which terms, conditions and restrictions shall be set forth in the instrument
evidencing the Award. The terms, conditions and restrictions that the Plan
Administrator shall have the power to determine shall include, without
limitation, the manner in which shares subject to Stock Awards are held during
the periods they are subject to restrictions and the circumstances under which
forfeiture of Restricted Stock shall occur by reason of termination of the
Holder's services or upon the occurrence of other events.
10.2 Issuance of Shares.
Upon the satisfaction of any terms, conditions and restrictions prescribed
with respect to a Stock Award, or upon the Holder's release from any terms,
conditions and restrictions of a Stock Award, as determined by the Plan
Administrator, Data I/O shall transfer, as soon as practicable, to the Holder
or, in the case of the Holder's death, to the personal representative of the
Holder's estate or as the appropriate court directs, the appropriate number of
shares of Common Stock covered by the Award.
10.3 Waiver of Restrictions.
Notwithstanding any other provisions of the Plan, the Plan Administrator
may, in its sole discretion, waive the forfeiture period and any other terms,
conditions or restrictions on any Restricted Stock under such circumstances and
subject to such terms and conditions as the Plan Administrator shall deem
appropriate.
11. OTHER STOCK-BASED AWARDS
The Plan Administrator may grant other Awards under the Plan pursuant to
which shares of Common Stock (which may, but need not, be shares of Restricted
Stock pursuant to Section 10) are or may in the future be acquired, or Awards
denominated in stock units, including ones valued using measures other than
market value. Such Other Stock-Based Awards may be granted alone or in addition
to or in tandem with any Award of any type granted under the Plan and must be
consistent with the Plan's purpose.
12. LOANS, INSTALLMENT PAYMENTS AND LOAN GUARANTEES
To assist a Holder (including a Holder who is an officer or director of
Data I/O) in acquiring shares of Common Stock pursuant to an Award granted under
the Plan, the Plan Administrator, in its sole discretion, may authorize, either
at the Grant Date or at any time before the acquisition of Common Stock pursuant
to the Award, (a) the extension of a loan to the Holder by Data I/O, (b) the
payment by the Holder of the purchase price, if any, of the Common Stock in
installments, or (c) the guarantee by Data I/O of a loan obtained by the grantee
from a third party. The terms of any loans, installment payments or loan
guarantees, including the interest rate and terms of and security for repayment,
will be subject to the Plan Administrator's discretion; provided, however, that
repayment of any Company loan to the Holder shall be secured by delivery of a
full-recourse promissory note for the loan amount executed by the Holder,
together with any other form of security determined by the Plan Administrator.
The maximum credit available is the purchase price, if any, of the Common Stock
acquired, plus the maximum federal and state income and employment tax liability
that may be incurred in connection with the acquisition.
13. ASSIGNABILITY
Except as otherwise specified or approved by the Plan Administrator at the
time of grant of an Award or any time prior to its exercise, no Award granted
under the Plan may be assigned, pledged or transferred by the Holder other than
by will or by the laws of descent and distribution, and during the Holder's
lifetime, such Awards may be exercised only by the Holder. Notwithstanding the
foregoing, and to the extent permitted by Section 422 of the Code, the Plan
Administrator, in its sole discretion, may permit such assignment, transfer and
exercisability and may permit a Holder of such Awards to designate a beneficiary
who may exercise the Award or receive compensation under the Award after the
Holder's death; provided, however, that (i) any Award so assigned or transferred
shall be subject to all the same terms and conditions contained in the
instrument evidencing the Award, (ii) the original Holder shall remain subject
to withholding taxes upon exercise, (iii) any subsequent transfer of an Award
shall be prohibited and (iv) the events of termination of employment or
contractual relationship set forth in subsection 7.6 shall continue to apply
with respect to the original transferor-Holder.
14. ADJUSTMENTS
14.1 Adjustment of Shares.
In the event that, at any time or from time to time, a stock dividend,
stock split, spin-off, combination or exchange of shares, recapitalization,
merger, consolidation, distribution to shareholders other than a normal cash
dividend, or other change in Data I/O's corporate or capital structure results
in (a) the outstanding shares, or any securities exchanged therefor or received
in their place, being exchanged for a different number or class of securities of
Data I/O or of any other corporation or (b) new, different or additional
securities of Data I/O or of any other corporation being received by the holders
of shares of Common Stock of Data I/O, then the Plan Administrator, in its sole
discretion, shall make such equitable adjustments as it shall deem appropriate
in the circumstances in (i) the maximum number and class of securities subject
to the Plan as set forth in Section 4.1, (ii) the maximum number and class of
securities that may be made subject to Awards to any individual Participant as
set forth in Section 4.2, and (iii) the number and class of securities that are
subject to any outstanding Award and the per share price of such securities,
without any change in the aggregate price to be paid therefor. The determination
by the Plan Administrator as to the terms of any of the foregoing adjustments
shall be conclusive and binding.
14.2 Dissolution, Liquidation or Change in Control Transactions.
(a) In the event of the proposed dissolution or liquidation of Data
I/O, Data I/O shall notify each Holder at least fifteen (15) days prior to such
proposed action. To the extent not previously exercised, all Awards will
terminate immediately prior to the consummation of such proposed action.
(b) Unless the applicable agreement representing an Option provides
otherwise, or unless the Plan Administrator determines otherwise in its sole and
absolute discretion in connection with any Change in Control, a Qualifying
Option which is not exercisable in full shall become exercisable in connection
with a Change in Control which becomes effective before the Holder's service to
Data I/O terminates as follows:
(i) If the Qualifying Option remains outstanding following the
Change in Control, is assumed by the surviving entity or its parent, or the
surviving entity or its parent substitutes options with substantially the same
terms for such Qualifying Option, the vesting and exercisability of the
Qualifying Option shall be accelerated to the extent of 25% of the Unvested
Portion thereof, and the remaining 75% of the Unvested Portion of such
Qualifying Option shall vest in accordance with the vesting schedule set forth
in the applicable Option agreement.
(ii) If the Qualifying Option remains outstanding following
the Change in Control, is assumed by the surviving entity or its parent, or the
surviving entity or its parent substitutes options with substantially the same
terms for such Qualifying Option and if the Holder thereof is subject to an
Involuntary Termination within 180 days following such Change in Control, then
all Options held by such Holder (or options issued in substitution thereof)
shall become exercisable in full, whether or not the vesting requirements set
forth in the Option agreement have been satisfied, for a period of 90 days
commencing on the effective date of such Holder's Involuntary Termination, or if
shorter, the remaining term of the option.
(iii) If a Qualifying Option does not remain outstanding, and
either such Qualifying Option is not assumed by the surviving entity or its
parent, or the surviving entity or its parent does not substitute options with
substantially the same terms for such Qualifying Option, such Qualifying Option
shall become exercisable in full, whether or not the vesting requirements set
forth in the Option agreement have been satisfied, for a period prior to the
effective date of such Change in Control of a duration specified by the Plan
Administrator, and thereafter the Option shall terminate.
(c) Unless the applicable agreement representing an Award provides
otherwise, or unless the Plan Administrator determines otherwise in its sole and
absolute discretion in connection with any Change in Control, the vesting of
Qualifying Shares shall be accelerated, and Data I/O's repurchase right with
respect to such shares shall lapse, in connection with a Change in Control which
becomes effective before such Holder's service to Data I/O terminates as
follows:
(i) If Qualifying Options were outstanding at the effective
time of the Change in Control and they are partially accelerated pursuant to
Subsection (b)(i) above or if there were no Qualifying Options outstanding at
the effective time of the Change in Control, the vesting of all Qualifying
Shares shall be accelerated to the extent of 25% of the Unvested Portion
thereof, and the remaining 75% of the Unvested Portion of such Qualifying Shares
shall vest in accordance with the vesting schedule set forth in the applicable
Award agreement.
(ii) If the preceding clause (i) applied and if a Holder of
Qualifying Shares is subject to an Involuntary Termination within 180 days
following the same Change in Control, then all Qualifying Shares held by such
Holder (or shares issued in substitution thereof) shall become vested in full,
whether or not the vesting requirements set forth in the applicable Award
agreement have been satisfied.
(iii) If Qualifying Options were outstanding at the effective
time of the Change in Control and they are accelerated in full pursuant to
Subsection (b)(iii) above or otherwise, the vesting of all Qualifying Shares
shall be accelerated in full, and Data I/O's repurchase right with respect to
all such shares shall lapse in full, whether or not the vesting requirements set
forth in the applicable Award agreement have been satisfied.
(d) Notwithstanding Subsections (b) and (c) above, if Data I/O and
the other party to the transaction constituting a Change in Control agree that
such transaction is to be treated as a "pooling of interests" for financial
reporting purposes, and if Data I/O's independent public accountants and such
other party's independent public accountants separately determine in good faith
that the transaction constituting a Change in Control would qualify for
treatment as a "pooling of interests" but for the acceleration of vesting
provided for in Subsections (b) and (c) above, then the acceleration of
exercisability or the lapse of Data I/O's right to repurchase shall not occur to
the extent that Data I/O's independent public accountants and such other party's
independent public accountants separately determine in good faith that such
acceleration would preclude the use of "pooling of interests" accounting for
such transaction.
14.3 Further Adjustment of Awards.
Subject to the preceding Section 14.2, the Plan Administrator shall have
the discretion, exercisable at any time before a sale, merger, consolidation,
reorganization, dissolution, liquidation or Change in Control of Data I/O, as
defined by the Plan Administrator, to take such further action as it determines
to be necessary or advisable, and fair and equitable to Participants, with
respect to Awards. Such authorized action may include (but shall not be limited
to) establishing, amending or waiving the type, terms, conditions or duration
of, or restrictions on, Awards so as to provide for earlier, later, extended or
additional time for exercise, payment or settlement or lifting restrictions,
differing methods for calculating payments or settlements, alternate forms and
amounts of payments and settlements and other modifications, and the Plan
Administrator may take such actions with respect to all Participants, to certain
categories of Participants or only to individual Participants. The Plan
Administrator may take such actions before or after granting Awards to which the
action relates and before or after any public announcement with respect to such
sale, merger, consolidation, reorganization, dissolution, liquidation or Change
in Control that is the reason for such action. Without limiting the generality
of the foregoing, if Data I/O is a party to a merger or consolidation,
outstanding Awards shall be subject to the agreement of merger or consolidation.
Such agreement, without the Holder's consent, may provide for:
(a) the continuation of such outstanding Award by Data I/O (if Data I/O is
the surviving corporation);
(b) the assumption of the Plan and some or all outstanding Awards by the
surviving corporation or its parent;
(c) the substitution by the surviving corporation or its parent of Awards
with substantially the same terms for such outstanding Awards; or
(d) the cancellation of such outstanding Awards with or without payment of
any consideration.
14.4 Limitations.
The grant of Awards will in no way affect Data I/O's right to adjust,
reclassify, reorganize or otherwise change its capital or business structure or
to merge, consolidate, dissolve, liquidate or sell or transfer all or any part
of its business or assets.
14.5 Fractional Shares.
In the event of any adjustment in the number of shares covered by any
Option, any fractional shares resulting from such adjustment shall be
disregarded and each such Option shall cover only the number of full shares
resulting from such adjustment.
15. WITHHOLDING
Data I/O may require the Holder to pay to Data I/O in cash the amount of
any withholding taxes that Data I/O is required to withhold with respect to the
grant, exercise, payment or settlement of any Award. Data I/O shall have the
right to withhold from any Award or any shares of Common Stock issuable pursuant
to an Award or from any cash amounts otherwise due or to become due from Data
I/O to the Participant an amount equal to such taxes. Data I/O may also deduct
from any Award any other amounts due from the Participant to Data I/O or a
Subsidiary.
16. AMENDMENT AND TERMINATION OF PLAN
16.1 Amendment of Plan.
The Plan may be amended by the Board in such respects as it shall deem
advisable including, without limitation, such modifications or amendments as are
necessary to maintain compliance with applicable statutes, rules or regulations;
however, to the extent required for compliance with Section 422 of the Code or
any applicable law or regulation, shareholder approval will be required for any
amendment that will increase the aggregate number of shares as to which
Incentive Stock Options may be granted or change the class of persons eligible
to participate. Amendments made to the Plan which would constitute
"modifications" to Incentive Stock Options outstanding on the date of such
Amendments shall not be applicable to such outstanding Incentive Stock Options
but shall have prospective effect only. The Board may condition the
effectiveness of any amendment on the receipt of shareholder approval at such
time and in such manner as the Board may consider necessary for Data I/O to
comply with or to avail Data I/O, the Holders or both of the benefits of any
securities, tax, market listing or other administrative or regulatory
requirement which the Board determines to be desirable. Whenever shareholder
approval is sought, and unless required otherwise by applicable law or exchange
requirements, the proposed action shall require the affirmative vote of holders
of a majority of the shares present, entitled to vote and voting on the matter
without including abstentions or broker non-votes in the denominator.
16.2 Termination Of Plan.
Data I/O's shareholders or the Board may suspend or terminate the Plan at
any time. The Plan will have no fixed expiration date; provided, however, that
no Incentive Stock Options may be granted more than ten (10) years after the
earlier of the Plan's adoption by the Board or approval by the shareholders.
17. GENERAL
17.1 Award Agreements.
Awards granted under the Plan shall be evidenced by a written agreement
which shall contain such terms, conditions, limitations and restrictions as the
Plan Administrator shall deem advisable and which are not inconsistent with the
Plan.
17.2 Continued Employment or Services; Rights In Awards.
None of the Plan, participation in the Plan as a Participant or any action
of the Plan Administrator taken under the Plan shall be construed as giving any
Participant or employee of Data I/O any right to be retained in the employ of
Data I/O or limit Data I/O's right to terminate the employment or services of
the Participant.
17.3 Registration; Certificates For Shares.
Data I/O shall be under no obligation to any Participant to register for
offering or resale or to qualify for exemption under the Securities Act, or to
register or qualify under state securities laws, any shares of Common Stock,
security or interest in a security paid or issued under, or created by, the
Plan, or to continue in effect any such registrations or qualifications if made.
Data I/O may issue certificates for shares with such legends and subject to such
restrictions on transfer and stop-transfer instructions as counsel for Data I/O
deems necessary or desirable for compliance by Data I/O with federal and state
securities laws.
Inability of Data I/O to obtain, from any regulatory body having
jurisdiction, the authority deemed by Data I/O's counsel to be necessary for the
lawful issuance and sale of any shares hereunder or the unavailability of an
exemption from registration for the issuance and sale of any shares hereunder
shall relieve Data I/O of any liability in respect of the nonissuance or sale of
such shares as to which such requisite authority shall not have been obtained.
17.4 No Rights As A Shareholder.
No Option, Stock Appreciation Right or Other Stock-Based Award shall
entitle the Holder to any cash dividend, voting or other right of a shareholder
unless and until the date of issuance under the Plan of the shares that are the
subject of such Award, free of all applicable restrictions.
17.5 Compliance With Laws And Regulations.
In interpreting and applying the provisions of the Plan, any Option granted
as an Incentive Stock Option pursuant to the Plan shall, to the extent permitted
by law, be construed as an "incentive stock option" within the meaning of
Section 422 of the Code.
17.6 No Trust Or Fund.
The Plan is intended to constitute an "unfunded" plan. Nothing contained
herein shall require Data I/O to segregate any monies or other property, or
shares of Common Stock, or to create any trusts, or to make any special deposits
for any immediate or deferred amounts payable to any Participant, and no
Participant shall have any rights that are greater than those of a general
unsecured creditor of Data I/O.
17.7 Severability.
If any provision of the Plan or any Award is determined to be invalid,
illegal or unenforceable in any jurisdiction, or as to any person, or would
disqualify the Plan or any Award under any law deemed applicable by the Plan
Administrator, such provision shall be construed or deemed amended to conform to
applicable laws, or, if it cannot be so construed or deemed amended without, in
the Plan Administrator's determination, materially altering the intent of the
Plan or the Award, such provision shall be stricken as to such jurisdiction,
person or Award, and the remainder of the Plan and any such Award shall remain
in full force and effect.
18. EFFECTIVE DATE
The Plan's effective date is the date on which it is adopted by the Board,
so long as it is approved by Data I/O's shareholders at any time within twelve
(12) months of such adoption.
Original Plan adopted by the Board on February 28, 2000 and approved by Data
I/O's shareholders in May 2000. The Plan was amended and approved by the Board
and Data I/O's shareholders in 2002 to add an additional 200,000 shares of
Common Stock to be reserved for issuance under the Plan. An additional 300,000
shares of Common Stock were reserved in 2004.
EXHIBIT 5.1
DORSEY & WHITNEY LLP
U.S. Bank Building Center, Suite 400
1420 Fifth Avenue
Seattle, wa 98101
January 5, 2005
Data I/O Corporation
10525 Willows Road N.E.
Redmond, Washington 98052
Re: Registration Statement on Form S-8
Ladies and Gentlemen:
We have acted as counsel to Data I/O Corporation, a Washington corporation
(the "Company"), in connection with a Registration Statement on Form S-8 (the
"Registration Statement") relating to the sale by the Company of up to 1,428,786
shares of the Company's common stock, without par value per share (the
"Shares"), pursuant to the Data I/O Corporation 2000 Stock Compensation
Incentive Plan, as amended (the "Plan").
We have examined such documents and have reviewed such questions of law as
we have considered necessary and appropriate for the purposes of the opinions
set forth below.
In rendering our opinions set forth below, we have assumed the authenticity
of all documents submitted to us as originals, the genuineness of all signatures
and the conformity to authentic originals of all documents submitted to us as
copies. We have also assumed the legal capacity for all purposes relevant hereto
of all natural persons and, with respect to all parties to agreements or
instruments relevant hereto other than the Company, that such parties had the
requisite power and authority (corporate or otherwise) to execute, deliver and
perform such agreements or instruments, that such agreements or instruments have
been duly authorized by all requisite action (corporate or otherwise), executed
and delivered by such parties and that such agreements or instruments are the
valid, binding and enforceable obligations of such parties. As to questions of
fact material to our opinions, we have relied upon certificates of officers of
the Company and of public officials.
Based on the foregoing, we are of the opinion that, upon issuance, delivery
and payment therefore in accordance with the terms of the Plan, the Shares will
be validly issued, fully paid and nonaccessable.
Our opinions expressed above are limited to the laws of the state of
Washington.
We hereby consent to the filing of this opinion as an exhibit to the
Registration Statement.
Very truly yours,
/s/ Dorsey & Whitney LLP
KRA/___
EXHIBIT 23.1
Consent of Independent Registered Public Accounting Firm
We have issued our report dated February 6, 2004, accompanying the financial
statements of Data I/O Corporation on Form 10-K for the year ended December 31,
2003 which are incorporated by reference in this Registration Statement. We
consent to the incorporation by reference in this Registration Statement of the
aforementioned report.
Seattle, Washington
January 5, 2005