As filed with the Securities and Exchange Commission on March 13, 1998
File No. 333-
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM S-8
REGISTRATION STATEMENT
Under
THE SECURITIES ACT OF 1933
Ethan Allen Interiors Inc.
(Exact Name of Registrant as Specified in its Charter)
Delaware 06-1275288
(State or Other Jurisdiction (I.R.S. Employer Identification No.)
of Incorporation or Organization)
Ethan Allen Drive
Danbury, Connecticut 06813
(Address of Principal Executive Offices) (Zip Code)
Registrant's telephone number, including area code: (203) 743-8000
Ethan Allen Interiors Inc. 1992 Stock Option Plan
(Full Title of the Plan)
Edward P. Schade
Ethan Allen Interiors Inc.
Ethan Allen Drive
Danbury, Connecticut 06813
(203) 743-8294
(Agent For Service)
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<CAPTION>
CALCULATION OF REGISTRATION FEE
Proposed Maximum Proposed Maximum Amount of
Title of Securities Amount to be Offering Price Aggregate Offering Registration Fee
to be Registered Registered Per Share(1) Price(1)
<S> <C> <C> <C> <C>
Common Stock ($.01 par value) 500,000 Shares $31.75 (2) $15,875,000 (2) $4683.13
Common Stock ($.01 par value) 500,000 Shares $41.275 (2) $20,637,500 (2) $6088.06
Common Stock ($.01 par value) 300,000 Shares $58.40625(3) $17,521,875 (3) $5168.95
Total 1,300,000 Shares (2)(3) $54,034,375 $15,940.14
=============================================================================================================
(1) Pursuant to Rule 457(h)(1), estimated solely for the purpose of
calculating the registration fee. (2) Pursuant to Rule 457(h)(1),
computed upon the basis of the price at which the options may be
exercised. (3) Pursuant to Rule 457(c), based upon the average of the
high and low prices for the Common Stock as reported on the New York
Stock Exchange on March 6, 1998 (which date is within five business
days prior to the date of the filing of this Registration Statement).
</TABLE>
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PART II
INFORMATION REQUIRED IN
THE REGISTRATION STATEMENT
Item 3. Incorporation of Documents by Reference.
The following documents, which have heretofore been filed by Ethan Allen
Interiors Inc., a Delaware corporation (the "Company"), with the Securities and
Exchange Commission pursuant to the Securities Act of 1933, as amended (the
"Securities Act"), and the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), are incorporated by reference herein and shall be deemed to be
a part hereof:
(a) The Company's Form 10-K for the year ended June 30, 1997 and
Form 10-Q for the quarters ended September 30, 1997 and
December 31, 1997.
(b) The description of the Company's common stock, $.01 par value
per share (the "Common Stock") under the caption "Description
of Registrant's Securities to be Registered" included in the
Company's Registration Statement on Form 8-A, File No.
1-11806.
All documents subsequently filed by the Company or Ethan Allen
Interiors Inc. 1992 Stock Option Plan 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 have been sold or which deregisters
all securities then remaining unsold, shall be deemed to be incorporated herein
by reference and shall be deemed a part hereof from the date of filing of such
documents.
Item 4. Description of Securities.
Not applicable.
Item 5. Interests of Named Experts and Counsel.
Not applicable.
Item 6. Indemnification of Directors and Officers.
(a) The Delaware General Corporation Law (the "Delaware GCL") (Section
145) gives Delaware corporations broad powers to indemnify their present and
former directors and officers and those of affiliated corporations against
expenses incurred in the defense of any lawsuit to which they are made parties
by reason of being or having been such directors or officers, subject to
specified conditions and exclusions, gives a director or officer who
successfully defends an action the right to be so indemnified, and authorizes
the Company to buy directors' and officers' liability insurance. Such
indemnification is not exclusive of any other rights to which those indemnified
may be entitled under any by-laws, agreement, vote of stockholders or otherwise.
(b) The Certificate of Incorporation of the Company requires, and
Article VI of the By-Laws of the Company provides for, indemnification of
directors, officers, employees and agents to the fullest extent permitted by
law.
(c) In accordance with Section 102(b)(7) of the Delaware GCL, the
Company's Certificate of Incorporation provides that directors shall not be
personally liable for monetary damages for breaches of their fiduciary duty as
directors except for (1) breaches of their duty of loyalty to the Company or its
stockholders, (2) acts or omissions not in good faith or which involve
intentional misconduct or knowing violations of law,
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(3) under Section 174 of the Delaware GCL (unlawful payment of dividends) or (4)
transactions from which a director derives an improper personal benefit.
(d) The Company has a $20,000,000 Directors' and Officers' insurance
policy.
(e) The Company has entered into indemnification agreements with each
of its directors providing that the Company will indemnify the directors against
certain liabilities (including settlements) and expenses actually and reasonably
incurred by them in connection with any threatened or pending legal action,
proceeding or investigation (other than actions brought by or in the right of
the Company) to which any of them is, or is threatened to be, made a party by
reason for their status as a director, officer or agent of the Company, provided
that such director acted in good faith and in a manner he or she reasonably
believed to be in or not opposed to the best interests of the Company and, with
respect to any criminal proceedings, had no reasonable cause to believe his or
her conduct was unlawful. With respect to any action brought by or in the right
of the Company, directors may also be indemnified, to the extent not prohibited
by applicable laws or as determined by a court of competent jurisdiction,
against expenses actually and reasonably incurred by them in connection with
such action if they acted in good faith and in a manner they reasonably believed
to be in or not opposed to the best interest of the Company. The agreements also
require indemnification of directors for all reasonable expenses incurred in
connection with the successful defense of any covered action or claim and
provide for partial indemnification in the case of any partially successful
defense.
Item 7. Exemption from Registration Claimed.
Not applicable.
Item 8. Exhibits.
See the Exhibit Index which is incorporated herein by reference.
Item 9. Undertakings.
A. Rule 415 Offering
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;
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(iii) To include any material information with respect to
the plan of distribution not previously disclosed in
the Registration Statement or any material change to
such information in the Registration Statement;
Provided, however, that paragraphs (1)(i) and (1)(ii)
do not apply if the Registration Statement is on Form
S-3 or Form S-8, and the information required to be
included in a post-effective amendment by those
paragraphs is contained in periodic reports filed 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 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. Filings Incorporating Subsequent Exchange Act Documents By Reference
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 plan's annual report pursuant to Section 15(d) of the
Securities Exchange Act of 1934) that is incorporated by reference in the
Registration Statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.
C. Indemnification of Directors and Officers
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 provisions of the registrant's
articles of incorporation or by-laws or otherwise, the registrant has been
advised that in the opinion of the Securities and Exchange Commission such
indemnification is against public policy as expressed in the Securities Act of
1933 and is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by the
registrant of expenses incurred or paid by a director, officer or controlling
person of the registrant in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling person in
connection with the securities being registered, the registrant will, unless in
the opinion of its counsel the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the question whether such
indemnification by it is against public policy as expressed in the Securities
Act of 1933 and will be governed by the final adjudication of such issue.
<PAGE>
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
of the requirements for filing on Form S-8 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Danbury, State of Connecticut, on this 13th day of
March, 1998.
ETHAN ALLEN INTERIORS INC.
By: /s/ M. Farooq Kathwari
M. Farooq Kathwari
Chairman and Chief Executive Officer
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POWER OF ATTORNEY
Each person whose signature appears below hereby constitutes and
appoints M. Farooq Kathwari and Edward P. Schade and each of them, the true and
lawful attorneys-in-fact and agents of the undersigned, with full power of
substitution and resubstitution, for and in the name, place and stead of the
undersigned, in any and all capacities, to sign any and all amendments
(including 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, and hereby grants to
such 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,
as fully to all intents and purposes as the undersigned might or could do in
person, hereby ratifying and confirming all that said attorneys-in-fact and
agents, or any of them, or their or his substitute or substitutes, may lawfully
do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed below by the following persons in their
respective capacities on this 13th day of March, 1998.
Signature Title
/s/ M. Farooq Kathwari Chairman, Chief Executive Officer and Director
M. Farooq Kathwari
/s/ Clinton A. Clark Director
Clinton A. Clark
/s/ Steven A. Galef Director
Steven A. Galef
/s/ Kristin Gamble Director
Kristin Gamble
/s/ Horace G. McDonell Director
Horace G. McDonell
/s/ Edward H. Meyer Director
Edward H. Meyer
/s/ William W. Sprgaue Director
William W. Sprague
/s/ Edward P. Schade Vice President and Treasurer (Principal
Edward P. Schade Financial Officer)
/s/ Gerardo Burdo Chief Accounting Officer
Gerardo Burdo
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EXHIBIT INDEX
Exhibit
Number Description of Exhibit
- ------ ----------------------
5 Opinion of Mayer, Brown & Platt
10 Amended and Restated Ethan Allen
Interiors Inc. 1992 Stock Option Plan
23.1 Consent of KPMG Peat Marwick
23.2 Consent of Mayer, Brown & Platt
(included in the opinion filed as
Exhibit 5 hereto)
24 Powers of Attorney (included on the
signature page of the Registration
Statement)
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EXHIBIT 5
OPINION OF COUNSEL
March 13, 1998
Ethan Allen Interiors Inc.
Ethan Allen Drive
Danbury, Connecticut 06813
Ladies and Gentlemen:
We are acting as special counsel to Ethan Allen Interiors Inc. (the
"Company") in connection with the registration under the Securities Act of 1933,
as amended, of up to 1,300,000 shares of its Common Stock, $.01 par value (the
"Shares"), to be offered pursuant to the Ethan Allen Interiors Inc. 1992 Stock
Option Plan (the "1992 Stock Option Plan"). In connection therewith, we have
examined or are otherwise familiar with the Company's Restated Certificate of
Incorporation, the Company's Amended and Restated By-Laws, the 1992 Stock Option
Plan, each as amended to date, the Company's Registration Statement on Form S-8
(the "Registration Statement") relating to the Shares, relevant resolutions of
the Board of Directors of the Company, and such other documents and instruments
as we have deemed necessary for the purposes of this opinion.
Based upon the foregoing, we are of the opinion that the Shares are duly
authorized for issuance and when issued in accordance with the provisions of the
1992 Stock Option Plan will be legally issued, fully paid and non-assessable
shares of the Company.
We hereby consent to the filing of this opinion as an Exhibit to the
Registration Statement.
Very truly yours,
/s/ Mayer, Brown & Platt
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EXHIBIT 10
ETHAN ALLEN INTERIORS INC.
AMENDED AND RESTATED 1992 STOCK OPTION PLAN
(October 28, 1997)
1. Purpose. The purpose of this Ethan Allen Interiors Inc. 1992 Stock
Option Plan (the "Plan) is to increase stockholder value, to advance the
interests of Ethan Allen Interiors Inc. (the "Company"), its subsidiary, Ethan
Allen Inc. ("Ethan Allen") and its and Ethan Allen's other subsidiaries and
affiliates (collectively, the "Subsidiaries"), to strengthen the Company's
ability to attract and retain the services of experienced and knowledgeable
independent directors to enhance the Company's, and its Subsidiaries' ability to
attract, retain and motivate employees, and to provide such directors and
employees with an opportunity to acquire an equity interest in the Company.
2. Administration.
2.1 Administration, Generally. Subject to the terms and
conditions of the Plan, the Plan shall be administered by the
Compensation Committee of the Company's Board of Directors, or by such
other committee of the Board as the Board may determine (the
"Committee").
2.2 Authority. Subject to the terms and conditions of the
Plan, the Committee shall have the authority to (a) manage and control
the operation of the Plan, (b) interpret and construe the provisions of
the Plan or the provisions of any award under the Plan, and prescribe,
amend and rescind rules and regulations relating to the Plan, (c) make
awards under the Plan, in such forms and amounts and subject to such
restrictions, limitations and conditions as it deems appropriate,
including, without limitation, awards which are made in combination
with or in tandem with other awards (whether or not contemporaneously
granted), (d) modify the terms of, cancel and reissue, or repurchase
outstanding awards, (e) prescribe the form of, agreement, certificate
or other instrument evidencing any award under the Plan, (f) correct
any defect or omission and reconcile any inconsistency in the Plan or
in any award hereunder, and (g) make all other determinations and take
all other actions as it deems necessary or desirable for the
implementation and administration of the Plan. Notwithstanding the
foregoing provisions of this subsection 2.2, the Chief Executive
Officer ("CEO") of the Company shall submit his recommendation for
awards under the Plan to the Committee or, if no such Committee exists,
to the Company's Board of Directors (the "Board"). The Committee, or
the Board, if no such Committee shall exist, shall duly consider the
recommendations of the Chief Executive Officer, and shall have the
authority to accept, modify or reject the CEO's recommendation, or to
request the CEO to reconsider such recommendation. In addition, the
Committee shall have no power,
<PAGE>
authority or discretion to determine the persons who are entitled to
awards under Section 5, to determine the number, price or timing of
awards granted pursuant to Section 5 or to alter the terms and
conditions of awards made pursuant to Section 5. The determination of
the Committee on matters within its authority shall be conclusive and
binding on the Company and all other persons.
3. Participation. Subject to the terms and conditions of Section 2 and
the remainder of the Plan, the Committee shall determine and designate from time
to time the directors of the Company and employees of the Company and its
Subsidiaries who shall receive awards under the Plan ("Participants"); provided,
however, that the Committee shall have no power, authority or discretion to
determine the persons who are entitled to awards under Section 5. The granting
of awards, if any, and the size of such awards are purely discretionary, and, no
employee or director shall have any right or privilege to be considered as a
Participant, and no Participant shall have any right or privilege, or be deemed
to have an expectation of being, recommended for an award, subject to Section 5.
4. Shares Subject to the Plan.
4.1 Number of Shares Reserved. Shares of common stock, $.01
par value, of the Company ("Common Stock") shall be available for
awards under the Plan. To the extent provided by resolution of the
Company's Board of Directors, such shares may be uncertificated.
Subject to adjustments in accordance with subsections 4.2 and 4.3 for
events occurring after October 28, 1997, and after giving effect to the
two-for-one split of the Common Stock distributed on September 2, 1997,
to shareholders of record on August 18, 1997, the aggregate number of
shares of Common Stock available for awards under the Plan shall be
equal to 2,500,924.
4.2 Reusage of Shares.
(a) In the event of the exercise or termination (by reason of
forfeiture, expiration, cancellation, surrender or otherwise) of any
award under the Plan, that number of shares of Common Stock that was
subject to the award but not delivered shall again be available for
awards under the Plan.
(b) Notwithstanding the provisions of paragraph (a), the
following shares shall not be available for reissuance under the Plan:
(i) shares which are withheld from any award or payment under the Plan
to satisfy tax withholding obligations (as described in paragraph
8.5(e)); (ii) shares which are surrendered to fulfill tax obligations
(as described in paragraph 8.5(e)); and (iii) shares which are
surrendered in payment of the Formula Option Price (as defined in
subsection 5.1) upon the exercise of a Formula Option or the Option
Price (as defined in subsection 6.1) upon the exercise of a Stock
Option.
2
<PAGE>
4.3 Adjustments to Shares Reserved. In the event of any
merger, consolidation, reorganization, recapitalization, spinoff,
split-up, stock dividend, stock split, reverse stock split, repurchase,
exchange or other distribution with respect to shares of Common Stock
or other change in the corporate structure or capitalization affecting
the Common Stock, the type and number of shares of stock which are or
may be subject to awards under the Plan and the terms of any
outstanding awards (including the price at which shares of stock may be
issued pursuant to an outstanding award) shall be equitably adjusted by
the Committee, in its sole discretion, to preserve the value of
benefits awarded or to be awarded to Participants under the Plan.
4.4 Individual Limit. The maximum number of shares of Common
Stock that may be covered by Options and SARs granted to any one
individual during any fiscal year of the Company shall be 2,000,000
shares (subject to adjustment in accordance with subsection 4.3).
5. Formula Awards.
5.1 Formula options. As of the date of the annual meeting of
the Company's stockholders for 1993, each Independent Director (as
defined below) shall be awarded an option to purchase 2,500 shares of
Common Stock with an exercise price equal to the initial offering price
in the Company's initial public offering of Common Stock on March 23,
1993 ("IPO") (such options will be rounded off to the nearest whole
share number, and are collectively referred to as "Formula Options").
Formula Options granted pursuant to this subsection 5.1 shall not
constitute "Incentive Stock Options" within the meaning of section 422
of the Internal Revenue Code of 1986, as amended (the "Code"). For
purposes of the Plan, the term "Independent Director" as of any annual
meeting of the Company's stockholders means a person who (a) is a
director of the Company as of the ending of such meeting, (b) is not an
executive or employee of the Company or its subsidiaries, and (c) is
not a partner, executive or employee of any person, or group (as
defined under Rule 13(d) under the Securities Exchange Act of 1934)
which includes persons, which would be an "interested person" as
referred to in the Company's Certificate of Incorporation (without
regard to any "business combination" for this purpose) as of the date
hereof or as of the date of grant. If, for any reason, any Independent
Director is prohibited or restricted from personally receiving the
foregoing Formula Options by his employer or otherwise, such Formula
Options will not be issued to such Independent Director.
5.2 Service Required for Exercise. One half of each Formula
Option granted to an Independent Director Participant shall become
exercisable upon such Participant's completion of one continuous year
of service as an Independent Director after the date of the grant
thereof, and the remaining one-half of each Formula Option granted to
an Independent Director shall become exercisable upon such
Participant's
3
<PAGE>
completion of two continuous years of service as an Independent
Director after the date of the grant hereof.
5.3 Expiration of Formula Options. All rights with respect to
a Formula Option shall automatically terminate on the earliest of:
(a) the date which is 10 years after the date of the
grant;
(b) the date which is 90 days after the date on which
the Participant's service to the Company as an Independent
Director terminates for any reason.
5.4 Manner of Exercise. A Formula Option may be exercised, in
whole or in part, by giving written notice to the Chief Executive
Officer of the Company prior to the date on which the Formula Option
expires; provided, however, that a Formula Option may only be exercised
with respect to whole shares of Common Stock. Such notice shall specify
the number of shares of Common Stock to be purchased and shall be
accompanied by payment of the exercise price for such shares in such
form and manner as the Committee may from time to time approve.
6. Stock Options.
6.1 Awards. Subject to the terms and conditions of the Plan,
there shall be designated the Participants to whom options to purchase
shares of Common Stock ("Stock Options") are to be awarded under the
Plan and shall determine the number, type and terms of the Stock
Options to be awarded to each of them; provided however, that each
Stock Option shall expire on the earlier of the date provided by the
option terms or the date which is 10 years after the date of grant. The
option price per share (the "Option Price") for any Stock Option
awarded shall not be less than the greater of par value or the Fair
Market Value of a share of Common Stock on the date the Stock Option is
awarded. Each Stock Option awarded under the Plan shall be a
"nonqualified stock option" for tax purposes unless the Stock Option
satisfies all of the requirements of section 422 of the Code and the
Committee designates such Stock Option as an Incentive Stock Option.
6.2 Manner of Exercise. A Stock Option may be exercised, in
whole or in part, by giving written notice to the Chief Executive
Officer of the Company prior to the date on which the Stock Option
expires; provided, however, that a Stock Option may only be exercised
with respect to whole shares of Common Stock. Such notice shall specify
the number of shares of Common Stock to be purchased and shall be
accompanied by payment of the Option Price for such shares in such form
and manner as the Committee may from time to time approve.
4
<PAGE>
7. Stock Appreciation Rights.
7.1 Awards. Subject to the terms and conditions of the Plan,
there shall be designated the Participants to whom stock appreciation
rights ("SARs") are to be awarded under the Plan and shall determine
the number and terms of the SARs to be awarded to each of them;
provided, however, that each SAR shall expire on the earlier of the
date provided by the terms of the SAR or the date which is 10 years
after the date of grant.
7.2 Payment. Subject to the terms and conditions of the Plan,
upon exercise of an SAR, a Participant shall be entitled to receive
that number of shares of Common Stock having a Fair Market Value (as of
the date of exercise) equal to the product of:
(a) the number of shares of Common Stock as to which
the SAR is exercised; and
(b) the excess of the Fair Market Value (as of the
date of exercise) of a share of Common Stock over the exercise
price of the SAR;
provided, however, that, in lieu of fractional shares of Common Stock,
a Participant shall be entitled to receive an appropriate cash payment;
and provided further that the Committee, in its sole discretion, may
elect to settle the SAR (or any portion thereof) in cash equal to the
Fair Market Value on the exercise date of any or all of the shares of
Common Stock that would otherwise be issuable upon exercise.
7.3 Manner of Exercise. An SAR may be exercised, in whole or
in part, by giving written notice to the Chief Executive Officer of the
Company prior to the date on which the SAR expires. Such notice shall
specify the number of shares with respect to which the SAR is
exercised. As soon as practicable after receipt of such notice, the
Company shall deliver to the Participant certificates for the shares of
Common Stock or cash, or both, to which the Participant is entitled
pursuant to subsection 7.2.
8. General.
8.1 Effective Date. The Plan shall be effective as of March
23, 1993.
8.2 Duration. The Plan shall be unlimited in duration and, in
the event of Plan termination, shall remain in effect as long as any
awards under it are outstanding; provided, however, that no awards may
be granted under the Plan on any date after October 28, 2007.
5
<PAGE>
8.3 Non-transferability of Awards; Other Agreements. Except as
otherwise provided by the Committee, no award made under the Plan may
be transferred, pledged or assigned by the holder thereof (except in
the event of the holder's death, by will or the laws of descent and
distribution) and the Company shall not be required to recognize any
attempted assignment of such rights by any Participant. During a
Participant's lifetime, awards may be exercised only by him or by his
guardian or legal representative. Awards under the Plan, including any
Formula Options, Stock Options, SARs and Common Stock issued in
connection with Formula Options, Stock Options, SARs or otherwise, will
also be subject to any other agreements entered into, from time to
time, by the Participant and the Company.
8.4 Effect of Termination of Employment or Death. In the event
that a Participant dies (or in the case of a Participant who is an
employee, ceases to be an employee of the Company for any reason,
including death), any Stock Options or SARs then outstanding may be
exercised or shall expire 90 days thereafter, and therefore may be
exercised by such Participant (or his estate) within 90 days
thereafter, unless otherwise provided in accordance with the terms of
the award.
8.5 Compliance with Applicable Law and Withholding.
(a) Notwithstanding any other provision of the Plan,
the Company shall have no obligation to issue any shares of
Common Stock under the Plan if such issuance would violate any
applicable law or any applicable regulation or requirement of
any securities exchange or similar entity.
(b) Prior to the issuance of any shares of Common
Stock under the Plan, the Company may require a written
statement that the recipient is acquiring the shares for
investment and not for the purpose or with the intention of
distributing the shares and will not dispose of them in
violation of the registration requirements of the Securities
Act of 1933.
(c) With respect to any person who is subject to
section 16(a) of the Exchange Act, the Committee may, at any
time, add such conditions and limitations to any award under
the Plan that it deems necessary or desirable to comply with
the requirements of Rule 16b-3.
(d) If, at any time, the Company, in its sole
discretion, determines that the listing, registration or
qualification (or any updating of any such document) of any
award, or the shares of Common Stock issuable pursuant
thereto, is necessary on any securities exchange or under any
federal or state securities or blue sky law, or that the
consent or approval of any governmental regulatory body is
necessary or desirable as a condition of, or in connection
with, any award or the issuance of shares of Common Stock
pursuant to any award, such award shall not be made and the
shares of Common Stock shall
6
<PAGE>
not be issued or such restrictions shall not be removed, as
the case may be, in whole or in part, unless such listing,
registration, qualification, consent or approval shall have
been effected or obtained free of any conditions not
acceptable to the Company.
(e) All awards and payments under the Plan which are
made to employees of the Company are subject to withholding of
all applicable taxes and the Company shall have the right to
withhold from any such award under the Plan or to collect as a
condition of any payment under the Plan, as applicable, any
taxes required by law to be withheld. To the extent provided
by the Committee, a Participant may elect to have any
distribution otherwise required to be made under the Plan to
be withheld or to surrender to the Company shares of Common
Stock already owned by the Participant to fulfill any tax
withholding obligation.
8.6 No Continued Employment. The Plan does not constitute a
contract of employment or continued service, and participation in the
Plan will not give any employee or Participant the right to be retained
in the employ of the Company or the right to continue as a director of
the Company or any right or claim to any benefit under the Plan unless
such right or claim has specifically accrued under the terms of the
Plan or the terms of any award under the Plan.
8.7 Treatment as a Stockholder. Any award to a Participant
under the Plan shall not create any rights in such Participant as a
stockholder of the Company until shares of Common Stock are registered
in the name of the Participant.
8.8 Amendment and Termination of the Plan. The Company's Board
of Directors may, at any time and in any manner, amend, alter, suspend,
discontinue, or terminate the Plan or any award outstanding under the
Plan; provided however, that no such amendment, alteration, suspension,
discontinuance or termination shall:
(a) increase or decrease the number of shares
reserved under subsection 4.1 without stockholder approval;
(b) be made without stockholder approval to the
extent such approval is required by law, agreement or the
rules of any exchange or automated quotation system upon which
the Common Stock is listed or quoted;
(c) alter or impair the rights of Participants with
respect to awards previously made under the Plan without the
consent of the holder thereof; or
(d) make any change that would disqualify the Plan,
intended to be so qualified, from the exemption provided by
Rule 16b-3.
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Notwithstanding any other provision of the Plan, the provisions of
Section 5 may not be amended more frequently than once in any six-month
period except to comport with changes in the Code, the Employee
Retirement Income Security Act of 1974, as amended, or the rules
thereunder.
8.9 Immediate Acceleration of Incentives. Notwithstanding any
provision in this Plan to the contrary or the normal terms of vesting
under any award, all outstanding Formula Options, Stock Options and
SARs will become exercisable immediately if a Change in Control occurs.
For purposes of this Plan, a "Change in Control" shall have occurred if
a Business Combination (as defined in Article Fifth of the Company's
Certificate of Incorporation) occurs and is consummated and the
disinterested directors of the Company either do not approve such
Business Combination in accordance with Article Fifth, or do approve
such Business Combination and so authorize such immediate
exercisability in connection with such Business Combination.
8.10 Definition of Fair Market Value. Except for Formula
Options or other Stock Options granted as of the closing date of the
IPO, for which the "Fair Market Value" of a share of Common Stock shall
be equal to the IPO price and as otherwise determined by the Committee,
the "Fair Market Value" of a share of Common Stock as of any date shall
be equal to the closing sale price of a share of Common Stock as
reported on The National Association of Securities Dealers' New York
Stock Exchange Composite Reporting Tape (or if the Common Stock is not
traded on the New York Stock Exchange, the closing sale price on the
exchange on which it is traded or as reported by an applicable
automated quotation system) (the "Composite Tape") on the applicable
date or, if no sales of Common Stock are reported on such date, the
closing sale price of a share of Common Stock on the date the Common
Stock was last reported on the Composite Tape (or such other exchange
or automated quotation system, if applicable).
8.11 Other Agreements. All Options and SARS, and shares of
Common Stock issued in respect thereof, will be subject to any other
agreements, if any, between the Company and a Participant that is
issued Awards hereunder.
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EXHIBIT 23.1
CONSENT OF INDEPENDENT AUDITORS
The Board of Directors
Ethan Allen Interiors Inc.
We consent to incorporation by reference in the registration statement on Form
S-8 of Ethan Allen Interiors Inc. of our report dated August 6, 1997, relating
to the consolidated balance sheets of Ethan Allen Interiors Inc. and Subsidiary
as of June 30, 1997 and 1996, and the related consolidated statements of
operations, shareholders' equity and cash flows and related schedules for each
of the years in the three-year period ended June 30, 1997, which report appears
in the June 30, 1997 annual report on Form 10-K of Ethan Allen Interiors Inc.
Our report refers to a change in the method of accounting for packaging costs in
the year ended June 30, 1995.
/s/ KPMG Peat Marwick
Danbury, Connecticut
March 12, 1998
