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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
__________________
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
GRAPHIX ZONE, INC.
---------------------
(Exact name of registrant as specified in its charter)
Delaware
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(State or other jurisdiction of incorporation or organization)
33-0697932
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(I.R.S. employer identification no.)
42 Corporate Park, Suite 200, Irvine, California 92606
- ------------------------------------------------ --------
(Address of principal executive offices) (Zip code)
1996 Stock Option Plan
Non-Qualified Stock Option Granted to Frank Cutler
--------------------------------------------------
(Full title of the plan)
Charles R. Cortright, Jr., 42 Corporate Park, Suite 200,
Irvine, California 92606
-----------------------------------------
(Name and address of agent for service)
(714) 833-3838
(Telephone number, including area code, of agent for service)
<TABLE>
<CAPTION>
CALCULATION OF REGISTRATION FEE
<S> <C> <C> <C> <C>
Title of Securities Amount To Be Proposed Maximum Proposed Maximum Amount of
To Be Registered Registered Offering Price Per Share Aggregate Offering Registration
Price Fee
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Common Stock 2,530,000(1) $5.25(2) $13,282,500 $4,580.18
(1) Consists of 2,500,000 shares under the 1996 Stock Option Plan and 30,000 shares under the Non-Qualified Stock Option granted to
Frank Cutler.
(2) Calculated in accordance with Rule 457(h)(1).
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</TABLE>
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PART II
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE.
The registrant incorporates the following documents by reference in this
Registration Statement:
(a) The registrant's Registration Statement on Form S-4 originall
filed on March 25, 1996, File No. 333-2642;
(b) A description of securities from the registrant's Registration
Statement on Form S-4, File No. 333-2642; and
(c) All other documents filed by registrant after the date of this
Registration Statement under Section 13(a), 13(c), 14 and 15(d) of
the Securities Exchange Act of 1934, prior to the filing of a
post-effective amendment to this Registration Statement which
deregisters the securities covered hereunder which remain unsold.
ITEM 4. DESCRIPTION OF SECURITIES.
Not applicable.
ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL.
Not applicable.
ITEM 6. INDEMNIFICATION OF OFFICERS AND DIRECTORS.
The registrant's Certificate of Incorporation limits, to the maximum
extent permitted by Delaware law, the personal liability of directors for
monetary damages for breach of their fiduciary duties as a director. The
registrant's Bylaws provide that the registrant shall indemnify its officers and
directors and may indemnify its employees and other agents to the fullest extent
permitted by Delaware law.
Section 145 of the Delaware General Corporation Law provides that a
corporation may indemnify a director, officer, employee or agent made a party to
an action by reason of that fact that he or she was a director, officer,
employee or agent of the corporation or was serving at the request of the
corporation against expenses actually and reasonably incurred by him or her in
connection with such action if he or she acted in good faith and in a manner he
or she reasonably believed to be in, or not opposed to, the best interests of
the corporation and with respect to any criminal action, had no reasonable cause
to believe his or her conduct was unlawful.
Insofar as indemnification for liabilities arising under the Securities
Act of 1933, as amended (the "Securities Act") may be permitted to directors,
officers or persons controlling the registrant pursuant to the foregoing
provisions, the registrant has been advised that in the opinion of the
Securities and Exchange Commission, such indemnification is against public
policy as expressed in the Securities Act and is, therefore, unenforceable.
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED.
Not applicable.
2
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ITEM 8. EXHIBITS.
3.1 Certificate of Incorporation of registrant(1).
3.2 Bylaws(1).
5 Opinion of Snell & Wilmer L.L.P. regarding legality of shares
being issued(2).
10.1 1996 Stock Option Plan(1).
10.2 Non-Qualified Stock Option granted to Frank Cutler(1).
24 Consent of Snell & Wilmer L.L.P. (contained in its opinion filed
as Exhibit 5 to this Registration Statement(2).
_______________
(1) Incorporated by reference from Form S-4, File No. 333-2642.
(2) Filed herewith.
ITEM 9. UNDERTAKINGS.
The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this registration statement:
(i) To include any prospectus required by section 10(a)(3)
of the Securities Act;
(ii) To reflect in the prospectus any facts or events
arising after the effective date of the registration statement (or the most
post-effective amendment thereof) which, individually or in the aggregate,
represent a fundamental change in the information set forth in the registration
statement; and
(iii) To include any material information with respect to the
plan of distribution not previously disclosed in the registration statement or
any material change to such information in the registration statement, including
(but not limited to) any addition or election of a managing underwriter.
(2) That, for the purpose of determining any liability under the
Securities Act, each such post-effective amendment shall be deemed to be a new
registration statement relating to the securities offered therein, and the
offering of such securities offered at that time shall be deemed to be the
initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective
amendment any of the securities being registered which remain unsold at the
termination of the offering.
The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act, each filing of the
registrant's annual report pursuant to Section 13(a) or 15(d) of the Securities
Exchange Act of 1934 (and, where applicable, each filing of an employee benefit
plan's annual report pursuant to Section 15(d) of the Securities Exchange Act of
1934) that is incorporated by reference in the registration statement shall be
deemed to be a new registration statement relating to the securities offered
3
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therein, and the offering of such securities at that time shall be deemed to be
the initial bona fide offering thereof.
Insofar as indemnification for liabilities arising under the Securities
Act may be permitted to directors, officers and controlling persons of the
registrant pursuant to the foregoing provisions, or otherwise, the registrant
has been advised that in the opinion of the Securities and Exchange Commission
such indemnification is against public policy as expressed in the Securities Act
and is, therefore, unenforceable. In the event that a claim for indemnification
against such liabilities (other than the payment by the registrant in the
successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the registrant will, unless in the opinion of its counsel that
matter has been settled by controlling precedent, submit to a court of
appropriate jurisdiction the question whether such indemnification by it is
against public policy as expressed in the Securities Act and will be governed by
the final adjudication of such issue.
4
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SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
registrant certifies 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 to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Irvine, State of California, on this 29th day of
July, 1996.
GRAPHIX ZONE, INC.
By: /S/CHARLES R. CORTRIGHT, JR.
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Charles R. Cortright, Jr., President
Pursuant to the requirements of the Securities Act of 1933, this
registration statement has been signed by the following persons in the
capacities indicated on July 29, 1996.
SIGNATURE TITLE
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/S/CHARLES R. CORTRIGHT, JR. President (principal executive officer)
- -------------------------------- and Director
Charles R. Cortright, Jr.
/S/ANGELA C. CORTRIGHT Executive Vice President, Secretary and
- -------------------------------- Director
Angela C. Cortright
/S/NORMAN H. BLOCK Chief Financial Officer (principal
- -------------------------------- financial and accounting officer)
Norman H. Block
/S/THOMAS C. K. YUEN Director
- --------------------------------
Thomas C. K. Yuen
/S/RONALD S. POSNER Chairman of the Board and Director
- --------------------------------
Ronald S. Posner
/S/C. RICHARD KRAMLICH Director
- --------------------------------
C. Richard Kramlich
/S/DOUGLAS GLEN
- -------------------------------- Director
Douglas Glen
5
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GENERAL PLAN DESCRIPTION
AS OF JULY 29, 1996
GRAPHIX ZONE, INC.
1996 STOCK OPTION PLAN
This document constitutes part of a prospectus covering securities that
have been registered under the Securities Act of 1933.
GENERAL INFORMATION
Graphix Zone, Inc. ("Company") adopted its 1996 Stock Option Plan
("Plan") to attract, retain, reward and encourage the Company's key employees,
directors, consultants and advisors by granting them options to purchase shares
of the Company's Common Stock. These options may take the form of "incentive
stock options" as defined in section 422 of the Internal Revenue Code of 1986,
as amended ("Code"), or options that are not intended to be incentive stock
options ("non-qualified options"), or both. A copy of the Plan is attached to
this General Plan Description as EXHIBIT A. The Plan is not subject to
provisions of the Employee Retirement Income Security Act of 1974. No options
may be granted under the Plan after January 17, 2006, although options granted
prior to expiration of the Plan may continue to be exercisable after that date.
The Plan is administered by a committee ("Committee") of the Company's
Board of Directors. The Committee is selected by the Board, and presently
consists of Charles R. Cortright, Jr. and Ronald S. Posner, the Company's
President and Chairman of the Board, respectively. Additional information about
the Plan and its administrators may be obtained by contacting, orally or in
writing:
Graphix Zone, Inc.
42 Corporate Park, Suite 200
Irvine, California 92606-5134
Attn: Chief Financial Officer
(714) 833-3838
PLAN SECURITIES
Plan participants receive options to purchase shares of the Company's
Common Stock, without par value. Options to purchase up to 2,500,000 shares of
Common Stock may be granted under the Plan. Of this amount, options to purchase
927,618 shares are outstanding as of the date of this General Plan Description.
ELIGIBLE PARTICIPANTS
Any employee, director, consultant or advisor who is in a position to
make a significant contribution to the success of the Company is eligible to
receive options, although only "employees" as defined in the Code are eligible
to receive incentive stock options.
OPTION TERMS, EXERCISABILITY AND PAYMENT
The Committee has broad authority to set the terms of any particular
option, including the exercise price, term and vesting period. Generally,
however, options granted under the Plan have an exercise price equal to the fair
market value on the date of grant and may be exercised during the ten-year
period following the date of grant. Options generally vest over three years,
with 25% vesting on the date of grant, and additional 25% increments vesting
each year thereafter. Options may be exercised by the payment of the exercise
price
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in cash, although the Committee may, if it chooses, permit exercise by delivery
of shares of the Company's Common Stock have a fair market value equal to the
exercise price. In the case of non-qualified options, the Company may also
require payment by the exercising holder of an amount sufficient to satisfy any
federal, state or local withholding tax requirements.
Each person who is a Committee member on July 1 of each year is
automatically granted on that date a non-qualified option ("Committee NQO") to
purchase 25,000 shares of Common Stock at fair market value on that date.
Committee NQOs vest as to one-half (1/2) of the total amount six (6) months from
the date of grant and as to the remaining one-half (1/2) twelve (12) months from
the date of grant.
Upon termination of any participant's employment or engagement with the
Company for any reason, all non-vested options immediately terminate, and all
vested options terminate if not exercised within three months of termination,
except that such three-month period shall be a twelve-month period in the case
of termination by reason of death.
FEDERAL INCOME TAX CONSIDERATIONS
Holders of non-qualified options do not realize income as a result of a
grant of an option, but normally realize compensation income upon exercise of a
non-qualified option to the extent that the fair market value of the shares of
Common Stock on the date of exercise of the non-qualified option exceeds the
exercise price paid. The Company will be required to withhold taxes on ordinary
income realized by an optionee upon the exercise of a non-qualified option.
Holders of incentive stock options will not be considered to have
received taxable income upon either the grant of an option or its exercise. Upon
the sale or other taxable disposition of the shares, long-term capital gain will
normally be recognized on the full amount of the difference between the amount
realized and the option exercise price paid if no disposition of the shares has
taken place within either (a) two years from the date of grant of the option or
(b) one year from the date of transfer of the shares to the optionee upon
exercise. If the shares are sold or otherwise disposed of before the end of the
one-year or two-year periods, the holder of the incentive stock option must
include the gain realized as ordinary income to the extent of the lesser of (1)
the fair market value of the option stock minus the option price, or (2) the
amount realized minus the option price. Any gain in excess of these amounts,
presumably, will be treated as capital gain. The Company will be entitled to a
tax deduction in regard to an incentive stock option only to the extent the
optionee has ordinary income upon the sale or other disposition of the option
shares. Upon the exercise of an incentive stock option, the amount by which the
fair market value of the purchased shares at the time of exercise exceeds the
option price will be an "item of tax preference" for purposes of computing the
optionee's alternative minimum tax for the year of exercise. If the shares so
acquired are disposed of prior to the expiration of the one-year or two-year
periods described above, there should be no "item of tax preference" arising
from the option exercise.
INFORMATION INCLUDED
Attached to this General Plan Description are copies of the following
documents:
Exhibit A - 1996 Stock Option Plan
Exhibit B - Joint Proxy Statement/Prospectus dated June 11, 1996
2
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INFORMATION AVAILABLE UPON REQUEST
Copies of the following documents are available without charge upon oral
or written request as described in GENERAL INFORMATION above, and such documents
are incorporated by reference to this General Plan Description:
1. All reports filed by the Company with the Securities and Exchange
Commission pursuant to Section 13(a) or 15(d) of the Securities
Exchange Act of 1934 for periods beginning June 30, 1996.
2. A description of the Company's Common Stock as contained in a
registration statement filed by the Company with the Securities
and Exchange Commission.
3
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GENERAL DESCRIPTION OF OPTION
GRAPHIX ZONE, INC.
NON-QUALIFIED STOCK OPTION GRANTED
TO FRANK CUTLER
This document constitutes part of a prospectus covering securities that
have been registered under the Securities Act of 1933.
GENERAL INFORMATION
Graphix Zone, Inc. ("Company") issued a Non-Qualified Stock Option
("Option") to Frank Cutler on July 1, 1994. Mr. Cutler is an independent
business and financial consultant to the Company and the purpose of the Option
is to provide incentive and reward to Mr. Cutler for assisting the Company in
general business and financial matters. Additional information about the Option
may be obtained by contacting, orally or in writing:
Graphix Zone, Inc.
42 Corporate Park, Suite 200
Irvine, California 92606
Attn: Chief Financial Officer
(714) 833-3838
OPTION SECURITIES
The Option gives Mr. Cutler the right to purchase up to 30,000 shares of
the Company's Common Stock, without par value.
OPTION TERMS, EXERCISABILITY AND PAYMENT
The Option is fully vested and the Option term is for ten years. The
exercise price is $3.43 per share and the Option exercise price must be paid in
cash. The Option is not transferable by Mr. Cutler.
FEDERAL INCOME TAX CONSIDERATIONS
Mr. Cutler does not realize income as a result of the grant of the
Option, but normally will realize compensation income upon exercise of the
Option to the extent that the fair market value of the shares of Common Stock on
the date of exercise of the Option exceeds the exercise price paid. The Company
may be required to withhold taxes on ordinary income realized by Mr. Cutler upon
the exercise of the Option.
INFORMATION INCLUDED
Attached to this General Plan Description are copies of the following
documents:
Exhibit A - Non-Qualified Stock Option
Exhibit B - Joint Proxy Statement/Prospectus dated June 11, 1996
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INFORMATION AVAILABLE UPON REQUEST
Copies of the following documents are available without charge upon oral
or written request as described in GENERAL INFORMATION above, and such documents
are incorporated by reference to this General Plan Description:
1. All reports filed by the Company with the Securities and Exchange
Commission pursuant to Section 13(a) or 15(d) of the Securities
Exchange Act of 1934 for periods beginning June 30, 1996.
2. A description of the Company's Common Stock as contained in a
registration statement filed by the Company with the Securities
and Exchange Commission.
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[LETTERHEAD]
July 29, 1996
Our File No.:
28188.0001
Graphix Zone, Inc.
42 Corporate Park, Suite 200
Irvine, California 92606
Re: REGISTRATION STATEMENT ON FORM S-8
Ladies and Gentlemen:
We have acted as counsel to Graphix Zone, Inc., a Delaware corporation
("Company"), and in such capacity have examined the form of Registration
Statement on Form S-8 ("Registration Statement") to be filed with the Securities
and Exchange Commission ("Commission") by the Company on July 29, 1996, in
connection with the registration under the Securities Act of 1933, as amended
("Act"), of up to 2,530,000 shares of common stock, $.01 par value per share, of
the Company (the "Shares"). The Shares are to be sold by the Company upon the
exercise of (i) the nonqualified stock option granted to Frank Cutler and (ii)
the stock options granted by the Company under its 1996 Stock Option Plan. The
Shares will be offered and sold pursuant to the Company's Registration Statement
filed with the Commission.
As counsel for the Company and for purposes of this opinion, we have
made those examinations and investigations of legal and factual matters we
deemed advisable and have examined the originals, or copies certified to our
satisfaction as being true copies, of those corporate records, certificates,
documents and other instruments which, in our judgment, we considered necessary
or appropriate to enable us to render the opinion expressed below. For these
purposes, we have relied upon certificates provided by public officials and by
officers of the Company as to certain factual matters. We have assumed the
genuineness of all signatures, the authenticity of all documents submitted to us
as originals, the conformity to the original documents of documents submitted to
us as certified or photostatic copies, and the authenticity of the originals of
the latter documents.
On the basis of the foregoing, and solely relying thereon, we are of
the opinion that the Shares are duly authorized and provided the Shares are
issued, delivered and paid for in the manner and upon the terms contemplated by
the Registration Statement, the Shares will be validly issued, fully paid and
nonassessable.
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Graphix Zone, Inc.
July 29, 1996
Page -2-
We consent to the use of this opinion as an exhibit to the
Registration Statement. In giving this consent, we do not hereby admit that we
are in the category of persons whose consent is required under Section 7 of the
Act or the rules and regulations of the Commission thereunder.
Very truly yours,
/s/ Snell & Wilmer LLP
Snell & Wilmer L.L.P.
