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As filed with the Securities and Exchange Commission on July 8, 1998
Registration No. 333-
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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM S-8
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
OROAMERICA, INC.
(Exact name of registrant as specified in its charter)
DELAWARE 94-2385342
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
443 NORTH VARNEY STREET
BURBANK, CALIFORNIA 91502
(Address of principal executive offices) (Zip Code)
1998 INCENTIVE STOCK OPTION PLAN
(Full title of the plan)
GUY BENHAMOU, CHAIRMAN OF THE BOARD
OROAMERICA, INC.
443 NORTH VARNEY STREET
BURBANK, CALIFORNIA 91502
(Name and address of agent for service)
(818) 848-5555
(Telephone number, including area code, of agent for service)
Copy to:
HOWARD Z. BERMAN, ESQ.
ERVIN, COHEN & JESSUP LLP
9401 WILSHIRE BOULEVARD, 9TH FLOOR
BEVERLY HILLS, CA 90212
(310) 273-6333
CALCULATION OF REGISTRATION FEE
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PROPOSED
MAXIMUM PROPOSED
TITLE OF OFFERING MAXIMUM AMOUNT OF
SECURITIES TO BE AMOUNT TO BE PRICE AGGREGATE REGISTRATION
REGISTERED REGISTERED PER UNIT(*) OFFERING PRICE(*) FEE
---------- ---------- ----------- ----------------- ---
<S> <C> <C> <C> <C>
COMMON STOCK ISSUABLE UNDER THE 500,000 SHARES $11.75 $5,875,000 $1,733.13
1998 INCENTIVE STOCK OPTION PLAN
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</TABLE>
(*) CALCULATED PURSUANT TO RULE 457(h)(1).
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PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE.
OroAmerica, Inc. ("OroAmerica") hereby incorporates by reference into
this Registration Statement the following documents:
(a) OroAmerica's Annual Report on Form 10-K for the fiscal
year ended January 30, 1998; and
(b) OroAmerica's Quarterly Report on Form 10-Q for the quarter
ended May 1, 1998;
(c) OroAmerica's Current Report on Form 8-K dated June 25,
1998;
(d) The description of the Common Stock of OroAmerica
contained in its Registration Statement filed pursuant to
Section 12 of the Securities Exchange Act of 1934, as
amended (the "Exchange Act"), as such description may be
amended from time to time.
All reports and other documents filed by OroAmerica subsequent to the
date of this Registration Statement pursuant to Sections 13(a), 13(c), 14 and
15(d) of the Exchange Act, prior to the filing of a post-effective amendment
which indicates that all securities offered hereby have been sold or which
deregisters all securities then remaining unsold, shall be deemed to be
incorporated by reference in this Registration Statement and to be considered a
part hereof from the date of filing of such documents.
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Section 145 of the General Corporation Law of the State of Delaware
(the "GCL") permits a corporation to indemnify any person who was or is a party
or is threatened to be made a party to any threatened, pending or completed
action, suit or proceeding, whether civil, criminal, administrative or
investigative (other than an action by or in the right of the corporation), by
reason of the fact that such person is or was a director, officer, employee or
agent of the corporation, or is or was serving at the request of the corporation
as a director, officer, employee or agent of another corporation, partnership,
joint venture, trust or other enterprise, against expenses (including attorneys'
fees), judgments, fines and amounts paid in settlement actually and reasonably
incurred in connection with such action, suit or proceeding if such person acted
in good faith and in a manner such person reasonably believed to be in or not
opposed to the best interests of the corporation, and, with respect to any
criminal action or proceeding, had no reasonable cause to believe such person's
conduct was unlawful.
Under Section 145 of the GCL, a corporation also may indemnify any
person who was or is a party or is threatened to be made a party to any
threatened, pending or completed action or suit by or in the right of the
corporation to procure a judgment in its favor by reason of the fact that such
person is or was a director, officer employee or agent of the corporation, or is
or was serving at the request of the corporation as a director, officer,
employee or agent of another corporation, partnership, joint venture, trust or
other enterprise against expenses (including attorneys' fees) actually and
reasonably incurred by such person in connection with the defense or settlement
of such action or suit if such person acted in good faith and in a manner such
person reasonably believed to be in or not opposed to the best
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interests of the corporation. However, in such an action by or on behalf of a
corporation, no indemnification may be made in respect of any claim, issue or
matter as to which the person is adjudged liable for negligence or misconduct in
the performance of such person's duty to the corporation unless, and only to the
extent that the court determines that, despite the adjudication of liability but
in view of all the circumstances, the person is fairly and reasonably entitled
to indemnity for such expenses which the court shall deem proper.
In addition, the indemnification provided by section 145 shall not be
deemed exclusive of any other rights to which a person seeking indemnification
may be entitled under any bylaw, agreement, vote of stockholders or
disinterested directors or otherwise, both as to action in such person's
official capacity and as to action in another capacity while holding such
office.
The registrant's Certificate of Incorporation (the "Certificate") and
Bylaws provide that the registrant shall indemnify, to the fullest extent
permitted by law, each of its officers and directors, and may indemnify, to the
same extent, each of its employees and agents, who was or is a party to, or is
threatened to be made a party to, any threatened, pending or completed action,
suit or proceeding, whether civil, criminal, administrative or investigative, by
reason of the fact that such person is or was a director, officer, employee or
agent of the registrant or is serving at the request of the registrant as a
director, officer, employee or agent of another corporation, partnership, joint
venture, trust, employee benefit plan or other enterprise. In addition,
agreements entered into by the registrant with its directors and executive
officers require the registrant to indemnify such persons against expenses,
judgments, fines, settlements and other amounts reasonably incurred in
connection with any proceeding to which any such person may be made a party by
reason of the fact that such person is or was an agent of the registrant, unless
indemnification is otherwise prohibited by law, provided such person acted in
good faith and in a manner such person reasonably believed to be in the best
interests of the registrant and, in the case of a criminal proceeding, had no
reason to believe his conduct was unlawful. The indemnification agreements also
set forth certain procedures that will apply in the event of a claim for
indemnification thereunder.
The Certificate provides that no director of the registrant shall be
liable to the registrant or its stockholders for monetary damages for breach of
his fiduciary duty as a director, except for liability (i) for any breach of the
director's duty of loyalty to the registrant or its stockholders, (ii) for acts
or omissions not in good faith or which involve intentional misconduct or a
knowing violation of law, (iii) under Section 174 of the GCL or (iv) for any
transaction from which the director derived an improper personal benefit.
The Certificate also provides that the registrant may purchase and
maintain insurance on behalf of any person who is or was a director, officer,
employee or agent of the registrant, or is serving at the request of the
registrant as a director, officer, employee or agent of another corporation,
partnership, joint venture, trust, employee benefit plan or other enterprise
against any liability incurred by such person in any such capacity, or arising
out of his status as such, regardless of whether the registrant is empowered to
indemnify such person under the provisions of applicable law. The registrant
currently maintains such insurance.
If the registrant's equity securities are held by less than 800
stockholders and a majority of its outstanding shares are held by persons with
California addresses, the registrant may become subject to Section 2115 of the
California Corporations Code. In such event, according to California law, the
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registrant's ability to indemnify its officers, directors and employees would be
governed by California law, which generally is more limited than the
corresponding provisions of the GCL.
ITEM 8. EXHIBITS.
4.1 OroAmerica, Inc. 1998 Incentive Stock Option Plan.
4.2 Form of Incentive Stock Option Agreement used in
connection with the OroAmerica, Inc. 1998 Incentive Stock
Option Plan.
4.3 Form of Nonstatutory Stock Option Agreement used in
connection with the OroAmerica, Inc. 1998 Incentive Stock
Option Plan.
5.1 Opinion of Ervin, Cohen & Jessup LLP.
23.1 Consent of PricewaterhouseCoopers LLP.
23.2 Consent of Ervin, Cohen & Jessup LLP (included in Exhibit
5.1).
24.1 Powers of Attorney (included on pages II-5 hereof).
ITEM 9. UNDERTAKINGS.
A. The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this registration statement:
(i) To include any prospectus required by Section 10(a)(3)
of the Securities Act 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 end 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 that a 20% change
in the maximum aggregate offering price set forth in the "Calculation of
Registration Fee" table in the effective registration statement.;
(iii) To include any material information with respect to
the plan of distribution not previously in the registration statement or any
material change to such information in the registration statement;
Provided, however, that paragraphs (a)(1)(i) and (a)(1)(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 with or furnished to the
Commission by the registrant pursuant to Section 13 or Section 15(d) of the
Securities Exchange Act of 1934 that are incorporated by reference in the
registration statement.
(2) 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
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securities offered therein, and the offering of such securities at that time
shall be deemed to be the initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective
amendment any of the securities being registered which remain unsold at the
termination of the offering.
B. The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of the
registrant'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 plans's annual report pursuant to Section 15(d) of the
Securities Exchange Act of 1934) that is incorporated by reference in this
registration statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.
C. Insofar as indemnification for liabilities arising under the Securities Act
of 1933 may be permitted to directors, officers and controlling persons of the
registrant pursuant to the foregoing provisions, or otherwise, the registrant
has been advised that in the opinion of the Securities and Exchange Commission
such indemnification is against public policy as expressed in the Act and is,
therefore, unenforceable. In the event that a claim for indemnification against
such liabilities (other than the payment by the registrant of expenses incurred
or paid by a director, officer or controlling person of the registrant in the
successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit a copy to a court of
appropriate jurisdiction the question whether such indemnification by it is
against public policy as expressed in the Act and will be governed by the final
adjudication of such issue.
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SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
registrant certifies that it has reasonable grounds to believe that it meets all
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 Burbank, State of California, on July 7, 1998.
OROAMERICA, INC.
By: /s/ Guy Benhamou
------------------------------------
Guy Benhamou, Chairman of the Board
President and Chief Executive
Officer
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature
appears below constitutes and appoints Shiu Shao and Marc Kesten, and each of
them, as true and lawful attorneys-in-fact and agents with full power of
substitution and resubstitution, for him and in his name, place and stead, in
any and all capacities, to sign any or all post-effective amendments to this
Registration Statement, 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, and each of them,
full power and authority to do and perform each and every act and thing
requisite and necessary to be done in and about the foregoing, as fully to all
intents and purposes as he might or could do in person, hereby ratifying and
confirming all that said attorneys-in-fact and agents, or any of them, or their
substitute or substitutes, may lawfully do or cause to be done by virtue hereof.
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.
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SIGNATURES TITLE DATE
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<S> <C> <C>
/s/ Guy Benhamou Chairman of the Board, President July 7, 1998
- -------------------------------- and Chief Executive Officer
Guy Benhamou
/s/ Shiu Shao Chief Financial Officer, Vice July 7, 1998
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Shiu Shao President and Director
/s/ Betty Sou Controller (Principal Accounting July 7, 1998
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Betty Sou Officer)
/s/ Bertram K. Massing Director July 7, 1998
- --------------------------------
Bertram K. Massing
/s/ Ronald A. Katz Director July 7, 1998
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Ronald A. Katz
/s/ David Rousso Director July 7, 1998
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David Rousso
</TABLE>
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EXHIBIT 4.1
OROAMERICA, INC.
1998 INCENTIVE STOCK OPTION PLAN
1. PURPOSE. This OroAmerica, Inc. 1998 Incentive Stock Option Plan
(the "Plan") is intended to allow designated employees, executive officers and
other corporate and divisional officers (all of whom are sometimes collectively
referred to herein as "Employees") of OroAmerica, Inc., a Delaware corporation
("OroAmerica"), and Subsidiaries which it may have from time to time (OroAmerica
and such Subsidiaries being together referred to herein as the "Company") to
receive certain options under the Plan ("Stock Options") to purchase
OroAmerica's common stock ("Common Stock") as herein provided. "Subsidiary"
shall mean each corporation which is a "subsidiary corporation" of OroAmerica,
within the definition contained in Section 424(f) of the Internal Revenue Code
of 1986, as amended (the "Code"). The purpose of the Plan is to provide
Employees with additional incentives to make significant and extraordinary
contributions to the long-term performance and growth of the Company and to
attract and retain Employees of exceptional ability.
2. ADMINISTRATION.
2.1 The Plan shall be administered by the Compensation
Committee (the "Committee") of the Board of Directors of OroAmerica (the
"Board"). Each member of the Committee shall be a "Non-Employee Director" as
that term is defined in Rule 16b-3 ("Rule 16b-3") promulgated by the Securities
and Exchange Commission (the "Commission") pursuant to the Securities Exchange
Act of 1934 (the "Exchange Act"), but no action of the Committee shall be
invalid if this requirement is not met. The Committee shall select one of its
members as Chairman and shall act by vote of a majority of a quorum or by
unanimous written consent. A majority of its members shall constitute a quorum.
The Committee shall be governed by the provisions of OroAmerica's Bylaws and of
Delaware law applicable to the Board, except as otherwise provided herein or
determined by the Board.
2.2 The Committee shall have full and complete authority,
in its discretion, but subject to the express provisions of the Plan: to approve
the Employees nominated by the management of the Company to be granted Stock
Options; to determine the number of Stock Options to be granted to an Employee;
to determine the time or times at which Stock Options shall be granted; to
establish the terms and conditions upon which Stock Options may be exercised; to
remove or adjust any restrictions and conditions upon Stock Options; to specify,
at the time of grant, provisions relating to the exercisability of Stock Options
and to accelerate or otherwise modify the exercisability of any Stock Options;
to reprice Stock Options; and to adopt such rules and regulations and to make
all other determinations deemed necessary or desirable for the administration of
the Plan. All interpretations and constructions of the Plan by the Committee,
and all of its actions hereunder, shall be binding and conclusive on all
persons for all purposes.
2.3 The Company hereby agrees to indemnify and hold
harmless each Committee member and each employee of the Company, and the estate
and heirs of such Committee member or employee, against all claims, liabilities,
expenses, penalties, damages or other pecuniary losses, including legal fees,
which such Committee member or employee or his or her estate or heirs may suffer
as a result of his or her responsibilities, obligations or duties in connection
with the Plan, to the extent that insurance, if any, does not cover the payment
of such items.
<PAGE> 2
3. ELIGIBILITY AND PARTICIPATION. Employees eligible under the Plan
shall be approved by the Committee from those Employees who, in the opinion of
the management of the Company, are in positions which enable them to make
significant and extraordinary contributions to the long-term performance and
growth of the Company. In selecting Employees to whom Stock Options may be
granted, consideration shall be given to factors such as employment position,
duties and responsibilities, ability, productivity, length of service, morale,
interest in the Company and recommendations of supervisors.
4. GRANTS. The Committee may grant Stock Options in such amounts, at
such times, and to such Employees nominated by the management of the Company as
the Committee, in its discretion, may determine; provided, however, that,
subject to adjustment as provided in paragraph 11, the maximum number of shares
of Common Stock for which Stock Options may be granted to any one Employee
during any one calendar year shall be 50,000. Stock Options granted under the
Plan shall constitute "incentive stock options" within the meaning of Section
422 of the Code, if so designated by the Committee on the date of grant. The
Committee shall also have the discretion to grant Stock Options which do not
constitute incentive stock options and any such Stock Options shall be
designated non-statutory stock options by the Committee on the date of grant.
The aggregate fair market value (determined as of the time an incentive stock
option is granted) of the Common Stock with respect to which incentive stock
options are exercisable for the first time by any Employee during any one
calendar year (under all plans of the Company and any parent or subsidiary of
the Company) may not exceed the maximum amount permitted under Section 422 of
the Code (currently $100,000.00). Non-statutory stock options shall not be
subject to the limitations relating to incentive stock options contained in the
preceding sentence. Subject to the provisions of paragraph 11 hereof, the number
of shares of Common Stock issued and issuable pursuant to the exercise of Stock
Options granted hereunder shall not exceed 500,000. Each Stock Option shall be
evidenced by a written agreement (the "Option Agreement") in a form approved by
the Committee, which shall be executed on behalf of the Company and by the
Employee to whom the Stock Option is granted. If a Stock Option expires,
terminates or is cancelled for any reason without having been exercised in full,
the shares of Common Stock not purchased thereunder shall again be available for
purposes of the Plan.
5. PURCHASE PRICE. The purchase price (the "Exercise Price") of
shares of Common Stock subject to each Stock Option ("Option Shares") shall
equal the fair market value ("Fair Market Value") of such shares on the date of
grant of such Stock Option. Notwithstanding the foregoing, the Exercise Price of
Option Shares subject to an incentive stock option granted to an Employee who at
the time of grant owns stock possessing more than 10% of the total combined
voting power of all classes of stock of the Company or of any parent or
Subsidiary shall be at least equal to 110% of the Fair Market Value of such
shares on the date of grant of such Stock Option. The Fair Market Value of a
share of Common Stock on any date shall be equal to the closing price of the
Common Stock for the last preceding day on which OroAmerica's shares were
traded, and the method for determining the closing price shall be determined by
the Committee.
6. OPTION PERIOD. The Stock Option period (the "Term") shall commence
on the date of grant of the Stock Option and shall be ten years or such shorter
period as is determined by the Committee. Notwithstanding the foregoing, the
Term of an incentive stock option granted to an Employee who at the time of
grant owns stock possessing more than 10% of the total combined voting power of
all classes of stock of the Company or of any parent or subsidiary shall not
exceed five years. Each Stock Option shall provide that it is exercisable over
its term in such periodic installments as the
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Committee in its sole discretion may determine. Such provisions need not be
uniform. If an Employee shall not in any period purchase all of the Option
Shares which the Employee is entitled to purchase in such period, the Employee
may purchase all or any part of such Option Shares at any time prior to the
expiration of the Stock Option.
7. EXERCISE OF OPTIONS.
7.1 Each Stock Option may be exercised in whole or in part
(but not as to fractional shares) by delivering it for surrender or endorsement
to the Company, attention of the Vice President, Administration, at the
principal office of the Company, together with payment of the Exercise Price and
an executed Notice and Agreement of Exercise in the form prescribed by paragraph
7.2. Payment may be made in cash, by cashier's or certified check or by
surrender of previously owned shares of the Company's Common Stock valued
pursuant to paragraph 5 (if the Committee authorizes payment in stock).
7.2 Exercise of each Stock Option is conditioned upon the
agreement of the Employee to the terms and conditions of this Plan and of such
Stock Option as evidenced by the Employee's execution and delivery of a Notice
and Agreement of Exercise in a form to be determined by the Committee in its
discretion. Such Notice and Agreement of Exercise shall set forth the agreement
of the Employee that: (a) no Option Shares will be sold or otherwise distributed
in violation of the Securities Act of 1933 (the "Securities Act") or any other
applicable federal or state securities laws; (b) each Option Share certificate
may be imprinted with legends reflecting any applicable federal and state
securities law restrictions and conditions; (c) the Company may comply with said
securities law restrictions and issue "stop transfer" instructions to its
Transfer Agent and Registrar without liability; (d) if the Employee is subject
to the reporting requirements of Section 16(a) of the Exchange Act (a "Section
16 Reporting Person"), the Employee will furnish to the Company a copy of each
Form 4 or Form 5 filed by said Employee and will timely file all reports
required under federal securities laws; and (e) the Employee will report all
sales of Option Shares to the Company in writing on a form prescribed by the
Company.
7.3 No Stock Option shall be exercisable unless and until
any applicable registration or qualification requirements of federal and state
securities laws, and all other legal requirements, have been fully complied
with. The Company will use reasonable efforts to maintain the effectiveness of a
Registration Statement under the Securities Act for the issuance of Stock
Options and shares acquired thereunder, but there may be times when no such
Registration Statement will be currently effective. The exercise of Stock
Options may be temporarily suspended without liability to the Company during
times when no such Registration Statement is currently effective, or during
times when, in the reasonable opinion of the Committee, such suspension is
necessary to preclude violation of any requirements of applicable law or
regulatory bodies having jurisdiction over the Company. If any Stock Option
would expire for any reason except the end of its term during such a suspension,
then, if the exercise of such Stock Option is duly tendered before its
expiration, such Stock Option shall be exercisable and exercised (unless the
attempted exercise is withdrawn) as of the first day after the end of such
suspension. The Company shall have no obligation to file any Registration
Statement covering resales of Option Shares.
8. CONTINUOUS EMPLOYMENT. Except as provided in paragraph 10 below,
an Employee may not exercise a Stock Option unless from the date of grant to the
date of exercise such Employee remains continuously in the employ of the
Company. For purposes of this paragraph 8, the period of
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continuous employment of an Employee with the Company shall be deemed to include
(without extending the term of the Stock Option) any period during which such
Employee is on leave of absence with the consent of the Company, provided that
such leave of absence shall not exceed three (3) months and that such Employee
returns to the employ of the Company at the expiration of such leave of absence.
If such Employee fails to return to the employ of the Company at the expiration
of such leave of absence, such Employee's employment with the Company shall be
deemed terminated as of the date such leave of absence commenced. The continuous
employment of an Employee with the Company shall also be deemed to include any
period during which such Employee is a member of the Armed Forces of the United
States, provided that such Employee returns to the employ of the Company within
ninety (90) days (or such longer period as may be prescribed by law) from the
date such Employee first becomes entitled to discharge. If an Employee does not
return to the employ of the Company within ninety (90) days (or such longer
period as may be prescribed by law) from the date such Employee first becomes
entitled to discharge, such Employee's employment with the Company shall be
deemed to have terminated as of the date such Employee's military service ended.
9. RESTRICTIONS ON TRANSFER. Incentive stock options granted under
this Plan shall be transferable only by will or the laws of descent and
distribution. The Committee shall have discretion to grant non-statutory stock
options that are not subject to the restrictions on transfer relating to
incentive stock options contained in the preceding sentence; provided, however,
that non-statutory stock options granted to a Section 16 Reporting Person shall
be subject to such restrictions on transfer as may be required to qualify for
the exemption provided for in Rule 16b-3 or otherwise imposed by the Committee
in its sole and absolute discretion. No interest of any Employee under the Plan
shall be subject to attachment, execution, garnishment, sequestration, the laws
of bankruptcy or any other legal or equitable process. Each Stock Option shall
be exercisable during an Employee's lifetime only by such Employee and, in the
case of non-statutory stock options, such Employee's permitted transferees.
10. TERMINATION OF EMPLOYMENT.
10.1 Subject to the discretion of the Committee with
respect to non-statutory Stock Options, upon termination of an Employee's
employment with the Company by reason of death, all outstanding Stock Options to
the extent exercisable on the date of death of the Employee shall remain in full
force and effect and may be exercised pursuant to the provisions thereof at any
time prior to expiration at the end of the fixed term thereof. Upon termination
of an Employee's employment with the Company by reason of Disability, all
outstanding Stock Options to the extent exercisable on the date of termination
of employment may be exercised pursuant to the provisions thereof at any time
until the earlier of the end of the fixed term thereof and the expiration of
twelve months following termination of the Employee's employment. Unless
otherwise provided by the Committee, all Stock Options to the extent not
presently exercisable by such Employee at the date of death or termination of
employment by reason of Disability shall terminate as of the date of death or
such termination of employment and shall not be exercisable thereafter.
10.2 Subject to the discretion of the Committee with
respect to non-statutory Stock Options, upon the termination of the Employee's
employment with the Company for any reason other than the reasons set forth in
paragraph 10.1 hereof, the Stock Option may be exercised during the period of
three months following the date of such termination of employment, but only to
the extent that such Stock Option was outstanding and exercisable on such date
of termination of employment. Unless otherwise provided by the Committee, all
Stock Options to the extent not then presently exercisable by
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such Employee shall terminate as of the date of such termination of employment
and shall not be exercisable thereafter.
10.3 For purposes of this Plan, "Disability" shall mean
total and permanent incapacity of an Employee, due to physical impairment or
legally established mental incompetence, to perform the usual duties of such
Employee's employment with the Company, which disability shall be determined:
(i) on medical evidence by a licensed physician designated by the Committee; or
(ii) on evidence that the Employee has become entitled to receive primary
benefits as a disabled employee under the Social Security Act in effect on the
date of such disability.
11. ADJUSTMENTS UPON CHANGE IN CAPITALIZATION.
11.1 The number and class of shares subject to each
outstanding Stock Option, the Exercise Price thereof (but not the total price)
and the maximum number of Stock Options that may be granted under the Plan shall
be proportionately adjusted in the event of any increase or decrease in the
number of the issued shares of Common Stock which results from a split-up or
consolidation of shares, payment of a stock dividend or dividends, a
recapitalization (other than the conversion of convertible securities according
to their terms), a combination of shares or other like capital adjustment, so
that upon exercise of the Stock Option, the Employee shall receive the number
and class of shares such Employee would have received had such Employee been the
holder of the number of shares of Common Stock for which the Stock Option is
being exercised upon the date of such change or increase or decrease in the
number of issued shares of the Company.
11.2 Upon a reorganization, merger or consolidation of the
Company with one or more corporations as a result of which OroAmerica is not the
surviving corporation or in which OroAmerica survives as a wholly-owned
subsidiary of another corporation, or upon a sale of all or substantially all of
the property of the Company to another corporation, or any dividend or
distribution to stockholders of more than ten percent (10%) of the Company's
assets, adequate adjustment or other provisions shall be made by the Company or
other party to such transaction so that there shall remain and/or be substituted
for the Option Shares provided for herein, the shares, securities or assets
which would have been issuable or payable in respect of or in exchange for such
Option Shares then remaining, as if the Employee had been the owner of such
Option Shares as of the applicable date. Any securities so substituted shall be
subject to similar successive adjustments.
11.3 In the sole discretion of the Committee, Stock Options
may include provisions, on terms (which need not be uniform) authorized by the
Committee in its sole discretion, that accelerate the Employees' rights to
exercise Stock Options upon a "Change in Control" (as defined by the Committee
in its sole discretion) of the Company.
12. WITHHOLDING TAXES. The Company shall have the right at the time
of exercise of any Stock Option to make adequate provision for any federal,
state, local or foreign taxes which it believes are or may be required by law to
be withheld with respect to such exercise ("Tax Liability"), to ensure the
payment of any such Tax Liability. The Company may provide for the payment of
any Tax Liability by any of the following means or a combination of such means,
as determined by the Committee in its sole and absolute discretion in the
particular case: (i) by requiring the Employee to tender a cash payment to the
Company; (ii) by withholding from the Employee's salary; (iii) by withholding
from the Option Shares which would otherwise be issuable upon exercise of the
Stock Option that number of
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<PAGE> 6
Option Shares having an aggregate fair market value (determined in the manner
prescribed by paragraph 5) as of the date the withholding tax obligation arises
that is equal to the Employee's Tax Liability; or (iv) by any other method
deemed appropriate by the Committee. Satisfaction of the Tax Liability of a
Section 16 Reporting Person may be made by the method of payment specified in
clause (iii) above upon satisfaction of such additional conditions as the
Committee shall deem in its sole and absolute discretion as appropriate in order
for such withholding of Option Shares to qualify for the exemption provided for
in Section 16b-3 of the Exchange Act.
13. RELATIONSHIP TO OTHER EMPLOYEE BENEFIT PLANS. Stock Options
granted hereunder shall not be deemed to be salary or other compensation to any
Employee for purposes of any pension, thrift, profit-sharing, stock purchase or
any other employee benefit plan now maintained or hereafter adopted by the
Company.
14. AMENDMENTS AND TERMINATION. The Board of Directors may at any
time suspend, amend or terminate this Plan. No amendment or modification of this
Plan may be adopted, except subject to stockholder approval, which would
materially increase the number of securities which may be issued under this Plan
(except for adjustments pursuant to paragraph 11 hereof) or change the
designation of Employees eligible to receive incentive stock options under the
Plan.
15. SUCCESSORS IN INTEREST. The provisions of this Plan and the
actions of the Committee shall be binding upon all heirs, successors and assigns
of the Company and of Employees.
16. OTHER DOCUMENTS. All documents prepared, executed or delivered in
connection with this Plan shall be, in substance and form, as established and
modified by the Committee or by persons under its direction and supervision;
provided, however, that all such documents shall be subject in every respect to
the provisions of this Plan, and in the event of any conflict between the terms
of any such document and this Plan, the provisions of this Plan shall prevail.
All Stock Options shall be evidenced by written agreements executed by the
Company and the Employees to whom the Stock Options have been granted.
17. NO OBLIGATION TO CONTINUE EMPLOYMENT. This Plan and grants
hereunder shall not impose any obligation on the Company to continue to employ
any Employee. Moreover, no provision of this Plan or any document executed or
delivered pursuant to this Plan shall be deemed modified in any way by any
employment contract between an Employee (or other employee) and the Company.
18. MISCONDUCT OF AN EMPLOYEE. Notwithstanding any other provision of
this Plan, if an Employee commits fraud or dishonesty toward the Company or
wrongfully uses or discloses any trade secret, confidential data or other
information proprietary to the Company, or intentionally takes any other action
materially inimical to the best interests of the Company, as determined by the
Committee, in its sole and absolute discretion, such Employee shall forfeit all
rights and benefits under this Plan.
19. TERM OF PLAN. This Plan was adopted by the Board effective April
14, 1998. No Stock Options may be granted under this Plan after April 13, 2008.
20. GOVERNING LAW. This Plan shall be construed in accordance with,
and governed by, the laws of the State of Delaware.
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<PAGE> 7
21. STOCKHOLDER APPROVAL. No Stock Option shall be exercisable unless
and until the stockholders of the Company have approved this Plan and all other
legal requirements have been fully complied with.
22. PRIVILEGES OF STOCK OWNERSHIP. The holder of a Stock Option shall
not be entitled to the privileges of stock ownership as to any shares of Common
Stock not actually issued to such holder.
IN WITNESS WHEREOF, this Plan has been executed effective as of the
14th day of April, 1998.
OROAMERICA, INC.
By: /s/ Guy Benhamou
------------------------------------
Guy Benhamou, Chairman of the Board
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<PAGE> 1
EXHIBIT 4.2
OROAMERICA, INC.
INCENTIVE STOCK OPTION AGREEMENT
(1998 INCENTIVE STOCK OPTION PLAN)
This Incentive Stock Option Agreement (the "Agreement") is made and
entered into as of ______________ (hereinafter referred to as the "Date of
Grant"), by and between OROAMERICA, INC., a Delaware corporation (the
"Company"), and ___________________ ("Optionee"),with reference to the following
facts:
A. The Company has duly adopted a 1998 Incentive Stock Option Plan
(hereinafter referred to as the "Plan") which authorizes the Compensation
Committee of the Board of Directors (hereinafter referred to as the "Committee")
to grant non-statutory stock options or incentive stock options, within the
meaning of Section 422 of the Internal Revenue Code of 1986, as amended (the
"Code"), and which is intended to encourage ownership of stock of the Company by
officers and other key management employees and to provide additional incentive
for them to promote the success of the Company.
B. The Committee, which is charged with responsibility for
administering the Plan, has determined that Optionee is entitled to participate
in the Plan, and has taken appropriate action to authorize the granting of a
stock option, which shall be an incentive stock option except as otherwise
provided herein, to Optionee for the number of shares, at the price per share
and on the terms set forth in this Agreement.
C. Optionee desires to participate in the Plan and to receive an
option on the terms and conditions set forth in this Agreement.
NOW, THEREFORE, the parties agree as follows:
1. Grant of Option
The Company hereby grants to Optionee the right and option
(hereinafter referred to as the "Option") to purchase from time to time all or
any part of an aggregate of _____________ shares (the "Option Shares") of the
common stock, $.001 par value, of the Company ("Common Stock") on the terms and
conditions set forth in this Agreement. The Option shall be an incentive stock
option, provided, however, that, to the extent that the aggregate fair market
value of Common Stock (including the Option Shares and the Common Stock issuable
upon exercise of all other incentive stock options granted to Optionee under the
Plan and under all other plans of the Company under which incentive stock
options may be issued) with respect to which incentive stock options (determined
without regard to this sentence) first become exercisable by Optionee during any
calendar year exceeds the maximum amount permitted under Section 422 of the Code
(currently $100,000.00), such options shall be treated as non-statutory stock
options. The preceding sentence shall be applied taking options into account in
the order in which they were granted. For purposes of this paragraph, the fair
market value of Common Stock shall be determined as of the time the option with
respect to such Common Stock was granted.
<PAGE> 2
2. Purchase Price
The purchase price (the "Exercise Price") of each Option
Share shall be $____.
3. Option Period
The Option shall commence on the Date of Grant and shall
expire, and all rights to purchase the Option Shares shall terminate, at the
close of business on the day immediately preceding the tenth anniversary of the
Date of Grant, unless terminated earlier as provided in this Agreement. The
Option shall be exercisable during its term as to 20% of the Option Shares
during the twelve months beginning on the Date of Grant; 20% of the Option
Shares during the twelve months beginning on the first anniversary of the Date
of Grant; 20% of the Option Shares during the twelve months beginning on the
second anniversary of the Date of Grant; 20% of the Option Shares during the
twelve months beginning on the third anniversary of the Date of Grant; and 20%
of the Option Shares during the twelve months beginning on the fourth
anniversary of the Date of Grant; provided, however, if Optionee shall not in
any period purchase all of the Option Shares which Optionee is entitled to
purchase in such period, Optionee may purchase all or any part of such Option
Shares at any time after the end of such period and prior to the expiration of
the Option.
4. Exercise of Option
4.1 The Option shall be exercised by delivering this
Agreement for surrender or endorsement to the Company, at its principal office,
attention of the Secretary, together with a Notice and Agreement of Exercise (in
the form attached hereto or specified from time to time by the Committee)
indicating the number of Option Shares Optionee wishes to purchase and full
payment of the Exercise Price of such shares. The minimum number of shares as to
which the Option Shares may be exercised at any time is ten. In no event shall
the Company be required to issue or transfer fractional shares.
4.2 Payment for Option Shares may be made in cash, by
cashier's or certified check or (if the Committee authorizes payment in stock)
by delivery to the Company of shares of Common Stock, duly assigned to the
Company by a stock power with signatures guaranteed as provided on the back of
the stock certificate. The value of each share delivered in payment of the
Exercise Price of Option Shares shall be the fair market value ("Fair Market
Value") of the Common Stock on the date such shares are delivered. The Fair
Market Value of a share of Common Stock on any date shall be equal to the
closing price of the Common Stock for the last preceding day on which the
Company's shares were traded, and the method for determining the closing price
shall be determined by the Committee.
5. Employment of Optionee
5.1 Except as otherwise provided in paragraph 6 of this
Agreement, Optionee may not exercise the Option unless, at the time of exercise,
Optionee is an employee of the Company or a parent or a subsidiary thereof and
has been in the employ of the Company or a parent or subsidiary thereof
continuously since the Date of Grant. For purposes of this paragraph, the period
of
2
<PAGE> 3
continuous employment with the Company shall be deemed to include (without
extending the term of the Option) any period during which Optionee is on leave
of absence with the consent of the Company, provided that such leave of absence
shall not exceed three months and Optionee returns to the employ of the Company
at the expiration of such leave of absence. If Optionee fails to return to the
employ of the Company at the expiration of such leave of absence, Optionee's
employment with the Company shall be deemed terminated as of the date such leave
of absence commenced. The continuous employment of Optionee with the Company
shall also be deemed to include any period during which Optionee is a member of
the Armed Forces of the United States, provided that Optionee returns to the
employ of the Company within 90 days (or such longer period as may be prescribed
by law) from the date Optionee first becomes entitled to discharge. If Optionee
does not return to the employ of the Company within 90 days from the date
Optionee first becomes entitled to discharge (or such longer period as may be
prescribed by law), Optionee's employment with the Company shall be deemed to
have terminated as of the date Optionee's military service ended.
5.2 Nothing contained herein shall be construed to impose
upon the Company or upon any parent or subsidiary thereof any obligation to
employ Optionee for any period or to supersede or in any way alter, increase or
diminish the respective rights and obligations of the Company or any parent or
subsidiary thereof and Optionee under any employment contract now or hereafter
existing between them.
6. Termination of Employment
6.1 Unless otherwise determined by the Committee, if the
employment of Optionee with the Company shall terminate because of death, (a)
the Option, to the extent then presently exercisable, shall remain in full force
and effect and may be exercised pursuant to the provisions hereof, including
expiration at the end of the fixed term hereof, and (b) the Option, to the
extent not then presently exercisable, shall terminate as of the date of such
termination of employment and shall not be exercisable thereafter.
6.2 Unless otherwise determined by the Committee, if the
employment of Optionee with the Company shall terminate because of "Disability"
(as defined in the Plan), (a) the Option, to the extent then presently
exercisable, shall remain exercisable and may be exercised pursuant to the
provisions hereof at any time until the earlier of the end of the fixed term
hereof or the expiration of twelve months following termination of Optionee's
employment, and (b) the Option, to the extent not then presently exercisable,
shall terminate as of the date of such termination of employment and shall not
be exercisable thereafter.
6.3 Unless otherwise determined by the Committee, if the
employment of Optionee with the Company shall terminate for any reason other
than the reasons set forth in paragraphs 6.1 and 6.2 hereof, (a) the Option, to
the extent then presently exercisable or to the extent the Option becomes
exercisable pursuant to paragraph 9.3 hereof, shall remain exercisable only for
a period of three months after the date of such termination of employment and
may be exercised during such period pursuant to the provisions hereof, including
expiration at the end of the fixed term hereof, and (b) the Option, to the
extent not then presently exercisable, shall terminate as of the date of such
termination of employment and shall not be exercisable thereafter.
3
<PAGE> 4
7. Securities Laws Requirements
7.1 The Option shall not be exercisable unless and until
any applicable registration or qualification requirements of federal and state
securities laws, and all other requirements of law or any regulatory bodies
having jurisdiction over such exercise or issuance and delivery, have been fully
complied with. The Company will use reasonable efforts to maintain the
effectiveness of a Registration Statement under the Securities Act of 1933, as
amended (the "Securities Act"), for the issuance of the Option and the Option
Shares but there may be times when no such Registration Statement will be
currently effective. Exercise of the Option may be temporarily suspended without
liability to the Company during times when no such Registration Statement is
currently effective, or during times when, in the reasonable opinion of the
Committee, such suspension is necessary to preclude violation of any
requirements of applicable law or regulatory bodies having jurisdiction over the
Company. If the Option would expire for any reason except the end of its term
during such a suspension, then if exercise of the Option is duly tendered before
its expiration, the Option shall be exercisable and exercised (unless the
attempted exercise is withdrawn) as of the first day after the end of such
suspension. The Company shall have no obligation to file any Registration
Statement covering resales of the Option Shares.
7.2 Upon each exercise of the Option, Optionee shall
represent, warrant and agree, by the Notice and Agreement of Exercise delivered
to the Company, that (a) no Option Shares will be sold or otherwise distributed
in violation of the Securities Act or any other applicable federal or state
securities laws, (b) if Optionee is subject to the reporting requirements under
Section 16(a) of the Securities Exchange Act of 1934, as amended (the "Exchange
Act"), Optionee will furnish to the Company a copy of each Form 4 filed by
Optionee and will timely file all reports required under federal securities
laws, and (c) Optionee will report all sales of Option Shares to the Company in
writing on the form prescribed from time to time by the Company. All Option
Share certificates may be imprinted with legend conditions reflecting federal
and state securities law restrictions and conditions and the Company may comply
therewith and issue "stop transfer" instructions to its transfer agents and
registrars without liability.
8. Non-transferability of Option
If Optionee is subject to the reporting requirements of
Section 16(a) of the Exchange Act at the time of the proposed transfer, the
Option shall be transferable only if such transferability or transfer would not
cause the Option to fail to qualify for the exemption provided for in Section
16b-3 of the Exchange Act, as determined by the Committee in its sole
discretion. The Option may be exercised, during the lifetime of Optionee, only
by Optionee and Optionee's permitted transferees. Notwithstanding the foregoing,
the Option shall not be assignable by operation of law and shall not be subject
to execution, attachment or similar process. Any attempted assignment, transfer,
pledge, hypothecation or other disposition contrary to the provisions of this
Agreement, and the levy of any execution, attachment or similar process
thereupon, shall be null and void and without effect.
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<PAGE> 5
9. Changes in Capitalization
9.1 The number and class of shares subject to the Option,
the Exercise Price (but not the total price), and the minimum number of shares
as to which the Option may be exercised at any one time, shall be
proportionately adjusted in the event of any increase or decrease in the number
of the issued shares of Common Stock of the Company which results from a
split-up or consolidation of shares, payment of a stock dividend or stock
dividends, a recapitalization (other than the conversion of convertible
securities according to their terms), a combination of shares or other like
capital adjustment, so that upon exercise of the Option, Optionee shall receive
the number and class of shares Optionee would have received had Optionee been
the holder of the number of shares of Common Stock for which the Option is being
exercised upon the date of such change or increase or decrease in the number of
issued shares of the Company.
9.2 Upon a reorganization, merger or consolidation of the
Company with one or more corporations as a result of which the Company is not
the surviving corporation, or in which the Company survives as a subsidiary of
another corporation, a sale of all or substantially all of the property of the
Company to another corporation or any dividend or distribution to shareholders
of more than ten percent of the Company's assets, adequate adjustment or other
provisions shall be made by the Company or other party to such transaction so
that there shall remain and/or be substituted for the Option Shares provided for
herein, the shares, securities or assets which would have been issuable or
payable in respect of or in exchange for the Option Shares then remaining under
the Option, as if Optionee had been the owner of such shares as of the
applicable date. Any securities so substituted shall be subject to similar
successive adjustments.
9.3 The Option shall become fully exercisable upon the
occurrence of a change in control of the Company as defined herein (a "Change in
Control"). A Change in Control of the Company shall be deemed to have occurred
(a) on the date the Company first has actual knowledge that any person (as such
is used in Sections 13(d) and 14(d)(2) of the Exchange Act) who is not such
beneficial owner on the Date of Grant has become the beneficial owner (as
defined in Rule 13(d)-3 under the Exchange Act), directly or indirectly, of
securities of the Company representing 40% or more of the combined voting power
of the Company's then outstanding securities or (b) on the date the stockholders
of the Company approve (i) a merger of the Company with or into any other
corporation in which the Company is not the surviving corporation or in which
the Company survives as a subsidiary of another corporation, (ii) a
consolidation of the Company with any other corporation or (iii) the sale or
disposition of all or substantially all of the Company's assets or a plan of
complete liquidation.
10. Relationship to Other Employee Benefit Plans
The Option shall not be deemed to be salary or other
compensation to Optionee for purposes of any pension, thrift, profit sharing,
stock purchase or other employee benefit plan now maintained or hereafter
adopted by the Company.
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<PAGE> 6
11. Misconduct of Optionee
Notwithstanding any other provision of this Agreement or
the Plan, if Optionee shall commit fraud or dishonesty toward the Company,
wrongfully use or disclose any trade secret, confidential data or other
information proprietary to the Company or intentionally take any other action
materially inimical to the best interests of the Company, as determined by the
Committee in its sole and absolute discretion, Optionee shall forfeit all rights
and benefits under this Agreement.
12. Subsidiary
The term "subsidiary", as used herein, shall mean each
corporation which is a "subsidiary corporation" of the Company, within the
definition contained in Section 424(f) of the Code. Unless the context indicates
otherwise, references herein to the Company shall include all subsidiaries of
the Company and any parent it may have in the future.
13. Privileges of Ownership
Optionee shall not have any of the rights of a stockholder
with respect to the shares covered by the Option except to the extent that share
certificates have actually been issued and registered in Optionee's name on the
books of the Company or its registrar upon the due exercise of the Option. The
Company shall be allowed a reasonable time following notice of exercise in which
to accomplish the issuance and registration.
14. Reference to Plan
This Agreement and the Option are subject to all of the
terms and conditions of the Plan, which are hereby incorporated by reference. In
the event of any conflict between this Agreement and the Plan, the provisions of
the Plan shall prevail.
15. Notices
Any notice to be given under the terms of this Agreement
shall be addressed to the Company in care of its Secretary at 443 North Varney
Street, Burbank, California 91502, and any notice to be given to Optionee shall
be addressed to Optionee at his or her address appearing on the employment
records of the Company, or at such other address or addresses as either party
may hereafter designate in writing to the other. Any such notice shall be deemed
duly given when enclosed in a properly sealed envelope, addressed as herein
required and deposited, postage prepaid, in a post office or branch post office
regularly maintained by the United States Government.
16. Withholding Taxes
The Company shall have the right at the time of exercise of
the Option to make adequate provision for any federal, state, local or foreign
taxes which it believes are or may be required by law to be withheld with
respect to such exercise, to ensure the payment (through
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<PAGE> 7
withholding from Optionee's salary or the Option Shares or otherwise as the
Company shall deem in its sole and conclusive discretion to be in its best
interests) of any such taxes.
17. Number and Gender
Terms used herein in any number or gender include other
numbers or genders, as the context may require.
IN WITNESS WHEREOF, the Company and Optionee have executed this
Agreement as of the Date of Grant.
"OPTIONEE" "COMPANY"
OROAMERICA, INC.
- ----------------------------------
Signature
- ---------------------------------- By----------------------------------
Print Name Guy Benhamou, President
7
<PAGE> 8
OROAMERICA, INC.
NOTICE AND AGREEMENT OF EXERCISE
OF INCENTIVE STOCK OPTION
_____________,_____
I hereby exercise my OroAmerica, Inc., Incentive Stock Option dated
__________, ____, as to ________ shares of OroAmerica, Inc. common stock, $.001
par value (the "Option Shares").
Enclosed are the documents and payment specified in paragraph 4 of my
Option Agreement. I understand that no Option Shares shall be issued and
delivered unless and until any applicable registration requirements of the
Securities Act of 1933, as amended, any listing requirements of any securities
exchange on which stock of the same class is then listed, and any other
requirements of law or any regulatory bodies having jurisdiction over such
issuance and delivery, shall have been fully complied with. I hereby represent,
warrant and agree, to and with OroAmerica, Inc. (the "Company"), that:
The Option Shares I am purchasing are being acquired for my account,
and no other person (except, if I am married, my spouse) will own any interest
therein.
a. I will not sell or dispose of my Option Shares in violation of the
Securities Act of 1933 or any other applicable Federal or state securities laws.
I will obtain the Company's advice prior to any disposition of my Option Shares
except sales in unsolicited brokers transaction in the over-the-counter market.
b. I agree that the Company may, without liability, place legend
conditions upon my Option Shares and issue "stop transfer" restrictions
requiring compliance with applicable securities laws and the terms of my option.
c. If and so long as I am subject to reporting requirements under
Section 16(a) of the Securities Exchange Act of 1934, I will furnish to the
Company a copy of each Form 4 filed by me and will timely file all reports
required under the Federal securities laws.
d. I will report to the Company all sales of Option Shares on the
form prescribed from time to time by the Company.
The number of Option Shares specified above are to be issued in the
following registration (husband and wife will be shown to be joint tenants
unless I state that the Option Shares will be held as community property or as
tenants in common):
- ---------------------------------- ------------------------------------
(Print your name) (Signature)
- ---------------------------------- ------------------------------------
(Option - Print name of spouse
if you wish joint registration ------------------------------------
Address
<PAGE> 1
EXHIBIT 4.3
OROAMERICA, INC.
NONSTATUTORY STOCK OPTION AGREEMENT
(1998 INCENTIVE STOCK OPTION PLAN)
This Nonstatutory Stock Option Agreement (the "Agreement") is made
and entered into as of ______________ (hereinafter referred to as the "Date of
Grant"), by and between OROAMERICA, INC., a Delaware corporation (the
"Company"), and ___________________ ("Optionee"),with reference to the following
facts:
A. The Company has duly adopted a 1998 Incentive Stock Option Plan
(hereinafter referred to as the "Plan") which authorizes the Compensation
Committee of the Board of Directors (hereinafter referred to as the "Committee")
to grant non-statutory stock options or incentive stock options, within the
meaning of Section 422 of the Internal Revenue Code of 1986, as amended (the
"Code"), and which is intended to encourage ownership of stock of the Company by
officers and other key management employees and to provide additional incentive
for them to promote the success of the Company.
B. The Committee, which is charged with responsibility for
administering the Plan, has determined that Optionee is entitled to participate
in the Plan, and has taken appropriate action to authorize the granting of a
non-statutory stock option to Optionee for the number of shares, at the price
per share and on the terms set forth in this Agreement.
C. Optionee desires to participate in the Plan and to receive an
option on the terms and conditions set forth in this Agreement.
NOW, THEREFORE, the parties agree as follows:
1. Grant of Option
The Company hereby grants to Optionee the right and option
(hereinafter referred to as the "Option") to purchase from time to time all or
any part of an aggregate of _______ shares (the "Option Shares") of the common
stock, $.001 par value, of the Company ("Common Stock") on the terms and
conditions set forth in this Agreement. The Option shall be a non-statutory
stock option.
2. Purchase Price
The purchase price (the "Exercise Price") of each Option
Share shall be $____.
3. Option Period
The Option shall commence on the Date of Grant and shall
expire, and all rights to purchase the Option Shares shall terminate, at the
close of business on the day immediately preceding the tenth anniversary of the
Date of Grant, unless terminated earlier as provided in this Agreement. The
Option shall be exercisable during its term as to 20% of the Option Shares
during the twelve months beginning on the Date of Grant; 20% of the Option
Shares during the twelve months beginning on the first anniversary of the Date
of Grant; 20% of the Option Shares during the twelve months beginning on the
second anniversary of the Date of Grant; 20% of the Option Shares
<PAGE> 2
during the twelve months beginning on the third anniversary of the Date of
Grant; and 20% of the Option Shares during the twelve months beginning on the
fourth anniversary of the Date of Grant; provided, however, if Optionee shall
not in any period purchase all of the Option Shares which Optionee is entitled
to purchase in such period, Optionee may purchase all or any part of such Option
Shares at any time after the end of such period and prior to the expiration of
the Option.
4. Exercise of Option
4.1 The Option shall be exercised by delivering this
Agreement for surrender or endorsement to the Company, at its principal office,
attention of the Secretary, together with a Notice and Agreement of Exercise (in
the form attached hereto or specified from time to time by the Committee)
indicating the number of Option Shares Optionee wishes to purchase and full
payment of the Exercise Price of such shares. The minimum number of shares as to
which the Option Shares may be exercised at any time is ten. In no event shall
the Company be required to issue or transfer fractional shares.
4.2 Payment for Option Shares may be made in cash, by
cashier's or certified check or (if the Committee authorizes payment in stock)
by delivery to the Company of shares of Common Stock, duly assigned to the
Company by a stock power with signatures guaranteed as provided on the back of
the stock certificate. The value of each share delivered in payment of the
Exercise Price of Option Shares shall be the fair market value ("Fair Market
Value") of the Common Stock on the date such shares are delivered. The Fair
Market Value of a share of Common Stock on any date shall be equal to the
closing price of the Common Stock for the last preceding day on which the
Company's shares were traded, and the method for determining the closing price
shall be determined by the Committee.
5. Employment of Optionee
5.1 Except as otherwise provided in paragraph 6 of this
Agreement, Optionee may not exercise the Option unless, at the time of exercise,
Optionee is an employee of the Company or a parent or a subsidiary thereof and
has been in the employ of the Company or a parent or subsidiary thereof
continuously since the Date of Grant. For purposes of this paragraph, the period
of continuous employment with the Company shall be deemed to include (without
extending the term of the Option) any period during which Optionee is on leave
of absence with the consent of the Company, provided that such leave of absence
shall not exceed three months and Optionee returns to the employ of the Company
at the expiration of such leave of absence. If Optionee fails to return to the
employ of the Company at the expiration of such leave of absence, Optionee's
employment with the Company shall be deemed terminated as of the date such leave
of absence commenced. The continuous employment of Optionee with the Company
shall also be deemed to include any period during which Optionee is a member of
the Armed Forces of the United States, provided that Optionee returns to the
employ of the Company within 90 days (or such longer period as may be prescribed
by law) from the date Optionee first becomes entitled to discharge. If Optionee
does not return to the employ of the Company within 90 days from the date
Optionee first becomes entitled to discharge (or such longer period as may be
prescribed by law), Optionee's employment with the Company shall be deemed to
have terminated as of the date Optionee's military service ended.
2
<PAGE> 3
5.2 Nothing contained herein shall be construed to impose
upon the Company or upon any parent or subsidiary thereof any obligation to
employ Optionee for any period or to supersede or in any way alter, increase or
diminish the respective rights and obligations of the Company or any parent or
subsidiary thereof and Optionee under any employment contract now or hereafter
existing between them.
6. Termination of Employment
6.1 Unless otherwise determined by the Committee, if the
employment of Optionee with the Company shall terminate because of death, (a)
the Option, to the extent then presently exercisable, shall remain in full force
and effect and may be exercised pursuant to the provisions hereof, including
expiration at the end of the fixed term hereof, and (b) the Option, to the
extent not then presently exercisable, shall terminate as of the date of such
termination of employment and shall not be exercisable thereafter.
6.2 Unless otherwise determined by the Committee, if the
employment of Optionee with the Company shall terminate because of "Disability"
(as defined in the Plan), (a) the Option, to the extent then presently
exercisable, shall remain exercisable and may be exercised pursuant to the
provisions hereof at any time until the earlier of the end of the fixed term
hereof or the expiration of twelve months following termination of Optionee's
employment, and (b) the Option, to the extent not then presently exercisable,
shall terminate as of the date of such termination of employment and shall not
be exercisable thereafter.
6.3 Unless otherwise determined by the Committee, if the
employment of Optionee with the Company shall terminate for any reason other
than the reasons set forth in paragraphs 6.1 and 6.2 hereof, (a) the Option, to
the extent then presently exercisable or to the extent the Option becomes
exercisable pursuant to paragraph 9.3 hereof, shall remain exercisable only for
a period of three months after the date of such termination of employment and
may be exercised during such period pursuant to the provisions hereof, including
expiration at the end of the fixed term hereof, and (b) the Option, to the
extent not then presently exercisable, shall terminate as of the date of such
termination of employment and shall not be exercisable thereafter.
7. Securities Laws Requirements
7.1 The Option shall not be exercisable unless and until
any applicable registration or qualification requirements of federal and state
securities laws, and all other requirements of law or any regulatory bodies
having jurisdiction over such exercise or issuance and delivery, have been fully
complied with. The Company will use reasonable efforts to maintain the
effectiveness of a Registration Statement under the Securities Act of 1933, as
amended (the "Securities Act"), for the issuance of the Option and the Option
Shares but there may be times when no such Registration Statement will be
currently effective. Exercise of the Option may be temporarily suspended without
liability to the Company during times when no such Registration Statement is
currently effective, or during times when, in the reasonable opinion of the
Committee, such suspension is necessary to preclude violation of any
requirements of applicable law or regulatory bodies having jurisdiction over the
Company. If the Option would expire for any reason
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<PAGE> 4
except the end of its term during such a suspension, then if exercise of the
Option is duly tendered before its expiration, the Option shall be exercisable
and exercised (unless the attempted exercise is withdrawn) as of the first day
after the end of such suspension. The Company shall have no obligation to file
any Registration Statement covering resales of the Option Shares.
7.2 Upon each exercise of the Option, Optionee shall
represent, warrant and agree, by the Notice and Agreement of Exercise delivered
to the Company, that (a) no Option Shares will be sold or otherwise distributed
in violation of the Securities Act or any other applicable federal or state
securities laws, (b) if Optionee is subject to the reporting requirements under
Section 16(a) of the Securities Exchange Act of 1934, as amended (the "Exchange
Act"), Optionee will furnish to the Company a copy of each Form 4 filed by
Optionee and will timely file all reports required under federal securities
laws, and (c) Optionee will report all sales of Option Shares to the Company in
writing on the form prescribed from time to time by the Company. All Option
Share certificates may be imprinted with legend conditions reflecting federal
and state securities law restrictions and conditions and the Company may comply
therewith and issue "stop transfer" instructions to its transfer agents and
registrars without liability.
8. Non-transferability of Option
If Optionee is subject to the reporting requirements of
Section 16(a) of the Exchange Act at the time of the proposed transfer, the
Option shall be transferable only if such transferability or transfer would not
cause the Option to fail to qualify for the exemption provided for in Section
16b-3 of the Exchange Act, as determined by the Committee in its sole
discretion. The Option may be exercised, during the lifetime of Optionee, only
by Optionee and Optionee's permitted transferees. Notwithstanding the foregoing,
the Option shall not be assignable by operation of law and shall not be subject
to execution, attachment or similar process. Any attempted assignment, transfer,
pledge, hypothecation or other disposition contrary to the provisions of this
Agreement, and the levy of any execution, attachment or similar process
thereupon, shall be null and void and without effect.
9. Changes in Capitalization
9.1 The number and class of shares subject to the Option,
the Exercise Price (but not the total price), and the minimum number of shares
as to which the Option may be exercised at any one time, shall be
proportionately adjusted in the event of any increase or decrease in the number
of the issued shares of Common Stock of the Company which results from a
split-up or consolidation of shares, payment of a stock dividend or stock
dividends, a recapitalization (other than the conversion of convertible
securities according to their terms), a combination of shares or other like
capital adjustment, so that upon exercise of the Option, Optionee shall receive
the number and class of shares Optionee would have received had Optionee been
the holder of the number of shares of Common Stock for which the Option is being
exercised upon the date of such change or increase or decrease in the number of
issued shares of the Company.
9.2 Upon a reorganization, merger or consolidation of the
Company with one or more corporations as a result of which the Company is not
the surviving corporation, or in which
4
<PAGE> 5
the Company survives as a subsidiary of another corporation, a sale of all or
substantially all of the property of the Company to another corporation or any
dividend or distribution to shareholders of more than ten percent of the
Company's assets, adequate adjustment or other provisions shall be made by the
Company or other party to such transaction so that there shall remain and/or be
substituted for the Option Shares provided for herein, the shares, securities or
assets which would have been issuable or payable in respect of or in exchange
for the Option Shares then remaining under the Option, as if Optionee had been
the owner of such shares as of the applicable date. Any securities so
substituted shall be subject to similar successive adjustments.
9.3 The Option shall become fully exercisable upon the
occurrence of a change in control of the Company as defined herein (a "Change in
Control"). A Change in Control of the Company shall be deemed to have occurred
(a) on the date the Company first has actual knowledge that any person (as such
is used in Sections 13(d) and 14(d)(2) of the Exchange Act) who is not such
beneficial owner on the Date of Grant has become the beneficial owner (as
defined in Rule 13(d)-3 under the Exchange Act), directly or indirectly, of
securities of the Company representing 40% or more of the combined voting power
of the Company's then outstanding securities or (b) on the date the stockholders
of the Company approve (i) a merger of the Company with or into any other
corporation in which the Company is not the surviving corporation or in which
the Company survives as a subsidiary of another corporation, (ii) a
consolidation of the Company with any other corporation or (iii) the sale or
disposition of all or substantially all of the Company's assets or a plan of
complete liquidation.
10. Relationship to Other Employee Benefit Plans
The Option shall not be deemed to be salary or other
compensation to Optionee for purposes of any pension, thrift, profit sharing,
stock purchase or other employee benefit plan now maintained or hereafter
adopted by the Company.
11. Misconduct of Optionee
Notwithstanding any other provision of this Agreement or
the Plan, if Optionee shall commit fraud or dishonesty toward the Company,
wrongfully use or disclose any trade secret, confidential data or other
information proprietary to the Company or intentionally take any other action
materially inimical to the best interests of the Company, as determined by the
Committee in its sole and absolute discretion, Optionee shall forfeit all rights
and benefits under this Agreement.
12. Subsidiary
The term "subsidiary", as used herein, shall mean each
corporation which is a "subsidiary corporation" of the Company, within the
definition contained in Section 424(f) of the Code. Unless the context indicates
otherwise, references herein to the Company shall include all subsidiaries of
the Company and any parent it may have in the future.
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13. Privileges of Ownership
Optionee shall not have any of the rights of a stockholder
with respect to the shares covered by the Option except to the extent that share
certificates have actually been issued and registered in Optionee's name on the
books of the Company or its registrar upon the due exercise of the Option. The
Company shall be allowed a reasonable time following notice of exercise in which
to accomplish the issuance and registration.
14. Reference to Plan
This Agreement and the Option are subject to all of the
terms and conditions of the Plan, which are hereby incorporated by reference. In
the event of any conflict between this Agreement and the Plan, the provisions of
the Plan shall prevail.
15. Notices
Any notice to be given under the terms of this Agreement
shall be addressed to the Company in care of its Secretary at 443 North Varney
Street, Burbank, California 91502, and any notice to be given to Optionee shall
be addressed to Optionee at his or her address appearing on the employment
records of the Company, or at such other address or addresses as either party
may hereafter designate in writing to the other. Any such notice shall be deemed
duly given when enclosed in a properly sealed envelope, addressed as herein
required and deposited, postage prepaid, in a post office or branch post office
regularly maintained by the United States Government.
16. Withholding Taxes
The Company shall have the right at the time of exercise of
the Option to make adequate provision for any federal, state, local or foreign
taxes which it believes are or may be required by law to be withheld with
respect to such exercise, to ensure the payment (through withholding from
Optionee's salary or the Option Shares or otherwise as the Company shall deem in
its sole and conclusive discretion to be in its best interests) of any such
taxes.
17. Number and Gender
Terms used herein in any number or gender include other
numbers or genders, as the context may require.
IN WITNESS WHEREOF, the Company and Optionee have executed this
Agreement as of the Date of Grant.
"OPTIONEE" "COMPANY"
OROAMERICA, INC.
- ----------------------------------
Signature
By:
- ---------------------------------- ---------------------------------
Print Name Guy Benhamou, President
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OROAMERICA, INC.
NOTICE AND AGREEMENT OF EXERCISE
OF NONSTATUTORY STOCK OPTION
_____________,____
I hereby exercise my OroAmerica, Inc., Nonstatutory Stock Option
dated __________, ____, as to ________ shares of OroAmerica, Inc. common stock,
$.001 par value (the "Option Shares").
Enclosed are the documents and payment specified in paragraph 4 of my
Option Agreement. I understand that no Option Shares shall be issued and
delivered unless and until any applicable registration requirements of the
Securities Act of 1933, as amended, any listing requirements of any securities
exchange on which stock of the same class is then listed, and any other
requirements of law or any regulatory bodies having jurisdiction over such
issuance and delivery, shall have been fully complied with. I hereby represent,
warrant and agree, to and with OroAmerica, Inc. (the "Company"), that:
The Option Shares I am purchasing are being acquired for my account,
and no other person (except, if I am married, my spouse) will own any interest
therein.
a. I will not sell or dispose of my Option Shares in violation of the
Securities Act of 1933 or any other applicable Federal or state securities laws.
I will obtain the Company's advice prior to any disposition of my Option Shares
except sales in unsolicited brokers transaction in the over-the-counter market.
b. I agree that the Company may, without liability, place legend
conditions upon my Option Shares and issue "stop transfer" restrictions
requiring compliance with applicable securities laws and the terms of my option.
c. If and so long as I am subject to reporting requirements under
Section 16(a) of the Securities Exchange Act of 1934, I will furnish to the
Company a copy of each Form 4 filed by me and will timely file all reports
required under the Federal securities laws.
d. I will report to the Company all sales of Option Shares on the
form prescribed from time to time by the Company.
The number of Option Shares specified above are to be issued in the
following registration (husband and wife will be shown to be joint tenants
unless I state that the Option Shares will be held as community property or as
tenants in common):
- ---------------------------------- ------------------------------------
(Print your name) (Signature)
- ---------------------------------- ------------------------------------
(Option - Print name of spouse
you wish joint registration ------------------------------------
Address
<PAGE> 1
EXHIBIT 5.1
[ERVIN, COHEN & JESSUP LLP LETTERHEAD]
July 7, 1998
OroAmerica
443 North Varney Street
Burbank, CA 91502
Dear Gentlemen:
We have acted as your counsel in connection with the preparation of a
registration statement on Form S-8 to be filed with the Securities and Exchange
Commission (the "Registration Statement"), with respect to 500,000 shares of
Common Stock of OroAmerica, Inc., a Delaware corporation (the "Company"),
reserved for issuance from time to time under the Company's 1998 Incentive Stock
Option Plan (the "1998 Plan"). The foregoing shares of Common Stock are
hereinafter referred to as the "Shares".
We have made such legal and factual examinations and inquiries as we
deemed advisable for the purpose of rendering this opinion. Based upon our
examinations and inquiries, it is our opinion that the Shares have been duly
authorized by the Board of Directors of the Company and, when issued in
accordance with the terms of the 1998 Plan and awards made thereunder, the
shares will be validly issued, fully paid and nonassessable.
We hereby consent to the use of this opinion as an exhibit to the
Registration Statement.
Very truly yours,
ERVIN, COHEN & JESSUP LLP
<PAGE> 1
EXHIBIT 23.1
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the incorporation by reference in this Registration
Statement on Form S-8 of our report dated April 6, 1998, appearing on page F-1
of OroAmerica, Inc.'s Annual Report on Form 10-K for the year ended January 30,
1998.
PRICEWATERHOUSECOOPERS LLP
PricewaterhouseCoopers LLP
Los Angeles, California
July 1, 1998
