As filed with the Securities and Exchange Commission on August 5, 1999
Registration No. 333-_______________
================================================================================
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
-------------------------
FORM S-8
REGISTRATION STATEMENT
UNDER THE SECURITIES ACT OF 1933
-------------------------
GETTY IMAGES, INC.
(Exact name of Registrant as specified in its charter)
Delaware 98-0177556
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification Number)
Getty Images, Inc.
2101 Fourth Avenue
Suite 500
Seattle, Washington 98121
(Address and telephone number of Registrant's principal executive offices)
The art.com, Inc. 1999 Stock Option Plan
(Full title of the plan)
-------------------------
Suzanne Page, Esq.
Getty Images, Inc.
2101 Fourth Avenue
Suite 500
Seattle, Washington 98121
206-695-3400
(Name, address and telephone number of agent for service)
-------------------------
Copies to:
William Hinman, Esq.
Shearman & Sterling
555 California Street
Suite 2000
San Francisco, California 94104
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
===========================================================================================================================
Title of Amount Proposed Maximum Proposed Maximum Amount of
Securities to be to be Offering Price Per Aggregate Registration
Registered Registered Security (1) Offering Price (1) Fee (1)
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock, par value $0.01 per share 275,000 $18.125 $4,984,375 $1,385
===========================================================================================================================
</TABLE>
(1) Estimated solely for the purpose of calculating the registration fee.
Such estimate is calculated pursuant to Rules 457(c) and 457(h) under
the Securities Act of 1933, as amended (the "Securities Act"), based on
the average bid and asked price of $18.125 on the NASDAQ National
Market on July 29, 1999, which high and low prices were $18.50 and
$17.75 respectively.
<PAGE>
Part I
INFORMATION REQUIRED IN THE SECTION 10(a) PROSPECTUS
Item 1. Plan Information.*
Item 2 Registrant Information and Employee Plan Annual Information.*
- --------------------
* Information required by Part I to be contained in the Section 10(a)
prospectus is omitted from this Registration Statement in accordance with
Rule 428 under the Securities Act of 1933, as amended (hereinafter, the
"Securities Act"), and the "Note" to Part I of Form S-8.
<PAGE>
2
Part II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
Item 3. Incorporation of Documents by Reference.
The following documens filed with the Securities and Exchange
Commission (the "Commission") are incorporated by reference in this Registration
Statement:
(a) The Annual Report of the Registrant on Form 10-K for the
fiscal year ended December 31, 1998 (as filed with the
Commission on March 31, 1999);
(b) The Amended Quarterly Report of the Registrant on Form 10-Q/A
for the quarter ended March 31, 1999 (as filed with Commission
on July 17, 1999);
(c) The Quarterly Report of the Registrant on Form 10-Q for the
quarter ended March 31, 1999 (as filed with the Commission on
May 17, 1999);
(d) Amendment No. 5 to the Registrant's Registration Statement on
Form S-4 (File No. 333-38777), filed with the Commission on
January 7, 1998, which contains a description of the
Registrant's shares of Common Stock, par value $0.01 per share
(the "Shares") registered under Section 12(g) of the
Securities Exchange Act of 1934, as amended (the "Exchange
Act") under the heading "Description of Getty Images Capital
Stock."
All documents subsequently filed by the Registrant pursuant to
Sections 13(a), 13(c), 14 and 15(d) of the Exchange Act prior to the filing of a
post-effective amendment to this Registration Statement which indicates that all
securities offered have been sold or which deregisters all securities then
remaining unsold, shall be deemed to be incorporated by reference in this
Registration Statement and are a part thereof from the date of filing of such
documents.
Any statement contained in a document incorporated or deemed
incorporated by reference in this Registration Statement shall be deemed to be
modified or superseded for purposes of this Registration Statement to the extent
that a statement contained herein or in any other subsequently filed document
which also is or is deemed to be incorporated by reference herein modifies or
supersedes such statement. Any such statement so modified or superseded shall
not be deemed, except as so modified or superseded, to constitute a part of this
Registration Statement.
<PAGE>
3
Item 4. Description of Securities.
Not applicable.
Item 5. Interests of Named Experts and Counsel.
Not applicable.
Item 6. Indemnification of Directors and Officers.
Except to the extent indicated below, there is no charter
provision, by-law, contract, arrangement or statute under which any director or
officer of Getty Images is insured or indemnified in any manner against any
liability which he or she may incur in his or her capacity as such.
The Delaware General Corporation Law ("DGCL") provides that a
corporation may, and in certain circumstances must, indemnify its directors,
officers, employees and agents for expenses, judgments or settlements actually
and reasonably incurred by them in connection with suits and other legal actions
or proceedings if they acted in good faith and in a manner they reasonably
believed to be in or not opposed to the best interests of the corporation and,
with respect to any criminal action or proceeding, had no reasonable cause to
believe their conduct was unlawful. In such suit or action brought by or on
behalf of the corporation, such indemnification is limited to expenses incurred
in defense or settlement of the suit or action. The DGCL also permits a
corporation to adopt procedures for advancing expenses to directors, officers
and others without the need for a case-by-case determination of eligibility, so
long as, in the case of officers and directors, they undertake to repay the
amounts advanced if it is ultimately determined that the officer or director was
not entitled to be indemnified. The Certificate of Incorporation of Getty Images
and the Bylaws of Getty Images (the "Getty Images By-Laws") contain provisions
for indemnification of directors and officers and for the advancements of
expenses to any officer or director to the fullest extent of the law.
The DGCL permits corporations to purchase and maintain
insurance for directors and officers against liabilities for expenses, judgments
or settlements, whether or not the corporation would have the power to indemnify
such persons therefor. The Getty Images Bylaws permit Getty Images to purchase
such insurance.
Getty Images has also agreed by contract to indemnify the
directors and certain officers of Getty Images for certain liabilities incurred
by such persons by reason of the fact that such person is a director or officer,
provided that such person was acting in good faith.
<PAGE>
4
Item 7. Exemption from Registration Claimed.
Not applicable.
Item 8. Exhibits.
The following exhibits are filed as part of this Registration
Statement:
4.1 Amended and Restated Certificate of Incorporation of the
Registrant (incorporated herein by reference from the
Registrant's registration statement on Form S-4, File No.
333-38777, filed with the Commission on October 27, 1997).
4.2 Certificate of Amendment to the Certificate of Incorporation
of the Registrant (incorporated herein by reference from the
Registrant's report on Form 8-K, File No. 000-23747, filed
with the Commission on November 10, 1998).
4.3 Bylaws of the Registrant (incorporated herein by reference
from the Registrant's registration statement on Form S-4, File
No. 333-38777, filed with the Commission on October 27, 1997).
4.4 art.com, Inc. 1999 Stock Option Plan.
5.1 Opinion of Shearman & Sterling, Counsel to the Registrant, as
to the validity of the Shares being registered.
23.1 Consent of Shearman & Sterling (included as part of Exhibit
5.1).
23.2 Consent of PricewaterhouseCoopers.
24 Powers of Attorney (included on signature page).
Item 9. Undertakings.
(a) The undersigned Registrant hereby undertakes:
(1) To file, during any period in which offers or sales are
being made of securities registered hereby, a post-effective amendment to this
Registration Statement to include any material information with respect to the
plan of distribution not previously
<PAGE>
5
disclosed in the Registration Statement or any material change to such
information in the Registration Statement;
(2) That, for purposes of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be deemed to be
a new registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof; and
(3) To remove from registration by means of a post-effective
amendment any of the securities being registered which remain unsold at the
termination of the offering.
(b) The undersigned Registrant hereby further 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
Exchange Act that is incorporated by reference in the Registration Statement
shall be deemed to be a new registration statement relating to the securities
offered therein, and the offering of such securities at that time shall be
deemed to be the initial bona fide offering thereof.
(c) 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 of expenses incurred or paid by a director, officer or controlling
person of the Registrant in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling person in
connection with the securities being registered, the Registrant will, unless in
the opinion of its counsel the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the question whether such
indemnification by it is against public policy as expressed in the Securities
Act and will be governed by the final adjudication of such issue.
<PAGE>
6
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended,
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 to be signed on its behalf by the undersigned, thereunto
duly authorized, in the city of Seattle, Washington, on this 3rd day of August,
1999.
Getty Images, Inc.
By: /s/ Suzanne L. Page
-------------------------
Name: Suzanne Page
Title: General Counsel
<PAGE>
7
POWERS OF ATTORNEY
Each of the undersigned whose signature appears below hereby
constitutes and appoints Mark Getty, Suzanne Page and Jonathan Klein his true
and lawful attorney-in-fact and agent, with full power of substitution and
resubstitution, for him and in his name, place and stead, in any and all
capacities to sign any and all amendments (including post-effective amendments)
and supplements to this Registration Statement and any and all related
registration statements necessary to register additional securities, and to file
the same, with all exhibits thereto, and other documents in connection
therewith, with the Securities and Exchange Commission, granting unto said
attorney-in-fact and agent full power and authority to do and perform each and
every act and thing requisite and necessary to be done in and about the
premises, as fully to all intents and purposes as he might or could do in
person, hereby ratifying and confirming all that said attorney-in-fact and
agent, or his substitute or substitutes, may lawfully 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 below by the following persons in
the indicated capacities on August 3, 1999.
Signature Title
- --------- -----
/s/ Mark Getty Executive Chairman and Director
- --------------------------
Mark Getty
/s/ Mark Torrance Non-Executive Vice Chairman and
- -------------------------- Director
Mark Torrance
/s/ Jonathan Klein Chief Executive Officer and
- -------------------------- Director (Principal Executive Officer)
Jonathan Klein
/s/ Christopher J. Roling Treasurer, Chief Financial Officer and
- -------------------------- Secretary (Principal Financial Officer and
Christopher J. Roling Principal Accounting Officer)
/s/ Andrew Garb Director
- --------------------------
Andrew Garb
/s/ Anthony Stone Director
- --------------------------
Anthony Stone
Director
- --------------------------
James Bailey
Director
- --------------------------
Manny Fernandez
/s/ Christopher Sporborg Director
- --------------------------
Christopher Sporborg
<PAGE>
8
Exhibit Index
Exhibit No. Description of Document
4.1 Amended and Restated Certificate of Incorporation of the
Registrant (incorporated herein by reference from the
Registrant's registration statement on Form S-4, File No.
333-38777, filed with the Commission on October 27, 1997 ).
4.2 Certificate of Amendment to the Certificate of Incorporation
of the Registrant (incorporated herein by reference from the
Registrant's report on Form 8-K, File No. 000-23747, filed
with the Commission on November 10, 1998).
4.3 Bylaws of the Registrant (incorporated herein by reference
from the Registrant's registration statement on Form S-4, File
No. 333-38777, filed with the Commission on October 27, 1977).
4.4 art.com, Inc. 1999 Stock Option Plan.
5.1 Opinion of Shearman & Sterling, Counsel to the Registrant, as
to the validity of the Shares being registered.
23.1 Consent of Shearman & Sterling (included as part of Exhibit
5.1).
23.2 Consent of PricewaterhouseCoopers.
24 Powers of Attorney (included on signature page).
EXHIBIT 4.4
art.com, Inc.
1999 Stock Option Plan
art.com, Inc., a Delaware corporation (the "Company"), hereby
establishes a stock option plan to be known as the art.com, Inc. 1999 Stock
Option Plan (the "Plan"). The Plan shall become effective on the date it is
approved by the Board of Directors of the Company (the "Board"), subject to the
approval of the Company's shareholders within twelve (12) months after its
approval by the Board in accordance with Section 14(a) hereof.
1. Purposes.
The Company desires to attract and retain the best available
employees, officers, directors and consultants and to encourage the highest
level of performance by such individuals in order to serve the best interests of
the Company and its shareholders. The Plan is expected to contribute to the
attainment of these objectives by offering eligible individuals the opportunity
to acquire stock ownership interests in the Company, and to thereby provide them
with incentives to put forth maximum efforts for the success of the Company.
2. Form of Awards.
Stock options awarded under the Plan may be either incentive
stock options meeting the requirements of Section 422 of the Code ("ISOs") or
options that do not meet the requirements of Section 422 of the Code ("NSOs").
Unless otherwise indicated, references in the Plan to "Options" shall include
both ISOs and NSOs. The Committee (as defined in Section 4(a)) may also award
stock appreciation rights ("SARs") in tandem with any Option awarded hereunder.
An Option (or a portion thereof) that is not designated as an ISO, or that does
not satisfy all of the requirements of Section 422 of the Code, and any Option
granted to an individual who is not an employee or officer of the Company, shall
not constitute an ISO.
3. Maximum Shares Available.
The maximum aggregate number of shares of the Company's common
stock, $.001 par value per share ("Common Stock") for which Options may be
awarded under the Plan is 3,183,000, subject to adjustment pursuant to Section
11. Shares of Common Stock issued pursuant to the Plan may be either authorized
but unissued shares or issued shares reacquired by the Company. In the event
that any Option under the Plan expires unexercised or is terminated, surrendered
or canceled without being exercised in whole or in part for any reason (other
than cancellation as a result of the exercise of an SAR), then the shares of
Common Stock covered by such Option may, at the discretion of the Committee, be
made available for subsequent awards under the Plan, upon such terms as the
Committee may determine.
<PAGE>
2
4. Administration.
(a) Committee. The Plan shall be administered by the
Compensation Committee of the Board (the "Committee"); provided, however, that
with respect to any Option grant to an Optionee (as defined in Section 5) who is
subject to Section 16 of the Securities Exchange Act of 1934, as amended (the
"Act"), (i) each member of the Committee shall be a "Non-Employee Director" as
defined in Rule 16b-3(b)(3) under the Act, or (ii) the full Board shall act in
lieu of the Committee hereunder.
(b) Powers of Committee. Subject to the express provisions of
the Plan, the Committee shall have the power and authority (i) to grant Options
and to determine the exercise price of each such Option, the term of each such
Option, the number of shares of Common Stock to be covered by each such Option
and any vesting standards applicable to each such Option; (ii) to designate
Options as ISOs or NSOs; (iii) to award SARs in tandem with such Options and
(iv) to determine the employees, officers, directors and consultants to whom,
and the time or times at which, Options and SARs shall be granted.
(c) Delegation. The Committee may delegate to one or more of
its members or to any other person or persons such ministerial duties as it may
deem advisable. The Committee may also employ attorneys, consultants,
accountants or other professional advisors and shall be entitled to rely upon
the advice, opinions or valuations of any such advisors.
(d) Interpretations. The Committee shall have sole
discretionary authority to interpret the terms of the Plan, to adopt and revise
rules, regulations and policies to administer the Plan and to make any other
factual determinations which it believes to be necessary or advisable for the
administration of the Plan. All actions taken and interpretations and
determinations made by the Committee in good faith shall be final and binding
upon the Company, all Optionees who have received awards under the Plan and all
other interested persons.
(e) Liability; Indemnification. No member of the Committee,
nor any individual to whom ministerial duties have been delegated, shall be
personally liable for any action, interpretation or determination made with
respect to the Plan or awards made thereunder, and each member of the Committee
shall be fully indemnified and protected by the Company with respect to any
liability he or she may incur with respect to any such action, interpretation or
determination, to the extent permitted by applicable law and to the extent
provided in the Company's Certificate of Incorporation and Bylaws, as amended
from time to time.
5. Eligibility.
Options and SARs may be granted to executive and key
management employees, officers, directors and consultants of the Company;
provided, however, that ISOs may not be
<PAGE>
3
granted to any individual who is not an employee of the Company. In determining
the individuals to whom Options and SARs shall be granted and the number of
shares to be covered by each Option and SAR, the Committee shall take into
account the nature of the services rendered by such individuals, their present
and potential contribution to the success of the Company and such other factors
as the Committee in its sole discretion shall deem relevant. Any individual who
is granted an Option under the Plan is referred to herein as an Optionee.
6. Terms and Conditions of Option.
(a) Grant of Options. Options may be granted under this Plan
for the purchase of shares of Common Stock. Options shall be granted in such
form and upon such terms and conditions as the Committee shall from time to time
determine. Each award of Options shall be evidenced by a written agreement,
executed by the Optionee and the Company, and containing such restrictions,
terms and conditions, if any, as the Committee may require (the "Option
Agreement"). In the event of any conflict between an Option Agreement and the
Plan, the terms of the Plan shall govern. The date on which the Option is
granted to an Optionee, as set forth in the Option Agreement, is referred to
herein as the "Date of Grant."
(b) Option Price. The price at which a share of Common Stock
may be purchased pursuant to the exercise of an Option shall be determined by
the Committee at the Date of Grant; provided, however, that with respect to
ISOs, the option price shall not be less than one hundred (100) percent of the
Fair Market Value (as defined in Section 14(b)) of a share of Common Stock on
the Date of Grant.
(d) Term of Options. The term of each Option granted under the
Plan shall be established by the Committee. Except as otherwise provided in
Section 7(a) with respect to ten (10) percent stockholders of the Company, the
term of each ISO shall not exceed ten (10) years from the Date of Grant.
(e) Vesting. No Option shall be exercisable until it has
vested. Unless otherwise provided in an Option Agreement, each Option shall vest
and become exercisable (i) to the extent of 25% of the shares originally covered
thereby on the first anniversary of the date that the Optionee first began
performing services for the Company as an employee, director or consultant (the
"Anniversary Date") and (ii) to the extent of an additional .06845% percent of
the number of shares originally covered thereby on each day following such
Anniversary Date until fully vested. The Committee, in its sole discretion, may
accelerate the vesting of any Option at any time.
(f) Exercise of Options. Options may be exercised by an
Optionee by giving written notice to the Committee stating the number of shares
of Common Stock with respect to which the Option is being exercised and
tendering payment therefor. Payment for the Common
<PAGE>
4
Stock issuable upon exercise of the Option shall be made in full in cash or, if
the Committee, in its sole discretion, permits, in shares of Common Stock
(valued at Fair Market Value on the date of exercise). As soon as reasonably
practicable following such exercise, a certificate representing the shares of
Common Stock purchased, registered in the name of the Optionee, shall be
delivered to the Optionee.
(g) Cancellation of SARs. Upon exercise of all or a portion of
an Option, the related SARs if any, shall be canceled with respect to an equal
number of shares of Common Stock.
7. Special Rules Applicable to ISOs.
(a) Ten Percent Stockholders. Notwithstanding any other
provisions of this Plan to the contrary, an individual may not receive an ISO
under the Plan if such individual, on the Date of Grant, owns (after application
of the rules contained in Section 424(d) of the Code) stock possessing more than
ten (10) percent of the total combined voting power of all classes of stock of
the Company, unless (i) the option price for such ISO is at least one hundred
and ten (110) percent of the Fair Market Value of the Common Stock subject to
such ISO on the Date of Grant and (ii) such ISO is not exercisable after the
date five (5) years from its Date of Grant.
(b) Limitation on Grants. The aggregate Fair Market Value
(determined with respect to each ISO at the time such ISO is granted) of the
shares of Common Stock with respect to which ISOs are exercisable for the first
time by an Optionee during any calendar year (under this Plan or any other plan
of the Company) shall not exceed one hundred thousand dollars ($100,000). Any
portion of an Option which exceeds this annual limit shall be a NSO.
(c) Limitations on Time of Grant. No grant of an ISO shall be
made under this Plan more than ten (10) years after the earlier of the date of
adoption of the Plan by the Board or the date the Plan is approved by the
Company's stockholders.
8. Stock Appreciation Rights.
(a) Grants of SARs. SARs may be awarded by the Committee in
connection with an Option granted under the Plan, either on the Date of Grant of
the Option or thereafter at any time prior to the exercise, termination or
expiration of the Option. SARs shall be subject to such terms and conditions not
inconsistent with the other provisions of this Plan as the Committee shall
determine.
(b) Exercise of SARs. An SAR shall be exercisable only to the
extent that the related Option is exercisable and shall be exercisable only for
such period as the Committee may determine (which period may expire prior to the
expiration date of the related Option). Upon the
<PAGE>
5
exercise of all or a portion of an SAR, the related Option shall be canceled
with respect to an equal number of shares of Common Stock. An SAR shall entitle
the Optionee to surrender to the Company unexercised the related Option, or any
portion thereof, and to receive from the Company in exchange therefor, that
number of shares of Common Stock having an aggregate Fair Market Value equal to
(i) the excess of (A) the Fair Market Value of one (1) share of Common Stock as
of the date the SAR is exercised over (B) the Option price per share specified
in the Option Agreement, multiplied by (ii) the number of shares of Common Stock
subject to the Option, or portion thereof, which is surrendered. Cash shall be
delivered in lieu of any fractional shares.
(c) Settlement of SARs. As soon as is reasonably practicable
after the exercise of an SAR, the Company shall (i) issue, in the name of the
Optionee, stock certificates representing the total number of full shares of
Common Stock to which the Optionee is entitled pursuant to Section 8(b) hereof
and cash in an amount equal to the Fair Market Value, as of the date of
exercise, of any resulting fractional shares, or (ii) if the Committee causes
the Company to elect to settle all or part of its obligations arising out of the
exercise of the SAR in cash pursuant to Section 8(d), deliver to the Optionee an
amount in cash equal to the Fair Market Value, as of the date of exercise, of
the shares of Common Stock it would otherwise be obligated to deliver.
(d) Cash Settlement. The Committee, in its discretion, may
cause the Company to settle all or any part of its obligation arising out of the
exercise of a SAR by the payment of cash in lieu of all or part of the shares of
Common Stock it would otherwise be obligated to deliver in an amount equal to
the Fair Market Value of such shares on the date of exercise.
9. Nontransferability of Options.
No Option or SAR may be transferred, assigned, pledged or
hypothecated (whether by operation of law or otherwise), except as provided by
will, the applicable laws of descent and distribution or pursuant to a qualified
domestic relations order (as defined in Section 414(p) of the Code), and no
Option or SAR shall be subject to execution, attachment or similar process. Any
attempted assignment, transfer, pledge, hypothecation or other disposition of an
Option not specifically permitted herein shall be null and void and without
effect. An Option or SAR may be exercised only by the Optionee during his or her
lifetime and, following the Optionee's death, may be exercised only as provided
in Section 10(c).
10. Effect of Termination of Employment on Options.
(a) Termination of Employment. In the event that an Optionee's
employment or service as a non-employee director or consultant with the Company
shall be terminated (for reasons other than death or disability) or in the event
such Optionee shall resign from employment or service as a non-employee director
or consultant, vested Options and/or SARs held by such Optionee may be exercised
at any time within thirty (30) days after such employment or services
<PAGE>
6
ended, unless, in the case of an NSO, the exercise period is extended by the
Committee; provided, however, if the Company severs the employment relationship
or the performance of services by Optionee for "Cause" (as defined in Section
10(e)), the Optionee's right to exercise vested options shall terminate
simultaneously with such severance of employment or services. In no event,
however, may an Option and/or SAR be exercised after the expiration date of the
Option as designated by the Committee pursuant to Section 6(d).
(b) Disability. In the event that an Optionee's employment or
service as a non-employee director or consultant with the Company shall be
terminated as a result of the disability of the Optionee (within the meaning of
Section 22(e)(3) of the Code), vested Options and/or SARs may be exercised at
any time during the first twelve (12) months after such Optionee terminated
employment or ceased serving as a non-employee director or consultant, unless,
in the case of an NSO, the exercise period is extended by the Committee. In no
event, however, may the Option and/or SAR be exercised after the expiration date
of the Option as designated by the Committee pursuant to Section 6(d).
(c) Death. If an Optionee shall die while employed by or
serving as a non-employee director or consultant of the Company or within thirty
(30) days after the termination of such employment or cessation of such
director's term or service as a consultant, vested Options and SARs may be
exercised by the Optionee's estate or by the person who acquires the right to
exercise such Option and/or SAR on his or her death by bequest or inheritance.
Such exercise may occur at any time within one (1) year after the date of the
Optionee's death, unless, in the case of an NSO, the exercise period is extended
by the Committee. In no event, however, may the Option and/or SAR be exercised
after the expiration date of the Option as designated by the Committee pursuant
to Section 6(d).
(d) Nonvested Options. Unless accelerated in accordance with
Section 6(e), nonvested Options and SARs shall terminate immediately upon the
Optionee's termination of employment or cessation of service as a non-employee
director or consultant with the Company for any reason whatsoever, including
death or disability.
(e) Cause. For purposes of the Plan, "Cause" shall mean (i)
the conviction by the Optionee of a felony under state or federal law; (ii) the
knowing and continued failure by the Optionee substantially to perform his or
her duties for the Company (other than any such failure resulting from
incapacity due to physical or mental illness) for a period of fifteen (15) days
after the Company delivers to the Optionee a demand for substantial performance,
which specifically identifies the failure; or (iii) the knowing, engagement by
Optionee in misconduct which is materially injurious to the Company.
<PAGE>
7
11. Adjustment upon Changes in Capitalization.
Notwithstanding any other provision of the Plan, the Committee
may at any time make or provide for such adjustments to the Plan, to the number
and class of shares available thereunder or to any outstanding Options and SARs
as it shall deem appropriate to prevent dilution or enlargement of rights,
including adjustments in the event of changes in the number of shares of
outstanding Common Stock by reason of stock dividends, split-ups,
recapitalizations, mergers, consolidations, combinations or exchanges of shares,
separations, reorganizations, liquidations and the like.
12. Merger or Consolidation.
In the event of the merger or consolidation of the Company,
the Committee may, in its discretion, revise, alter, amend or modify any Option
Agreement and any then outstanding and unexercised Option and related SAR in any
manner that it deems appropriate, including, but not limited to the following:
(a) The expiration date of each Option and related SAR may be
accelerated to the effective date of such transaction. If this paragraph
applies, the Committee shall give at least thirty (30) days prior written notice
of such event to each Optionee holding an outstanding Option or SAR. During,
such period, the Optionee shall have the right to exercise any then outstanding
Option or SAR which has not previously expired in accordance with its terms,
without regard to any provision of the Option Agreement or the Plan which would
otherwise delay exercisability. Each such Option and SAR shall remain
exercisable after receipt of such written notice until the earlier of (1) the
day immediately preceding the effective date of the merger or consolidation or
(2) the Option or SAR otherwise expires in accordance with its terms; or
(b) The Option and related SAR may be deemed to apply to the
securities outstanding after such merger or consolidation becomes effective to
which a holder of the number of shares of Common Stock subject to the
unexercised Option and SAR would have been entitled if he or she actually owned
such shares immediately prior to the date such merger or consolidation became
effective. All other terms, restrictions and provisions of the Option Agreement
shall remain in force and effect, subject to such adjustment as the Committee
deems appropriate to reflect such merger or consolidation.
13. Amendment and Termination of Plan.
Subject to any approval of the shareholders of the Company
that may be required (or, in the opinion of the Committee, appropriate ) under
law, the Committee may at any time amend, suspend or terminate the Plan. No
amendment, suspension or termination of the Plan shall materially and adversely
alter or impair any Option or SAR previously granted under the Plan
<PAGE>
8
without the consent of the holder thereof. No amendment requiring shareholder
approval under Section 422 of the Code shall be valid unless such shareholder
approval is secured as provided therein.
14. Miscellaneous.
(a) Shareholder Approval. The shareholders of the Company
shall duly approve this Plan within twelve (12) months after its adoption by the
Board. If such shareholder approval is not obtained, then any grants made
hereunder shall be automatically rescinded.
(b) Fair Market Value. For purposes of the Plan, "Fair Market
Value" as of any date shall mean (i) if the Common Stock is listed on an
established stock exchange or exchanges (including for this purpose, the NASD
National Market), the average of the highest and lowest sale prices of the stock
quoted for such date as reported in the Transactions Index of each such
exchange, as published in The Wall Street Journal and determined by the
Committee, or, if no sale price was quoted in any such Index for such date, then
as of the next preceding date on which such a sale price was quoted; (ii) if the
Common Stock is not then listed on an exchange or the NASDAQ National Market,
the average of the closing bid and asked prices per share for the stock in the
over-the-counter market as quoted on The NASDAQ Small Cap or OTC Electronic
Bulletin Board, as appropriate, on such date; or (iii) if the Common Stock is
not then listed on an exchange or quoted in the over-the-counter market, an
amount determined in good faith by the Committee; provided, however, that when
appropriate, the Committee, in determining Fair Market Value of the Common
Stock, may take into account such factors as it may deem appropriate under the
circumstances. Notwithstanding the foregoing, the Fair Market Value of Common
Stock for purposes of grants of ISOs shall be determined in compliance with
applicable provisions of the Code.
(c) Tax Withholding. The Company shall have the right to
require Optionees or their beneficiaries or legal representatives to remit to
the Company an amount sufficient to satisfy Federal, state and local withholding
tax requirements, or to deduct from all payments under this Plan amounts
sufficient to satisfy all withholding tax requirements. Whenever payments under
the Plan are to be made to an Optionee in cash, such payments shall be net of
any amounts sufficient to satisfy all Federal, state and local withholding tax
requirements. The Committee may, in its discretion, permit an Optionee to
satisfy his or her tax withholding obligation either by (i) surrendering shares
owned by the Optionee or (ii) having the Company withhold from shares otherwise
deliverable to the Optionee. Shares surrendered or withheld shall be valued at
their Fair Market Value as of the date on which income is required to be
recognized for income tax purposes. In the case of an award of ISOs, the
foregoing right shall be deemed to be provided to the Optionee at the time of
such award.
<PAGE>
9
(d) No Right to Employment. Nothing in the Plan or in any
Option Agreement entered into pursuant to Section 6(a), nor the grant of any
Option, shall confer upon any individual any right to continue in the employ of
the Company or an affiliate or to be entitled to any remuneration or benefits
not set forth in the Plan or such Option Agreement or interfere with or limit
the right of the Company or an affiliate to modify the terms of or terminate
such individual's employment at any time.
(e) Notices. Notices required or permitted to be made under
the Plan shall be sufficiently made if sent by registered or certified mail
addressed (a) to the Optionee at the Optionee's address as set forth in the
books and records of the Company or (b) to the Company or the Committee at the
principal office of the Company.
(f) Severability. In the event that any provision of the Plan
shall be held illegal or invalid for any reason, such illegality or invalidity
shall not affect the remaining parts of the Plan, and the Plan shall be
construed and enforced as if the illegal or invalid provision had not been
included.
(g) Governing Law. To the extent not preempted by Federal law,
the Plan, and all a agreements hereunder, shall be construed in accordance with
and governed by the laws of the State of Delaware.
(h) Term of Plan. Unless earlier terminated pursuant to
Section 13, the Plan shall terminate on the tenth (10th) anniversary of the date
of its adoption by the Board.
Date Approved by Board: ____________________________________
Dated Approved by Shareholders: ____________________________
EXHIBIT 5.1
415-616-1221
August 4, 1999
Getty Images, Inc.
2101 Fourth Avenue, Suite 500
Seattle, Washington 98121
Getty Images Inc.
Registration Statement on Form S-8
----------------------------------------------
Ladies and Gentlemen:
We have acted as counsel for Getty Images, Inc., a Delaware
corporation (the "Company"), in connection with the Company's Registration
Statement on Form S-8 (the "Registration Statement") to be filed with the
Securities and Exchange Commission under the Securities Act of 1933, as amended,
with respect to 275,000 shares of common stock, par value $0.01 per share, of
the Company (the "Shares"), to be issued from time to time pursuant to the
art.com, Inc. 1999 Stock Option Plan (the "Plan").
In so acting, we have examined the Registration Statement and
have also examined and relied as to factual matters upon the representations and
warranties contained in originals, or copies certified or otherwise identified
to our satisfaction, of such documents, records, certificates and other
instruments as in our judgment are necessary or appropriate to enable us to
render the opinion expressed below. In such examination, we have assumed the
genuineness of all signatures, the authenticity of all documents, certificates
and instruments submitted to us as originals and the conformity with originals
of all documents submitted to us as copies.
<PAGE>
Getty Images, Inc. 2 August 4, 1999
The opinion expressed below is limited to the law of the State
of New York, the General Corporation Law of Delaware and the federal law of the
United States, and we do not express any opinion herein concerning any other
law.
Based upon the foregoing and having regard for such legal
considerations as we have deemed relevant, we are of the opinion that the Shares
have been duly authorized by the Company and, when (a) issued and delivered by
the Company in accordance with the terms of the Plan and (b) paid for in full in
accordance with the terms of the Plan, the Shares will be validly issued, fully
paid and non-assessable.
We hereby consent to the filing of this opinion as an exhibit
to the Registration Statement.
Very truly yours,
/s/ Shearman & Sterling
Shearman & Sterling
EXHIBIT 23.2
CONSENT OF INDEPENDENT ACCOUNTANTS
We consent to the incorporation by reference in this Registration Statement of
Getty Images, Inc. on Form S-8 of our report dated March 31, 1999 on our audits
of the consolidated financial statements and financial statement schedules of
Getty Images, Inc. and subsidiaries and of its predecessor, Getty Communications
Plc and subsidiaries, appearing in the Annual Report on Form 10K of Getty
Images, Inc., filed with the Securities and Exchange Commission on March 31,
1999.
PRICEWATERHOUSECOOPERS
----------------------------
PricewaterhouseCoopers
London, England
August 4, 1999
