<PAGE>
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of
the Securities Exchange Act of 1934 (Amendment No. )
Filed by the Registrant /X/
Filed by a Party other than the Registrant / /
Check the appropriate box:
/ / Preliminary Proxy Statement
/ / Confidential, for Use of the Commission Only (as permitted by Rule
14a-6(e)(2))
/X/ Definitive Proxy Statement
/ / Definitive Additional Materials
/ / Soliciting Material Pursuant to Section 240.14a-11(c) or Section
240.14a-12
OROAMERICA, INC.
- --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
/X/ $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), 14a-6(i)(2) or
Item 22(a)(2) of Schedule 14A.
/ / $500 per each party to the controversy pursuant to Exchange Act Rule
14a-6(i)(3).
/ / Fee computed on table below per Exchange Act Rules 14a-6(i)(4)
and 0-11.
1) Title of each class of securities to which transaction applies:
------------------------------------------------------------------------
2) Aggregate number of securities to which transaction applies:
------------------------------------------------------------------------
3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which the
filing fee is calculated and state how it was determined):
------------------------------------------------------------------------
4) Proposed maximum aggregate value of transaction:
------------------------------------------------------------------------
5) Total fee paid:
------------------------------------------------------------------------
/ / Fee paid previously with preliminary materials.
/ / Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.
1) Amount Previously Paid:
------------------------------------------------------------------------
2) Form, Schedule or Registration Statement No.:
------------------------------------------------------------------------
3) Filing Party:
------------------------------------------------------------------------
4) Date Filed:
------------------------------------------------------------------------
<PAGE>
OROAMERICA, INC.
----------------
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON JULY 16, 1996
---------------------
To the Stockholders of OroAmerica, Inc.:
The Annual Meeting of Stockholders of OroAmerica, Inc., a Delaware
corporation, will be held on Tuesday, July 16, 1996, at 10:00 a.m., P.S.T., at
The Regent Beverly Wilshire Hotel, 9500 Wilshire Boulevard, Beverly Hills,
California, for the following purposes:
(1) To elect a Board of Directors;
(2) To consider and act upon a proposal to ratify the selection of auditors;
and
(3) To transact any other business that may properly come before the
meeting.
Only stockholders of record at the close of business on May 20, 1996 are
entitled to notice of and to vote at the meeting and any adjournments thereof.
All stockholders are cordially invited to attend the meeting in person.
Whether or not you expect to attend the meeting, PLEASE COMPLETE AND SIGN THE
ENCLOSED PROXY AND RETURN IT PROMPTLY IN THE ENCLOSED ENVELOPE. The giving of
your proxy will not affect your right to vote in person should you later decide
to attend the meeting.
By Order of the Board of Directors
Betty Sou
SECRETARY
Burbank, California
June 3, 1996
<PAGE>
OROAMERICA, INC.
443 NORTH VARNEY STREET
BURBANK, CALIFORNIA 91502
(818) 848-5555
PROXY STATEMENT
JUNE 3, 1996
GENERAL INFORMATION
This Proxy Statement is furnished in connection with the solicitation of
proxies by the Board of Directors of OroAmerica, Inc. ("OroAmerica" or the
"Company") for the Annual Meeting of Stockholders to be held on July 16, 1996
and any postponements or adjournments thereof. This Proxy Statement and the
accompanying Notice of Annual Meeting and form of proxy were first mailed to
stockholders on or about June 6, 1996.
The execution and return of the enclosed proxy will not in any way affect a
stockholder's right to attend the Annual Meeting in person. Any stockholder
giving a proxy may revoke it before it is voted by so notifying the Secretary of
OroAmerica in writing before or at the meeting, by providing a proxy bearing a
later date or by attending the meeting and expressing a desire to vote in
person. Your cooperation in promptly returning the enclosed proxy will reduce
OroAmerica's expenses and enable its management and employees to continue their
normal duties for your benefit with minimum interruption for follow-up proxy
solicitation.
Only stockholders of record at the close of business on May 20, 1996 are
entitled to receive notice of and to vote at the meeting. On that date,
OroAmerica had outstanding and entitled to vote at the Annual Meeting 6,248,378
shares of Common Stock, each of which is entitled to one vote at the meeting,
except as noted below with respect to the election of directors. The presence at
the Annual Meeting, either in person or by proxy, of the holders of a majority
of the shares of Common Stock outstanding on the record date is necessary to
constitute a quorum for the transaction of business.
A plurality of the votes cast is required for the election of directors. The
affirmative vote of a majority of the votes cast is required to approve each of
the other matters to be acted upon at the Annual Meeting. Mr. Benhamou, who owns
3,573,560 shares of Common Stock, representing 57.2% of the votes entitled to be
cast at the Annual Meeting, has advised the Board of Directors that he intends
to vote all of his shares for the election of each of the Board's nominees and
in favor of each of the other proposals identified in the accompanying Notice of
Annual Meeting.
Abstentions and broker non-votes (which occur if a broker or other nominee
does not have discretionary authority and has not received voting instructions
from the beneficial owner with respect to the particular item) are counted for
purposes of determining the presence or absence of a quorum for the transaction
of business. Abstentions are counted in tabulations of the votes cast on
proposals presented to the stockholders and have the same legal effect as a vote
against a particular proposal. Broker non-votes are not taken into account for
purposes of determining whether a proposal has been approved by the requisite
stockholder vote.
All proxies will be voted as directed by the stockholder on the proxy card.
IF NO CHOICE IS SPECIFIED, PROXIES WILL BE VOTED "FOR" THE DIRECTORS NOMINATED
BY THE BOARD OF DIRECTORS AND "FOR" THE RATIFICATION OF THE SELECTION OF
AUDITORS.
If any other matters are properly presented at the Annual Meeting,
including, among other things, consideration of a motion to adjourn the Annual
Meeting to another time or place for the purpose of soliciting additional
proxies, the persons named in the enclosed form of proxy and acting thereunder
will have discretion to vote on those matters in accordance with their best
judgment, subject to direction by the Board of Directors, to the same extent as
the person signing the proxy. It currently is not anticipated that any other
matters will be raised at the Annual Meeting.
<PAGE>
The cost of preparing, printing and mailing the Proxy Statement, the Notice
and the enclosed form of proxy, as well as the cost of soliciting proxies
relating to the Annual Meeting, will be borne by OroAmerica. The original
solicitation of proxies by mail may be supplemented by telephone, telegram and
personal solicitation by officers and other regular employees of OroAmerica, but
no additional compensation will be paid to such individuals on account of such
activities. OroAmerica will reimburse banks, brokerage houses and other
custodians, nominees and fiduciaries for their reasonable expenses in forwarding
proxy materials to their principals.
ELECTION OF DIRECTORS
NOMINEES AND VOTING
The Company is incorporated under the laws of the State of Delaware. Under
Delaware law and the Company's Certificate of Incorporation and Bylaws, the
Company's Board of Directors, which currently consists of five members, is
divided into three classes, with one class of directors elected at each annual
meeting of stockholders for a three-year term and until their respective
successors are elected and qualified. However, since the Company's Common Stock
is held by less than 800 stockholders, a majority of the Common Stock is held by
persons with California addresses and the Company has substantial business
contacts with the State of California, the Company is subject to Section 2115 of
the California Corporation Code. As a result, certain legal matters, including
provisions relating to the election of directors, are governed by California law
and not by Delaware law or the Company's Certificate of Incorporation and
Bylaws. Under applicable California law, all directors of the Company are
required to be elected each year.
Cumulative voting also could apply under applicable California law. This
means that, in the election of directors, each stockholder is entitled to a
number of votes equal to the number of his or her shares of stock multiplied by
the number of directors to be elected. A stockholder may cast all of such votes
for a single nominee or distribute them among the nominees as he or she sees
fit. However, no stockholder is entitled to cumulate votes for a nominee unless
the nominee's name has been placed in nomination prior to the vote and a
stockholder has given notice at the meeting, prior to the voting, of the
stockholder's intention to cumulate his or her votes. If any one stockholder
gives such notice, all stockholders may cumulate their votes for nominees. The
persons named in the enclosed form of Proxy may, in their discretion, cumulate
votes pursuant to the proxies for any one or more nominees.
The Board of Directors has nominated for election as directors the five
persons named below, all of whom are incumbent directors. All of the nominees
have indicated that they are able and willing to serve as a directors.
If the Company continues to be subject to Section 2115 of the California
Corporations Code at the time of the next annual meeting of stockholders, the
directors elected at the Annual Meeting will hold office until the next annual
meeting and until their respective successors are elected and qualified.
However, if at the time of the next annual meeting the Company no longer is
subject to Section 2115, Mr. Massing will be deemed to have been elected as a
Class II director to serve for a term of two years and until his successor is
elected and qualified, and Messrs. Shao and Katz will be deemed to have been
elected as a Class III directors to serve for a term of three years and until
their successors are elected and qualified. The terms of Messrs. Benhamou and
Rousso will expire at the next annual meeting and upon the election and
qualification of their respective successors regardless of whether the Company
continues to be subject to Section 2115.
The Board of Directors recommends that the stockholders vote "FOR" the
election of its nominees. Unless otherwise instructed, the Board's proxies
intend to vote the shares of Common Stock represented by the proxies in favor of
the election of these nominees. If for any reason any of these nominees will be
unable to serve, the Board's proxies will vote instead for such other person or
persons as the Board of Directors may recommend.
2
<PAGE>
The following table sets forth certain information as of May 20, 1996 with
respect to the Board's nominees:
<TABLE>
<CAPTION>
DIRECTOR
NAME AGE SINCE
- ---------------------------------------------------------- --- -----------
<S> <C> <C>
CLASS I
Guy Benhamou............................................. 44 1977
David Rousso............................................. 55 1995
CLASS II
Bertram K. Massing....................................... 62 1987
CLASS III
Shiu Shao................................................ 44 1993
Ronald A. Katz........................................... 60 1993
</TABLE>
BUSINESS EXPERIENCE OF DIRECTORS DURING THE PAST FIVE YEARS
GUY BENHAMOU is a co-founder of the Company and has been its President,
Chief Executive Officer and a member of its Board of Directors since its
inception in January 1977. Mr. Benhamou was appointed Chairman of the Board in
May 1993.
DAVID ROUSSO was appointed to the Board of Directors in November 1995. Mr.
Rousso has been a professional investor since January 1991, and is the President
and sole shareholder of DPR Investments, a financial consulting firm. Mr. Rousso
also is Chairman of the Board of CreditCheck, Inc., a privately held financial
software company.
BERTRAM K. MASSING has been a partner in the law firm of Ervin, Cohen &
Jessup, which represents the Company in a variety of legal matters, for more
than the past five years. Mr. Massing originally was elected to serve on the
Board of Directors in order to satisfy the Company's obligation, under the terms
of an indenture entered into in connection with the issuance of senior
subordinated debentures (the "Debentures"), to have at least one director who is
not an officer, employee or affiliate of the Company. The indenture was
terminated upon the repayment of the Debentures in November 1993.
SHIU SHAO has been employed by the Company since April 1981. Mr. Shao served
as Controller of the Company from 1981 to 1984 and Vice President -- Finance
from 1984 until September 1991, when he was appointed Chief Financial Officer.
Mr. Shao also has served as a director of the Company since May 1993 and was
appointed a Vice President of the Company in May 1994.
RONALD A. KATZ is the Chief Executive Officer of Ronald A. Katz Technology
Licensing, L.P., a patent licensing company. He served as Special Advisor to the
Chairman of First Data Corporation, an affiliate of American Express, from
August 1992 to October 1994, and served as Vice Chairman of American Express
Information Services Corporation from August 1989 to August 1992. From 1970 to
1988, Mr. Katz was involved in a variety of business ventures, including the
formation of Light Signatures, Inc., a developer of counterfeit prevention
technology. Mr. Katz also was a co-founder of Telecredit, Inc., a payment
services company, and served as an executive officer of Telecredit from 1961 to
1970.
No family relationships exist between any of the directors or officers of
OroAmerica.
MEETINGS OF THE BOARD OF DIRECTORS AND COMMITTEES
OroAmerica maintains an Audit Committee whose current members are Messrs.
Massing, Katz and Rousso. The Audit Committee's responsibilities include
approval of the selection and engagement of independent accountants and review
of the plan and scope of their audit for each year, the results of such audit
when completed and their fees for services performed. The Audit Committee also
assists and makes recommendations to the Board of Directors in fulfilling the
Board's responsibilities relating to OroAmerica's accounting, financial
reporting and internal control functions and reviews and passes upon all
transactions with affiliates and other persons having a material financial
interest in OroAmerica. The Audit Committee met once during fiscal 1996.
3
<PAGE>
OroAmerica maintains a Compensation Committee whose current members are Mr.
Massing and Mr. Rousso. Mr. Katz also was a member of the Compensation Committee
until March 18, 1996. The Compensation Committee approves the compensation of
the executive officers of OroAmerica, formulates and reviews significant
compensation policies and decisions and administers OroAmerica's employee
benefit plans. The Compensation Committee did not meet during fiscal 1996.
OroAmerica's Board of Directors met four times during fiscal 1996 and took
three actions by unanimous written consent. Each director attended all of the
meetings of the Board of Directors and of any committees on which he served.
OroAmerica does not maintain a nominating committee.
COMPENSATION OF DIRECTORS
Since September 30, 1993, directors who are not employees of OroAmerica have
been paid an annual fiscal year retainer of $10,000 plus $1,000 for each Board
meeting attended. The same compensation arrangements will apply in fiscal 1997.
All directors are reimbursed for their travel expenses incurred in attending
Board or committee meetings.
Pursuant to the provisions of the OroAmerica, Inc. 1994 Directors' Stock
Option Plan (the "Directors' Plan"), each new non-employee director, on the date
of his or her election to the Board of Directors (whether elected by the
stockholders or the Board of Directors), automatically will be granted a stock
option to purchase 10,000 shares of Common Stock at an exercise price equal to
the fair market value of the Common Stock on the date of grant. Only one grant
may be made under the Directors' Plan to each non-employee director. On November
1, 1995, the date of his election to the Board of Directors, Mr. Rousso was
granted a stock option to purchase 10,000 shares of Common Stock at an exercise
price of $4.6875, the fair market value of the Common Stock on the date of
grant.
4
<PAGE>
OWNERSHIP OF COMMON STOCK
The following table sets forth information with respect to the beneficial
ownership of OroAmerica Common Stock as of May 20, 1996 by (i) each person who
is known by OroAmerica to be the beneficial owner of more than five percent (5%)
of the outstanding Common Stock, (ii) each director of OroAmerica, (iii) the
executive officers named in the Summary Compensation Table on page 6 and (iv)
all directors and executive officers as a group. Unless otherwise indicated,
each of the entities and persons named in the table has sole voting and
investment power with respect to all shares of Common Stock beneficially owned
by it or him, except to the extent that authority is shared by spouses under
applicable law.
<TABLE>
<CAPTION>
SHARES BENEFICIALLY
OWNED (1)
------------------------
NAME AND ADDRESS NUMBER PERCENT
- ------------------------------------------------------------------------------- ----------- -----------
<S> <C> <C>
Guy Benhamou................................................................... 3,573,560 57.19%
443 North Varney Street
Burbank, CA 91502
FMR Corp. (2).................................................................. 630,300 10.09%
82 Devonshire Street
Boston, MA 02109
Peter Cundill & Associates (Bermuda) Ltd (3)................................... 321,500 5.15%
15 Alton Hill
Southhampton SN 01
Bermuda
Shiu Shao (4).................................................................. 82,750 1.31%
David Rousso................................................................... 60,000 *
Bertram K. Massing (5)......................................................... 14,000 *
Ronald A. Katz (4)............................................................. 4,000 *
Andrew Concool (6)............................................................. 32,750 *
Sophia Chalermsopone (7)....................................................... 52,750 *
David Wu (8)................................................................... 13,830 *
All directors and executive
officers as a group (10 persons) (9).......................................... 3,863,640 59.79%
</TABLE>
- ------------------------
* Indicates ownership of less than one percent.
(1) Except as otherwise noted in the following footnotes, no effect has been
given to the possible issuance of up to 423,750 shares issuable upon the
exercise of outstanding stock options.
(2) Sole voting power with respect to 7,800 shares and sole dispositive power
with respect to 630,300 shares.
(3) Sole voting power with respect to 124,200 shares and sole dispositive power
with respect to 111,900 shares.
(4) Consists of shares issuable upon the exercise of presently exercisable stock
options.
(5) Includes 10,000 shares issuable upon the exercise of presently exercisable
stock options.
(6) Consists of 32,250 shares issuable upon the exercise of presently
exercisable stock options and 500 shares held for the benefit of the minor
children of Mr. Concool.
(7) Consists of 52,250 shares issuable upon the exercise of presently
exercisable stock options and 500 shares held for the benefit of the minor
children of Ms. Chalermsopone.
(8) Includes 12,000 shares issuable upon the exercise of presently exercisable
stock options.
(9) Includes 211,250 shares which may be purchased pursuant to stock options
exercisable on or before July 31, 1996.
5
<PAGE>
EXECUTIVE COMPENSATION
SUMMARY COMPENSATION TABLE
The following table summarizes all compensation paid to OroAmerica's Chief
Executive Officer and to each of the other four most highly paid executive
officers for services rendered in all capacities to OroAmerica for the fiscal
years ended February 2, 1996, January 27, 1995 and January 28, 1994.
<TABLE>
<CAPTION>
LONG TERM
COMPENSATION AWARDS
--------------------
ANNUAL COMPENSATION SECURITIES
NAME AND ---------------------- UNDERLYING ALL OTHER
PRINCIPAL POSITIONS YEAR SALARY BONUS OPTIONS/SARS (1) COMPENSATION (2)
- ---------------------------------------- --------- ----------- --------- -------------------- -----------------
<S> <C> <C> <C> <C> <C>
Guy Benhamou............................ 1996 $ 662,500 -- -- $ 7,942
Chairman of the Board 1995 650,000 $ 45,076 -- 7,142
President and Chief 1994 882,884 28,182 -- 6,208
Executive Officer
Shiu Shao............................... 1996 219,246 -- -- 7,942
Vice President and 1995 215,552 64,360 25,000 6,917
Chief Financial Officer 1994 188,217 89,821 20,000 4,831
Andrew Concool.......................... 1996 194,552 -- -- 7,942
Vice President -- Sales 1995 188,692 -- -- 7,142
1994 159,227 67,751 20,000 6,208
Sophia Chalermsopone.................... 1996 159,545 -- -- 5,178
Vice President -- Sales 1995 152,716 53,616 50,000 5,579
1994 150,924 73,768 20,000 6,208
David Wu................................ 1996 146,053 -- -- 2,310
Vice President -- Manufacturing 1995 146,741 34,731 -- 2,310
1994 117,597 14,000 20,000 2,249
</TABLE>
- ------------------------
(1) Number of shares of Common Stock underlying options granted under the
Amended and Restated OroAmerica, Inc. 1988 Incentive Stock Option Plan (the
"1988 Plan"). No SARs may be granted under the 1988 Plan.
(2) Consists of contributions by the Company to a defined contribution 401(k)
plan for each of the named executive officers of $2,310 in fiscal 1996 and
1995 and $2,249 in fiscal 1994. Also includes premiums for medical insurance
coverage for dependents of Mr. Benhamou, Mr. Shao, Mr. Concool and Ms.
Chalermsopone of $5,632, $5,632, $5,632 and $2,868, respectively, for fiscal
1996, $4,832, $4,607, $4,832 and $3,269, respectively, for fiscal 1995 and
$3,959, $2,582, $3,959 and $3,959, respectively, for fiscal 1994.
OPTION EXERCISES IN LAST FISCAL YEAR AND FISCAL YEAR END VALUE
The following table sets forth information with respect to the named
executive officers with respect to the unexercised stock options held by them as
of the end of the fiscal year ended February 2, 1996. No stock options issued
under the 1988 Plan have been exercised.
<TABLE>
<CAPTION>
NUMBER OF SECURITIES
UNDERLYING
UNEXERCISED OPTIONS HELD VALUE OF UNEXERCISED
AT IN-THE-MONEY OPTIONS AT
FEBRUARY 2, 1996 FEBRUARY 2, 1996 (1)
-------------------------- --------------------------------
NAME EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
- ------------------------------------------ ----------- ------------- ------------- -----------------
<S> <C> <C> <C> <C>
Guy Benhamou.............................. -- -- -- --
Shiu Shao................................. 82,750 23,000 -- --
Andrew Concool............................ 32,250 8,000 -- --
Sophia Chalermsopone...................... 52,250 38,000 -- --
David Wu.................................. 12,000 8,000 -- --
</TABLE>
- ------------------------
(1) Based on the closing price on the New York Stock Exchange of OroAmerica's
Common Stock on that date ($4.56), minus the exercise price.
6
<PAGE>
EMPLOYMENT AGREEMENT
Since September 30, 1993, Mr. Benhamou has served as Chairman, Chief
Executive Officer and President pursuant to the terms of an employment agreement
which continues in effect until the end of fiscal 1997 and automatically renews
for successive one-year periods thereafter unless terminated by either party.
Under the terms of the agreement, Mr. Benhamou receives an annual salary of
$650,000 and a bonus in an amount determined by the Compensation Committee of
the Board of Directors. Mr. Benhamou also is entitled to a bonus pursuant to the
1994 Chief Executive Officer Bonus Plan approved by stockholders in July 1994.
In addition to salary and bonus, OroAmerica is required to provide Mr. Benhamou
with the use of an automobile and pay all expenses incurred in connection
therewith.
COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION
The Compensation Committee (the "Committee") of the Board of Directors was
established on September 30, 1993, and currently consists of Messrs. Massing and
Rousso, each of whom is a non-employee director. Mr. Katz also was a member of
the Committee until March 1996. The Committee sets OroAmerica's compensation
policies applicable to executive officers and administers OroAmerica's bonus
plans and stock option plan. The Committee does not administer the 1994
Directors' Stock Option Plan, which is administered by the Board. The Committee
has prepared the following report for inclusion in this Proxy Statement.
COMPENSATION POLICY FOR EXECUTIVE OFFICERS
The policy of the Committee is to provide each executive officer current
cash compensation that is reasonable and consistent with OroAmerica's size,
industry and performance, and long-term incentive compensation, in the form of
stock options, based on the increase in value of OroAmerica's Common Stock. In
addition to salary, current cash compensation includes a bonus based in part on
OroAmerica's current annual performance and in part on the executive's
individual performance.
COMPENSATION OF CHIEF EXECUTIVE OFFICER
Since the completion of OroAmerica's initial public offering in September
1993, Mr. Benhamou's salary ($650,000 per year) has been fixed by his employment
contract, and he is entitled under the contract to a bonus determined by the
Board of Directors or the Committee in its discretion. The Board has delegated
this responsibility to the Committee.
In keeping with the Committee's objective of rewarding executive officers
based on corporate performance, and in order to assure the deductibility to
OroAmerica of amounts paid to Mr. Benhamou, in March 1994, the Committee adopted
the 1994 Chief Executive Officer Bonus Plan (the "Bonus Plan"), which was
approved by stockholders in July 1994. The Bonus Plan provides for the payment
to Mr. Benhamou of an annual bonus based on a percentage of the amount by which
income before income taxes (before the payment of Mr. Benhamou's bonus) ("Pretax
Income") for the applicable year exceeds $5.0 million, calculated as follows: 2%
of Pretax Income in excess of $5.0 million up to $8.0 million; plus 4% of Pretax
Income in excess of $8.0 million up to $15.0 million; plus 6% of Pretax Income
in excess of $15.0 million. Pursuant to the Bonus Plan, no bonus was paid to Mr.
Benhamou for fiscal 1996.
Mr. Benhamou has not been awarded any stock options by OroAmerica, although
he is eligible to participate in the 1988 Plan. Mr. Benhamou also participates
in OroAmerica's defined contribution plan.
COMPENSATION OF OTHER EXECUTIVE OFFICERS
For fiscal 1996, compensation paid to OroAmerica's executive officers other
than Mr. Benhamou consisted of a base salary and contributions to a defined
contribution plan. The base salaries of executive officers other than Mr.
Benhamou for fiscal 1996 were determined by the Committee, based on Mr.
Benhamou's recommendations. In determining salaries, Mr. Benhamou and the
Committee
7
<PAGE>
considered available information about the pay scales of other companies in the
jewelry industry. The Committee believes that the salaries of these executive
officers are comparable to the salaries of executives with similar experience
and responsibilities in the jewelry industry.
Bonuses to executive officers other than Mr. Benhamou are awarded pursuant
to OroAmerica's Executive/Key Employee Bonus Plan, which was adopted based on
the recommendations of a compensation consulting firm. Under this plan,
participating executives and key employees may receive a cash bonus calculated
as a percentage of their base salary, with the applicable percentage determined
by reference to the income before income taxes of OroAmerica for the applicable
fiscal year and individual performance measures which are intended to recognize
individual contributions as reflected by the level of the executive's
responsibilities, his or her effectiveness in overseeing the matters under his
or her supervision and the degree to which he or she has contributed to the
accomplishment of major corporate goals. For each of the named executive
officers, 50% of the bonus is based on company performance, and 50% of the bonus
is based on individual performance. For certain other executive officers, the
bonus is based 25% on company performance and 75% on individual performance. For
the fiscal year ended February 2, 1996, the income before income taxes targets
and the individual performance measures were determined by the Committee, based
on Mr. Benhamou's recommendations. In light of the Company's performance, no
cash bonuses were paid to any executive officers of the Company for fiscal 1996.
STOCK OPTION PLAN
OroAmerica's stock option program provides additional incentives to key
employees to maximize stockholder value and provides a link between the
interests of senior managers and stockholders. By utilizing vesting periods, the
option program encourages key employees to remain in the employ of OroAmerica
and provides a long-term perspective to the compensation available under the
option program. The Committee determines the number of option shares to be
granted to each participating employee based upon his or her level of
responsibility, a review of OroAmerica's overall performance and prior grants.
The Committee did not award any stock options during fiscal 1996.
INTERNAL REVENUE CODE PROVISIONS
The Committee will continue to consider the anticipated tax treatment to
OroAmerica regarding the compensation and benefits paid to the Chief Executive
Officer and the four other most highly compensated executive officers of
OroAmerica in light of Section 162(m) of the Internal Revenue Code of 1986, as
amended ("Section 162(m)"). The amendment to OroAmerica's stock option plan
limiting the number of shares subject to option that may be granted to any
individual during a calendar year and the Bonus Plan that were adopted by
stockholders at the 1994 Annual Meeting were adopted in response to Section
162(m). The Committee will from time to time consider further amendments to
OroAmerica's compensation, including further amendments to the stock option
plan, necessary to preserve the deductibility of all compensation paid by
OroAmerica which is subject to Section 162(m). While OroAmerica does not expect
to pay its executive officers compensation in fiscal 1997 in excess of the
Section 162(m) deductibility limit, the Board of Directors and the Committee
retain discretion to authorize the payment of compensation that does not qualify
for income tax deductibility under Section 162(m).
BERTRAM K. MASSING RONALD A. KATZ
DAVID ROUSSO
PERFORMANCE GRAPH
The following graph compares the cumulative stockholder return on OroAmerica
Common Stock from September 23, 1993 (the date OroAmerica first became publicly
traded) through February 2, 1996, based on the market price of the Common Stock,
with the cumulative total return of the Nasdaq Market Value Index and the Media
General Recreation-Jewelry Index. The graph assumes that the
8
<PAGE>
value of the investment in OroAmerica Common Stock and each index was $100 on
September 23, 1993 and that all dividends, if any, were reinvested. The
comparisons in this table are not intended to forecast or be indicative of
possible future price performance.
COMPARISON OF CUMULATIVE STOCKHOLDER RETURN OF OROAMERICA, INC.,
NASDAQ MARKET VALUE INDEX AND
MEDIA GENERAL RECREATION-JEWELRY INDEX
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
OROAMERICA, INC. MG GROUP INDEX NASDAQ MARKET INDEX
<S> <C> <C> <C>
9/23/93 100.00 100.00 100.00
1/28/94 114.29 97.72 106.38
1/27/95 55.10 88.03 100.54
2/2/96 37.24 117.9 140.77
</TABLE>
<TABLE>
<CAPTION>
SEPT. 23, JAN. 28, JAN. 27, FEB. 2,
1993 1994 1995 1996
----------- --------- --------- ---------
<S> <C> <C> <C> <C>
OroAmerica, Inc............................................... 100.00 114.29 55.10 37.24
Industry Index................................................ 100.00 97.72 88.03 117.90
Broad Market.................................................. 100.00 106.38 100.54 140.77
</TABLE>
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
Bertram K. Massing, a partner of Ervin, Cohen & Jessup, serves as a member
of the Compensation Committee. Ervin, Cohen & Jessup provided legal services to
OroAmerica during fiscal 1996, and OroAmerica expects that such law firm will
render legal services to OroAmerica in the future.
CERTAIN TRANSACTIONS
OroAmerica and Mr. Benhamou have entered into an agreement which obligates
OroAmerica to make available to Mr. Benhamou appropriate books, records and
personnel in connection with tax filings, audits and other proceedings relating
to OroAmerica's status as an S Corporation prior to September 1, 1992, and for
other similar matters, and to pay all expenses incurred in connection therewith.
The agreement also requires OroAmerica to indemnify Mr. Benhamou for the effect
of any adjustments (including interest and penalties) made by the Internal
Revenue Service or state taxing authorities to the income tax returns of
OroAmerica for periods in which OroAmerica was treated as an S Corporation, if
such adjustments result in an increase in Mr. Benhamou's tax liabilities. If, as
a result of any such adjustments, Mr. Benhamou receives a refund from any taxing
authority,
9
<PAGE>
Mr. Benhamou has agreed to pay such amount to OroAmerica as a capital
contribution. The amount of any indemnification payment made by OroAmerica to
Mr. Benhamou under this agreement will be increased to reflect the effects of
any federal, state or local income taxes imposed on Mr. Benhamou as a result of
the receipt of such payment, including any income taxes imposed on Mr. Benhamou
as a result of any such increase in the amount of an indemnification payment. As
a result of previous distributions made to Mr. Benhamou, OroAmerica may offset
up to $540,950 against any subsequent obligations it may have to indemnify Mr.
Benhamou under this agreement.
RATIFICATION OF SELECTION OF AUDITORS
The Board of Directors has selected the accounting firm of Price Waterhouse
LLP to serve as independent auditors for the current fiscal year, subject to
ratification by the stockholders. Price Waterhouse LLP has served as
OroAmerica's independent auditors since 1983.
The Board of Directors recommends a vote "FOR" ratification of this
selection. Stockholder ratification of the selection of auditors is not required
under the laws of the State of Delaware, but the Board has determined to
ascertain the position of the stockholders on the selection. The Board of
Directors will reconsider the selection if it is not ratified by the
stockholders.
It is anticipated that representatives of Price Waterhouse LLP will be
present at the Annual Meeting, and such representatives will be given the
opportunity to make a statement, if they so desire, and to answer appropriate
questions.
MISCELLANEOUS
STOCKHOLDER PROPOSALS
Stockholder proposals intended to be presented at the 1997 Annual Meeting of
Stockholders must be received by OroAmerica by February 6, 1997 to be considered
by OroAmerica for inclusion in OroAmerica's proxy statement and form of proxy
relating to that meeting. Such proposals should be directed to the attention of
the Secretary, OroAmerica, Inc., 443 North Varney Street, Burbank, California
91502.
COMPLIANCE WITH SECTION 16(A) OF THE SECURITIES EXCHANGE ACT
Section 16(a) of the Securities Exchange Act of 1934 requires OroAmerica's
officers and directors, and persons who own more than ten percent of a
registered class of OroAmerica's equity securities, to file reports of ownership
and changes in ownership with the Securities and Exchange Commission. Officers,
directors and greater than ten percent stockholders are required by Securities
and Exchange Commission regulations to furnish OroAmerica with copies of all
Section 16(a) forms they file.
Based solely on a review of the copies of such forms furnished to
OroAmerica, or written representations that no Forms 5 were required, OroAmerica
believes that, during fiscal 1996, all Section 16(a) filing requirements
applicable to its officers, directors and greater than ten-percent beneficial
owners were complied with, except that the grant of a stock option was reported
late by Mr. Shao and Ms. Chalermsopone.
OTHER MATTERS
Neither OroAmerica nor any of the persons named as proxies knows of any
matters to be voted on at the Annual Meeting other than as described in this
Proxy Statement. However, if any other matters are properly presented at the
meeting, it is the intention of the persons named as proxies to vote in
accordance with their judgment on such matters, subject to direction by the
Board of Directors.
The 1996 Annual Report to Stockholders accompanies this Proxy Statement, but
is not to be deemed a part of the proxy soliciting material.
WHILE YOU HAVE THE MATTER IN MIND, PLEASE COMPLETE, SIGN AND RETURN THE
ENCLOSED PROXY CARD.
10
<PAGE>
OROAMERICA, INC.
PROXY SOLICITED BY THE BOARD OF DIRECTORS FOR THE ANNUAL
MEETING OF STOCKHOLDERS TO BE HELD ON JULY 16, 1996
The undersigned, revoking any previous proxies for such stock, hereby
appoints Guy Benhamou and Shiu Shao, and each of them, proxies of the
undersigned with full power of substitution to each, to vote all shares of
Common Stock of OROAMERICA, INC. which the undersigned is entitled to vote at
the Annual Meeting of Stockholders of OroAmerica, Inc. to be held on July 16,
1996, and all postponements or adjournments thereof, with all the power the
undersigned would possess if personally present, with authority to vote (i) as
specified by the undersigned below and (ii) in the discretion of any proxy upon
such other business as may properly come before the meeting.
Vote this proxy as follows:
<TABLE>
<S> <C> <C> <C> <C>
1. Election of FOR THE NOMINEES LISTED BELOW / / WITHHOLD VOTE / /
directors: (except as marked to the contrary below) (for all nominees)
</TABLE>
Guy Benhamou, Shiu Shao, Bertram K. Massing, Ronald A. Katz and David Rousso
INSTRUCTION: TO WITHHOLD VOTE FOR A NOMINEE, MARK THROUGH THE NOMINEE'S NAME IN
THE ABOVE LIST.
<TABLE>
<S> <C> <C> <C> <C>
2. Proposal to ratify the selection of Price Waterhouse LLP as independent auditors: FOR / / AGAINST
/ / ABSTAIN / /
</TABLE>
<PAGE>
THIS PROXY WILL BE VOTED AS DIRECTED, OR, IF NO DIRECTION IS INDICATED, WILL
BE VOTED FOR THE ELECTION OF THE NOMINEES OF THE BOARD OF DIRECTORS, FOR THE
RATIFICATION OF AUDITORS AND OTHERWISE IN THE DISCRETION OF ANY OF THE PERSONS
ACTING AS PROXIES.
IMPORTANT: Please date this proxy and sign
exactly as your name or names
________________________________
appear hereon. If stock is held jointly, each
should sign. Executors, administrators,
________________________________
trustees, guardians and others signing in a
representative capacity, please give your full
(SIGNATURE OF STOCKHOLDER)
title(s). If this proxy is submitted to a
corporation or partnership, it should be
executed in the full corporate or partnership
name by a duly authorized person.
DATED __________________, 1996
IMPORTANT: PLEASE SIGN PROXY EXACTLY AS YOUR NAME OR NAMES APPEAR HEREON.
