<PAGE> 1
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON JUNE 12, 1997.
REGISTRATION NO. _____________
================================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
==========================
FORM S-8
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
==========================
MICHAEL ANTHONY JEWELERS, INC.
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
DELAWARE 13-2910285
(STATE OR OTHER JURISDICTION OF I.R.S. EMPLOYER
INCORPORATION OR ORGANIZATION IDENTIFICATION NO.)
115 SOUTH MACQUESTEN PARKWAY, MOUNT VERNON, NEW YORK 10550
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES INCLUDING ZIP CODE)
=================
1993 LONG-TERM INCENTIVE PLAN
(FULL TITLE OF PLAN)
=================
ALLAN CORN
MICHAEL ANTHONY JEWELERS, INC.
115 SOUTH MACQUESTEN PARKWAY, MOUNT VERNON, NEW YORK 10550
(NAME AND ADDRESS OF AGENT FOR SERVICE)
(914) 699-0000
(TELEPHONE NUMBER, INCLUDING AREA CODE, OF AGENT OF SERVICE)
------------ ---------
COPIES OF ALL COMMUNICATIONS, INCLUDING ALL COMMUNICATIONS SENT TO THE AGENT FOR
SERVICE, SHOULD ALSO BE SENT TO:
M. FRANCES DURDEN, ESQ.
MICHAEL ANTHONY JEWELERS, INC.
115 SOUTH MACQUESTEN PARKWAY
MOUNT VERNON, NEW YORK 10550
(914) 699-0000
<TABLE>
<CAPTION>
CALCULATION OF REGISTRATION FEE
=====================================================================================================
Title to Amount to be Proposed Proposed Amount of
securities to be registered (1) maximum maximum registration fee
registered offering price aggregate
per share (2) offering price
(2)
- ----------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common stock, 2,000,000
par value $.001 shares $4.125 $8,250,000 $2500
per share
- ----------------------------------------------------------------------------------------------------
(1) Represents the aggregate number of shares of Common Stock to be issued upon
the exercise of stock options granted under the 1993 Long-Term Incentive Plan.
(2) Estimated in accordance with Rule 457(h) under the Securities Act of 1933,
as amended, solely for the purpose of calculating the registration fee, on the
basis of the average of the high and low prices on June 6, 1997.
=====================================================================================================
</TABLE>
<PAGE> 2
PART I
INFORMATION REQUIRED IN THE PROSPECTUS
The document(s) containing the information called for in Part I of Form
S-8 will be sent or given to employees awarded stock options under the Michael
Anthony Jewelers, Inc. 1993 Long-Term Incentive Plan, as amended (the "Plan"),
adopted by Michael Anthony Jewelers, Inc. (the "Company") and is not being filed
with or included in this Form S-8 in accordance with the rules and regulations
of the Securities and Exchange Commission (the "Commission").
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE
---------------------------------------
The following documents filed with, or furnished to, the Commission,
and the information included therein, are incorporated herein by reference.
(1) The Company's Annual Report on Form 10-K for the year ended
February 1, 1997 (the "1997 Annual Report").
(2) The Company's Quarterly Report on Form 10-Q for the quarter
ended May 3, 1997.
(3) All reports filed by the Company pursuant to Section 13(a) or
15(d) of the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), since the end of the fiscal year covered by
the 1997 Annual Report.
(4) The description of the Common Stock contained on the Company's
Form 8-A dated December 9, 1986 filed under the Exchange Act.
(5) Information concerning the Plan, including the options
outstanding and the exercises, prices and expiration of
options, which will be included in the future, either in the
Company's Proxy Statement or Annual Reports on Form 10-K.
All documents subsequently filed by the Company pursuant to Section
13(a), 13(c), 14 or 15(d) of the Exchange Act, prior to the filing of a
post-effective amendment which either indicates that all securities offered
hereby have been sold or deregisters all such securities then remaining unsold,
shall be deemed to be incorporated by reference and to be part hereof from the
date of filing of such documents.
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<PAGE> 3
Any statement contained in a document incorporated or deemed to be incorporated
by reference herein shall be deemed to be modified or superseded for purposes of
this Registration Statement to the extent that a statement contained herein or
in any subsequently filed document which also is or is deemed to be incorporated
by reference herein modifies or supersedes such statement.
The Company hereby undertakes to provide without charge to each person
who has received a copy of the document(s) containing the information called for
in Part I of this Registration Statement, upon the written or oral request of
any such person, a copy of the Company's Annual Report to Stockholders for its
last fiscal year and a copy of any or all documents that have been or may be
incorporated by reference into this Registration Statement, other than exhibits
to such documents (unless such exhibits are incorporated by reference). Requests
for such information should be addressed to Michael Anthony Jewelers, Inc., 115
South MacQuesten Parkway, Mount Vernon, New York 10550, Attention: Secretary, or
made by telephone at (914) 699-0000.
ITEM 4. DESCRIPTION OF SECURITIES
-------------------------
Not Applicable
ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL
--------------------------------------
The consolidated financial statements and related statement schedules
incorporated in this Registration Statement on Form S-8 by reference to the
Company's Annual Report on Form 10-K for the year ended February 1, 1997, have
been audited by Deloitte & Touche, independent auditors, as stated in their
report which is incorporated herein by reference, and have been so incorporated
in reliance upon such firm given upon their authority as experts in accounting
and auditing.
Certain matters with respect to legality in connection with the sale of
the shares of Common Stock offered hereby are being passed upon for the Company
by M. Frances Durden, Esq. General Counsel for the Company, 115 South MacQuesten
Parkway, Mount Vernon, New York 10550. Ms. Durden is an executive officer of the
Company and beneficially owns 1,000 shares of Common Stock of the Company.
ITEM 6. INDEMNIFICATIONS OF DIRECTORS AND OFFICERS
------------------------------------------
Section 145 of the General Corporation Law of Delaware permits
indemnification of directors, officers and employees of a corporation under
certain conditions and subject to certain limitations. Article VI of the
Company's By-Laws provides for the indemnification, to the extent permitted by
Section 145 of the General Corporation Law of the State of Delaware, directors,
officers, employees or agents of the Company against expenses reasonably
incurred with respect to civil, criminal, administrative or investigative
actions, suits or proceedings (except actions by or in the right of the
Company), provided that such director, officer, employee or agent, with respect
to civil mattes, acted in good faith and in a
II-2
<PAGE> 4
manner reasonably believed to be in or not opposed to the best interests of the
Company, and with respect to any criminal action or proceeding, had no
reasonable cause to believe his or her conduct was unlawful. Respecting actions
or suits by or in the right of the Company, the By-Laws provide for the
indemnification of directors, officers, employees or agents of the Company
against expenses reasonably incurred in connection with the defense or
settlement of such action or suit if he or she acted in good faith and in a
manner reasonably believed to be in or not opposed to the best interests of the
Company; provided, however no indemnification may be made in respect of any such
claim, issue or matter as to which such person shall have been adjudged to be
liable for the negligence or misconduct in the performance of his or her duty to
the Company, unless and only to the extent that the Court of Chancery of
Delaware or the court in which such action or suit was brought shall determine
that, despite such adjudication and in view of all of the circumstances of the
case, such person is fairly and reasonably entitled to such indemnity as such
court deems proper.
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED
-----------------------------------
Not Applicable
ITEM 8. EXHIBITS
--------
The Exhibits to this Registration Statement are listed in the Exhibit
Index on page II-9 of this Registration Statement which Exhibit Index is
incorporated herein by reference.
ITEM 9. UNDERTAKINGS
------------
(1) The Company hereby undertakes:
(a) To file, during any period in which offers or
sales are being made, a post-effective amendment to this Registration
Statement:
(i) To include any prospectus required by section 10(a)(3)
of the Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events arising
after the effective date of the Registration Statement (or the most recent
post-effective amendment thereof) which, individually or in the aggregate,
represent a fundamental change in the information set forth in the Registration
Statement. Notwithstanding the foregoing, any increase or decrease in volume of
securities offered (if the total dollar value of securities offered would not
exceed that which was registered) and any deviation from the low or high and of
the estimated maximum offering range may be reflected in the form of prospectus
filed with the Commission pursuant to Rule 424(b) if, in the aggregate, the
changes in volume and price represent no more than a 20 percent change in the
maximum aggregate offering price set forth in the "Calculation of Registration
Fee" table in the effective registration statement.
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<PAGE> 5
(iii) To include any material information with respect to the plan of
distribution not previously disclosed in the Registration Statement or
any material change to such information in the Registration Statement;
PROVIDED, HOWEVER, that paragraphs (1)(a)(i) and (1)(a)(ii) do not
apply if the registration statement is on Form S-3, Form S-8 or Form F-3 and the
information required to be included in a post-effective amendment by those
paragraphs is contained in periodic reports filed by the Company pursuant to
Section 13 or Section 15(d) of the Securities Exchange Act of 1934 that are
incorporated by reference in the Registration Statement.
(b) That, for the purpose of determining any liability under
the Securities Act of 1933, each such post-effective amendment shall be deemed
to be a new registration statement relating to the securities offered therein,
and the offering of such securities at that time shall be deemed to be the
initial bona fide offering thereof.
(c) 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.
(2) The Company hereby undertakes that, for purposes of determining any
liability under the Securities Act of 1933, each filing of the Company's annual
report pursuant to Section 13(a) or Section 15(d) of the Securities Exchange Act
of 1934 (and, where applicable, each filing of an employee benefit plan's annual
report pursuant to Section 15(d) of the Securities Exchange Act of 1934) that is
incorporated by reference in the Registration Statement shall be deemed to be a
new registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
(3) Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers and controlling
persons of the Company pursuant to the foregoing provisions, or otherwise, the
Company 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, therefor, unenforceable. In the event that a claim for
indemnification against such liabilities (other than payment by the Company of
expenses incurred or paid by a director, officer or controlling person of the
Company 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 Company 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.
II-4
<PAGE> 6
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Company
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 Mount Vernon, State of New York, on the 9th day of
June, 1997.
MICHAEL ANTHONY JEWELERS, INC.
By: /s/ Michael W. Paolercio
------------------------
Michael W. Paolercio, Co-Chairman
of the Board and Chief Executive Officer
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature
appears below constitutes and appoints Michael W. Paolercio, Fredric R.
Wasserspring and M. Frances Durden, his true and lawful attorneys-in-fact and
agents, each acting alone, with full powers of substitution and resubstitution,
for him and in his name, place and stead, in any and all capacities, to sign any
and all amendments to this Registration Statement, including post-effective
amendments, and to file the same, with all exhibits thereto, and other documents
in connection therewith, with the Securities and Exchange Commission, granting
unto said attorneys-in-fact and agents, 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, and hereby ratifies and confirms all his said attorneys-in-fact and
agents, each acting alone, or his substitute or substitutes, may lawfully do or
cause to be done by virtue thereof.
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities and on the date indicated.
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
- --------- ----- ----
<S> <C> <C>
/s/ Michael W. Paolercio Co-Chairman of the Board and June 9, 1997
- ------------------------ Chief Executive Officer
Michael W. Paolercio
/s/ Anthony Paolercio, Jr. Co-Chairman of the Board and June 9, 1997
- -------------------------- Executive Vice President
Anthony Paolercio, Jr.
</TABLE>
II-5
<PAGE> 7
<TABLE>
<CAPTION>
<S> <C> <C>
/s/ Fredric R. Wasserspring President, Chief Operating June 9, 1997
- ------------------------------- Officer and Director
Fredric R. Wasserspring
/s/ Allan Corn Chief Financial Officer June 9, 1997
- ------------------------------- Senior Vice President and
Allan Corn Director (Principal Accounting
Officer)
/s/ Michael A. Paolercio Senior Vice President, Treasurer June 9, 1997
- ------------------------------- and Director
Michael A. Paolercio
/s/ Michael Wager
- -------------------------------
Michael Wager Director June 9, 1997
/s/ David Harris
- -------------------------------
David Harris Director June 9, 1997
/s/ Donald Miller
- -------------------------------
Donald Miller Director June 9, 1997
</TABLE>
II-6
<PAGE> 8
THE PLAN
Pursuant to the requirements of the Securities Act of 1933, the Plan
has duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Mount Vernon, State of
New York, as of the 9th day of June, 1997.
MICHAEL ANTHONY JEWELERS, INC.
1993 LONG-TERM INCENTIVE PLAN
By: /s/ Michael Wager
-----------------
Chairman, Compensation Committee
<PAGE> 9
EXHIBITS INDEX
Exhibit No. Description
- ----------- -----------
4 1993 Long-Term Incentive Plan
as amended
5 Opinion of M. Frances Durden, Esq.
23.1 Consent of Deloitte & Touche
23.2 Consent of M. Frances Durden, Esq.
(See Exhibit 5)
24 Power of Attorney
(Included on
signature page)
<PAGE> 1
EXHIBIT 4
1993 LONG-TERM INCENTIVE PLAN
OF
MICHAEL ANTHONY JEWELERS, INC.
1. PURPOSE OF THE PLAN. This 1993 Long-Term Incentive Plan of Michael
Anthony Jewelers, Inc. adopted on this 22nd day of April, 1993, is intended to
enable officers and key employees of the Company and its Subsidiaries to acquire
or increase their ownership of common stock of the Company on reasonable terms.
The opportunity so provided is intended to foster in participants an incentive
to put forth maximum effort for the continued success and growth of the Company
and its Subsidiaries, to aid in retaining individuals who put forth such
efforts, and to assist in attracting the best available individuals to the
Company and its Subsidiaries in the future.
2. DEFINITIONS. When used herein, the following terms shall have the
meaning set forth below:
2.1 "AWARD" means an Option, an Option granted in tandem with an
SAR, a Performance Plan Award, a Reload Option, a Restricted Stock Award,
a Restricted Stock Award granted in tandem with an Option, an SAR or a
Stock Bonus Award.
2.2 "AWARD AGREEMENT" means a written agreement in such form as may
be from time to time, hereafter approved by the Committee, which shall be
duly executed by the Company and the Employee and which shall set forth
the terms and conditions of an Award under the Plan.
2.3 "BOARD" means the Board of Directors of Michael Anthony
Jewelers, Inc.
2.4 "CHANGE IN CONTROL" means a change in control of the Company of
a nature that would be required to be reported in response to Item 6(e) of
Schedule 14A of Regulation 14A promulgated under the Exchange Act (as in
effect on the date the Plan
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<PAGE> 2
is adopted by the Board), whether or not the Company is then subject to
such reporting requirement; provided, that, without limitation, a Change
in Control shall be deemed to have occurred if:
(a) any "person" (as defined in Sections 13(d) and 14(d) of the
Exchange Act) is or becomes the "beneficial owner" (as defined in Rule
13d-3 under the Exchange Act), directly or indirectly, of securities of
the Company representing forty percent (40%) or more of the combined
voting power of the Company's then outstanding securities; provided,
however, that a Change in Control shall not be deemed to occur under this
clause (a) by reason of the acquisition of securities by the Company or an
employee benefit plan (or any trust funding such a plan) maintained by the
Company, or by reason of the new issuance of securities directly by the
Company;
(b) during any period of two (2) consecutive years (not including
any period prior to the adoption of this Plan) there shall cease to be a
majority of the Board comprised of Continuing Directors; or
(c) (i) the stockholders of the Company approve a merger or
consolidation of the Company with any other corporation, other than a
merger or consolidation which would result in the voting securities of the
Company outstanding immediately prior thereto continuing to represent
(either by remaining outstanding or by being converted into voting
securities of the surviving entity) more than fifty-one percent (51%) of
the combined voting power of the voting securities of the Company or such
surviving entity outstanding immediately after such merger or
consolidation, or (ii) the stockholders of the Company approve a plan of
complete liquidation of the Company or an agreement for the sale or
disposition by the Company of all or substantially all of the Company's
assets.
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<PAGE> 3
2.5 "CODE" means the Internal Revenue Code of 1986, as in effect at
the time of reference, or any successor revenue code which may hereafter
be adopted in lieu thereof, and reference to any specific provisions of
the Code shall refer to the corresponding provisions of the Code as it may
hereafter be amended or replaced.
2.6 "COMMITTEE" means the Stock Option Committee of the Board or any
other committee appointed by the Board which is invested by the Board with
responsibility for the administration of the Plan and whose members meet
the requirements for eligibility to serve as set forth in Rule 16b-3 and
in the Plan.
2.7 "COMPANY" means Michael Anthony Jewelers, Inc.
2.8 "CONTINUING DIRECTORS" means individuals who at the beginning of
any period of two (2) consecutive years (not including any period prior to
the adoption of this Plan) and any new director(s) whose election by the
Board or nomination for election by the Company's stockholders was
approved by a vote of at least a majority of the directors then still in
office who either were directors at the beginning of the period or whose
election or nomination for election was previously so approved.
2.9 "EMPLOYEE STOCKHOLDER" means an Employee who, at the time an
Incentive Stock Option is granted owns, as defined in Section 424 of the
Code, stock possessing more than ten percent (10%) of the total combined
voting power of all classes of stock of: (a) the Company; or (b) if
applicable, a Subsidiary or a Parent.
2.10 "EMPLOYEES" means officers (including officers who are members
of the Board) and other key employees of the Company or any of its
Subsidiaries.
2.11 "ERISA" means the Employee Retirement Income Security Act of
1974, as in effect at the time of reference, or any successor law which
may hereafter be
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<PAGE> 4
adopted in lieu thereof, and any reference to any specific provisions of
ERISA shall refer to the corresponding provisions of ERISA as it may
hereafter be amended or replaced.
2.12 "EXCHANGE ACT" means the Securities Exchange Act of 1934, as in
effect at the time of reference, or any successor law which may hereafter
be adopted in lieu thereof, and any reference to any specific provisions
of the Exchange Act shall refer to the corresponding provisions of the
Exchange Act as it may hereafter be amended or replaced.
2.13. "EXERCISED OPTION" has the meaning ascribed to it in Section
2.24 hereof.
2.14 "FAIR MARKET VALUE" means, with respect to the Shares, the
closing price of the Shares on the American Stock Exchange or other
national securities exchange, on the last business day prior to the date
on which the value is to be determined, as reported in the WALL STREET
JOURNAL or such other source of quotations for, or report of trading of,
the Shares as the Committee may reasonably select from time to time;
provided, however, if the Shares are not then traded on such an exchange,
but are then traded on the over-the-counter market, Fair Market Value
means the mean between the high and low bid and asked prices for the
Shares on the over-the-counter market on the last business day prior to
the date on which the value is to be determined (or the next preceding day
on which sales occurred if there were no sales on such date); provided
further, however, if no sales have occurred in the over-the-counter market
during the three week period preceding the date on which the value is to
be determined, Fair Market Value means the average
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<PAGE> 5
of the mean between the high and low bid and asked prices for the Shares
on the over-the-counter market for the three (3) month period ending on
the last business day prior to the date on which the value is to be
determined; provided, further, however, if the Shares are reported in the
National Market List of the National Association of Securities Dealers,
Inc. Automated Quotation System, the closing price shall be substituted
above for the mean of the high and the low bid and asked prices.
2.15 "INCENTIVE STOCK OPTION" means an Option meeting the
requirements and containing the limitations and restrictions set forth in
Section 422 of the Code.
2.16 "NON-QUALIFIED STOCK OPTION" means an Option other than an
Incentive Stock Option.
2.17 "OPTION" means the right to purchase the number of Shares
specified by the Committee, at a price and for a term fixed by the
Committee, in accordance with the Plan, and subject to such other
limitations and restrictions as the Plan and the Committee may impose.
2.18 "PARENT" means any corporation, other than the employer
corporation, in an unbroken chain of corporations ending with the employer
corporation if, at the time of the granting of the Option, each of the
corporations other than the employer corporation owns stock possession
fifty percent (50%) or more of the total combined voting power of all
classes of stock in one of the other corporations in such chain.
2.19 "PERFORMANCE GOALS" has the meaning ascribed to it in Section
11 of the Plan.
2.20 "PERFORMANCE PERIOD" has the meaning ascribed to it in Section
11 of the Plan.
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<PAGE> 6
2.21 "PERFORMANCE PLAN AWARD" means the right to receive Options,
Reload Options, Restricted Stock Awards, SARs, Shares, Stock Bonus Awards
or units (representing such monetary amount as designated by the Committee
and payable in cash or in Shares) pursuant to Section 11 of the Plan,
which right is based on, or subject to, in whole or in part, the
achievement of certain performance criteria specified by the Committee.
2.22 "PLAN" means the 1993 Long-Term Incentive Plan of Michael
Anthony Jewelers, Inc.
2.23 "REGULATION T" means Part 220, chapter II, title 12 of the Code
of Federal Regulations, issued by the Board of Governors of the Federal
Reserve System pursuant to the Exchange Act, as amended from time to time,
or any successor regulation which may hereafter be adopted in lieu
thereof.
2.24 "RELOAD OPTION" means, with respect to an Employee who
exercises an Option or Reload Option (the "Exercised Option") with Shares,
an Incentive Stock Option or Non-Qualified Stock Option to purchase a
number of Shares equal to the number of Shares transferred to the Company
upon exercise of the Exercised Option, on terms similar to those set forth
in the Award Agreement evidencing such Exercised Option, except that the
option price per Share shall equal the Fair Market Value of the Shares
subject to the Reload Option on the date the Reload Option is granted, and
subject to such other terms, limitations and restrictions as the Plan and
the Committee may impose. All provisions in the Plan applicable to Options
shall also apply to Reload Options.
2.25 "RESTRICTED STOCK AWARD AGREEMENT" means an Award Agreement
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<PAGE> 7
executed in connection with a Restricted Stock Award.
2.26 "RESTRICTED STOCK AWARD" means the right to receive Shares, but
subject to forfeiture and/or other restrictions set forth in the related
Restricted Stock Award Agreement and the Plan.
2.27 "RULE 16B-3" means Rule 16b-3 of the General Rules and
Regulations of the Securities and Exchange Commission as in effect at the
time of reference, or any successor rules or regulations which may
hereafter be adopted in lieu thereof, and any reference to any specific
provisions of Rule 16b-3 shall refer to the corresponding provisions of
Rule 16b-3 as it may hereafter be amended or replaced.
2.28 "SAR" means a stock appreciation right, which is a right to
receive an amount in cash, or Shares, or a combination of cash and Shares,
as determined or approved by the Committee, no greater than the excess, if
any, of (i) the Fair Market Value of a Share on the date the SAR is
exercised, over (ii) the SAR Base Price.
2.29 "SAR BASE PRICE" means the Fair Market Value of a Share on the
date an SAR was granted, or if the SAR was granted in tandem with an
Option (whether or not the Option was granted on a different date than the
SAR), in the Committee's discretion, the option price of a Share subject
to the Option.
2.30 "SHARES" means shares of the Company's $.001 par value common
stock or, if by reason of the adjustment provisions contained herein, any
rights under an Award under the Plan pertaining to any other security,
such other security.
2.31 "STOCK BONUS AWARD" means the right to receive Shares as
provided in Section 10 of the Plan.
2.32 "SUBSIDIARY" OR "SUBSIDIARIES" means any corporation or
corporations
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<PAGE> 8
other than the employer corporation in an unbroken chain of corporations
beginning with the employer corporation if each of the corporations other
than the last corporation in the unbroken chain owns stock possessing
fifty percent (50%) or more of the total combined voting power of all
classes of stock in one of the other corporations in such chain.
2.33 "SUCCESSOR" means the legal representative of the estate of a
deceased Employee or the person or persons who shall acquire the right to
exercise or receive an Award by bequest or inheritance or by reason of the
death of the Employee.
2.34 "TERM" means the period during which a particular Award may be
exercised.
2.35 "WINDOW PERIOD" means the period beginning on the third
business day following the date of release of the financial data specified
in paragraph (e)(1)(ii) of Rule 16b-3 and ending on the twelfth business
day following such date.
3. STOCK SUBJECT TO THE PLAN. There will be reserved for use, upon the
issuance, vesting or exercise of Awards to be granted from time to time under
the Plan, an aggregate of Seven Hundred Fifty Thousand (750,000) Shares, which
Shares may be, in whole or in part, as the Board shall from time to time
determine, authorized but unissued Shares, or issued Shares which shall have
been reacquired by the Company. Any Shares subject to issuance upon exercise of
Options or SARs, or vesting of Performance Plan Awards, but which are not issued
because of a surrender, lapse, expiration, forfeiture or termination of any such
Option, SAR or Performance Plan Award prior to issuance of the Shares shall once
again be available for issuance in satisfaction of Awards. Similarly, any Shares
issued pursuant to a Restricted Stock Award which are subsequently forfeited
pursuant to the terms
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<PAGE> 9
of the related Restricted Stock Award Agreement shall once again be available
for issuance in satisfaction of Awards.
4. ADMINISTRATION OF THE PLAN. The Board shall appoint the Committee,
which shall consist of not less than two (2) disinterested directors as defined
in Rule 16b-3. Subject to the provisions of the Plan, the Committee shall have
full authority, in its discretion, to determine the Employees to whom Awards
shall be granted, the number of Shares to be covered by each of the Awards, and
the terms of any such Award; to amend or cancel Awards (subject to Section 23 of
the Plan), to accelerate the vesting of Awards; to require the cancellation or
surrender of any previously granted awards under this Plan or any other plans of
the Company as a condition to the granting of an Award, to interpret the Plan;
and to prescribe, amend, and, rescind rules and regulations relating to the
Plan, and generally to interpret and determine any and all matters whatsoever
relating to the administration of the Plan and the granting of Awards hereunder.
The Board may from time to time appoint members to the Committee in substitution
for or in addition to members previously appointed and may fill vacancies,
however caused, in the Committee. The Committee shall select one of its members
as its chairman and shall hold its meetings at such times and places as it shall
deem advisable. A majority of its members shall constitute a quorum. Any action
of the Committee may be taken by a written instrument signed by all of the
members, and any action so taken shall be fully as effective as if it had been
taken by a vote of a majority of the members at a meeting duly called and held.
The Committee shall make such rules and regulations for the conduct of its
business as it shall deem advisable and shall appoint a Secretary who shall keep
minutes of its meetings and records of all action taken in writing without a
meeting. No member of the Committee shall be
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liable, in the absence of bad faith, for any act or omission with respect to his
or her service on the Committee.
5. EMPLOYEES TO WHOM AWARDS MAY BE GRANTED. Awards may be granted in
each calendar year or portion thereof while the Plan is in effect to such of the
Employees as the Committee, in its discretion, shall determine. In determining
the Employees to whom Awards shall be granted and the number of Shares to be
issued or subject to purchase or issuance under such Awards, the Committee shall
take into account the recommendations of the Company's management as to the
duties of the respective Employees, their present and potential contributions to
the success of the Company and its Subsidiaries, and such other factors as the
Committee shall deem relevant in connection with accomplishing the purposes of
the Plan. No Award shall be granted to any member of the Committee so long as
his or her membership on the Committee continues or to any member of the Board
who is not also an officer or key employee of the Company or any Subsidiary.
6. Stock Options.
6.1 TYPES OF OPTIONS. Options granted under the Plan may be
(i) Incentive Stock Options, (ii) Non-Qualified Stock Options, (iii) a
combination of the foregoing or (iv) Reload Options. The Award
Agreement shall designate whether an Option is an Incentive Stock
Option or a Non-Qualified Stock Option and separate Award Agreements
shall be issued for each type of Option when a combination of an
Incentive Stock Option and a Non-Qualified Stock Option are granted on
the same date to the same Employee. Any Option which is designated as a
Non-Qualified Stock Option shall not be treated by the Company or the
Employee to whom the Option is granted as an Incentive Stock Option for
federal income tax purposes.
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6.2 OPTION PRICE. The option price per Share of any Non-Qualified
Stock Option granted under the Plan shall be the Fair Market Value of
the Shares covered by the Option on the date the Option is granted
unless the Committee, in its sole discretion, determines to set the
option price at an amount less than or greater than the Fair Market
Value of the Shares on such date. The option price per Share of any
Incentive Stock Option granted under the Plan shall not be less than
the Fair Market Value of the Shares covered by the Option on the date
the Option is granted, Notwithstanding anything herein to the
contrary, the option price per Share of any Incentive Stock Option
granted to an Employee Stockholder shall not be less than one hundred
ten percent (110%) of the Fair Market Value of the Shares covered by
the Option on the date the Option is granted.
6.3 TERM OF OPTIONS. Options granted hereunder shall be
exercisable for a Term of not more than ten (10) years from the date
of grant thereof, but shall be subject to earlier termination as
hereinafter provided. Each Award Agreement issued hereunder shall
specify the Term of the Option, which shall be determined by the
Committee in accordance with its discretionary authority hereunder. No
Option in tandem with an SAR shall be exercisable during the first six
(6) months following the date of grant of the SAR, except that this
limitation shall not apply in the event that it is permissible under
Rule 16b-3 to exercise the Option prior to the expiration of the six
(6) month period.
Notwithstanding anything herein to the contrary, if an Incentive
Stock Option is granted to an Employee Stockholder, then such
Incentive Stock Option shall not be exercisable more than five (5)
years from the date of grant thereof, but shall be subject to earlier
termination as hereinafter provided.
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7. LIMIT ON FAIR MARKET VALUE OF INCENTIVE STOCK OPTIONS. No Employee
may be granted an Incentive Stock Option hereunder to the extent that the
aggregate fair market value (such fair market value being determined as of the
date of grant of the option in question) of the stock with respect to which
incentive stock options are first exercisable by such Employee during any
calendar year (under all such plans of the Employee's employer corporation, its
Parent, if any, and its Subsidiaries, if any) exceeds One Hundred Thousand
Dollars ($100,000). For purposes of the preceding sentence, options shall be
taken into account in the order in which they were granted. Any Option granted
under the Plan which is intended to be an Incentive Stock Option, but which
exceeds the limitation set forth in this Section 7, shall be a Non-Qualified
Stock Option.
8. STOCK APPRECIATION RIGHTS.
8.1 GRANT OF SAR. The Committee, in its discretion, may grant
an Employee an SAR in tandem with an Option or may grant an Employee an
SAR on a stand alone basis. The Committee, in its discretion, may grant
an SAR in tandem with an Option either at the time the Option is granted
or at any time after the Option is granted, but no later than six (6)
months and one (1) day prior to the end of the Term of the Option, so
long as the grant of the SAR is made during the period in which grants
of SARs may be made under the Plan. The Committee, in its discretion,
may grant an SAR in tandem with an Option which is exercisable either in
lieu of, or in addition to, the exercise of the related Option.
8.2 LIMITATIONS ON EXERCISE. Each SAR granted in tandem with
an Option shall be exercisable to the extent, and only to the extent,
the related Option is exercisable and shall be for such Term as the
Committee may determine (which Term, which is not to
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exceed ten (10) years, may expire prior to the Term of the related
Option). Each SAR granted on a stand alone basis shall be exercisable to
the extent, and for such Term, as the Committee may determine. No SAR or
any related Option shall be exercisable during the first six (6) months
following the date of grant of the SAR, except that this limitation will
not apply in the event it is permissible under Rule 16b-3 to exercise
the SAR prior to the expiration of the six (6) month period. If, and to
the extent, an Employee who is subject to Section 16(b) of the Exchange
Act is to receive cash in exchange for an SAR, the SAR and any related
Option are exercisable only during a Window Period and the right of the
Employee to request to be paid in cash may only be made during a Window
Period. The SARs shall be subject to such other terms and conditions as
the Committee, in its discretion, shall determine, which are not
otherwise inconsistent with the Plan. The terms and conditions may
include Committee approval of the exercise of the SAR, limitations on
the time within which and the extent to which such SAR shall be
exercisable, limitations, if any, on the amount of appreciation in value
which may be recognized with regard to such SAR, and specification of
what portion, if any, of the amount payable to the Employee upon
exercise of such SAR shall be payable in cash and what portion if any,
shall be payable in Shares. If, and to the extent, that Shares are
issued in satisfaction of amounts payable on exercise of an SAR, the
Shares shall be valued at their Fair Market Value on the date of
exercise.
8.3 SARs IN TANDEM WITH INCENTIVE STOCK OPTIONS. With respect
to SARs granted in tandem with Incentive Stock Options, the following
shall apply:
(a) No SAR shall be exercisable unless the Fair Market
Value of
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the Shares on the date of exercise exceeds the option price of the
related Incentive Stock Option.
(b) In no event shall any amounts paid pursuant to the SAR exceed
the difference between the Fair Market Value of the Shares on the
date of exercise and the option price of the related Incentive Stock
Opiton.
8.4 SURRENDER OF OPTION OR SAR GRANTED IN TANDEM. If the Award
Agreement related to the grant of an SAR in tandem with an Option
provides that the SAR can only be exercised in lieu of the related
Option, then, upon exercise of such SAR, the related Option or portion
thereof with respect to which such SAR is exercised shall be deemed
surrendered and shall not thereafter be exercisable, and, similarly,
upon exercise of the Option, the related SAR or portion thereof with
respect to which such Option is exercised shall be deemed surrendered
and shall not thereafter be exercisable. If the Award Agreement related
to the grant of an SAR in tandem with an Option provides that the SAR
can be exercised in addition to the related Option, then, upon exercise
of such SAR, the related Option or portion thereof with respect to which
such SAR is exercised shall not be deemed surrendered and shall continue
to be exercisable and, similarly, upon exercise of the Option, the
related SAR or portion thereof with respect to which such Option is
exercised shall not be deemed surrendered and shall continue to be
exercisable.
9. RESTRICTED STOCK AWARDS. Restricted Stock Awards granted under
the Plan shall be subject to such terms and conditions as the Committee may, in
its discretion, determine and set forth in the related Restricted Stock Award
Agreements. The Committee, in its discretion, may grant an Employee a Restricted
Stock Award on a stand alone basis or in
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tandem with an Option. Restricted Stock Awards shall be granted in accordance
with, and subject to, the provisions set forth below.
9.1 ISSUANCE OF SHARES. Each Restricted Stock Award shall be
evidenced by a Restricted Stock Award Agreement which shall set forth
the number of Shares issuable under the Restricted Stock Award. Subject
to the restrictions in Section 9.3 of the Plan, and subject further to
such other restrictions or conditions established by the Committee, in
its discretion, and set forth in the related Restricted Stock Award
Agreement (such as requiring the Employee to pay an amount equal to the
aggregate par value of the Shares to be issued thereunder), the number
of Shares granted under a Restricted Stock Award shall be issued in the
recipient Employee's name on the date of grant of such Restricted Stock
Award or as soon as reasonably practicable thereunder.
9.2 RIGHT OF RECIPIENT EMPLOYEES. Shares received pursuant to
Restricted Stock Awards shall be duly issued or transferred to the
Employee, and a certificate or certificates for such Shares shall be
issued in the Employee's name. Subject to the restrictions in Section
9.3 of the Plan, and subject further to such other restrictions or
conditions established by the Committee, in its discretion, and set
forth in the related Restricted Stock Award Agreement, the Employee
shall thereupon be a stockholder with respect to all the Shares
represented by such certificate or certificates and shall have the
rights of a stockholder with respect to such Shares, including the right
to vote such Shares and to receive dividends and other distributions
paid with respect to such Shares. In aid of the restrictions in Section
9.3 of the Plan and in the related Restricted Stock Award Agreement, the
certificate or certificates for
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Shares awarded hereunder, together with a suitably executed stock power
signed by such recipient Employee, shall be held by the Company in its
control for the account of such Employee (i) until the restrictions in
Section 9.3 of the plan and in the related Restricted Stock Award
Agreement lapse pursuant to the Plan or the Restricted Stock Award
Agreement, at which time a certificate for the appropriate number of
Shares (free of all restrictions imposed by the Plan or the Restricted
Stock Award Agreement) shall be delivered to the Employee, or (ii) until
such Shares are forfeited to the Company and canceled as provided by the
Plan or the Restricted Stock Award Agreement.
9.3 RESTRICTIONS. Except as otherwise determined by the Committee in
its sole discretion, each share issued pursuant to a Restricted Stock
Award Agreement shall be subject, in addition to any other restrictions
set forth in the related Restricted Stock Award Agreement, to the
following restrictions until such restrictions have lapsed pursuant to
Section 9.4 of the Plan;
(a) DISPOSITION. The Shares awarded to an Employee and held by the
Company pursuant to Section 9.2 of the Plan, and the right to vote such
Shares or receive dividends on such Shares, may not be sold, exchanged,
transferred, pledged, hypothecated or otherwise disposed of; provided,
however, that such Shares may be transferred upon the death of the
Employee to the Employee's Successor. Any transfer or purported transfer
of such Shares in violation of the restrictions outlined in this Section
9.3 shall be null and void and shall result in the forfeiture of the
Shares transferred or purportedly transferred to the Company without
notice and without consideration.
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<PAGE> 17
(b) FORFEITURE. The Shares awarded to an Employee and held by the
Company pursuant to Section 9.2 of the Plan shall be forfeited to the
Company without notice and without consideration therefor immediately
upon the termination of the Employee's employment with the Company and
all Subsidiaries of the Company for any reason other than (i) death,
(ii) disability, (iii) retirement, (iv) the Employee's attainment of age
sixty-five (65), (v) Good Reason (as defined in the related Restricted
Stock Award Agreement) if by the Employee, or (vi) other than for Cause
(as defined in the related Restricted Stock Award Agreement) if by the
Company.
9.4 LAPSE OF RESTRICTIONS. Except as otherwise determined by the
Committee in its sole discretion, the restrictions set forth in Section
9.3 of the Plan on Shares issued under a Restricted Stock Award shall
lapse on, and certificates for the Shares held for the account of the
Employee in accordance with Section 9.2 of the plan hereof shall be
appropriately distributed to the Employee as soon as reasonably
practical after, the earliest of:
(a) the Employee's death;
(b) the termination of the Employee's employment by reason of
the Employee being "disabled" or defined in Section 22(e)(3) of the
Code;
(c) the Employee's early, normal or late retirement pursuant to
the retirement plans of the Company or any of its Subsidiaries;
(d) the Employee's attainment of age sixty-five (65);
(e) the termination of the Employee's employment by the Employee
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<PAGE> 18
for Good Reason (as defined in the related Restricted Stock Award
Agreement) or by the Company other than for Cause (as defined in the
related Restricted Stock Award Agreement); or
(f) (i) the first anniversary of the date of grant with
respect to one-third (1/3) of the Shares originally awarded,
(ii) the second anniversary of the date of grant with respect to
an additional one-third (1/3) of the Shares originally awarded, and
(iii) the third anniversary of the date of grant with respect to
the balance of the Shares originally awarded.
9.5 SURRENDER OF OPTIONS OR RESTRICTED STOCK GRANTED IN TANDEM. If
the Restricted Stock Award Agreement related to the grant of a Restricted Stock
Award in tandem with an Option provides that the Option can only be exercised in
lieu of the scheduled vesting for the Restricted Stock Award, then, upon vesting
of the Shares subject to the Restricted Stock Award, the related Option or
portion thereof with respect to which such Restricted Stock Award becomes vested
shall be deemed surrendered and shall not thereafter be exercisable and,
similarly, upon exercise of the Option, the Shares subject to the related
Restricted Stock Award or portion thereof with respect to which such Option is
exercised shall be deemed forfeited to the Company and shall be canceled as
provided by the Plan or the Restricted Stock Award Agreement.
10. STOCK BONUS AWARDS. Stock Bonus Awards may be granted under the
Plan with respect to Shares, and shall be granted, subject to the provisions of
the Plan, upon such terms and conditions as the Committee may determine in its
discretion. The Committee, in its discretion, may require the Employees to whom
Stock Bonus Awards are granted to pay the Company an amount equal to the
aggregate par value of the Shares to be issued to
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<PAGE> 19
such Employees. Subject to the Employee delivering in cash or by check the
amounts, if any, required to be paid pursuant to this Section 10 or pursuant to
Section 21 of the Plan (relating to taxes), a certificate or certificates for
such Shares shall be issued in the Employee's name as soon as reasonably
practicable following the date of grant, or if such payments are required,
following the date of such payments. The Company shall deliver such certificate
or certificates to the Employee and the Employee shall thereupon be a
stockholder with respect to all Shares represented by such certificate or
certificates and shall have all the rights of a stockholder with respect to such
Shares.
11. PERFORMANCE PLAN AWARDS.
(a) PERFORMANCE PLAN AWARDS. Performance Plan Awards may be
granted under the Plan in such form as the Committee may from time to time
approve. Performance Plan Awards may be granted alone, in addition to or in
tandem with other Awards under the Plan. Subject to the terms of the Plan,
including the terms of the Plan applicable to any underlying type of Award that
is the subject of a Performance Plan Award (i.e., an Option, an Option granted
in tandem with an SAR, a Reload Option, a Restricted Stock Award, a Restricted
Stock Award granted in tandem with an Option, an SAR or a Stock Bonus Award, as
the case may be), the Committee shall determine the number of Performance Plan
Awards to be granted to an Employee, the terms and conditions applicable to any
particular Performance Plan Award made to an Employee and, in the case of a
performance Plan Award of units, the monetary amount represented by each such
unit.
(b) PERFORMANCE GOALS AND PERFORMANCE PERIODS. A Performance Plan Award
shall provide that in order for an Employee to vest, in whole or in part, in
such Performance Plan Award the Company and/or the Employee must achieve certain
individual and/or aggregate
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performance criteria ("Performance Goals") over a designated performance period
("Performance Period"). The Performance Goals and Performance Period shall be
established by the Committee, in its sole discretion. The Committee may also
establish a schedule or schedules for any such Performance Period setting forth
the portion of the Performance Plan Award which will be earned or forfeited
based on the degree of achievement of the Performance Goals actually achieved or
exceeded. In setting Performance Goals the Committee may use such measures as
cumulative or non-cumulative return on equity, earnings growth, revenue growth
or such other individual and/or aggregate measure or measures of performance in
such manner as it deems appropriate. During the Performance Period, the
Committee, except as provided otherwise in the Award Agreement evidencing the
Performance Plan Award, shall have the authority to adjust upward or downward
the Performance Goals in such manner as it deems appropriate.
(c) PAYMENTS OF UNITS. An employee who has been granted a Performance
Plan Award of units shall be entitled to receive a payment with respect to such
units in an amount equal to the number of units earned at the conclusion of the
respective Performance Period times the dollar value of each unit. Payment in
settlement of such unit shall be made in cash, in Shares, or in any combination
thereof, as the Committee in its sole discretion shall determine, and shall be
made as soon as practicable following the conclusion of the respective
Performance Period and the calculation of the dollar value of such units.
12. CASH PAYMENTS FOR TAXES. The Committee may, in its sole discretion,
provide in an Award Agreement that the Company will make a cash payment to the
Employee covered thereby equal to the aggregate of the amount of federal, state
and local income taxes which such Employee would be required to pay to each such
taxing authority attributable to the realization of taxable income, if any, as a
result of the receipt of Shares pursuant to any Award (other than an
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Incentive Stock Option) granted under the Plan. The Committee may, in its
discretion, require the Employee to make an election to be taxed immediately
under Section 83(b) of the Code as a condition to receiving such payment. In
computing the amount of such payment, it shall be assumed that every Employee
granted an Award under the Plan is subject to tax by each taxing authority at
the highest marginal tax rate in the respective taxing jurisdiction of such
Employee (provided that the highest marginal tax rate for federal income tax
purposes shall be determined under Section 1 of the Code), taking into account
the city and state in which such Employee resides, but giving effect to the tax
benefit, if any, which such Employee may enjoy to the extent that any such tax
is deductible in determining the tax liability of any other taxing jurisdiction
(disregarding the effects of code Section 68 in determining deductibility for
federal income tax purposes). Likewise, the Committee may, in its sole
discretion, provided in an Award Agreement that the Company will make a cash
payment to the Employee covered thereby equal to the amount of excise taxes
(i.e., an "excise tax gross-up payment") which such Employee would be required
to pay pursuant to Section 4999 of the Code as a result of all or any part of
such Employee's Award being treated as an "excess parachute payment" within the
meaning of Section 280G(b) of the Code. In addition to the foregoing, the
Committee may, in its discretion, increase each cash payment due to an Employee
hereunder, such that each Employee who receives Shares and/or an excise tax
gross-up payment pursuant to any Award granted under this Plan shall receive
such Shares and/or excise tax gross-up payment net of all income and/or excise
taxes imposed on such employee on account of the receipt of such Shares and/or
excise tax gross-up payment.
13. DATE OF GRANT. The date of grant of an Award granted hereunder
shall be the date on which the Committee acts in granting the Award.
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14. EXERCISE OF RIGHTS UNDER OPTIONS OR SARs.
14.1 NOTICE OF EXERCISE. An Employee entitled to exercise an
Option or SAR shall do so by delivery of a written notice to that effect
specifying the number of Shares with respect to which the Option or SAR is being
exercised and any other relevant information the Committee may require. The
notice shall be accompanied by payment in full of the purchase price of any
Shares to be purchased, which payment may be made in cash or, with the
Committee's approval (which in the case of Incentive Stock Options must be given
at the time of grant), in Shares valued at Fair Market Value at the time of
exercise or a combination thereof. No Shares shall be issued upon exercise of an
Option until full payment has been made therefor. An Employee exercising a SAR
of an Option granted in tandem with a SAR may, if the terms and conditions of
the Award so provide, state in the notice of exercise what percentage of the SAR
the Employee desires to be paid in cash or Shares, in which event the Committee
may honor the request so made or satisfy the SAR in cash or Shares or some
combination of each, as the Committee may determine in its sole discretion. All
notices or requests provided for herein shall be delivered to the Company's
Secretary, or such other person as the Committee may designate.
14.2 CASHLESS EXERCISE PROCEDURES. The Company, in its sole
discretion, may establish procedures whereby an Employee, subject to the
requirements of Rule 16b-3, Regulation T, federal income tax laws, and other
federal, state and local tax and securities laws, can exercise an Option or a
portion thereof without making a direct payment of the option price to the
Company; provided, however, that these cashless exercise procedures shall not
apply to Incentive Stock Options which are outstanding on the date the Company
establishes such procedures unless the application of such procedures to such
Options is permitted pursuant to the Code and the regulations thereunder without
affecting the Options' qualification under Code Section 422 as
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Incentive Stock Options. If the Company so elects to establish a cashless
exercise program, the Company shall determine, in its sole discretion, and from
time to time, such administrative procedures and policies as it deems
appropriate and such procedures and policies shall be binding on any Employee
wishing to utilize the cashless exercise program.
15. AWARD TERMS AND CONDITIONS. Each Award or each agreement setting
forth an Award shall contain such other terms and conditions not inconsistent
herewith as shall be approved by the Committee. For example, an Award Agreement
evidencing an Option may provide for the automatic grant of a Reload Option to
an Employee who exercises an Option with Shares.
16. RIGHTS OF AWARD HOLDER. The holder of an Award shall not have any
of the rights of a stockholder with respect to the Shares subject to purchase or
receipt under the Award, except that (a) an Award holder's rights with respect
to a Restricted Stock Award shall be as prescribed in Section 9.2 and (b)
stockholder rights with respect to any other Award shall rise at the time and to
the extent that one or more certificates for such Shares shall be delivered to
the holder upon the due exercise or grant of the Award.
17. NONTRANSFERABILITY OF AWARDS. An Award shall not be transferable
other than: (a) by will or the laws of descent and distribution, and an Award
subject to exercise may be exercised, during the lifetime of the holder of the
Award, only by the holder or in the event of death, the holder's Successor, or
in the event of disability, the holder's personal representative, or (b)
pursuant to a qualified domestic relations order, as defined in the Code or
ERISA or the rules thereunder; provided, however, that an Incentive Stock Option
may not be transferred pursuant to a qualified domestic relations order unless
such transfer is otherwise permitted pursuant to the
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Code and the regulations thereunder without affecting the Option's qualification
under Code Section 422 as an Incentive Stock Option.
18. ADJUSTMENTS UPON CHANGES IN CAPITALIZATION. In the event of changes
in all of the outstanding Shares by reason of stock dividends, stock splits,
reclassifications, recapitalizations, mergers, consolidations, combinations, or
exchanges of shares, separations, reorganizations or liquidations, or similar
events, or in the event of extraordinary cash or non-cash dividends being
declared with respect to the Shares, or similar transactions or events, the
number and class of Shares subject to Awards theretofore granted, applicable
purchase prices and all other applicable provisions, shall, subject to the
provisions of the Plan, be equitably adjusted by the Committee (which adjustment
may, but need not, include payment to the holder of an Option or SAR, in cash or
in shares, in an amount equal to the difference between the price at which such
Option or SAR may be exercised and the then current fair market value of the
Shares subject to such Option or SAR as equitably determined by the Committee).
The foregoing adjustment and the manner of application of the foregoing
provisions shall be determined by the Committee, in its sole discretion. Any
such adjustment may provide for the elimination of any fractional share which
might otherwise become subject to an Award.
19. CHANGE IN CONTROL. Notwithstanding anything to the contrary in the
Plan or any Award Agreement, in the case of a Change in Control of the Company,
the Committee may, in its discretion, taking into account the purposes of this
Plan, determine, on a case by case basis, that each Award granted under the Plan
shall, subject to the following provisions, terminate ninety (90) days after the
occurrence of such Change in Control but, in the event of any such termination:
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(a) An Option or SAR holder ( not including the holder of an Option in
tandem with a Restricted Stock Award) shall have the right, commending at least
five (5) days prior to such Change in Control and subject to any other
limitation on the exercise of such Option or SAR in effect on the date of
exercise, (i) to immediately exercise any Options not in tandem with SARs or
Restricted Stock Awards in full, without regard to any vesting limitations, to
the extent they shall not have been theretofore exercised, and (ii) to exercise
at any time after the sixth (6th) month anniversary of the date of the grant of
the respective SAR (but subject to the restrictions of Rule 16b-3), any SARs or
Options in tandem with SARs in full, without regard to any vesting limitations,
to the extent they shall not have been theretofore exercised, provided, however,
that no SAR or Option in tandem with a SAR shall terminate prior to the end of
the first Window Period following the occurrence of such Change in Control;
(b) All restrictions on Restricted Stock Awards shall immediately
lapse, certificates for the affected Shares shall be appropriately distributed
and any Options in tandem with Restricted Stock Awards will be deemed to have
been surrendered; and
(c) All vesting limitations with respect to Performance Plan Awards
shall be deemed satisfied and any Option, Reload Option, Restricted Stock Award,
SAR, Share or Stock Bonus Award issuable thereunder shall, subject to (a) and
(b) above, be appropriately issued, and any cash payment required to be made
with respect to a unit shall be appropriately made.
20. FORMS OF AWARDS. Nothing contained in the Plan nor any resolution
adopted or to be adopted by the Board or by the stockholders of the Company
shall constitute the granting of any Award. An Award shall be granted hereunder
only by action taken by the Committee in granting an Award. Whenever the
Committee shall designate an Employee for the receipt of an Award, the Company's
Secretary, or such other person as the Committee may designate, shall
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forthwith send notice thereof to the Employee, in such form as the Committee
shall approve, stating the number of Shares subject to the Award, its Term, and
the other terms and conditions thereof. The notice shall be accompanied by a
written Award Agreement in such form as may from time to time hereafter be
approved by the Committee, which shall have been duly executed by or on behalf
of the Company. If the surrender of previously issued Awards is made a condition
of the grant, the notice shall set forth the pertinent details of such
condition. Execution by the Employee to whom such Award is granted of said Award
Agreement in accordance with the provisions set forth in this Plan shall be a
condition precedent to the exercise or receipt of any Award.
21. TAXES.
21.1 RIGHT TO WITHHOLD REQUIRED TAXES. The Company shall have
the right to require a person entitled to receive Shares pursuant to the
receipt, vesting or exercise of an Award under the Plan to pay the Company the
amount of any taxes which the Company is or will be required to withhold with
respect to such Shares before the certificate for such Shares is delivered
pursuant to the Award. Furthermore, the Company may elect to deduct such taxes
from any other amounts then payable in cash or in shares or from any other
amounts payable any time thereafter to the Employee. The Company shall also have
the right to deduct from any cash payment payable to a person pursuant to an
Award the amount of any taxes which the Company is required by law to withhold
with respect to such cash payment. If the Employee disposes of Shares acquired
pursuant to an Incentive Stock Option in any transaction considered to be a
disqualifying disposition under Sections 421 and 422 of the Code, the Employee
shall notify the Company of such transfer and the Company shall have the right
to deduct any taxes required by
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law to be withheld from any amounts otherwise payable then or at any time
thereafter to the Employee.
21.2 EMPLOYEE ELECTION TO WITHHOLD SHARES. Subject to
Committee approval (which in the case of Incentive Stock Options must be given
at the time of grant), an Employee may elect to satisfy the tax liability with
respect to the exercise of an Option by having the Company withhold Shares
otherwise issuable upon exercise of the Option; provided, however, that if an
Employee is subject to Section 16(b) of the Exchange Act at the time the Option
is exercised, such election must satisfy the requirements of Rule 16b-3.
22. TERMINATION OF THE PLAN. The Plan shall terminate ten (10) years
from the date hereof, and an Award shall not be granted under the Plan after
that date although the terms of any Awards may be amended at any date prior to
the end of its Term in accordance with the Plan. Any Awards outstanding at the
time of termination of the Plan shall continue in full force and effect
according to the terms and conditions of the Award and this Plan.
23. AMENDMENT OF THE PLAN. The Plan may be amended at any time and from
time to time by the Board, but no amendment without the approval of the
stockholders of the Company shall be made if stockholder approval under Section
422 of the Code or Rule 16b-3 would be required. Notwithstanding the
discretionary authority granted to the Committee in Section 4 of the Plan, no
amendment of the Plan or any Award granted under the Plan shall impair any of
the rights of any holder, without the holder's consent, under any Award
theretofore granted under the Plan.
24. DELIVERY OF SHARES ON EXERCISE OR GRANT. Delivery of certificates
for Shares pursuant to the grant or exercise of an Award may be postponed by the
Company for such period as may be required for it with reasonable diligence to
comply with any applicable requirements of
-27-
<PAGE> 28
any federal, state or local law or regulation or any administrative or
quasi-administrative requirement applicable to the sale, issuance, distribution
or delivery of such Shares. The Committee may, in its sole discretion, require
an Employee to furnish the Company with appropriate representations and a
written investment letter prior to the exercise of an Award or the delivery of
any Shares pursuant to an Award.
25. FEES AND COSTS. The Company shall pay all original issue taxes on
the issuance or exercise of any Award granted under the Plan and all other fees
and expenses necessarily incurred by the Company in connection therewith.
26. EFFECTIVENESS OF THE PLAN. The Plan shall become effective when
approved by the Board. The Plan shall thereafter be submitted to the Company's
stockholders for approval and unless the Plan is approved by the affirmative
votes of the holders of shares having a majority of the voting power of all
shares either (i) represented at a meeting duly held in accordance with Delaware
law within twelve (12) months after being approved by the Board, the Plan and
all Awards made under it shall be void and of no force and effect. In aid of
this provision, any Award granted prior to their approval of the Plan by the
Company's stockholders shall be conditioned upon receipt of such approval.
27. OTHER PROVISIONS. As used in the Plan, and in Awards and other
documents prepared in implementation of the Plan, references to the masculine
pronoun shall be deemed to refer to the feminine or neuter, and references in
the singular or the plural shall refer to the plural or the singular, as the
identify of the person or persons or entity or entities being referred to may
require. The captions used in the Plan and in such Awards and other documents
prepared in implementation of the Plan are for convenience only and shall not
affect the meaning of any provision hereof or thereof.
-28-
<PAGE> 29
28. DELAWARE LAW TO GOVERN. This Plan shall be governed by and
construed in accordance with the laws of the State of Delaware.
-29-
<PAGE> 30
AMENDMENT NO. 1
TO THE 1993 LONG-TERM INCENTIVE PLAN
OF MICHAEL ANTHONY JEWELERS, INC.
1. Section 3 of the Plan is hereby amended to increase the number of
Shares reserved for use, upon the issuance, vesting or exercise of Awards to be
granted from time to time under the Plan, from 750,000 to 1,000,000 Shares.
2. Section 5 of the Plan is hereby amended by adding the following as
the last sentence thereof
"Moreover, during any one fiscal year of the Company, neither the chief
executive officer of the Company (or an individual acting in such
capacity) nor any other Employee whose total compensation for such
fiscal year is required to be reported to the Company's stockholders
pursuant to the Exchange Act by reason of such Employee being among the
four (4) highest compensated officers (other than the chief executive
officer) for such fiscal year, may be granted options, SARs or Options
in tandem with SARs to acquire more than 150,000 Shares."
3. Capitalized terms not otherwise defined herein shall have the
meanings ascribed to them in the Plan.
4. This Amendment No. 1 to the Plan shall be effective when approved by
the Board. Unless this Amendment No. 1 to the Plan is approved by the
affirmative votes of the holder of shares having a majority of the voting power
of all shares represented at a meeting duly held in accordance with Delaware law
within twelve (12) months after being approved by the Board, this Amendment No.
1 and all Awards granted under it shall be void and of no force and effect.
As approved by the Board of Directors of the Company on September 21, 1993),
subject to stockholder approval.
<PAGE> 31
AMENDMENT NO. 2
TO THE LONG-TERM INCENTIVE PLAN
OF MICHAEL ANTHONY JEWELERS, INC.
1. Section 2.6 of the Plan is hereby amended by adding the phrase ",to
the extent practical," after the word "eligibility" in the phrase "whose members
meet the requirements for eligibility to serve" near the end of the sentence.
2. Section 3 of the Plan is hereby amended to increase the number of
Shares reserved for use, upon the issuance, vesting or exercise of Awards to be
granted from time to time under the Plan, from 1,000,000 to 2,000,000 Shares.
3. Section 4 of the Plan is hereby amended by deleting the first two
sentences of the paragraph and adding the following three sentences at the
beginning of the paragraph:
"The Board may appoint a Committee to administer the Plan, which
Committee shall consist of not less than two (2) disinterested
directors, to the extent practical, as defined in Rule 16b- 3. Subject
to the provisions of the Plan, the Committee or the Board shall have
full authority, in its discretion, to determine the Employees to whom
Awards shall be granted, the number of Shares to be covered by each of
the Awards, and the terms of any such Award; to amend or cancel Awards
(subject to Section 23 of the Plan), to accelerate the vesting of
Awards; to require the cancellation or surrender of any previously
granted awards under this Plan or any other plans of the Company as a
condition to the granting of an Award, to interpret the Plan; and to
prescribe, amend, and rescind rules and regulations relating to the
Plan, and generally to interpret and determine any and all matters
whatsoever relating to the administration of the Plan and the granting
of Awards hereunder. Notwithstanding anything in the Plan to the
contrary any and all rights conferred upon the Committee shall also be
conferred upon the Board."
4. Section 17 of the Plan is hereby amended by adding the phrase
"(other than Awards of non-qualified stock options, which Awards may be freely
transferred by the recipient upon prior written notice to the Company)" after
the words "An Award" at the beginning of the first sentence in the paragraph.
5. Capitalized terms not otherwise defined herein shall have the
meanings ascribed to them in the Plan.
6. This Amendment to the Plan shall be effective when approved by the
Board. Unless this Amendment to the Plan is approved by the affirmative votes of
the holder of shares having a majority of the voting power of all shares
represented at a meeting duly held in accordance with Delaware law within twelve
(12) months after being approved by the Board, this Amendment and all Awards
granted under it shall be void and of no force and effect.
As approved by the Board of Directors of the Company on November 8, 1996,
subject to stockholder approval.
<PAGE> 1
EXHIBIT 5
TO BE THE BEST SUPPLIER OF KARAT GOLD IN AMERICA [MICHAEL ANTHONY LOGO]
MICHAEL ANTHONY JEWELERS, INC.
June 12, 1997
Board of Directors
Michael Anthony Jewelers, Inc.
115 South MacQuesten Parkway
Mount Vernon, New York 10550
RE: Registration Statement on Form S-8 Re: Long-Term Incentive
Plan filed by Michael Anthony Jewelers, Inc. with the
Securities and Exchange Commission
Gentlemen:
Michael Anthony Jewelers, Inc., a Delaware corporation (the "Company"),
has filed with the Securities and Exchange Commission under the Securities Act
of 1933, a Registration Statement on Form S-8 which relates to 2,000,000 shares
of the Company's Common Stock, $.001 par value per share (the "Shares"), to be
issued upon the exercise of stock options granted under the Company's 1993
Long-Term Incentive Plan (the "Plan").
The Company has requested that I render an opinion with respect to the
Shares. I have examined such documents, instruments and matters of law as I have
deemed necessary for purposes of this opinion.
Based upon the foregoing, I am of the opinion that the Shares are duly
authorized and, when issued, delivered and paid for in accordance with the Plan,
will be validly issued, fully paid and non-assessable.
I hereby consent to (1) being named in the Registration Statement under
the heading "Legal Matters" and (2) the filing of this opinion as an exhibit to
the Registration Statement.
Very truly yours,
/s/ M. Frances Durden
---------------------
M. Frances Durden
General Counsel
115 South MacQuesten Parkway, Mount Vernon, NY 10550-1724
- - (914) 699-0000 - Fax 699-9869
70 South MacQuesten Parkway, Mount Vernon, NY 10550-1778
- - (914) 699-0000 - Fax 699-0133
<PAGE> 1
EXHIBIT 23.1
INDEPENDENT AUDITORS' CONSENT
We consent to the incorporation by reference in this Registration Statement of
Michael Anthony Jewelers, Inc. on Form S-8 of our report dated April 11, 1997,
appearing in the Annual Report on Form 10-K of Michael Anthony Jewelers, Inc.
for the year ended February 1, 1997.
DELOITTE & TOUCHE LLP
Parsippany, New Jersey
June 11, 1997
